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YoY shift: Neutral
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 bullish 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
-0.03pp
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
restated+10
adversely+6
closing+4
divestiture+4
loss+3
Positive rising
gain+20
benefit+13
effective+5
achieve+2
able+1
Risk Factors (Item 1A)
46,422 words
RISK FACTORS
We are subject to various risks and events that could adversely affect our business, our financial condition, our results of operations, our cash flows and the price of our common stock.
In addition to the information presented elsewhere in this report, particularly in Our Business , Forward-Looking Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) , you should consider the risk factors in this section, as well as those set forth from time to time in our other public statements, reports, registration statements, prospectuses, information statements and other filings we make from time to time with the SEC, in evaluating us, our business and an investment in our securities.
The risks discussed below are not the only risks we face, and our descriptions of such risks, here and elsewhere, should not be considered exhaustive. Additional risks not currently known to us or that we currently deem immaterial also may adversely affect our business, our financial condition, our results of operations, our cash flows and the price of our common stock.
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RISKS RELATED TO OUR BUSINESS AND INDUSTRY
MARKET AND OTHER EXTERNAL RISKS
The industries in which we operate are sensitive to macroeconomic conditions and consequently are highly cyclical.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
restated+10
closing+4
divestiture+4
loss+3
volatility+3
Positive rising
gain+20
benefit+12
effective+2
satisfied+1
greater+1
MD&A (Item 7)
34,425 words
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANC IAL CONDITION AND RESULTS OF OPERATIONS (MD&A)
WHAT YOU WILL FIND IN THIS MD&A
Our MD&A includes the following major sections:
economic and market conditions affecting our operations;
financial performance summary;
results of operations;
liquidity and capital resources;
environmental matters, legal proceedings and other contingencies;
accounting matters and
performance and liquidity measures.
For Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) related to the year ended December 31, 2023, refer to this same section in our 2024 annual report on Form 10-K as filed with the Securities and Exchange Commission on February 14, 2025.
ECONOMIC AND MARKET CONDITIONS AFFECTING OUR OPERATIONS
Our market conditions and the strength of the broader U.S. economy are, and will continue to be, influenced by the trajectory of activity in the U.S. housing and repair and remodel segments, inflation trends and interest rates. The demand for sawlogs within our Timberlands segment is directly affected by domestic production of wood-based building products. The strength of the U.S. housing market, particularly new residential construction, strongly affects demand in our Wood Products segment, as does repair and remodeling activity. Seasonal weather patterns impact the level of construction activity in the U.S., which in turn affects demand for our logs and wood products. Our Timberlands segment, particularly the Western region, is also affected by export demand and trade policy. Japanese housing starts are a key driver of export log demand in Japan. The demand for pulpwood from our Timberlands segment is directly affected by the production of pulp, paper and oriented strand board (OSB), as well as the demand for biofuels, such as wood-burning pellets made from pulpwood. Our Timberlands segment is also influenced by the availability of harvestable timber. In general, Western log markets are highly tensioned by available supply, while Southern log markets have
The overall levels of demand for the products we manufacture and distribute reflect fluctuations in levels of end-user demand, which consequently affect our sales and profitability. End-user demand depends in large part on general macroeconomic conditions, both in the U.S. and globally, as well as on local economic conditions. The length and magnitude of industry cycles vary over time, both by market and by product, but generally reflect changes in macroeconomic conditions and levels of industry capacity. Any decline or stagnation in macroeconomic conditions could cause us to experience lower sales volumes and reduced margins for our products.
Low demand for new homes and home repair and remodeling can adversely affect our business, financial condition, results of operations and cash flows.
Our business is particularly dependent upon the health of the U.S. housing market, and specifically on demand for new homes and home repair and remodeling. Demand in these markets is sensitive to changes in economic conditions such as the level of employment, consumer confidence, inflation, consumer income, the availability of financing and interest rate levels. Other factors that could limit or adversely affect demand for new homes and home repair and remodeling, and hence demand for our products, include factors such as changes in consumer preferences, limited wage growth, increases in non-mortgage consumer debt, any weakening in consumer confidence, as well as any increase in foreclosure rates and distress sales of houses.
Homebuyers’ ability to qualify for and obtain affordable mortgages could be affected by changes in interest rates, changes in home loan underwriting standards and government sponsored entities and private mortgage insurance companies supporting the mortgage market.
Access to affordable mortgage financing is critical to the health of the U.S. housing market. Generally, increases in interest rates make it more difficult for home buyers to obtain mortgage financing, which could negatively affect demand for housing and, in turn, negatively affect demand for our wood products. After maintaining interest rates at historically low levels for an extended period of time, in the first quarter of 2022 the U.S. Federal Reserve began implementing a policy of incrementally raising rates, which it continued through 2023. Although the Federal Reserve began reducing rates in 2024, they remain well above pre-2022 levels. We cannot predict the extent to which the U.S. Federal Reserve's current policy will be maintained or the timing, number, extent or direction of future rate adjustments.
Along with prevailing interest rates, other significant factors affecting the demand for new homes relate to the ability of home buyers to obtain mortgage financing. During the last U.S. recession, credit requirements for home lending were severely tightened and the number of mortgage loans available for financing home purchases were thereby severely reduced. Although the availability of credit has improved since that time, the housing market could be limited or adversely affected if credit requirements were to again tighten or become more restrictive for any reason.
Additionally, the liquidity provided to the mortgage industry by Fannie Mae and Freddie Mac, both of which purchase home mortgages and mortgage-backed securities originated by mortgage lenders, has been critical to the home lending market. Any political or other developments that would have the effect of limiting or restricting the availability of financing by these government sponsored entities could also adversely affect interest rates and the availability of mortgage financing. Whether resulting from further direct increases in borrowing rates, tightened underwriting standards on mortgage loans or reduced federal support of the mortgage lending industry, a challenging mortgage financing environment could reduce demand for housing and, therefore, adversely affect demand for our products.
Changes in regulations relating to tax deductions for mortgage interest expense and real estate taxes could harm our future sales and earnings.
Significant costs of homeownership include mortgage interest expense and real estate taxes, both of which are generally deductible for an individual’s federal and, in some cases, state income taxes. Federal legislation reduced the amount of mortgage interest and real estate taxes that certain taxpayers may deduct. These and any similar changes to income tax laws by the federal government or by a state government to eliminate or substantially reduce these income tax deductions, or any significant increase in real property taxes by local governments, may increase the cost of homeownership and thus could adversely affect the demand for our products.
Catastrophic events may adversely affect the markets for our products and our business, financial condition, results of operations and cash flows.
We are subject to the risk of various catastrophic events, including but not limited to the occurrence of: severe regional or local weather events or trends and related fires or flooding; wide-spread insect or pest infestations on one or more of our properties; significant geological events such as earthquakes, volcanic eruptions and major erosion in the form of landslides; significant geopolitical events, conditions or developments such as significant international trade disputes or domestic or foreign terrorist attacks, domestic or foreign armed conflict and political unrest; and regional health epidemics or global health pandemics, such as the 2020 outbreak of the novel strain of coronavirus and its many subsequent mutations. Any one or more of these events or conditions, or other catastrophic events or developments, could directly or indirectly significantly affect our ability to operate our businesses and adversely affect domestic and foreign general economic conditions and thus domestic or foreign market demand for our products. The impact of any one or more of these events or conditions may also trigger the occurrence of, or exacerbate,
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other risks discussed herein, any one of which could have a material adverse effect on our business, financial condition, results of operations and cash flows.
PRODUCT PRICING AND PROFITABILITY
Our profitability is affected by market dynamics outside of our control.
Because commodity products have few distinguishing properties from producer to producer, competition for these products is based largely on price, which is determined by supply relative to demand and competition from substitute products. Prices for our products are also affected by many other factors outside of our control. As a result, we have little influence or control over the timing and extent of price changes, which often are volatile in our industry. Moreover, our profit margins with respect to these products depend, in part, on managing our costs, particularly raw material, labor (including contract labor) and energy costs, which represent significant cost components that also fluctuate based upon market and other factors beyond our control.
Excess supply of logs and wood products may adversely affect prices and margins.
Producers in our industry have in the past put downward pressure on product pricing by selling excess supply into the market. Our industry may increase harvest levels, which could lead to an oversupply of logs. Wood products producers may likewise expand manufacturing capacity, which could lead to an oversupply of manufactured wood products. Any such increases of industry supply to our markets could adversely affect our prices and margins.
THIRD-PARTY SERVICE PROVIDERS
We depend heavily on third parties for logging and transportation services, and any increase in the cost or any disruption in the availability of these services could materially adversely affect our business and operations and our financial results.
Our businesses depend heavily on the availability of third-party service providers for the harvest of our timber and the transportation of our wood products and wood fiber. We are therefore considerably affected by the availability and cost of these services. Any significant increase in the operating costs to our service providers, including without limitation an increase in the cost of fuel, labor or insurance, could have a material negative effect on our financial results by increasing the cost of these services to us, as well as result in an overall reduction in the availability of these services altogether.
Our third-party transportation providers are also subject to several events outside of their control, such as disruption of transportation infrastructure, labor issues including shortages of commercial truck drivers and natural disasters. Any failure of a third-party transportation provider to timely deliver our products, including delivery of our wood products and wood fiber to our customers and delivery of wood fiber to our mills, could harm our supply chain, negatively affect our customer relationships and have a material adverse effect on our financial condition, results of operations, cash flows and our reputation.
As a result of weak business conditions in the timber industry that persisted for several years, there are fewer third-party service providers in certain markets to harvest and deliver our logs. This shortage has resulted in an overall increase in logging and hauling costs and, in some cases, compromised the general availability of these contractors. Any increase in harvest levels due to positive changes in macroeconomic conditions driving demand for logs could further strain the existing supply of third-party logging and hauling service providers. This, in turn, could increase the cost of log supply and delivery, or prevent us from fully capitalizing on favorable market conditions by limiting our ability to access and deliver our logs to market.
MANAGING COMMERCIAL TIMBERLANDS RISKS
Our ability to harvest and deliver timber may be subject to limitations which could adversely affect our financial condition, results of operations and cash flows.
Our primary assets are our timberlands. Weather conditions, timber growth cycles, access limitations and availability of contract loggers and haulers may adversely affect our ability to harvest our timberlands. Other factors that may adversely affect our timber harvest include damage to our standing timber by fire or by insect or pest infestation, disease, prolongeddrought, flooding, severe weather and other natural disasters. As discussed in more detail in the following risk factors, changes in global climate conditions could intensify the severity and rate of occurrence of any one or more of these risks that we currently face or introduce other risks that we currently cannot predict. Although damage from such causes usually is localized and affects only a limited percentage of standing timber, there can be no assurance that any damage affecting our timberlands will in fact be limited. As is common in the forest products industry, we do not maintain insurance coverage for damage to our timberlands. Our revenues, net income and cash flow from operations are dependent to a significant extent on the pricing of our products and our continued ability to harvest timber at adequate levels. Therefore, if we were to be restricted from harvesting on a significant portion of our timberlands for a prolonged period of time, or if material damage to a significant portion of our standing timber were to occur, we could suffer materially adverse effects to our financial condition, results of operations and cash flows.
Future timber harvest levels may also be affected by our ability to timely and effectively replant harvested areas, which depends on several factors including changes in estimates of long-term sustainable yield because of silvicultural advances, natural disasters, fires, pests, insects and other hazards, regulatory constraints, availability of contractors, U.S. immigration policies and other factors beyond our control.
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Timber harvest activities are also subject to a number of federal, state and local regulations pertaining to the protection of fish, wildlife, water and other resources. Regulations, government agency policy and guidelines, and litigation, can restrict timber harvest activities and increase costs. Examples include federal and state laws protecting threatened, endangered and “at-risk” species, harvesting and forestry road building activities that may be restricted under the U.S. Federal Clean Water Act, state forestry practices laws, laws protecting aboriginal rights and other similar regulations.
Our estimates of timber inventories and growth rates may be inaccurate and include risks inherent in calculating such estimates, which may impair our ability to realize expected revenues.
Whether in connection with managing our existing timberland portfolio or assessing potential timberland acquisitions, we make and rely on important estimates of merchantable timber inventories. These include estimates of timber inventories that may be lawfully and economically harvested, timber growth rates and end-product yields. Timber growth rates and yield estimates are developed by forest biometricians and other experts using statistical measurements of tree samples on given property. These estimates are central to forecasting our anticipated timber harvests, revenues and expected cash flows. While the company has confidence in its timber inventory processes and the professionals in the field who administer them, future growth and yield estimates are inherently inexact and uncertain and subject to many external variables that could further affect their accuracy. These external variables include, among other things, disease, insect or pest infestation, natural disasters and changes in weather patterns, all of which could be exacerbated by the impacts of climate change. If these estimates are inaccurate, our ability to manage our timberlands in a sustainable or profitable manner may be compromised, which may cause our financial condition, results of operations, cash flows and our stock price to be adversely affected.
Our financial condition, operating results and cash flows will be materially affected by supply and demand for timber.
A variety of factors affect prices for timber, including available supply, changes in economic conditions that affect demand, the level of domestic new construction and remodeling activity, interest rates, credit availability, population growth, weather conditions, insect or pest infestation and other factors. These factors vary by region, by timber type (i.e., sawlogs or pulpwood logs) and by species.
Timber prices are affected by changes in demand on a local, national and international level. The closure of a mill in a region where we own timber could have a material adverse effect on demand in that region, and therefore pricing. For example, as the demand for paper continues to decline, closures of pulp mills in some of our operating regions have adversely affected the regional demand for pulpwood and wood chips. Additionally, some of our Asian log export markets, particularly China, have a history of significant volatility. Lower demand for our export logs could have a negative effect on timber prices, particularly in the western region.
Timber prices are also affected by changes in timber supply and availability at the local, national and international level. Our timberland ownership is concentrated in Alabama, Arkansas, Georgia, Louisiana, Maine, Mississippi, North Carolina, Oklahoma, Oregon and Washington. In some of these states, much of the timberland is privately owned. Increases in timber prices often result in substantial increases in harvesting on private timberlands, including lands owned by others and not previously made available for commercial timber operations, causing a short-term increase in supply that moderates such price increases. In western states such as Oregon and Washington, where a greater proportion of timberland is government-owned, any substantial increase in timber harvesting from government-owned land could significantly reduce timber prices. On a local level, timber supplies can fluctuate depending on factors such as changes in weather conditions and harvest strategies of local timberland owners, as well as occasionally high timber salvage efforts due to events such as insect or pest infestations, fires or other natural disasters. Demand for timber in foreign markets can fluctuate due to a variety of factors as well, including but not limited to: changes in the fundamental economic conditions that affect demand for logs in a given export market country or region; any substantial increase in supply of logs from local or regional sources, including such sources that periodically supply large amounts of salvage timber as a result of disease or infestation, and other factors.
Timberlands make up a significant portion of our business portfolio and we are therefore subject to real estate investment risks.
Our real property holdings are primarily timberlands and we may make additional timberlands acquisitions in the future. As the owner and manager of more than 10 million acres of timberlands, we are subject to the risks that are inherent in concentrated real estate investments. A downturn in the real estate industry generally, or the timber or forest products industries specifically, could reduce the value of our properties and adversely affect our financial condition, results of operations and cash flows. Such a downturn could also adversely affect our customers and reduce the demand for our products, as well as our ability to execute upon our strategy of selling nonstrategic timberlands and timberland properties that have higher and better uses at attractive prices. These risks may be more pronounced than if we diversified our investments outside of real property holdings.
MANUFACTURING AND SELLING WOOD PRODUCTS RISKS
A material disruption at one of our manufacturing facilities could prevent us from meeting customer demand, reduce our sales, and negatively affect our results of operations, financial condition and cash flows.
Any of our manufacturing facilities, or any of our equipment within an otherwise operational facility, could cease operations unexpectedly due to a number of events, including:
unscheduled maintenance outages;
prolonged power failures;
equipment failure;
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chemical spill or release;
explosion of a boiler;
fires, floods, windstorms, earthquakes, hurricanes or other severe weather conditions or catastrophes affecting the production of goods or the supply of raw materials (including fiber);
the effect of drought or reduced rainfall on water supply;
labor difficulties;
disruptions in transportation or transportation infrastructure, including roads, bridges, rail, tunnels, shipping and port facilities;
terrorism or threats of terrorism;
cyberattack;
governmental regulations;
other operational problems and
effects of viral or disease outbreaks and any resulting epidemic or global pandemic.
We cannot predict the duration of any such downtime or extent of facility damage. If one of our facilities or machines were to incur significant downtime, our ability to meet our production targets and satisfy customer demand could be impaired, resulting in lower sales and income. Additionally, we may be required to make significant unplanned capital expenditures. Although some risks are not insurable and some coverage is limited, we purchase insurance on our manufacturing facilities for damage from fires, floods, windstorms, earthquakes, other severe weather conditions, equipment failures and boiler explosions. Such insurance may not be sufficient to recover all of our damages.
Some of our wood products are vulnerable to declines in demand due to competing technologies or materials.
Our products compete with non-fiber based alternatives or with alternative products in certain market segments. For example, plastic, wood/plastic or composite materials may be used by builders as alternatives to our wood products such as lumber, veneer, plywood and oriented strand board. Changes in prices for oil, chemicals and wood-based fiber can change the competitive position of our products relative to available alternatives and could increase substitution of those products for our products. If use of these or other alternative products grows, demand for and pricing of our products could be adversely affected.
Our financial condition, results of operations and cash flows could be materially adversely affected by changes in product mix or pricing.
Our results may be materially adversely affected by a change in our product mix or pricing. Some of our wood products, such as lumber, veneer, plywood and oriented strand board, are commodities and are subject to fluctuations in market pricing. If pricing on our commodity products decreases and if we are not successful in increasing sales of higher-priced, higher-value products, or if we are not successful in implementing price increases, or there are delays in acceptance of price increases or higher-priced products, our financial condition, results of operations and cash flows could be materially and adversely affected. Price discounting, if required to maintain our competitive position in one or more markets, could result in lower than anticipated price realizations and margins.
We face intense competition in our markets; any failure to compete effectively could have a material adverse effect on our business, financial condition, results of operations and cash flows.
We compete with North American producers and, for some of our product lines, global producers, some of which may have greater financial resources and lower production costs than we do. The principal basis for competition for many of our products is selling price. Our industries also are particularly sensitive to other factors including innovation, design, quality and service, with varying emphasis on these factors depending on the product line. To the extent that any of our competitors are more successful with respect to any key competitive factor, our ability to attract and retain customers and maintain and increase sales could be materially adversely affected. Any failure to compete effectively could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Competition from lumber imports could vary significantly and have a material effect on U.S. timber and lumber prices.
The future amount and pricing of lumber imports entering U.S. markets remain uncertain. Historically, Canada has been the most significant source of lumber for the U.S. market, particularly in the new home construction market. We produce lumber in our Canadian mills, but the bulk of our lumber production is in the U.S. There have been many disputes and subsequent trade agreements regarding sales of softwood lumber between Canada and the U.S. The last agreement, which required Canadian softwood lumber facilities, including our mills, to pay an export tax when the price of lumber is at or below a threshold price, expired in October 2015. Since that time, the U.S. Department of Commerce has issued countervailing and antidumping duties on softwood lumber imports from Canada based on findings of injury to U.S. lumber producers. We are not able to predict when, or if, a new softwood lumber agreement with Canada will be reached or, if reached, what the terms of the agreement would be. Similarly, we are not able to predict if the current U.S. policy of imposing import duties on Canadian softwood lumber will continue. We could, therefore, experience significant downward pressure on timber and lumber prices caused by Canadian lumber imports.
We also periodically face competition from lumber producers in Europe. Historically, European imports to U.S. markets have been more robust during strong domestic lumber market cycles, which can limit the benefits we realize from high timber and lumber prices by creating downward pressure on pricing. As with Canadian imports, we cannot predict the timing nor the extent of future levels of European lumber imports and could therefore experience significant downward pressure on timber and lumber prices stemming from this source of competition.
For more discussion about U.S. trade policy and its potential effects on our business, see the following risk factor entitled U.S. and International Trade Policy .
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Customer demand for certain brands of sustainably-produced products could reduce competition among buyers for our products or cause other adverse effects.
We have adopted the Sustainable Forestry Initiative ® (SFI) standard for wood fiber supplied to our manufacturing facilities, both from our timberlands and from third-party suppliers. If customer preference for a sustainability standard other than SFI increases, or if the SFI standard falls into disfavor , there may be reduced demand and lower prices for our products relative to competitors who can supply products sourced from forests certified to competing certification standards. If we seek to comply with such other standards, we could incur materially increased costs for our operations or be required to modify our operations, such as reducing harvest levels. FSC, in particular, employs standards that are geographically variable and could cause a material reduction in the harvest levels of some of our timberlands, most notably in the Pacific Northwest.
Our business and operations could be materially adversely affected by changes in the cost or availability of raw materials and energy.
We rely heavily on certain raw materials (principally wood fiber and chemicals) and energy sources (principally natural gas, electricity and fuel oil) in our manufacturing processes. Our ability to increase earnings has been, and will continue to be, affected by changes in the costs and availability of such raw materials and energy sources. We may not be able to fully offset the effects of higher raw material or energy costs through price increases, productivity improvements, cost-reduction programs or hedging arrangements. The U.S. has experienced significant inflation, which could continue or worsen and therefore negatively affect the cost or availability of raw materials and energy, which we may not be able to fully pass onto our customers.
PHYSICAL RISKS RELATED TO CLIMATE CHANGE
Changes in global or regional climate conditions could significantly harm our timberland assets and have a negative impact on our results of operations, cash flow and financial condition.
Climate change has the potential to cause significant disruptions to our business and results of operations, cash flow and financial condition. There is increasing concern that increases in global average temperatures caused by increased concentrations of carbon dioxide and other greenhouse gases in the atmosphere could cause significant changes in weather patterns, including changes to precipitation patterns and growing seasons. These changes could, in the long term and in some locations, lead to slower growth of our trees and, potentially, changes to the species mix that we manage in our timber assets. An increase in global temperature could also lead to an increase in the frequency and severity of extreme weather events and other natural disasters. Thus, damage or access to our timberland assets by existing causes, such as fire, insect or pest infestation, disease, prolongeddrought, flooding, windstorms and other natural disasters, could be significantly worsened by climate change. Extreme weather and temperatures could also lead to interruptions of normal work conditions in our operations. Any one or more of these negative effects on commercial timberland operations from climate change, both our own and that of other commercial timberland operators, could also have a material adverse impact on our Wood Products business by significantly affecting the availability, cost and quality of the wood fiber used in our mill operations.
WORKFORCE RISK
Our business is dependent upon attracting, retaining and developing key personnel.
Our success depends, to a significant extent, upon our ability to attract, retain and develop employees to help run our business, including but not limited to employees needed to staff our operations and key personnel capable of performing at a high level to fill roles in senior corporate and operations management. Our financial condition, results of operations or cash flows could be significantly adversely affected if we were to fail to recruit, retain, and develop such employees, or if there were to occur any significant decrease in the availability of such employees or any significant increase in the cost of providing such employees with competitive total compensation and benefits. For the last few years, we have experienced a competitive and challenging labor market. In addition, most of our operations are located in rural communities where we draw from local labor forces to fill many positions in both our Timberlands and Wood Products operations. These communities are often beset with many challenges ranging from struggling economies to limited community resources and access to educational opportunities, any one or more of which could lead to decreases in location populations and therefore decreases in the availability of an able and qualified workforce. A sustained labor shortage or increased turnover rates within our employee base, whether caused by any singular event such as a global pandemic or as a result of general macroeconomic, demographic or other factors, could disrupt our operations and lead to increased labor costs, such as an increased need for overtime work by current employees to meet demand and increased wage rates to attract and retain employees.
A strike or other work stoppage, or our inability to renew collective bargaining agreements on favorable terms, could adversely affect our financial results.
A significant number of employees in our Western Timberlands and in our Wood Products businesses located in the Pacific Northwest are covered by a collective bargaining agreement, and these employees have in the recent past commenced a work stoppage that was subsequently resolved. We also have collective bargaining agreements with smaller groups of employees in various other parts of our business operations. If our unionized employees were to engage in a protracted work stoppage or if our non-unionized employees were to become unionized and thereafter commence a work stoppage, we could experience a significant disruption of operations. If we are unable to reach or renew collective bargaining agreements with our unionized workers, we could also experience higher ongoing labor costs. Any work stoppage by any one or more of our significant customers, transportation providers or suppliers could also have similar negative effects on us. Depending on scope and duration, any of these labor disruptions could have a material adverse effect on our financial condition, results of operations or cash flows.
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PENSION PLAN LIABILITY RISK
Volatility in interest rates and lower than expected returns on our pension assets could reduce the funded status of our defined benefit pension plans, requiring us to make significant additional cash contributions to our benefit plans.
A portion of our current and former employees have accrued benefits under our defined benefit pension plans. Although the plans are not open to newly hired or rehired employees, current employees hired before the plan closure continue to accrue benefits. Requirements for funding our pension plan liabilities are based on a number of actuarial assumptions, including the expected rate of return on our plan assets and the discount rate applied to our pension plan obligations. Fluctuations in equity market returns and changes in long-term interest rates could increase our costs under our defined benefit pension plans and may significantly affect future contribution requirements. It is unknown what the actual investment return on our pension assets will be in future years and what interest rates may be at any given point in time. We cannot therefore provide any assurance of what our actual pension plan costs will be in the future, or whether we will be required under applicable law to make future material plan contributions. See Note 8: Pension and Other Post-Employment Benefit Plans for additional information about these plans, including funding status.
STRATEGIC INITIATIVES AND EXECUTION RISK
Our business and financial results may be adversely affected if we are unable to successfully execute on important strategic initiatives.
Our strategic initiatives are designed to improve our results of operations and drive long-term shareholder value, and our financial plans contemplate a combination of important strategic growth initiatives across segments. These initiatives include, among others, optimizing cash flow through operational excellence and opportunistic acquisitions and divestitures, expanding capacity and distribution for our timber and wood products, reducing costs to achieve industry-leading cost structure, innovating in higher-margin products and pursuing opportunities in new and emerging markets. For example, through our Timberlands business we are pursuing opportunities to expand exports in Asia, Europe, the Middle East and Africa, and through our Real Estate, Energy & Natural Resources business we are pursuing opportunities to participate in new and emerging markets for forest carbon credits, renewable energy, carbon storage and biocarbon. In our Wood Products segment, we are making strategic capital investments in our Lumber business, expanding the footprint of our Distribution business and investing resources in new product development. The success of these endeavors is subject to many known and unknown risks. Known risks include but are not limited to market acceptance or changes in demand for our products and services as these markets evolve over time. Domestic and foreign political and regulatory developments could also make these business opportunities less profitable or even impossible to pursue. We are also investing significant capital resources in constructing a new TimberStrand® manufacturing facility, and our ability to realize our projected financial and other benefits of the project is also subject to many known and unknown risks. These include but are not limited to our ability to timely complete construction of the facility, our ability to procure necessary government licenses, approvals and permits, our receipt of certain tax abatement and related financial incentives from state and local governments and the performance of vendors and contractors. There can be no assurance that we will be able to successfully implement any one or more of our important strategic growth initiatives in accordance with our expectations or that our initiatives, even if implemented, will lead to successfulachievement of our objectives. If we are not able to successfully implement our initiatives, our business and financial results could be adversely affected.
We may be unsuccessful in carrying out our acquisition strategy.
We intend to strategically pursue acquisitions in all of our business segments when market conditions warrant. As with any investment, our acquisitions may not perform in accordance with our expectations. In addition, we anticipate financing many of these acquisitions through cash from operations, borrowings under our unsecured credit facilities, proceeds from equity or debt offerings or proceeds from strategic asset dispositions, or any combination thereof. Our inability to finance future acquisitions on favorable terms, or at all, could adversely affect our ability to successfully execute strategic acquisitions and thereby adversely affect our results of operations, financial condition and cash flows.
Our joint ventures may pose unique risks.
We currently participate in joint venture and other business partnering structures, and we may in the future participate in additional such arrangements with the same or other parties and with varying business objectives and investment terms. We may also increase our capital investment or otherwise expand our interests in existing joint venture arrangements and partnering structures. Any of these arrangements involve risks including, but not limited to, the risk that one or more of our partners, none of which we control, fail to abide by our agreed upon terms or otherwise take actions that are contrary to our interests, policies or objectives, which could adversely affect our ability to achieve our goals and thereby adversely affect our results of operations, financial condition and cash flows.
FOREIGN CURRENCY RISK
We will be affected by changes in currency exchange rates.
We have manufacturing operations in Canada. We are also an exporter and compete with global producers of products very similar to ours. Therefore, we are affected by changes in the strength of the U.S. dollar, particularly relative to the Canadian dollar, euro, yuan and yen, and the strength of the euro relative to the yen. Changes in exchange rates could materially and adversely affect our sales volumes, margins and results of operations.
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LEGAL, REGULATORY AND TAX RISKS
ENVIRONMENTAL LAWS AND REGULATIONS
We could incur substantial costs as a result of compliance with, violations of, or liabilities under applicable environmental laws and other laws and regulations.
We are subject to a wide range of general and industry-specific laws and regulations relating to the protection of the environment and wildlife, including those governing:
air emissions,
wastewater discharges,
harvesting,
silvicultural activities, including use of pesticides and herbicides,
forestry operations and endangered species habitat protection,
surface water management,
the storage, usage, management and disposal of hazardous substances and wastes,
the cleanup of contaminated sites,
landfill operation and closure obligations,
building codes and
health and safety matters.
We have incurred, and we expect to continue to incur, significant capital, operating and other expenditures complying with applicable environmental laws and regulations and as a result of remedial obligations, and there can be no assurances that existing accruals for specific matters will be adequate to cover future costs. We also could incur substantial costs, such as civil or criminalfines, sanctions and enforcement actions (including orders limiting our operations or requiring corrective measures, installation of pollution control equipment or other remedial actions), cleanup and closure costs, and third-party claims for property damage and personal injury as a result of violations of, or liabilities under, environmental laws and regulations.
As the owner and operator of real estate, we may be liable under environmental laws for cleanup, closure and other damages resulting from the presence and release of hazardous substances on or from our current or former properties or operations. In addition, surface water management regulations may present liabilities and are subject to change. The amount and timing of environmental expenditures is difficult to predict, and in some cases, our liability may exceed forecasted amounts or the value of the property itself. The discovery of additional contamination or the imposition of additional cleanup obligations at our sites or third-party sites may result in significant additional costs.
We also lease some of our properties to third-party operators for the purpose of exploring, extracting, developing and producing oil, gas, rock and other minerals in exchange for fees and royalty payments. These activities are also subject to federal, state and local laws and regulations. These operations may create risk of environmental liabilities for any unlawful discharge of oil, gas or other chemicals into the air, soil or water. Generally, these third-party operators indemnify us against any such liability, and we require that they maintain liability insurance during the term of our lease with them. However, if for any reason our third-party operators are not able to honor their indemnity obligation, or if the required liability insurance were not in effect, then it is possible that we could be deemed responsible for costs associated with environmental liability caused by such third-party operators.
Any material liability we incur as a result of activities conducted on our properties by us or by others with whom we have a business relationship could adversely affect our financial condition.
We also anticipate public policy developments at the state, federal and international level regarding climate change and energy access, security and competitiveness. As discussed below, we expect these developments to address emission of carbon dioxide, renewable energy and fuel standards, and the monetization of carbon. These developments may also include mandated changes to energy use and building codes which could affect homebuilding practices. Enactment of new environmental laws or regulations or changes in existing laws or regulations, or the interpretation of these laws or regulations, might require significant expenditures. We also anticipate public policy developments at the state, federal and international level regarding taxes and a number of other areas that could require significant expenditures.
LEGAL AND REGULATORY RISKS RELATED TO CLIMATE CHANGE
Governmental response to climate change at the international, federal and state levels may affect our financial condition, results of operations, cash flows and financial condition.
There continue to be numerous international, U.S. federal and state-level initiatives and proposals to address domestic and global climate issues. Within the U.S. and Canada, some of these proposals would regulate and/or tax the production of carbon dioxide and other greenhouse gases to facilitate the reduction of carbon compound emissions into the atmosphere and provide tax and other incentives to produce and use cleaner energy. Indeed, such regulations have already been passed into law in some Canadian provinces and in Washington state, where we have mill operations. Climate change effects, if they occur, and governmental initiatives, laws and regulations to address potential climate
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concerns, could increase our costs and have a long-term adverse effect on our businesses and results of operations. Future legislation or regulatory activity in this area remains uncertain, and its effect on our operations is unclear at this time.
However, climate change legislation or related government mandates, standards or regulations intended to mitigate or reduce carbon compound, greenhouse gas emissions or other climate change effects could have significant adverse effects on our business and operations as well as our ability to achieve our recently announced business goals in emerging carbon credit and carbon storage markets. Any one or more of such new legal requirements and regulations could, for example, significantly increase the costs for our mills to comply with stricter air emissions regulations. They could also limit harvest levels for commercial timberland operators, which could in turn adversely affect our timberland operations as well as potentially lead to significant increases in the cost of energy, wood fiber and other raw materials for our wood products businesses. Any one or more of these developments, as well as other unforeseeable governmental responses to climate change, could have a material adverse effect on our financial condition, results of operations, cash flows and financial condition.
LEGAL MATTERS
We are involved in various environmental, regulatory, product liability and other legal matters, disputes and proceedings that, if determined or concluded in a manner adverse to our interests, could have a material adverse effect on our financial condition.
We are, from time to time, involved in a number of legal matters, disputes and proceedings (legal matters), some of which involve ongoing litigation. These include, without limitation, legal matters involving environmental clean-up and remediation, warranty and non-warranty product liability claims, regulatory issues, contractual and personal injuryclaims and other legal matters. In some cases, all or a portion of any loss we experience in connection with any such legal matters will be covered by insurance; in other cases, any such losses will not be covered.
The outcome, costs and other effects of current legal matters in which we are involved, and any related insurance recoveries, cannot be determined with certainty. Although the disclosures in Note 13: Legal Proceedings, Commitments and Contingencies contain management ’ s current views of the effect such legal matters could have on our financial results, there can be no assurance that the outcome of such legal matters will be as currently expected. It is possible that there could be adverse judgments against us in some or all major litigation matters against us, and that we could be required to take a charge and make cash payments for all or a portion of any related awards of damages. Any one or more of such charges or cash payment could materially and adversely affect our financial condition, results of operations or cash flows for the quarter or year in which we record or pay it.
REIT STATUS AND TAX IMPLICATIONS
If we fail to remain qualified as a REIT, our taxable income would be subject to tax at corporate rates and we would not be able to deduct dividends to shareholders.
In any taxable year in which we fail to qualify as a REIT, unless we are entitled to relief under the IRC:
We would not be allowed to deduct dividends to shareholders in computing our taxable income.
We would be subject to federal and state income tax on our taxable income at applicable corporate rates.
We also would be disqualified from treatment as a REIT for the four taxable years following the year during which we lost qualification.
Qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code (IRC or Code) to our operations and the determination of various factual matters and circumstances not entirely within our control. There are only limited judicial or administrative interpretations of these provisions. We closely monitor our compliance with all of the various requirements for maintaining our REIT status. For example, we regularly test our compliance with the general requirement that at least 75 percent of the market value of our total assets consist of REIT-qualifying interests in real property (such as timberlands) and certain other specified qualifying assets, and that no more than 25 percent of the market value of our total assets may consist of assets that are not REIT-qualifying assets. Although we operate in a manner consistent with these REIT qualification rules, we cannot provide assurance that we are or will remain qualified.
Certain of our business activities are subject to corporate-level income tax and potentially subject to prohibited transactions tax.
Under the IRC, REITs generally must engage in the ownership and management of income producing real estate. For the company, this generally includes owning and managing a timberland portfolio for the production and sale of standing timber. Certain activities that generate non-qualifying REIT income could constitute “prohibited transactions.” Prohibited transactions are defined by the Internal Revenue Code generally to be sales or other dispositions of property to customers in the ordinary course of a trade or business. Accordingly, the harvesting and sale of logs, the development or sale of certain timberlands and other real estate, and the manufacture and sale of wood products are conducted through one or more of our wholly-owned TRSs, the net income of which is subject to corporate-level tax. By conducting our business in this manner, we believe that we satisfy the REIT requirements of the Internal Revenue Code. However, if the Internal Revenue Service (IRS) were to successfully assert that these or any of our activities conducted at the REIT constituted prohibited transactions, we could be subject to the 100 percent tax on the net income from such activities.
The extent of our use of our TRSs may affect our REIT qualification and affect the price of our common shares relative to the share price of other REITs.
We conduct a significant portion of our business activities through one or more TRSs. The use of our TRSs enables us to engage in non-REIT qualifying business activities such as the harvesting and sale of logs, manufacture and sale of wood products, and the development and sale of certain higher and better use (HBU) property. Our TRSs are subject to corporate-level income tax. Under the Code, effective January 1, 2026, no
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more than 25 percent (previously 20 percent) of the value of the gross assets of a REIT may be represented by securities of one or more TRSs. This limitation may affect our ability to increase the size of our TRSs’ operations. While we intend to monitor the value of our investments in the stock and securities of our TRSs to ensure compliance with the 25 percent limitation, we cannot provide assurance that we will always be able to comply with the limitation so as to maintain REIT status. If we were to exceed the 25 percent limitation, we may be forced to sell or otherwise distribute assets of our TRSs in order to remain a qualified REIT. Furthermore, our use of TRSs may cause the market to value our common shares differently than the shares of other REITs, which may not use TRSs at all, or as extensively as we use them.
The failure of either of our two subsidiary REITs to maintain their separate REIT qualification could affect the company’s own REIT qualification.
The vast majority of our timberlands are held in two subsidiaries that we operate to qualify as REITs. Our western timberlands and related assets are held in a subsidiary that began qualifying as a REIT beginning in the tax year 2022 and our southern timberlands and related assets are held in another subsidiary that began qualifying as a REIT beginning in the tax year 2025. While our ownership interests in these subsidiaries are qualifying real estate assets for purposes of the company’s 75 percent asset test described above, any failure of either subsidiary REIT to maintain its own separate REIT status would generally result in the subsidiary being subject to regular U.S. corporate income tax, as described above, and the company’s ownership interest in the subsidiary no longer qualifying as a real estate asset for purposes of the 75 percent asset test. If this were to occur, the company’s own REIT qualification could be adversely affected.
We may be limited in our ability to fund distributions using cash generated through our TRSs.
The ability of the company to receive dividends from our TRSs is limited by the rules with which we must comply to maintain our status as a REIT. In particular, at least 75 percent of gross income for each taxable year as a REIT must be derived from real estate sources including sales of our standing timber and other types of qualifying real estate income, and no more than 25 percent of our gross income may consist of dividends from our TRSs and other non-real estate income. This limitation on our ability to receive dividends from our TRSs may affect our ability to fund cash distributions to our shareholders using cash flows from our TRSs. The net income of our TRSs is not required to be distributed, and income of our TRSs that is not distributed to the company will not be subject to the REIT income distribution requirement.
To maintain our qualification as a REIT and to avoid an excise tax, we are generally required to distribute substantially all of our taxable income to our shareholders.
Generally, REITs are required to distribute 90 percent of their ordinary taxable income and (to avoid an excise tax) 95 percent of their net capital gains income. Capital gains may be retained by the REIT but would be subject to corporate income taxes. If capital gains were retained rather than distributed, our shareholders would be deemed to have received a taxable distribution (about which we would notify them), with a credit or refund for any federal income tax paid by the company. We believe that we are not required to distribute material amounts of cash since substantially all of our taxable income is treated as capital gains income. As previously discussed in these Risk Factors, our board of directors, in its sole discretion, determines the amount, timing and frequency of our dividends to shareholders.
Changes in tax laws or their interpretation could adversely affect our shareholders and our results of operations.
Federal and state tax laws are constantly under review by persons involved in the legislative process, the IRS, the United States Department of the Treasury and state taxing authorities. Changes to tax laws could adversely affect our shareholders or increase our effective tax rates. We cannot predict with certainty whether, when, in what forms, or with what effective dates, the tax laws applicable to us or our shareholders may be changed.
U.S. AND INTERNATIONAL TRADE POLICY
Recent and future changes in U.S. foreign trade policy and responses from other countries may substantially increase the cost of our products in our export markets as well as increase the cost of imported products and raw materials that we use in our operations.
Our ability to conduct business can be significantly affected by changes in tariffs, duties, taxes or customs resulting from changes in U.S. and foreign trade policy. For example, we export logs and finished wood products to foreign markets, including Canada and China, and our ability to do so profitably could be affected by trade disputes that result in tariffs being charged on these products.
The U.S. presidential administration has taken multiple actions in 2025 to significantly increase tariffs on foreign imports into the United States, including imports from countries to which we export our products, such as Canada and China. For example, on February 1, 2025, the United States imposed tariffs on imports from Canada, Mexico and China, and on April 2, 2025, the United States announced a universal baseline tariff of 10% on almost all imports, plus additional country-specific tariffs for select trading partners, including China. The rates and effective dates of these tariffs have been adjusted on several occasions since the initial announcements, and certain of these tariffs are subject to legal and other challenges, the outcome of which could further change tariff rates and effective dates. In addition to increasing the cost of the wood products that we export to U.S. markets from our Canadian operations, these policies could result in one or more of our foreign export market jurisdictions adopting retaliatory trade policy that makes it more difficult or costly for us to export our products to those countries including, for example, by increasing tariffs, taxes or duties on our products or by placing significant import restrictions on our products such as onerous and excessive phytosanitary requirements. Several countries, including Canada and China, have imposed retaliatory tariffs, and the imposition of U.S. and foreign tariff regimes is fluid and changing. We could experience reduced revenues and margins in our businesses that are adversely affected by international trade policy or disputes, including the terms of any settlement of such disputes. To the extent such trade policies increase prices, they could also reduce the overall demand for our products in affected markets. Likewise, U.S.-imposed tariffs on imports could also increase our costs for products and raw materials that we use in our operations. We may not be able to pass on those cost increases to our customers, and if
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we do pass on those cost increases to our customers, it could reduce demand for our products. Further, tariff-related disruptions could cause supply chain delays and increase our operational expenses. These changes could have a material adverse effect on our business, financial condition and results of operations, including facility closures or impairments of assets. We cannot predict future U.S. or foreign trade policy or the terms and conditions of any resolutions or settlements of international trade disputes and their effects on our business, and the evolving landscape of global trade policies, including the potential for further tariff escalations or broader economic impacts, could adversely affect our business, financial condition and results of operations.
OTHER RISKS
RISKS RELATED TO OWNING OUR STOCK
Our cash dividends are not guaranteed and may fluctuate.
Our board of directors, in its sole discretion, determines the amount and timing of our cash dividends to shareholders based on consideration of a number of factors. These factors include, but are not limited to: our results of operations and cash flows; current and forecasted economic conditions; changes in the current or expected prices and demand for our products and the general market demand for timberlands, including those timberland properties that have higher and better uses; current and forecasted harvest levels; balancing various capital allocation priorities and considerations including without limitation the company’s capital requirements and debt repayment obligations; various finance considerations, including the company’s credit ratings, borrowing capacity, debt covenant restrictions that may impose limitations on cash payments and other related factors and tax considerations. Consequently, the amount, timing and frequency of our dividends, including our quarterly base dividend and annual supplemental dividend, may fluctuate.
The market price of our common stock may be influenced by many factors, some of which are beyond our control.
The market price of our common stock may be influenced by many factors, some of which are beyond our control, including without limitation those described above and elsewhere in this report, as well as the following:
actual or anticipated fluctuations in our operating results or our competitors' operating results;
announcements by us or our competitors of new products, capacity changes, significant contracts, acquisitions or strategic investments or initiatives;
our growth rate and our competitors’ growth rates;
general economic conditions;
conditions in the financial markets;
market interest rates and the relative yields on other financial instruments;
general perceptions and expectations regarding housing markets, interest rates, commodity prices and currencies;
changes in stock market analyst recommendations regarding us, our competitors or the forest products industry generally, or lack of analyst coverage of our common stock;
sales of our common stock by our executive officers, directors and significant shareholders;
sales or repurchases of substantial amounts of common stock;
fluctuation in the market price of our products (see Product Pricing and Profitability above);
changes in accounting principles and
changes in tax laws and regulations.
In addition, there has been significant volatility in the market price and trading volume of securities of companies, including companies operating in the forest products industry, that often has been unrelated to individual company operating performance. Some companies that have experienced volatile market prices for their securities have had securities litigation brought against them. If litigation of this type is brought against us, it could result in substantial costs and divert management’s attention and resources.
CAPITAL MARKETS RISKS
Deterioration in economic conditions and capital markets could adversely affect our access to capital.
Challenging market conditions could impair the company ’ s ability to raise debt or equity capital or otherwise access capital markets on terms acceptable to us, which may, among other effects, reduce our ability to refinance debt maturities or take advantage of growth and expansion opportunities. Moreover, our businesses require substantial capital for repair or replacement of existing facilities or equipment. While we believe our capital resources will be adequate to meet our current projected operating needs, capital expenditures and other cash requirements, if for any reason we are unable to access capital for our operating needs, capital expenditures and other cash requirements on acceptable economic terms, or at all, we could experience a material adverse effect on our business, financial condition, results of operations and cash flows.
Changes in credit ratings issued by nationally recognized rating organizations could adversely affect our cost of financing and have an adverse effect on the market price of our securities.
Credit rating agencies rate our debt securities on factors that include our operating results and balance sheet, actions that we take, their view of the general outlook for our industry and their view of the general outlook for the economy. Ratings decisions by these agencies include
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maintaining, upgrading or downgrading our current rating, as well as placing the company on a "watch list" for possible future ratings actions. Any downgrade of our credit rating, or decision by a rating agency to place us on a "watch list" for possible future downgrading could have an adverse effect on our ability to access credit markets, increase our cost of financing, and have an adverse effect on the market price of our securities.
INFORMATION TECHNOLOGY SYSTEMS AND CYBERSECURITY
Risks associated with our Information Technology (IT) systems, including but not limited to security breaches, system failures or other significant disruptions, as well as risks relating to implementation of new IT systems such as delays, cost overruns and platform integration problems, could compromise our data and adversely affect our operations, reported financial results and reputation and thereby expose us to potential liability or litigation.
We use IT systems to carry out our operating activities, maintain our business records, and collect and store sensitive data, including but not limited to intellectual property and personally identifiable information. Some of our systems are internally managed and some are maintained by third-party service providers. Although we employ, and we believe our third-party service providers employ, what we deem to be reasonably adequate security measures and controls, there can be no assurance that our efforts will be effectiveagainst the risks we face from cyber-attacks, including from: computer hackers, foreign governments and cyber terrorists; malicious code (such as malware, viruses and ransomware); an intentional or unintentional personnel action; a natural disaster; a hardware or software corruption, failure or error; a telecommunications system failure or disruption; a service provider failure or error; or any one or more other causes of a security breach, system failure or disruption. The increased prevalence and sophistication of Artificial Intelligence (AI) tools, such as AI-enabled malware, could increase the risks of cyber-attacks to our systems and to those of our third-party service providers. Implementation of new IT systems, including replacement of legacy systems with new or upgraded versions, could also pose a significant risk to us, as any such implementation could involve system failure, potential loss or corruption of our important data, security or internal control failures, delays, cost overruns and disruption to our operations.
Although we have, on occasion, experienced cybersecurity threats to our data and IT systems, including phishing attacks, to date no events of this nature have had a material adverse effect on our business or otherwise caused material harm to the company. However, if in the future our IT systems are significantly disrupted, shut down or otherwise compromised for any reason, or if our data is destroyed, misappropriated or inappropriatelydisclosed, our operations and financial results could be negatively affected. Additionally, we could suffer significant losses or incur significant liabilities, including without limitationdamage to our reputation, loss of customer confidence or goodwill and significant expenditures of time and money to address and remediate any resulting damages to affected individuals or business partners or to defend ourselves in resulting litigation or other legal proceedings by affected individuals, business partners or regulators. For more information about our cybersecurity program, see Item 1C Cybersecurity .
We may experience risks, liabilities or other issues relating to the use of Artificial Intelligence (AI) in our business.
We have recently begun using third-party developed AI tools for internal purposes, such as data and inventory management and sales and logistics optimization. Over time, we may explore the use of AI in additional areas.
There can be no assurance that any current or future use of AI or machine learning technologies will achievedesired results, improveefficiency or otherwise benefit our business. AI systems are complex and may not always operate as intended, and could produce inaccurate, incomplete or biased outputs, and ineffective or inadequate AI deployment practices could result in unintended consequences. In addition, our business could be disrupted if any of the AI systems we use become unavailable due to extended outages or interruptions or because they are no longer available on commercially reasonable terms or prices.
Laws, regulations and industry standards applicable to AI are rapidly evolving and may require us or our third-party providers to incur significant costs to modify or enhance our business practices to comply with such requirements, which may vary across jurisdictions.
Furthermore, our competitors or other third parties may adopt AI capabilities more quickly or more effectively than we do, which could adversely affect our ability to compete and affect our business, financial condition and results of operations. In addition, the use of AI, even in limited internal applications, may give rise to new risks or liabilities, including increased governmental or regulatory scrutiny, litigation exposure, compliance requirements, ethical considerations and confidentiality or security risks. These risks could, in turn, adversely affect our reputation, business, financial condition and results of operations.
UNRESOLVED ST AFF COMMENTS
There are no unresolved comments that were received from the SEC staff relating to our periodic or current reports under the Securities Exchange Act of 1934.
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CYBERSECURITY
RISK MANAGEMENT
Our risk management program includes focused efforts on identifying, assessing and managing cybersecurity risk, including the following:
A robust information security training program that requires all company employees with access to our networks to participate in regular and mandatory training on how to be aware of, and help defendagainst, cyber risks, combined with periodic testing to measure the efficacy of our training efforts. Highlights of our training program include:
At least annual training for company employees who have access to our information systems.
Specialized training for all new hires.
Targeted training for all employees aimed at responding to current and emerging risks and threats using tools such as situational simulations and frequent testing of our employees' ability to identify and appropriately respond to cybersecurity threats.
Alignment of our program with the National Institute of Standards and Technology Cybersecurity Framework to prevent, detect and respond to cyberattacks.
Ongoing adoption of a “zero trust” cybersecurity model.
Regular and robust testing of our systems to assess our vulnerability to cyber risk, which includes targeted penetration testing, tabletop incident response exercises, periodic audits of our systems by outside industry experts and regular vulnerability scanning.
A third-party cybersecurity risk management process for service providers and vendors who access our systems.
Engaging external cybersecurity experts in incident response development and management.
Business continuity plans and critical recovery backup systems.
Requiring employees and third parties who have access to our systems to treat confidential and private information and data with care.
Insurance for damage to property caused by a cyberattack.
Our chief information security officer (CISO) is primarily responsible for leading the technical team that assesses and manages cybersecurity risk for the company on a day-to-day basis . He and other members of the cybersecurity team have deep and broad experience and training in cybersecurity management, as well as relevant education and industry recognized certifications in information systems security .
CYBERSECURITY INCIDENT RESPONSE PROCESS
We maintain and actively update a cybersecurity incident response plan that outlines the steps we take to identify, investigate and take action in response to any potentially material cyber incidents. Our response plan ensures that our Cyber Incident Response Team, which includes our CISO, members of our senior management team and select members of our legal staff, is timely informed of and consulted with respect to any potentially material cyber incidents.
BOARD OVERSIGHT OF CYBERSECURITY RISK
Members of management, including our CISO, regularly report on the company’s cybersecurity matters to both our board’s Audit Committee and to the full board , which has primary oversight responsibility in this area, as follows:
Our cybersecurity program and risks are specifically discussed at least three times per year (including as part of our discussions regarding enterprise risk management).
Our internal audit function’s reviews of our information security programs and controls are included in quarterly reports to the Audit Committee .
Current information security issues that arise during the year are discussed throughout the year if potentially significant to the company and are discussed with our chairman and Audit Committee chair between board meetings as appropriate.
RISK MITIGATION
We also manage cybersecurity risk by limiting our threat landscape. For example, we do not store, transmit or process many of the types of data commonly targeted in cyberattacks, such as consumer credit card or financial information, nor do we store or maintain significant proprietary data on our systems. Moreover, our businesses do not involve or represent national infrastructure, the likes of which are common targets of cyber attackers (e.g., energy, oil and gas, transportation, communications and banking and financial systems). We recognize that cyber threats are a permanent part of the risk landscape and that new threats are constantly evolving. For these and other reasons, cybersecurity is a top risk management priority at Weyerhaeuser.
Like many companies, we face a number of cybersecurity risks in the day-to-day operation of our business. Although during the three-year period ended December 31, 2025 and to date these risks have not materialized i nto any incident or series of incidents that have materially affected, or are reasonably likely to materially affect the company , its business strategy, results of operations or financial condition or otherwise caused material harm to the company , we have, on occasion, experienced cybersecurity threats to our data and information systems, including phishing attacks. Over this same time period, certain of our vendors and service providers have notified us of cybersecurity incidents involving their own systems and these cybersecurity incidents, likewise, have not materially affected us, our business strategy, results of operations or financial condition or otherwise caused material harm to the company. To date, we have incurred no expenses for penalties or settlements with a
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third party relating to any cybersecurity incidents. For more information about the cybersecurity risks we face, see the risk factor entitled "Information Systems and Cybersecurity" in Item 1A Risk Factors .
PROPERTIES
Details about our facilities, production capacities and locations are found in the Our Business — What We Do section of this report.
For details about our Timberlands properties, go to Our Business/What We Do/Timberlands/Where We Do It .
For details about our Real Estate, Energy and Natural Resources properties, go to Our Business/What We Do/Real Estate, Energy and Natural Resources/Where We Do It .
For details about our Wood Products properties, go to Our Business/What We Do/Wood Products/Where We Do It .
LEGAL PROCEEDINGS
Refer to Note 13: Legal Proceedings, Commitments and Contingencies . SEC regulations require us to disclose certain information about proceedings arising under federal, state or local environmental provisions if we reasonably believe that such proceedings may result in monetary sanctions above a stated threshold. In accordance with these regulations, the company uses a threshold of $1 million for purposes of determining whether disclosure of any such proceedings is required pursuant to this item.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our common stock trades on the New York Stock Exchange under the symbol WY.
As of December 31, 2025, there were 10,555 holders of record of our common shares.
INFORMATION ABOUT COMMON SHARE REPURCHASES
The following table provides information with respect to purchases of common shares made by the company during fourth quarter 2025:
TOTAL NUMBER
APPROXIMATE
OF SHARES
DOLLAR VALUE
PURCHASED AS
OF SHARES THAT
PART OF
MAY YET BE
PUBLICLY
PURCHASED
TOTAL NUMBER
AVERAGE
ANNOUNCED
UNDER THE
COMMON SHARE REPURCHASES DURING FOURTH
OF SHARES
PRICE PAID
PLANS OR
PLANS OR
QUARTER 2025
PURCHASED
PER SHARE
PROGRAMS
PROGRAMS
October 1 - October 31
November 1 - November 30
December 1 - December 31
Total
During second quarter 2025, we completed the $1 billion purchase authorization under the share repurchase program approved by the board in
September 2021 (the 2021 Repurchase Program). On May 8, 2025, we announced the board approved a new share repurchase program (the 2025 Repurchase Program) under which we are authorized to repurchase up to $1 billion of outstanding shares. Concurrently, the board terminated the completed purchase authorization under the 2021 Repurchase Program.
During fourth quarter 2025, we repurchased 427,576 common shares for approximately $10 million (including transaction fees) under the 2025 Repurchase Program in open-market transactions. Transaction fees incurred for repurchases are not counted as use of funds authorized for repurchase under the 2025 Repurchase Program. As of December 31, 2025, we had remaining authorization of $938 million for future share repurchases.
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COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL SHAREHOLDER RETURN
Weyerhaeuser Company, S&P 500 and S&P Global Timber & Forestry Index
PERFORMANCE GRAPH ASSUMPTIONS
Assumes $100 invested on December 31, 2020, in Weyerhaeuser common stock, the S&P 500 Index and the S&P Global Timber & Forestry Index.
Total return assumes dividends received are reinvested immediately.
Measurement dates are the last trading day of the calendar year shown.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANC IAL CONDITION AND RESULTS OF OPERATIONS (MD&A)
WHAT YOU WILL FIND IN THIS MD&A
Our MD&A includes the following major sections:
economic and market conditions affecting our operations;
financial performance summary;
results of operations;
liquidity and capital resources;
environmental matters, legal proceedings and other contingencies;
accounting matters and
performance and liquidity measures.
For Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) related to the year ended December 31, 2023, refer to this same section in our 2024 annual report on Form 10-K as filed with the Securities and Exchange Commission on February 14, 2025.
ECONOMIC AND MARKET CONDITIONS AFFECTING OUR OPERATIONS
Our market conditions and the strength of the broader U.S. economy are, and will continue to be, influenced by the trajectory of activity in the U.S. housing and repair and remodel segments, inflation trends and interest rates. The demand for sawlogs within our Timberlands segment is directly affected by domestic production of wood-based building products. The strength of the U.S. housing market, particularly new residential construction, strongly affects demand in our Wood Products segment, as does repair and remodeling activity. Seasonal weather patterns impact the level of construction activity in the U.S., which in turn affects demand for our logs and wood products. Our Timberlands segment, particularly the Western region, is also affected by export demand and trade policy. Japanese housing starts are a key driver of export log demand in Japan. The demand for pulpwood from our Timberlands segment is directly affected by the production of pulp, paper and oriented strand board (OSB), as well as the demand for biofuels, such as wood-burning pellets made from pulpwood. Our Timberlands segment is also influenced by the availability of harvestable timber. In general, Western log markets are highly tensioned by available supply, while Southern log markets have
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more available supply. However, additional mill capacity being added in the U.S. South has led to tightening of markets in certain geographies. Our Real Estate, Energy and Natural Resources segment is affected by a variety of factors, including the general state of the economy, local real estate market conditions, the level of construction activity in the U.S. and evolution of emerging renewable energy and carbon-related markets.
Ongoing U.S. trade policy changes have resulted in macroeconomic uncertainty and increased cautiousness by consumers. These policies, along with potential countermeasures by other countries, have the potential to affect supply and demand trends, import and export dynamics, and pricing for our products. Trade and tariff policies are generally separate from the annual establishment and collection of anti-dumping and countervailing duties (AD/CVD) placed on certain products and countries, such as for Canadian softwood lumber.
The discussion below includes a number of publicly available data points, many of which are obtained from U.S. federal government institutions. Due to the federal government shutdown that ended in November, availability of these data points is limited to October or November 2025. All other data points are updated through fourth quarter 2025.
Home sales and building activity continue to moderate in response to elevated mortgage interest rates, reduced affordability and lower consumer confidence. While overall housing inventory remains historically low across many markets, there has been some increase in unsold new and existing single-family units. On a seasonally adjusted annual basis, as reported by the U.S. Census Bureau, housing starts for October 2025 averaged 1.2 million units, a 7.0 percent decrease from third quarter 2025. Single-family starts averaged 874 thousand units in October 2025, a 1.0 percent decrease from third quarter 2025. Multi-family starts averaged 372 thousand units in October 2025, an 18.4 percent decrease from third quarter 2025. Single-family construction is the primary driver for our business as compared to multi-family due to the amount of wood products used. Sales of newly built single-family homes averaged a seasonally adjusted annual rate of 737 thousand units for October 2025, a 5.9 percent increase from third quarter 2025, driven by builder incentives and moderate relief in mortgage rates. Notwithstanding current macroeconomic uncertainty and potential impacts to housing demand, we expect a favorable U.S. housing construction market over the medium to long-term, supported by strong demographics in the key home buying age cohorts and a decade of under building.
Repair and remodeling expenditures decreased 0.6 percent from third quarter 2025 to the end of November 2025, according to the Census Bureau Advance Retail Spending report. While there continues to be steady demand due to growing home equity and the lock-in effect of lower mortgage rates compared to current rates, many homeowners have been more cautious in discretionary spending on large projects. Recent softness has been reflected in both the do-it-yourself (DIY) and professionally built segments, largely driven by subdued consumer confidence, elevated interest rates and concerns around the trajectory of the economy. Slower sales of existing homes have also contributed to muted activity as there is often an increase in upgrades and repairs before and after the sale of a home. Over the longer term, we expect this sector to return to historical growth trends driven by recent deferrals in repair and remodel spending, higher levels of home equity and an aging U.S. housing stock, with a median age of 46 years.
In U.S. wood product markets, soft end use demand and steady supply have led to continued price weakness in commodity products. In fourth quarter 2025, the Random Lengths Framing Lumber Composite price averaged $378/MBF and the OSB Composite averaged $234/MSF, both near multi-decade lows on an inflation-adjusted basis. Over the course of fourth quarter 2025, composite prices for lumber increased from $367/MBF to $385/MBF and composite prices for OSB decreased from $237/MSF to $230/MSF. The Framing Lumber Composite began the fourth quarter on a slight upward trajectory supported by improving Western SPF pricing and broader concerns around the Section 232 tariff, which took effect in October. As the quarter progressed, ample product supply and seasonally softer demand led to lower composite pricing through early December. By quarter end, product supply decreased and demand improved as buyers replenished lean inventories. This drove price gains across North American lumber markets, with a notable increase in Southern Yellow Pine. For OSB, soft product pricing in fourth quarter 2025 was largely driven by lower demand in response to the seasonal reduction in new home construction activity. In September 2025, Weyerhaeuser elected to moderate production across its lumber mill set in response to the softer demand environment, and maintained a lower operating posture through year end 2025. When combined with the volume impact associated with the sale of the company’s sawmill in Princeton, British Columbia – which was sold in late third quarter 2025 – Weyerhaeuser’s lumber production volumes decreased by 14 percent in fourth quarter 2025 compared to the prior quarter. The company expects to return to a more normalized operating posture in first quarter 2026.
In Western log markets, Douglas-fir sawlog prices decreased 5.6 percent in fourth quarter 2025 compared with third quarter 2025, as reported by Fastmarkets RISI Log Lines based on Weyerhaeuser’s sales mix. Log prices in the domestic market faced downward pressure as supply remained ample, and mills continued to carry elevated log inventories and navigate a challenging lumber market. In the South, delivered sawlog prices decreased 2.3 percent in fourth quarter 2025 compared to third quarter 2025 and declined 2.3 percent from fourth quarter 2024, as reported by TimberMart-South. Delivered pine pulpwood prices decreased 2.1 percent in fourth quarter 2025 compared to third quarter 2025 and declined 4.7 percent from fourth quarter 2024 as reported by TimberMart-South. In general, Southern log supply remains ample and wood product and fiber mills continue to align production with end-market demand. Pulpwood prices have been more challenged in several localized regions following recent mill closures.
Currency exchange rates, available supply from other countries and trade policy affect our export businesses. In Japan, total housing starts decreased 7.4 percent year-to-date through December compared to the same period in 2024, while the key Post and Beam segment saw a 4.0 percent decrease, in part due to more stringent building permit requirements which went into effect on April 1, 2025. The slowing demand has been partially offset by a decrease in lumber imports to Japan from Europe and reduced inventories of European lumber in the Japanese market. In China, during fourth quarter 2025 regulators lifted the March 4, 2025 suspension of log imports from the U.S. As a result, Weyerhaeuser is in the early stages of re-establishing its log export program to strategic customers in China.
Interest rates affect our business primarily through their impact on mortgage rates and housing affordability, their general impact on the economy and their influence on our capital management activities. Actions by the U.S. Federal Reserve, the overall condition of the economy and fluctuations in financial markets are all factors that influence long-term interest rates. 30-year mortgage rates, which are generally correlated with long-term interest rates, decreased from 6.3 percent in third quarter 2025 to 6.2 percent in fourth quarter 2025, according to economic data from Freddie Mac. Many builders have been able to offset higher mortgage rates through discounts, mortgage rate buydowns and modifying product offerings such as home sizes and finishes. Higher rates have also locked in many existing homeowners from selling, thereby reducing inventories of existing homes for sale which has led to incremental demand for available new homes.
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Increased inflation affects the cost of our operations across each of our business segments, including costs for raw materials, transportation, energy and labor. The Consumer Price Index increased at an annual rate of 2.7 percent as of December 2025 compared to 3.0 percent as of September 2025. This rate is markedly down from prior periods of elevated inflation. While we can offset some of our costs that are affected by inflation through our sales activities, operational excellence initiatives and procurement practices, not all costs associated with inflation can be fully mitigated or passed on to the customer.
The condition of the labor market affects all of our businesses as it relates to our ability to attract and retain employees and contractors. The unemployment rate remained level at 4.4 percent in third quarter 2025 and fourth quarter 2025.
Governments and businesses across the globe have publicly expressed that climate change is a compelling issue requiring considerable responsive action; many have made significant commitments toward decarbonizing activities and operations and reducing greenhouse gas emissions. Achieving these commitments will require significant efforts, including modifying operations, investing in low-carbon technologies or purchasing credits to reduce environmental impacts. Although political and broader sentiment for climate change mitigation activities and related investments can fluctuate, we expect that over the long-term, climate change will continue to be a significant social concern and priority. With that in mind, we believe we are uniquely positioned to help others achieve climate change mitigation goals through our Climate Solutions business.
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FINANCIAL PERFORMANCE SUMMARY
Net Sales by Segment
Contribution to Earnings by Segment
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RESULTS OF OPERATIONS
In reviewing our results of operations, it is important to understand these terms:
Sales realizations refer to net selling prices — this includes selling price plus freight minus normal sales deductions.
Net contribution (charge) to earnings refers to earnings (loss) before interest expense and income taxes.
CONSOLIDAT ED RESULTS
HOW WE DID
Summary of Financial Results
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
AMOUNT OF CHANGE
Net sales
Costs of sales
Operating income
Net earnings
Basic and diluted earnings per share
COMPARING 2025 WITH 2024
Net Sales
Net sales decreased $219 million — 3 percent — primarily due to a $264 million decrease in Wood Products net sales attributable to decreased sales realizations across most product lines, as well as an $18 million decrease in Timberlands net sales to unaffiliated customers attributable to decreased log sales realizations and volumes in the Western region. These decreases were partially offset by a $63 million increase in Real Estate, Energy and Natural Resources net sales attributable to an increase in average price per acre sold.
Costs of Sales
Costs of sales increased $69 million — 1 percent — primarily due to increased sales volumes for structural lumber, oriented strand board and softwood plywood within our Wood Products segment, partially offset by a decrease in acres sold in our Real Estate, Energy and Natural Resources segment and decreased Western sales volumes in our Timberlands segment.
Operating Income
Operating income increased $46 million — 7 percent — primarily due to:
a $266 million increase in gain on sale of timberlands (refer to: Note 4: Timberland Acquisitions and Divestitures );
a $43 million increase in insurance recoveries;
a $29 million gain on the sale of our Princeton lumber mill in third quarter 2025;
a $27 million decrease in general and administrative expenses and
a $10 million decrease in noncash impairment charges.
These changes were partially offset by:
a $288 million decrease in consolidated gross margin (see discussion of components above);
a $25 million decrease in product remediation recoveries received and
an $18 million noncash environmental remediation charge recorded in fourth quarter 2025.
Refer to the breakout of these items in Note 17: Other Operating Costs, Net .
Net Earnings
Net earnings decreased $72 million — 18 percent — primarily due to a $178 million increase in non-operating and other post-employment benefit costs, primarily attributable to a $145 million noncash pension settlement charge (refer to: Note 8: Pension and Other Post-Employment Benefit Plans ), as well as a $31 million decrease in interest income and other. These changes were partially offset by a $95 million decrease in tax expense (refer to Income Taxes ) and the $46 million increase in operating income discussed above.
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TIMBE RLANDS
HOW WE DID
We report sales volumes and fee harvest volumes for our Timberlands segment in Our Business/What We Do/Timberlands .
Net Sales and Net Contribution to Earnings for Timberlands
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales to unaffiliated customers:
Delivered logs:
West
South
North
Total
Stumpage and pay-as-cut timber
Recreational and other lease revenue
Other products (1)
Subtotal net sales to unaffiliated customers
Intersegment net sales
Total segment net sales
Costs of sales
Operating income
Interest income and other
Net contribution to earnings
Other products include sales of seeds and seedlings from our nursery operations and wood chips.
COMPARING 2025 WITH 2024
Net Sales — Unaffiliated Customers
Net sales to unaffiliated customers decreased $18 million — 1 percent — primarily due to a $48 million decrease in Western log sales attributable to a 4 percent decrease in sales volumes and a 3 percent decrease in sales realizations. This decrease was partially offset by a $10 million increase in Southern log sales attributable to a 1 percent increase in sales volumes, as well as a $9 million increase in stumpage and pay-as-cut timber sales attributable to increased sales realizations and sales volumes.
Intersegment Sales
Intersegment sales increased $38 million — 7 percent — primarily due to a 3 percent increase in sales realizations, as well as a 3 percent increase in sales volumes.
Costs of Sales
Costs of sales decreased $22 million — 1 percent — primarily due to decreased Western sales volumes, partially offset by increased Southern sales volumes.
Net Contribution to Earnings
Net contribution to earnings increased $306 million — 109 percent — primarily due to a $266 million increase in gain on sale of timberlands (refer to Note 4: Timberland Acquisitions and Divestitures ), as well as the change in the components of gross margin, as discussed above.
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REAL ESTATE, ENERGY A ND NATURAL RESOURCES
HOW WE DID
We report acres sold and average price per acre for our Real Estate, Energy and Natural Resources (Real Estate & ENR) segment in Our Business/What We Do/Real Estate, Energy and Natural Resources .
Net Sales and Net Contribution to Earnings for Real Estate, Energy and Natural Resources
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales to unaffiliated buyers:
Real estate
Energy and natural resources
Total segment net sales
Costs of sales
Operating income and Net contribution to earnings
The volume of real estate sales is a function of many factors, including the general state of the economy, demand in local real estate markets, the ability of buyers to obtain financing, the number of competing properties listed for sale, the seasonal nature of sales, the plans of adjacent landowners, our expectations of future price appreciation, the timing of harvesting activities and the availability of government and not-for-profit funding. In any period, the average price per acre will vary based on the location and physical characteristics of parcels sold.
COMPARING 2025 WITH 2024
Net Sales
Net sales increased $63 million — 16 percent — primarily due to an increase in average price per acre sold and an increase in right-of-way easements and royalty income from our Energy and Natural Resources business, partially offset by a decrease in acres sold.
Costs of Sales
Costs of sales decreased $35 million — 23 percent — primarily due to a decrease in acres sold.
Operating Income and Net Contribution to Earnings
Operating income and net contribution to earnings increased $99 million — 46 percent — primarily due to the change in the components of gross margin, as discussed above.
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WOOD PR ODUCTS
HOW WE DID
We report sales volumes and annual production data for our Wood Products segment in Our Business/What We Do/Wood Products .
Net Sales and Net Contribution to Earnings for Wood Products
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales:
Structural lumber
Oriented strand board
Engineered solid section
Engineered I-joists
Softwood plywood
Medium density fiberboard
Complementary building products
Other products produced (1)
Total segment net sales
Costs of sales
Operating income and Net contribution to earnings
Other products produced sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations.
COMPARING 2025 WITH 2024
Net Sales
Net sales decreased $264 million — 5 percent — primarily due to:
a $217 million decrease in oriented strand board sales attributable to a 25 percent decrease in sales realizations, partially offset by a 4 percent increase in sales volumes;
a $59 million decrease in engineered solid section sales attributable to a 7 percent decrease in sales realizations and a 1 percent decrease in sales volumes;
a $50 million decrease in complementary building products sales attributable to a decrease in sales volumes across most products;
a $47 million decrease in engineered I-joist sales attributable to a 7 percent decrease in sales realizations and a 5 percent decrease in sales volumes;
a $24 million decrease in medium density fiberboard sales attributable to a 14 percent decrease in sales volumes and a 1 percent decrease in sales realizations and
a $3 million decrease in softwood plywood sales attributable to a 7 percent decrease in sales realizations, partially offset by a 5 percent increase in sales volumes.
These decreases were partially offset by a $131 million increase in structural lumber sales attributable to a 5 percent increase in sales volumes and a 1 percent increase in sales realizations, as well as a $5 million increase in other products produced sales attributable to an increase in wood chip sales volumes.
Costs of Sales
Costs of sales increased $158 million — 3 percent — primarily due to increased sales volumes for structural lumber, oriented strand board and softwood plywood.
Operating Income and Net Contribution to Earnings
Operating income and net contribution to earnings decreased $402 million — 88 percent — primarily due to the change in the components of gross margin, as discussed above, as well as a $25 million product remediation recovery recorded in second quarter 2024. These changes were partially offset by a $10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill recorded in third quarter 2024 and a $29 million gain related to the sale of our Princeton lumber mill recorded in third quarter 2025 (refer to the breakout of these items in Note 17: Other Operating Costs, Net ).
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UNALLOCAT ED ITEMS
Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as:
share-based compensation,
pension and post-employment costs,
elimination of intersegment profit in inventory and LIFO — the last-in, first-out method,
foreign exchange transaction gains and losses resulting from changes in exchange rates primarily related to our U.S. dollar denominated cash and debt balances that are held by our Canadian subsidiary, as well as
interest income and other.
Net Charge to Earnings for Unallocated Items
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Unallocated corporate function and variable compensation expense
Liability classified share-based compensation
Foreign exchange gain
Elimination of intersegment profit in inventory and LIFO
Other, net
Operating loss
Non-operating pension and other post-employment benefit costs
Interest income and other
Net charge to earnings
Net charge to earnings increased by $166 million — 65 percent — primarily due to:
a $178 million increase in non-operating pension and other post-employment benefit costs, primarily attributable to a $145 million pension settlement charge (refer to Note 8: Pension and Other Post-Employment Benefit Plans );
a $30 million decrease in interest income and other, primarily attributable to a decrease in cash and cash equivalents and
a $12 million increase in unallocated corporate function and variable compensation expense.
These changes were partially offset by a $48 million decrease in other, net, primarily attributable to a $30 million increase in insurance recoveries, as well as a $7 million increase in the benefit from elimination of intersegment profit in inventory and LIFO.
INTEREST EXPENSE
Our net interest expense incurred for the last two years was:
$273 million in 2025 and
$269 million in 2024.
Interest expense increased by $4 million compared to 2024 primarily due to $3 million of debt extinguishment costs incurred in conjunction with the partial redemption of our $750 million 4.75 percent senior unsecured notes due in May 2026, as well as a series of debt issuances and retirements in 2025 that increased our outstanding debt, partially offset by a decrease in our weighted average interest rate.
Refer to Note 11: Long-Term Debt, Net for further information.
INCOME TAXES
As a REIT, we generally are not subject to federal corporate level income taxes on REIT taxable income that is distributed to shareholders. Historical distributions to shareholders, including amounts and tax characteristics, are summarized in the table below.
AMOUNTS PER SHARE
Common - capital gain distribution
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We are required to pay corporate income taxes on earnings of our TRSs, which include our Wood Products segment and portions of our Timberlands and Real Estate & ENR segments' earnings. Our provision for income taxes is primarily driven by earnings generated by our TRSs.
Our provision for income taxes the last two years was:
$64 million benefit in 2025 and
$31 million expense in 2024.
Income tax expense decreased by $95 million compared to 2024, resulting in a net benefit position, primarily due to a significant decrease in our TRS earnings in 2025 and the effect of a $34 million tax benefit related to the noncash pretax settlement charge recorded in connection with our U.S. pension plan, as well as a decrease in our effective tax rate.
Refer to Note 8: Pension and Other Post-Employment Benefit Plans and Note 18: Income Taxes for further information.
LIQUIDITY AND CAPITAL RESOURCES
We are committed to maintaining an appropriate capital structure that provides financial flexibility and enables us to protect the interests of our shareholders and meet our obligations to our lenders, while also maintaining access to all major financial markets. As of December 31, 2025, we had $464 million in cash and cash equivalents, $1.75 billion of availability on our line of credit, which expires in June 2030, and $1.75 billion of availability on our commercial paper program. We believe we have sufficient liquidity to meet our cash requirements for the foreseeable future.
CASH FROM OPERATIONS
Consolidated net cash from operations was:
$562 million in 2025 and
$1,008 million in 2024.
COMPARING 2025 WITH 2024
Net cash from operations decreased by $446 million, primarily due to decreased cash inflows from our business operations, as well as a $201 million increase in pension and post-employment benefit contributions and payments, as discussed below. Refer to Note 8: Pension and Other Post-Employment Benefit Plans for further information .
Pension Contributions and Benefit Payments Made and Expected
During 2025, we contributed a total of $219 million to our pension and post-employment benefit plans, including a $200 million voluntary contribution to our U.S. qualified pension plan, compared to a total of $18 million during 2024.
For 2026, we expect to contribute approximately $20 million to our pension and post-employment benefit plans. Refer to Note 8: Pension and Other Post-Employment Benefit Plans for further information .
INVESTING IN OUR BUSINESS
Cash from investing activities includes items such as:
capital expenditures for property, equipment and reforestation,
acquisitions and divestitures of timberlands,
proceeds from sales of assets and operations and
purchases and maturities of short-term investments.
Consolidated net cash from investing activities was:
$(475) million in 2025 and
$(636) million in 2024.
COMPARING 2025 WITH 2024
Net cash from investing activities increased by $161 million, primarily due to a $405 million increase in proceeds from the sale of timberlands and a $61 million increase in proceeds from the sale of our Princeton lumber mill, partially offset by a $218 million increase in cash spent on the acquisition of timberlands and a $59 million increase in capital expenditures for property and equipment.
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Summary of Capital Spending by Business Segment
DOLLAR AMOUNTS IN MILLIONS
Timberlands
Wood Products
Unallocated Items
Total
During fourth quarter 2024, we announced our plan to invest approximately $500 million to build a new TimberStrand ® facility in Monticello, Arkansas. This capital outlay may be sourced from cash on hand or through future financing, as deemed appropriate. Construction began in 2025, with the goal of starting operations in 2027. Once completed, the new facility will increase our engineered wood products capacity by approximately 10 million cubic feet. In 2025, we had $109 million in capital expenditures related to the construction of this facility.
We expect our capital expenditures for 2026 to be approximately $400-$450 million, excluding approximately $300 million of investment in our Monticello engineered wood products facility. We exclude this investment for purposes of calculating our annual Adjusted Funds Available for Distribution (Adjusted FAD), as used in our flexible cash return framework. The amount we spend on capital expenditures could change due to:
future economic conditions,
environmental regulations,
changes in the composition of our business,
weather,
timing of equipment purchases and
capital needs related to other business opportunities.
FINANCING
Cash from financing activities includes items such as:
issuances and payments of debt and
payments for cash dividends and repurchasing stock.
Consolidated net cash from financing activities was:
$(290) million in 2025 and
$(852) million in 2024.
COMPARING 2025 WITH 2024
Net cash from financing activities increased by $562 million, primarily due to a $1,199 million increase in net proceeds from issuance of long-term debt and a $78 million decrease in cash paid for dividends, partially offset by a $712 million increase in payments on long-term debt.
LONG-TERM DEBT
Our consolidated long-term debt (including current portion) was:
$5,572 million as of December 31, 2025 and
$5,076 million as of December 31, 2024.
The $496 million increase in our long-term debt during 2025 is primarily attributable to:
the August 2025 issuance of an $800 million senior unsecured term loan;
the March 2025 issuance of a $300 million senior unsecured term loan and
the November 2025 loan of $102 million related to resource recovery revenue bonds.
These issuances were partially offset by:
the August 2025 partial repayment of approximately $500 million of our $750 million 4.75 percent senior unsecured notes;
the January 2025 repayment of our $139 million 8.50 percent debentures and
the March 2025 repayment of our $71 million 7.95 percent debentures.
The weighted average interest rate and the weighted average maturity on our long-term debt as of December 31, 2025 were 5.11 percent and 6.5 years, respectively.
See Note 11: Long-Term Debt, Net for more information.
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LINE OF CREDIT
In June 2025, we amended and restated our senior unsecured revolving credit facility to extend the expiration date to June 2030, while increasing borrowing capacity from $1.5 billion to $1.75 billion. Borrowings will bear interest at a floating rate based on either the adjusted term Secured Overnight Financing Rate (SOFR) plus a spread or a mutually agreed-upon base rate plus a spread. As of December 31, 2025 and 2024, we had no outstanding borrowings on the revolving credit facility.
Refer to Note 10: Line of Credit and Commercial Paper Program for further information.
COMMERCIAL PAPER PROGRAM
In November 2025, we established a commercial paper program under which we may issue short-term, unsecured commercial paper notes pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. Under this program, we may issue notes from time to time in an aggregate amount not to exceed $1.75 billion outstanding at any time. The notes will have maturities of up to 397 days from the date of issue and will not be subject to voluntary prepayment or redemption prior to maturity. We use our revolving credit facility as a liquidity backstop for the repayment of short-term unsecured notes issued under the commercial paper program. There were no notes outstanding under this program as of December 31, 2025.
Refer to Note 10: Line of Credit and Commercial Paper Program for further information.
OUR COVENANTS
Our key covenants include the requirement to maintain:
a minimum total adjusted shareholders' equity of $3.0 billion and
a defined debt-to-total-capital ratio of 65 percent or less.
Our total adjusted shareholders' equity is comprised of:
total shareholders’ equity,
excluding accumulated other comprehensive loss,
minus our investment in our unrestricted subsidiaries.
Our capitalization is comprised of:
total debt,
plus total adjusted shareholders' equity.
As of December 31, 2025, we had:
total adjusted shareholders' equity of $9.7 billion and
a defined debt-to-total-capital ratio of 36.4 percent.
When calculating compliance in accordance with financial debt covenants as of December 31, 2025 and December 31, 2024, we excluded the full amount of accumulated other comprehensive loss of $293 million and $402 million, respectively. See Note 14: Shareholders’ Interest for further information on accumulated other comprehensive loss.
There are no other significant financial debt covenants related to our third-party debt.
INTEREST RATE SWAP HEDGING RELATIONSHIP
During third quarter 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $800 million term loan. No comparable activity was present for the year ended December 31, 2024.
Refer to Note 12: Fair Value of Financial Instruments for further information.
CREDIT RATINGS
As of December 31, 2025, our long-term issuer credit rating was BBB and Baa2 from S&P and Moody’s, respectively.
DIVIDENDS
We paid cash dividends on common shares of:
$606 million in 2025 and
$684 million in 2024.
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The decrease in dividends paid is primarily due to a supplemental dividend of $0.14 per share based on 2023 financial results for a total of $102 million paid in first quarter 2024.
Under our cash return framework, we plan to supplement our base dividend with an additional return of variable cash, as appropriate, in the form of share repurchase and/or a supplemental cash dividend to achieve our targeted total return to shareholders of 75 to 80 percent of annual Adjusted Funds Available for Distribution (Adjusted FAD). For further information on Adjusted FAD see Performance and Liquidity Measures .
SHARE REPURCHASES
During second quarter 2025, we completed the $1 billion purchase authorization under the share repurchase program approved by the board in
September 2021 (the 2021 Repurchase Program). On May 8, 2025, we announced the board approved a new share repurchase program (the 2025 Repurchase Program) under which we are authorized to repurchase up to $1 billion of outstanding shares. Concurrently, the board terminated the completed purchase authorization under the 2021 Repurchase Program.
We repurchased 6.1 million common shares for approximately $160 million (including transaction fees) during the year ended December 31, 2025. We repurchased 4.9 million common shares for approximately $153 million (including transaction fees) in 2024. As of December 31, 2025, we had remaining authorization of $938 million for future share repurchases. For further information on share repurchases see Note 14: Shareholders’ Interest .
OUR CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
More details about our contractual obligations and commercial commitments are in Note 8: Pension and Other Post-Employment Benefit Plans , Note 10: Line of Credit and Commercial Paper Program , Note 11: Long-Term Debt, Net , Note 12: Fair Value of Financial Instruments , Note 13: Legal Proceedings, Commitments and Contingencies , Note 16: Leases and Note 18: Income Taxes .
Significant Contractual Obligations as of December 31, 2025
Significant contractual obligations as of December 31, 2025 include our long-term debt obligations and lease obligations. Refer to Note 11: Long-Term Debt, Net , Note 12: Fair Value of Financial Instruments and Note 16: Leases for further information. Additional significant contractual obligations are included below.
DOLLAR AMOUNTS IN MILLIONS
PAYMENTS DUE BY PERIOD
LESS THAN
MORE THAN
TOTAL
1 YEAR
YEARS
YEARS
5 YEARS
Interest (1)
Purchase obligations (2)
Employee-related obligations (3)
Amounts presented for interest payments assume that all long-term debt obligations outstanding as of December 31, 2025 will remain outstanding until maturity. Interest payments related to our $800 million term loan due in 2028 are treated as fixed due to the impact of the related interest rate swap.
Purchase obligations include agreements to purchase goods or services that are enforceable and legally binding on the company and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions and the approximate timing of the transaction. Purchase obligations exclude arrangements that the company can cancel without penalty.
The timing of certain payments within this category will be triggered by retirements or other events. These payments can include workers compensation, deferred compensation and banked vacation, among other obligations. When the timing of payment is uncertain, the amounts are included in the total column only. Minimum pension funding is required by established funding standards and estimates are not made for 2027 onward. Estimated payments of contractually obligated post-employment benefits are not included due to the uncertainty of payment timing.
OFF-BALANCE SHE ET ARRANGEMENTS
Off-balance sheet arrangements have not had — and are not reasonably likely to have — a material effect on our current or future financial condition, results of operations or cash flows. Note 10: Line of Credit and Commercial Paper Program contains our disclosures of surety bonds and letters of credit.
ENVIRONMENTAL MATTERS, LEGAL PROCEEDINGS AND OTHER CONTINGENCIES
See Note 13: Legal Proceedings, Commitments and Contingencies .
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ACCOUNTING MATTERS
CRIT ICAL ACCOUNTING ESTIMATES
In the preparation of our financial statements we follow established accounting policies and make estimates that affect both the amounts and timing of the recording of assets, liabilities, revenues and expenses. We base our judgments and estimates on historical experience and assumptions we believe are appropriate and reasonable under current circumstances. Actual results, however, could differ materially from the estimated amounts we have recorded. Some of these estimates require judgments about matters that are inherently uncertain. Accounting policies whose application involve a significant level of estimation uncertainty and may have a material effect on our results of operations or financial condition are considered critical accounting estimates.
DISCOUNT RATES FOR PENSION AND POST-EMPLOYMENT BENEFIT PLANS
Discount rates are used to estimate the net present value of our pension and other post-employment plan obligations. These rates are determined at the measurement date by matching current spot rates of high-quality corporate bonds with maturities similar to the timing of expected cash outflows for benefits. The selection of discount rates requires judgment as well as the involvement of actuarial specialists. These specialists assist with selecting yield curves based on published indices for high-quality corporate bonds and projecting the timing and amount of cash flows associated with our obligations to ultimately support our determination of an appropriate discount rate for each plan.
Our discount rates as of December 31, 2025 are:
5.3 percent for our U.S. pension plans — compared with 5.7 percent at December 31, 2024;
5.0 percent for our U.S. post-employment benefit plans — compared with 5.5 percent at December 31, 2024;
4.9 percent for our Canadian pension plans — compared with 4.7 percent at December 31, 2024 and
4.6 percent for our Canadian post-employment benefit plans — compared with 4.5 percent at December 31, 2024.
Pension expenses for 2026 will be based on the 5.3 percent and 4.9 percent assumed discount rates for the U.S. pension plans and the Canadian pension plans, respectively, and the 5.0 percent and 4.6 percent assumed discount rates for the U.S. and Canadian post-employment benefit plans, respectively.
Our discount rates are important in determining the cost of our plans. A 50 basis point decrease in our discount rate would increase expense or reduce a credit by approximately:
$8 million for our U.S. qualified pension plans and
$2 million for our Canadian registered pension plans.
Details about our other significant accounting policies are in Note 1: Summary of Significant Accounting Policies .
PROSPECTIVE ACCOUNTING PRONOUNCEMENTS
A summary of prospective accounting pronouncements is in Note 1: Summary of Significant Accounting Policies .
PERFORMANCE AND LIQUIDITY MEASURES
We use Adjusted EBITDA as a key performance measure to evaluate the performance of the consolidated company and our business segments. This measure should not be considered in isolation from, and is not intended to represent an alternative to, our results reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP). However, we believe Adjusted EBITDA provides meaningful supplemental information for our investors about our operating performance, better facilitates period to period comparisons and is widely used by analysts, lenders, rating agencies and other interested parties. Our definition of Adjusted EBITDA may be different from similarly titled measures reported by other companies. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, depletion, amortization, basis of real estate sold and special items.
Adjusted EBITDA by Segment
DOLLAR AMOUNTS IN MILLIONS
Timberlands
Real Estate & ENR
Wood Products
Unallocated Items
Total
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We reconcile Adjusted EBITDA to net earnings for the consolidated company and to operating income (loss) for the business segments, as those are the most directly comparable U.S. GAAP measures for each.
The table below reconciles Adjusted EBITDA by segment to net earnings for the year ended December 31, 2025:
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
TOTAL
Net earnings
Interest expense, net of capitalized interest
Income taxes
Net contribution (charge) to earnings
Non-operating pension and other post-employment benefit costs (1)
Interest income and other
Operating income (loss)
Depreciation, depletion and amortization
Basis of real estate sold
Special items included in operating income (loss) (2)(3)(4)
Adjusted EBITDA
Non-operating pension and other post-employment benefit costs includes a pretax special item consisting of a $145 million noncash settlement charge related to the transfer of pension plan assets and liabilities to an insurance company through the purchase of a
group annuity contract.
Operating income (loss) for Timberlands includes pretax special items consisting of a $117 million gain on the sale of Georgia and Alabama timberlands and a $149 million gain on the sale of Oregon timberlands.
Operating income (loss) for Wood Products includes a pretax special item consisting of a $29 million gain on the sale of our Princeton lumber mill.
Operating income (loss) for Unallocated Items includes pretax special items consisting of an $18 million noncash environmental remediation charge and a $26 million insurance recovery.
The table below reconciles Adjusted EBITDA by segment to net earnings for the year ended December 31, 2024:
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
TOTAL
Net earnings
Interest expense, net of capitalized interest
Income taxes
Net contribution (charge) to earnings
Non-operating pension and other post-employment benefit costs
Interest income and other
Operating income (loss)
Depreciation, depletion and amortization
Basis of real estate sold
Special items included in operating income (loss) (1)
Adjusted EBITDA
Operating income (loss) for Wood Products includes pretax special items consisting of a $25 million product remediation recovery and a $10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill.
Net Earnings and Net Earnings per Diluted Share Before Special Items (Income Tax Affected)
We reconcile net earnings before special items to net earnings and net earnings per diluted share before special items to net earnings per diluted share, as those are the most directly comparable U.S. GAAP measures. We believe the measures provide meaningful supplemental information for investors about our operating performance, better facilitate period to period comparisons, and are widely used by analysts, lenders, rating agencies and other interested parties.
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The table below reconciles net earnings before special items to net earnings:
DOLLAR AMOUNTS IN MILLIONS
Net earnings
Environmental remediation charge
Gain on sale of lumber mill
Gain on sale of timberlands
Insurance recovery
Pension settlement charge
Product remediation recovery
Restructuring, impairments and other charges
Net earnings before special items
The table below reconciles net earnings per diluted share before special items to net earnings per diluted share:
AMOUNTS PER SHARE
Net earnings per diluted share
Environmental remediation charge
Gain on sale of lumber mill
Gain on sale of timberlands
Insurance recovery
Pension settlement charge
Product remediation recovery
Restructuring, impairments and other charges
Net earnings per diluted share before special items
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Adjusted FAD
We use Adjusted Funds Available for Distribution (Adjusted FAD) to evaluate the company’s liquidity and measure cash generated during the period (net of capital expenditures and significant nonrecurring items) that is available for dividends, repurchases of common shares, debt reduction, acquisitions, and other discretionary and nondiscretionary capital allocation activities. Adjusted FAD should not be considered in isolation from, and is not intended to represent an alternative to, results reported in accordance with U.S. GAAP. However, we believe the measure provides meaningful supplemental information for our investors about our liquidity. Adjusted FAD, as we define it, is net cash from operations adjusted for capital expenditures and significant non-recurring items. Our definition of Adjusted FAD may be different from similarly titled measures reported by other companies, including those in our industry. We reconcile Adjusted FAD to net cash from operations, as that is the most directly comparable U.S. GAAP measure.
The table below reconciles Adjusted FAD to net cash from operations:
DOLLAR AMOUNTS IN MILLIONS
Net cash from operations
Capital expenditures
FAD
Cash from product remediation recovery
Cash contribution to our U.S. qualified pension plan
Monticello engineered wood products facility capital expenditures
Adjusted FAD
Net cash from investing activities
Net cash from financing activities
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QUANTITATIVE AND QUALITATIVE D ISCLOSURES ABOUT MARKET RISK
LONG-TERM DEBT OBLIGATIONS
The following summary of our long-term debt obligations includes:
scheduled principal repayments for the next five years and after;
weighted average interest rates for debt maturing in each of the next five years and after and
estimated fair values of outstanding obligations.
We estimate the fair value of long-term debt based on quoted market prices we receive for the same types and issues of our debt or on the discounted value of the future cash flows using market yields for the same type and comparable issues of debt. Changes in market rates of interest affect the fair value of our fixed-rate debt.
SUMMARY OF LONG-TERM DEBT OBLIGATIONS AS OF DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
THEREAFTER
TOTAL (1)
FAIR VALUE
Fixed-rate debt
Weighted average interest rate
Variable-rate debt (2)
Excludes $35 million of unamortized discounts and capitalized debt expense.
As of December 31, 2025, the weighted average interest rate for our variable-rate debt was 5.05%, excluding estimated patronage refunds and the impact of interest rate swaps.
In 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $800 million term loan. No comparable activity was present as of and for the year ended December 31, 2024.
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FINANCIAL STATEMENTS A ND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors
Weyerhaeuser Company:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Weyerhaeuser Company and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, cash flows, and changes in equity for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 13, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Projected benefit obligations for pensions
As discussed in Notes 1 and 8 to the consolidated financial statements, the Company's projected benefit obligations for pension plans were $1,881 million as of December 31, 2025, which included the projected benefit obligation for the U.S. qualified pension plans. The Company estimates the liability related to their pension plans using actuarial models that include assumptions about the Company’s discount rates.
We identified the evaluation of the Company’s projected benefit obligation for the U.S. qualified pension plans as a critical audit matter. This is due to the sensitivity of the obligation to changes in the discount rate used and the subjectivity in evaluating the rate. Additionally, the assessment of the discount rate required specialized actuarial skills and knowledge.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the U.S. qualified pension obligation process. This included controls related to the actuarial determination of the discount rate used in the valuation of the projected benefit obligation for the U.S. qualified pension plans. These procedures also included analyzing year-over-year changes to the projected cash flows associated with the obligation. Additionally, we involved actuarial professionals with specialized skills and knowledge, who assisted in the evaluation of the Company’s discount rate by:
evaluating the selected yield curve used to determine the discount rate
assessing changes in the discount rate from the prior year against changes in published indices
evaluating the discount rate based on the projected cash flows compared with those of similar plans.
/s/ KPMG LLP
We have served as the Company’s auditor since 2002.
Seattle, Washington
February 13, 2026
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CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
Net sales (Note 3)
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Gain on sale of timberlands (Note 4)
Other operating costs, net (Note 17)
Operating income
Non-operating pension and other post-employment benefit costs (Note 8)
Interest income and other
Interest expense, net of capitalized interest
Earnings before income taxes
Income taxes (Note 18)
Net earnings
Basic and diluted earnings per share (Note 5):
Weighted average shares outstanding (in thousands) (Note 5):
Basic
Diluted
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATEMENT O F COMPREHENSIVE INCOME
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
Comprehensive income:
Net earnings
Other comprehensive income (loss):
Foreign currency translation adjustments
Changes in unamortized actuarial loss, net of tax (expense) benefit of $( 28 ) in 2025, $ 20 in 2024 and $ 17 in 2023
Changes in unamortized net prior service credit, net of tax benefit (expense) of $ 1 in 2025, $( 1 ) in 2024 and $ 2 in 2023
Unrealized net gain on cash flow hedges, net of tax expense of $ 1 in 2025, $ 0 in 2024 and $ 0 in 2023 (Note 12)
Total comprehensive income
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED B ALANCE SHEET
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PAR VALUE
DECEMBER 31,
DECEMBER 31,
ASSETS
Current assets:
Cash and cash equivalents
Receivables, net
Receivables for taxes
Inventories (Note 6)
Assets held for sale (Note 4)
Prepaid expenses and other current assets
Total current assets
Property and equipment, net (Note 7)
Construction in progress
Timber and timberlands at cost, less depletion
Minerals and mineral rights, less depletion
Deferred tax assets (Note 18)
Other assets
Total assets
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt (Notes 11 and 12)
Accounts payable
Accrued liabilities (Note 9)
Total current liabilities
Long-term debt, net (Notes 11 and 12)
Deferred tax liabilities (Note 18)
Deferred pension and other post-employment benefits (Note 8)
Other liabilities
Total liabilities
Commitments and contingencies (Note 13)
Equity:
Weyerhaeuser shareholders’ interest (Notes 14 and 15):
Common shares: $ 1.25 par value; authorized 1,360 million shares; issued and outstanding: 720,531 thousand shares at December 31, 2025 and 725,845 thousand shares at December 31, 2024
Other capital
Retained earnings
Accumulated other comprehensive loss (Note 14)
Total equity
Total liabilities and equity
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATE MENT OF CASH FLOWS
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
Cash flows from operations:
Net earnings
Noncash charges (credits) to earnings:
Depreciation, depletion and amortization
Basis of real estate sold
Deferred income taxes, net (Note 18)
Pension and other post-employment benefits (Note 8)
Share-based compensation expense (Note 15)
Gain on lumber mill sale (Note 20)
Gain on sale of timberlands (Note 4)
Other
Change in:
Receivables, net
Receivables and payables for taxes
Inventories
Prepaid expenses and other current assets
Accounts payable and accrued liabilities
Pension and post-employment benefit contributions and payments (Note 8)
Other
Net cash from operations
Cash flows from investing activities:
Capital expenditures for property and equipment
Capital expenditures for timberlands reforestation
Acquisition of timberlands (Note 4)
Proceeds from lumber mill sale (Note 20)
Proceeds from sale of timberlands (Note 4)
Purchase of short-term investments
Maturities of short-term investments
Other
Net cash from investing activities
Cash flows from financing activities:
Cash dividends on common shares
Net proceeds from issuance of long-term debt (Note 11)
Payments on long-term debt (Note 11)
Repurchases of common shares (Note 14)
Other
Net cash from financing activities
Net change in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of year
Cash, cash equivalents and restricted cash at end of year
Cash paid during the year for:
Interest, net of amounts capitalized of $ 11 in 2025, $ 10 in 2024 and $ 7 in 2023
Income taxes, net of refunds
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
Common shares:
Balance at beginning of year
Issued for exercise of stock options and vested units
Repurchases of common shares (Note 14)
Balance at end of year
Other capital:
Balance at beginning of year
Issued for exercise of stock options
Repurchases of common shares (Note 14)
Share-based compensation
Other transactions, net
Balance at end of year
Retained earnings:
Balance at beginning of year
Net earnings
Dividends on common shares
Balance at end of year
Accumulated other comprehensive loss:
Balance at beginning of year
Other comprehensive income (loss)
Balance at end of year
Total equity:
Balance at end of year
Dividends paid per common share
See accompanying Notes to Consolidated Financial Statements .
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INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1:
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NOTE 2:
BUSINESS SEGMENTS
NOTE 3:
REVENUE RECOGNITION
NOTE 4:
TIMBERLAND ACQUISITIONS AND DIVESTITURES
NOTE 5:
NET EARNINGS PER SHARE
NOTE 6:
INVENTORIES
NOTE 7:
PROPERTY AND EQUIPMENT, NET
NOTE 8:
PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS
NOTE 9:
ACCRUED LIABILITIES
NOTE 10:
LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
NOTE 11:
LONG-TERM DEBT, NET
NOTE 12:
FAIR VALUE OF FINANCIAL INSTRUMENTS
NOTE 13:
LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES
NOTE 14:
SHAREHOLDERS’ INTEREST
NOTE 15:
SHARE-BASED COMPENSATION
NOTE 16:
LEASES
NOTE 17:
OTHER OPERATING COSTS, NET
NOTE 18:
INCOME TAXES
NOTE 19:
GEOGRAPHIC AREAS
NOTE 20:
PRINCETON LUMBER MILL DIVESTITURE
NOTE 21:
RESTRICTED CASH
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies describe:
our election to be taxed as a real estate investment trust,
how we report our results,
changes in how we report our results and
how we account for certain key items.
REAL ESTATE INVESTMENT TRUST (REIT)
We are organized as a REIT. Our holding company and two subsidiaries, which collectively hold most of the timberland assets related to our Timberlands segment, each operate as a REIT for federal income tax purposes. We also own Taxable REIT Subsidiaries (TRSs), which collectively hold the assets relating to our Wood Products segment and portions of our Timberlands and Real Estate, Energy and Natural Resources (Real Estate & ENR) segments. REIT income can be distributed to shareholders without first paying corporate level tax, which substantially eliminates the double taxation of income. We expect to derive most of our REIT income from investments in timberlands, including the sale of standing timber through pay-as-cut sales contracts and lump sum timber deeds. We continue to be required to pay federal corporate income taxes on earnings of our TRSs.
HOW WE REPORT OUR RESULTS
Our report includes:
consolidated financial statements,
our business segments,
estimates,
fair value measurements and
foreign currency translation.
Consolidated Financial Statements
Our consolidated financial statements provide an overall view of our results and financial condition. They include our accounts and the accounts of entities that we control, including majority-owned domestic and foreign subsidiaries.
They do not include our intercompany transactions and accounts, which are eliminated.
Throughout these Notes to Consolidated Financial Statements , unless specified otherwise, references to “Weyerhaeuser,” "the company," “we” and “our” refer to the consolidated company.
Our Business Segments
Reportable business segments are determined based on the company’s "management approach," as defined by Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting . The management approach is based on the way the chief operating decision maker organizes the segments within a company for making decisions about resources to be allocated and assessing their performance.
We are principally engaged in:
growing and harvesting timber;
maximizing the value of our acreage through the sale of higher and better use (HBU) properties and monetizing the value of surface and subsurface assets through leases and royalties and
manufacturing, distributing and selling products made from trees.
Our business segments are organized based primarily on products and services.
SEGMENT
PRODUCTS AND SERVICES
Timberlands
Logs, timber, recreational leases and other products.
Real Estate & ENR
Real Estate (sales of timberlands) and ENR (rights to explore for and extract hard minerals, construction materials, natural gas production, wind and solar).
Wood Products
Structural lumber, oriented strand board, engineered wood products and building materials distribution.
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We also transfer raw materials, semi-finished materials and end products among our business segments. Because of this intracompany activity, accounting for our business segments involves pricing products transferred between our business segments at current market values.
Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses, interest income and other.
Estimates
We prepare our financial statements according to U.S. generally accepted accounting principles (U.S. GAAP). This requires us to make estimates and assumptions during our reporting periods and at the date of our financial statements. The estimates and assumptions affect our:
reported amounts of assets, liabilities and equity;
disclosure of contingent assets and liabilities and
reported amounts of revenues and expenses.
While we believe the assumptions used in preparing these estimates are appropriate and reasonable, actual results can and do differ from those estimates and assumptions.
Fair Value Measurements
We use a fair value hierarchy in accounting for certain nonfinancial assets and liabilities including:
long-lived assets (asset groups) measured at fair value for an impairment assessment;
pension plan assets measured at fair value and
asset retirement obligations initially measured at fair value.
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions.
The fair value hierarchy consists of the following three levels:
Level 1: Inputs are unadjusted quoted prices for identical assets or liabilities traded in an active market.
Level 2: Inputs are quoted prices in non-active markets for which pricing inputs are observable either directly or indirectly at the reporting date.
Level 3: Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.
Foreign Currency Translation
We translate foreign currencies into U.S. dollars in two ways:
assets and liabilities — at the exchange rates in effect as of our balance sheet date and
revenues and expenses — at average monthly exchange rates throughout the year.
CHANGES IN HOW WE REPORT OUR RESULTS
Changes in how we report our results come from:
reclassification of certain balances and results from prior years to make them consistent with our current reporting and
accounting changes made upon our adoption of new accounting guidance.
Reclassifications
We have reclassified certain balances and results from prior years to be consistent with our 2025 reporting. This makes balances comparable from year to year. Our reclassifications had no effect on consolidated net earnings or equity.
HOW WE ACCOUNT FOR CERTAIN KEY ITEMS
This section provides information about how we account for certain key items related to:
capital investments,
financing our business and
our operations.
ITEMS RELATED TO CAPITAL INVESTMENTS
Key items related to accounting for capital investments pertain to property and equipment, timber and timberlands and impairment of long-lived assets.
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Property and Equipment
We maintain property accounts on an individual asset basis and account for them as follows:
Improvements to and replacements of major units of property are capitalized.
Maintenance, repairs and minor replacements are expensed.
Depreciation is calculated using a straight-line method at rates based on estimated service lives.
Costs associated with logging roads that we intend to utilize for a period longer than one year are capitalized. These roads are then amortized over an estimated service life.
Cost and accumulated depreciation of property sold or retired are removed from the accounts and the gain or loss is included in earnings.
Timber and Timberlands
We carry timber and timberlands at cost less depletion. Depletion refers to the carrying value of timber that is harvested or sold.
Key activities affecting how we account for timber and timberlands include:
reforestation,
depletion and
forest management in Canada.
Reforestation. Generally, we capitalize initial site preparation and planting costs as reforestation and then expense costs after the first planting as they are incurred or over the period of expected benefit. These expensed costs include:
fertilization,
vegetation and insect control,
pruning and precommercial thinning and
property taxes.
Accounting practices for these costs do not change when timber becomes merchantable and harvesting starts.
Timber Depletion. To determine depletion rates, we divide the net carrying value of timber by the related volume of timber estimated to be available over the growth cycle. To determine the growth cycle volume of timber, we consider:
regulatory and environmental constraints,
our management strategies,
inventory data improvements,
growth rate revisions and recalibrations and
known dispositions and inoperable acres.
In addition, the duration of the harvest cycle varies by geographic region and species of timber.
Depletion rate calculations do not include estimates for:
future silviculture or sustainable forest management costs associated with existing stands;
future reforestation costs associated with a stand's final harvest and
future volume in connection with the replanting of a stand subsequent to its final harvest.
We include the cost of timber harvested in the carrying values of raw materials and product inventories. As these inventories are sold to third parties, we include them in costs of sales.
Forest Management in Canada. We manage timberlands under long-term licenses in various Canadian provinces that are:
granted by the provincial governments;
granted for initial periods of 15 to 25 years and
renewable provided we meet reforestation, operating and management guidelines.
Calculation of the fees we pay on the timber we harvest:
varies from province to province,
is tied to product market pricing and
depends upon the allocation of land management responsibilities in the license.
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Impairment of Long-Lived Assets
We review the carrying value of long-lived assets whenever an event or a change in circumstance indicates that the carrying value of the asset or asset group may not be recoverable through future operations. The carrying value is the original cost, less accumulated depreciation and any past impairments recorded. If we evaluate recoverability, we are required to estimate future cash flows and residual values of the asset or asset group. Key assumptions used in developing estimates of future cash flows and residual values could include probability of alternative outcomes, product pricing, raw material cost and product sales. An impairment occurs when the carrying value of a long-lived asset is greater than the amount that could be recovered from the estimated undiscounted future cash flows of the asset and greater than fair market value (the amount we could receive if we were to sell the asset).
Impaired assets held for use are written down to fair value, while impaired assets held for sale are written down to fair value less cost to sell. We determine fair value based on:
appraisals,
market pricing of comparable assets,
discounted value of estimated future cash flows from the asset,
replacement values of comparable assets and
agreed upon sale price or offer price.
Key assumptions used in developing estimates of fair value would include the estimated future cash flows used to assess recoverability, discount rates and probability of alternative outcomes.
ITEMS RELATED TO FINANCING OUR BUSINESS
Key items related to financing our business include financial instruments, cash equivalents and concentration of risk.
Financial Instruments
We estimate the fair value of financial instruments where appropriate. The assumptions we use — including the discount rate and estimates of cash flows — can significantly affect the fair value. These values are estimates and may not match the amounts we would realize upon sale or settlement of our financial positions.
Derivative Instruments. At times, we may manage exposure to certain risks by entering into derivative instruments. We do not enter into derivative instruments for speculative purposes.
We record all derivative instruments on our Consolidated Balance Sheet at fair value. We are allowed to net settle transactions with respective counterparties for certain derivative instruments; however, we have not offset derivative asset and liability balances on our Consolidated Balance Sheet .
For derivative instruments that are designated as hedging instruments in a qualifying cash flow hedge, the hedging instrument’s income or loss is reported as a component of other comprehensive income (loss) and recorded in accumulated other comprehensive loss on our Consolidated Balance Sheet . The income or loss is subsequently reclassified into net earnings when the hedged transaction affects net earnings in the same line item as the underlying hedged transaction in our Consolidated Statement of Operations . Where applicable, the initial value of hedged components excluded from the assessment of effectiveness are amortized over the life of the hedging instrument, using a systematic and rational method, and recognized in the same line item as the hedged transaction.
Cash flows from derivative instruments designated as hedging instruments are classified in the same category as the cash flows from the respective hedged transaction.
See Note 12: Fair Value of Financial Instruments .
Cash Equivalents
Cash equivalents are investments with maturities of 90 days or less at the date of purchase. We state cash equivalents at cost, which approximates market.
Concentration of Risk
We disclose customers that represent a concentration of risk. As of December 31, 2025 and December 31, 2024 , no customer accounted for 10 percent or more of our net sales.
ITEMS RELATED TO OPERATIONS
Key items related to operations include revenue recognition, inventories, shipping and handling costs, income taxes, pension and other post-employment benefit plans and contingent liabilities.
Revenue Recognition
Refer to Note 3: Revenue Recognition for details on how we account for revenue.
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Inventories
We state inventories at the lower of cost or net realizable value. Cost includes labor, materials and production overhead. LIFO applies to major inventory products held at our U.S. domestic locations. We began to use the LIFO method for domestic products in the 1940s as required to conform with the tax method elected. Subsequent acquisitions of entities added new products under the moving average cost or FIFO — the first-in, first-out — methods and those products continue to be recognized under those methods. The moving average cost or FIFO method applies to the balance of our domestic raw material and product inventories, all material and supply inventories and all foreign inventories.
Shipping and Handling Costs
We classify shipping and handling costs in "Costs of sales" in our Consolidated Statement of Operations .
Income Taxes
We account for income taxes under the asset and liability method. Unrecognized tax benefits represent potential future funding obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. Accrued interest and penalties related to unrecognized tax benefits are recognized as a component of income tax expense.
We recognize deferred tax assets and liabilities to reflect:
future tax consequences due to differences between the carrying amounts for financial reporting purposes and the tax bases of certain items and
net operating loss and tax credit carryforwards.
To measure deferred tax assets and liabilities, we:
determine when the differences between carrying amounts and tax bases of affected items are expected to be recovered or resolved and
use enacted tax rates expected to apply to taxable income in those years.
Pension and Other Post-Employment Benefit Plans
We recognize the overfunded or underfunded status of our defined benefit pension and other post-employment benefit plans on our Consolidated Balance Sheet and recognize changes in the funded status through comprehensive income (loss) in the year in which the changes occur.
Actuarial valuations determine the amount of the pension and other post-employment benefit obligations and the net periodic benefit cost we recognize. The net periodic benefit cost includes:
cost of benefits provided in exchange for employees’ services rendered during the year;
interest cost of the obligations;
expected long-term return on plan assets;
gains or losses on plan settlements and curtailments;
amortization of prior service costs and plan amendments over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the participants affected by the plan amendment are inactive and
amortization of cumulative unrecognized net actuarial gains and losses — generally in excess of 10 percent of the greater of the benefit obligation or the combination of market-related and fair value of plan assets at the beginning of the year — over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the plan participants are inactive.
Pension plans. We have defined benefit pension plans covering appr oximately 30 percent of our employees. Determination of benefits differs for salaried, hourly and union employees as follows:
Salaried employee benefits are based on each employee’s highest monthly earnings for five consecutive years during the final 10 years before retirement.
Hourly and union employee benefits generally are stated amounts for each year of service.
Union employee benefits are set through collective-bargaining agreements.
We contribute to our U.S. and Canadian pension plans according to established funding standards. The funding standards for the plans are:
U.S. pension plans — according to the Employee Retirement Income Security Act of 1974 and
Canadian pension plans — according to the applicable provincial pension act and the Income Tax Act.
Post-employment benefits other than pensions. We provide certain post-employment healthcare and life insurance benefits for some retired employees. In some cases, we pay a portion of the cost of the benefit. Note 8: Pension and Other Post-Employment Benefit Plans provides additional information about our post-employment benefit plans.
Estimates for pension and other post-employment benefit plans. Estimates we use in accounting for our pension and other post-employment benefit plans include the:
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fair value of our plan assets;
expected long-term rate of return on plan assets and
discount rates.
At the end of every year, we review our estimates with external advisers and make adjustments as appropriate. We use these estimates to calculate plan asset and liability information as of year-end as well as pension and post-employment expense for the following year. Actual experience that differs from our estimates and subsequent changes in our estimates could have a significant effect on our financial position, results of operations and cash flows.
Fair value of plan assets. Plan assets are assets of the pension plan trusts that fund the benefits provided under the pension plans. The fair value of our plan assets estimates the amount that would be received if we were to sell each asset in an orderly transaction between market participants at the reporting date. We estimate the fair value of these assets based on the information available during the year-end reporting process.
Refer to Note 8: Pension and Other Post-Employment Benefit Plans for information about the assets held within our pension plans and their related valuation methods.
Expected long-term rate of return on plan assets. Our expected long-term rate of return is our estimate of the return that our plan assets will earn over time. This rate is used in determining the net periodic benefit or cost we recognize for our plans.
Factors we consider in determining our expected long-term rate of return include:
historical returns for a portfolio of assets similar to our expected allocation and
expected future performance of similar asset classes.
The actual return on plan assets in any given year may vary from our expected long-term rate of return. Actual returns on plan assets affect the funded status of the plans. Differences between actual returns on plan assets and the expected long-term rate of return are reflected as adjustments to accumulated other comprehensive loss, a component of total equity.
Discount rates. Discount rates are used to estimate the net present value of our plan obligations. The discount rates are determined at the measurement date by matching current spot rates of high-quality corporate bonds with maturities similar to the timing of expected cash outflows for benefits.
Contingent Liabilities
We are subject to lawsuits, investigations and other claims related to environmental remediation, product and other matters, and are required to assess the likelihood of any adverse judgments or outcomes to these matters, as well as the amount or range of potential loss.
We record contingent liabilities when:
it becomes probable that a loss has been incurred and
the amount of loss can be reasonably estimated.
Assessing probability of loss and estimating the amount of loss can require analysis of multiple factors, such as:
historical experience,
evaluations of relevant legal and environmental authorities and regulations,
judgments about the potential actions of third-party claimants and courts and
consideration of potential environmental remediation methods.
In addition to contingent liabilities recorded for probable losses, we disclose contingent liabilities when there is a reasonable possibility that a loss may have been incurred.
Recorded contingent liabilities are based on the best information available and actual losses in any future period are inherently uncertain. Future expenditures for environmental remediation obligations are not discounted to their present value. If estimated probable future losses or actual losses exceed our recorded liability for such claims, we record additional charges. These exposures and proceedings can be significant and the ultimate outcomes could be material to our operating results or cash flows in any given period. Recoveries of environmental remediation costs from other parties are recorded as assets when the recovery is deemed probable and does not exceed the amount of losses previously recorded. See Note 13: Legal Proceedings, Commitments and Contingencies for more information.
NEW ACCOUNTING PRONOUNCEMENTS
Income Taxes
In 2025 , we adopted the FASB Accounting Standards Update (ASU) 2023-09 , “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which expands annual income tax disclosures to disaggregate rate reconciliations and income taxes paid by nature and jurisdiction. The adoption of this standard did no t impact our Consolidated Statement of Operations , Consolidated Balance Sheet or Consolidated Statement of Cash Flows . The expanded disclosures are incorporated in Note 18: Income Taxes .
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Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which expands annual and interim disclosure requirements for certain income statement expenses. The new guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The adoption of the new guidance will not impact our Consolidated Statement of Operations , Consolidated Balance Sheet or Consolidated Statement of Cash Flows . We plan to incorporate these expanded disclosures beginning in fourth quarter 2027.
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NOTE 2: BUSINESS SEGMENTS
Our business segments and how we account for those segments are discussed in Note 1: Summary of Significant Accounting Policies . This note provides key financial data by business segment and information about our chief operating decision maker.
KEY FINANCIAL DATA BY BUSINESS SEGMENT
Sales, Significant Segment Expenses and Net Contribution (Charge) to Earnings
DOLLAR AMOUNTS IN MILLIONS
UNALLOCATED
REAL
ITEMS AND
ESTATE
WOOD
INTERSEGMENT
TIMBERLANDS
& ENR
PRODUCTS
ELIMINATIONS
CONSOLIDATED
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Other segment items for each reportable segment includes recurring and non-recurring income and expense items. For our Timberlands segment, this includes a legal benefit in 2023 and gains on the sale of timberlands in 2023 and 2025. For our Wood Products segment, this includes insurance recoveries in 2023, product remediation recoveries and an impairment charge related to the indefinite curtailment of our New Bern lumber mill in 2024, and a gain on the sale of our Princeton lumber mill in 2025. For Unallocated Items, this includes a legal expense in 2023, noncash environmental remediation charges in 2023 and 2025, as well as non-operating pension and other post-employment benefit costs, interest income and other and insurance recoveries for all periods presented. Refer to Note 17: Other Operating Costs, Net for additional information.
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The chief operating decision maker, our president and chief executive officer, evaluates segment performance and allocates capital based on the net contribution (charge) to earnings of the respective segments. This measure is used to monitor budget versus actual results and to benchmark performance against competitors, as well as to evaluate segment performance for capital allocation decisions. An analysis and reconciliation of our business segment information to the consolidated financial statements are included below:
Reconciliation of Net Contribution to Earnings to Net Earnings
DOLLAR AMOUNTS IN MILLIONS
Net contribution to earnings
Interest expense, net of capitalized interest
Income before income taxes
Income taxes
Net earnings
Additional Financial Information
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
CONSOLIDATED
Depreciation, depletion and amortization
Capital expenditures
Total Assets
DOLLAR AMOUNTS IN MILLIONS
TIMBERLANDS AND
WOOD
UNALLOCATED
REAL ESTATE & ENR
PRODUCTS
ITEMS
CONSOLIDATED
Total assets (1)
Assets attributable to the Real Estate & ENR segment are combined with total assets for the Timberlands segment as we do not produce separate balance sheets internally.
NOTE 3: REVENUE RECOGNITION
A majority of our revenue is derived from sales of delivered logs and manufactured wood products. We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers .
PERFORMANCE OBLIGATIONS
A performance obligation, as defined in ASC Topic 606, is a promise in a contract to transfer a distinct good or service to a customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue at the point in time, or over the period, in which the performance obligation is satisfied.
Performance obligations associated with delivered log sales are typically satisfied when the logs are delivered to our customers’ mills or delivered to an ocean vessel in the case of export sales. Performance obligations associated with the sale of wood products are typically satisfied when the products are shipped. We have elected, as an accounting policy, to treat shipping and handling that is performed after a customer obtains control of the product as an activity required to fulfill the promise to transfer the good; therefore we will not evaluate this requirement as a separate performance obligation.
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Customers are generally invoiced shortly after logs are delivered or after wood products are shipped, with payment generally due within a month or less of the invoice date. ASC Topic 606 requires entities to consider significant financing components of contracts with customers, though allows for the use of a practical expedient when the period between satisfaction of a performance obligation and payment receipt is one year or less. Given the nature of our revenue transactions, we have elected to utilize this practical expedient.
Performance obligations associated with real estate sales are generally met when placed into escrow and all conditions of closing have been satisfied.
CONTRACT ESTIMATES
Substantially all of our performance obligations are satisfied as of a point in time. Therefore, there is little judgment in determining when control transfers for our business segments as described above.
The transaction price for log sales generally equals the amount billed to our customer for logs delivered during the accounting period. For the limited number of log sales subject to a long-term supply agreement, the transaction price is variable but is known at the time of billing. For wood products sales, the transaction price is generally the amount billed to the customer for the products shipped but may be reduced slightly for estimated cash discounts and rebates.
There are no significant contract estimates related to the real estate business.
CONTRACT BALANCES
In general, customers are billed and a receivable is recorded as we ship and/or deliver wood products and logs. We generally receive payment shortly after products have been received by our customers. Contract asset and liability balances are immaterial.
For real estate sales, the company receives the entire consideration in cash at closing.
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MAJOR PRODUCTS
A Reconciliation of Revenue Recognized by our Major Products:
DOLLAR AMOUNTS IN MILLIONS
Net sales to unaffiliated customers:
Timberlands segment
Delivered logs:
West
Domestic sales
Export grade sales
Subtotal West
South
North
Subtotal delivered logs sales
Stumpage and pay-as-cut timber
Recreational and other lease revenue
Other (1)
Net sales attributable to Timberlands segment
Real Estate & ENR segment
Real estate
Energy and natural resources
Net sales attributable to Real Estate & ENR segment
Wood Products segment
Structural lumber
Oriented strand board
Engineered solid section
Engineered I-joists
Softwood plywood
Medium density fiberboard
Complementary building products
Other (2)
Net sales attributable to Wood Products segment
Total
Other Timberlands sales includes sales of seeds and seedlings from our nursery operations as well as wood chips.
Other Wood Products sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations.
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NOTE 4: TIMBERLAND ACQUISITIONS AND DIVESTITURES
VIRGINIA DIVESTITURE
In February 2026, we completed the sale of 108 thousand acres of Virginia timberlands for approximately $ 193 million . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations. However, the related assets did meet the relevant criteria to be classified as held for sale on our current period Consolidated Balance Sheet . As of December 31, 2025, assets held for sale of $ 128 million within our Timberlands segment were included in "Assets held for sale" on our Consolidated Balance Sheet .
GEORGIA AND ALABAMA DIVESTITURE
In December 2025 , we completed the sale of 86 thousand acres of Georgia and Alabama timberlands for $ 216 million , which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $ 117 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
OREGON DIVESTITURE
In October 2025, we completed the sale of 28 thousand acres of Oregon timberlands for $ 190 million, which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $ 149 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
NORTH CAROLINA AND VIRGINIA ACQUISITION
In August 2025, we completed the purchase of 117 thousand acres of North Carolina and Virginia timberlands for $ 364 million. We recorded $ 361 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 3 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
WASHINGTON ACQUISITION
In August 2025, we completed the purchase of approximately 10 thousand acres of Washington timberlands for $ 95 million. We recorded $ 94 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
ALABAMA ACQUISITIONS
In July 2024, we announced acquisitions totaling 84 thousand acres of Alabama timberlands for $ 244 million. The first transaction was completed in May 2024 and was comprised of 13 thousand acres for $ 48 million. We recorded $ 47 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The second transaction was completed in August 2024 and was comprised of 32 thousand acres for $ 82 million. We recorded $ 81 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The third transaction was completed in October 2024 and was comprised of 39 thousand acres for $ 114 million. We recorded $ 113 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
SOUTHERN TIMBERLANDS ACQUISITION AND DIVESTITURE
In December 2023, we completed the sale of 63 thousand acres of South Carolina timberlands f or $ 166 million , which is net of purchase price adjustments and closing costs. This transaction was structured as a like-kind exchange along with the acquisition discussed below. As a result of the sale, we recorde d an $ 84 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
In December 20 23, we completed the purchase of 61 thousand acres of timberlands across the Carolinas and Mississ ippi for $ 159 million, which is net of purchase price adjustments. As a result of the pu rchase, we recorded $ 157 million of timberland assets in “Timber and timberlands at cost, less depletion” and $ 2 million of related as sets in “Property and equipment, net” on our Consolidated Balance Sheet .
MISSISSIPPI ACQUISITION
In July 2023, we completed the purchase of 22 thousand acres of Mississippi timberlands for approximately $ 60 million. We recorded $ 59 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
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NOTE 5: NET EARNINGS PER SHARE
Our basic and diluted earnings per share for the last three years were:
$ 0.54 in 2024 and
HOW WE CALCULATE BASIC AND DILUTED NET EARNINGS PER SHARE
Basic earnings per share is net earnings available to common shareholders divided by the weighted average number of our outstanding common shares, including stock equivalent units where there is no circumstance under which those shares would not be issued.
Diluted earnings per share is net earnings available to common shareholders divided by the sum of the:
weighted average number of our outstanding common shares and
the effect of our outstanding dilutive potential common shares.
Dilutive potential common shares may include:
outstanding stock options,
restricted stock units and
performance share units.
Calculation of Weighted Average Number of Outstanding Common Shares – Dilutive
SHARES IN THOUSANDS
Weighted average number of outstanding shares — basic
Dilutive potential common shares:
Stock options
Restricted stock units
Performance share units
Total effect of outstanding dilutive potential common shares
Weighted average number of outstanding common shares — dilutive
We use the treasury stock method to calculate the dilutive effect of our outstanding stock options, restricted stock units and performance share units. Share-based payment awards that are contingently issuable upon the achievement of specified performance or market conditions are included in our diluted earnings per share calculation in the period in which the conditions are satisfied.
SHARES EXCLUDED FROM DILUTIVE EFFECT
The following shares were not included in the computation of diluted earnings per share because they were either antidilutive or the required performance or market conditions were not met. Some or all of these shares may be dilutive potential common shares in future periods.
Potential Shares Not Included in the Computation of Diluted Earnings per Share
SHARES IN THOUSANDS
Stock options
Performance share units
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NOTE 6: INVENTORIES
Inventories include raw materials, work-in-process and finished goods as well as materials and supplies, as shown below:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
LIFO inventories:
Logs
Lumber, plywood, oriented strand board and fiberboard
Other products
Moving average cost or FIFO inventories:
Logs
Lumber, plywood, oriented strand board, fiberboard and engineered wood products
Other products
Materials and supplies
Total
If we used FIFO for all LIFO inventories, our stated inventories would have been higher by $ 121 million as of December 31, 2025 and $ 115 million as of December 31, 2024.
HOW WE ACCOUNT FOR OUR INVENTORIES
The Inventories section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our inventories.
NOTE 7: PROPERTY AND EQUIPMENT, NET
Property and equipment includes land, buildings and improvements, machinery and equipment, roads and other items.
Carrying Value of Property and Equipment and Estimated Service Lives
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
RANGE OF LIVES
Property and equipment, at cost:
Land
Buildings and improvements
Machinery and equipment
Roads
Other
Total cost
Accumulated depreciation and amortization
Property and equipment, net
SERVICE LIVES AND DEPRECIATION
In general, additions are classified into components, each with its own estimated useful life as determined at the time of purchase.
Depreciation and amortization expense for property and equipment was:
$ 282 million in 2025,
$ 273 million in 2024 and
$ 261 million in 2023 .
NOTE 8: PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS
This note provides details about defined benefit and defined contribution plans we sponsor for our employees. The Pension and Other Post-Employment Benefit Plans section of Note 1: Summary of Significant Accounting Policies provides information about how we account for pension and other post-employment plans and benefits.
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PLANS WE SPONSOR
OVERVIEW OF PLANS
The defined benefit pension plans we sponsor in the U.S. and Canada differ according to each country’s requirements. In the U.S., we have plans that qualify under the Internal Revenue Code (qualified plans), as well as plans for select employees that provide additional benefits not qualified under the Internal Revenue Code (nonqualified plans). In Canada, we have plans that are registered under the Income Tax Act and applicable provincial pension acts (registered plans), as well as nonregistered plans for select employees that provide additional benefits that may not be registered under the Income Tax Act or provincial pension acts (nonregistered plans). We also sponsor other post-employment benefit (OPEB) plans in the U.S. and Canada, including retiree medical and life insurance plans. Our defined benefit pension plans were closed to newly hired and rehired salaried and non-union employees effective January 1, 2014, and were closed to union employees at various dates over the course of 2014 to 2019.
We sponsor various defined contribution plans for our U.S. and Canadian salaried and hourly employees. Our contributions to these plans were $ 38 million, $ 37 million and $ 35 million in 2025, 2024 and 2023, respectively.
Actions to Reduce Pension Plan Obligations
As part of our continued efforts to reduce pension plan obligations, we transferred approximate ly $ 455 million of U.S. qualified pension plan liabilities to an insurance company through the purchase of a group annuity contract in November 2025 (2025 Retiree Annuity Purchase). The contract purchase was funded from $ 440 million of U.S. qualified pension plan assets. In connection with this transaction, we recorded a noncash pretax settlement charge of $ 145 million during 2025. This settlement charge accelerated the recognition of previously unrecognized losses in "Accumulated Other Comprehensive Loss" that would have been recognized in subsequent periods, and is classified as "Non-operating pension and other post-employment benefits costs" in our Consolidated Statement of Operations .
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FUNDED STATUS OF PLANS
The funded status of the plans we sponsor is determined by comparing the projected benefit obligation with the fair value of plan assets at the end of the year. The following table demonstrates how our plans' funded status is reflected on our Consolidated Balance Sheet .
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
Projected benefit obligation at beginning of year
Service cost
Interest cost
Actuarial loss (gain) (1)
Plan participants’ contributions
Benefits paid, including lump sum and annuity transfers
Foreign currency translation and other
Projected benefit obligation at end of year
Fair value of plan assets at beginning of year (estimated)
Actual return on plan assets
Employer contributions and benefit payments
Plan participants’ contributions
Benefits paid, including lump sum and annuity transfers
Other, including foreign currency translation
Fair value of plan assets at end of year (estimated)
Presentation on our Consolidated Balance Sheet: (2)
Noncurrent assets
Current liabilities
Noncurrent liabilities
Funded status (3)
Accumulated benefit obligation at end of year
Actuarial Assumptions Used in Estimating Our Pension and OPEB Benefit Obligations:
Discount rate (4)
Rate of compensation increase (5)
Lump sum distributions election (6)
Healthcare cost trend rate:
Assumed for next year (7)
Ultimate (7)
Year when rate will reach ultimate (7)
Actuarial loss (gain) is primarily due to year-over-year changes in discount rates.
Assets and liabilities on our Consolidated Balance Sheet are different from the cumulative income or expense that we have recorded associated with the plans. The differences are actuarial loss (gain) and prior service (cost) credit that are deferred and amortized into periodic benefit costs in future periods. Unamortized amounts are recorded in "Accumulated Other Comprehensive Loss", which is a component of total equity on our Consolidated Balance Sheet . The Accumulated Other Comprehensive Loss section of Note 14: Shareholders' Interest details changes in these amounts by component.
For pension plans with a projected benefit obligation exceeding plan assets, the projected benefit obligation and fair value of plan assets were $ 1.6 billion and $ 1.2 billion at December 31, 2025 , respectively, and $ 2.0 billion and $ 1.5 billion at December 31, 2024, respectively. For pension plans with an accumulated benefit obligation exceeding plan assets, the accumulated benefit obligation and fair value of plan assets were $ 1.6 billion and $ 1.2 billion at December 31, 2025 , respectively, and $ 2.0 billion and $ 1.5 billion at December 31, 2024, respectively.
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For the U.S. defined benefit plans, the discount rate assumption was 5.3 % and 5.7 % for 2025 and 2024, respectively. For the Canadian defined benefit plans, the discount rate assumption was 4.9 % and 4.7 % for 2025 and 2024, respectively. For U.S. OPEB plans, the discount rate assumption was 5.0 % and 5.5 % for 2025 and 2024, respectively. For Canadian OPEB plans, the discount rate assumption was 4.6 % a nd 4.5 % for 2025 and 2024, respectively. For lump sum distributions (for U.S. qualified salaried and nonqualified plans only), the interest and mortality assumptions are the same as those mandated by the Pension Protection Act of 2006 for benefits commencing in the current year.
For the U.S. defined benefit plans, the rate of compensation increase assumption for both 2025 and 2024 was between 2.00 % - 13.00 % for salaried participants and was decreasing with participant age. For the Canadian defined benefit plans, the rate of compensation increase assumption was 1.00 % - 2.75 % and 2.00 % - 2.75 % for salaried and hourly participants, respectively, for both 2025 and 2024.
U.S. qualified salaried and nonqualified plans only.
For U.S. OPEB plans, the healthcare cost trend rate assumption for the next year for Pre-Medicare was 7.00 % for both 2025 and 2024. The ultimate healthcare cost trend rate was 4.50 % for both 2025 and 2024 and the assumption for the year the ultimate healthcare cost trend rate is reached was 2036 and 2035 in 2025 and 2024, respectively. For Canadian OPEB plans, the healthcare cost trend rate assumption for the next year was 4.99 % a nd 5.06 % for 2025 and 2024, respectively. The ultimate healthcare cost trend rate was 4.00 % and the assumption for the year the ultimate healthcare cost trend rate is reached was 2040 for both 2025 and 2024 .
PENSION ASSETS
Our Investment Policies and Strategies
Our investment policies, strategies and advisory agreements guide and direct how the funds are managed for the benefit plans we sponsor. These funds include our:
U.S. Pension Trust — funds our U.S. qualified pension plans;
Canadian Pension Trust — funds our Canadian registered pension plans and
Retirement Compensation Arrangements — fund a portion of our Canadian nonregistered pension plans.
U.S. and Canadian Pension Trusts
In 2018, we began to shift pension plan assets to an allocation that more closely aligns with our pension plan liability profile. Our former investment strategy included investments primarily in hedge funds and private equity funds. These asset classes are now in redemption and run-off mode. However, given the long-term nature of these investments, they will continue to comprise a portion of the plan assets for several years. We expect all investments in redemption to be redeemed at amounts materially consistent with their net asset values (NAV). As these investments are redeemed or liquidated, cash proceeds available for investment will be invested in accordance with our current investment strategy.
Our investment strategy targets a percentage allocation to growth assets and a percentage allocation to liability hedging assets based on each plan’s funded status. We expect to increase the allocation to liability hedging assets over time as the funded status of the pension plans improves. Growth assets may include investments in global public equities, hedge funds (which are in redemption), private equity assets (which are in run-off mode), fixed income and real estate and infrastructure. Liability hedging assets may include corporate credit and government issued fixed income securities as well as treasury futures selected to align with the plan liabilities.
Assets within our U.S. and Canadian pension trusts were invested as follows:
DECEMBER 31,
DECEMBER 31,
Cash and short-term investments (1)
Public equity investments (2)
Fixed income investments: (3)
Corporate
Government
Repurchase agreements
Hedge funds and related investments (4)(5)
Private equity and related investments (5)(6)
Derivative instruments, net (7)
Accrued liabilities
Total
Cash and short-term investments are valued at cost, which approximates market.
Public equity investments are valued at exit prices quoted in active markets.
Fixed income investments include publicly traded corporate and government issued debt. These bonds have varying maturities, credit quality and sector exposure and are selected to align with the duration of our plan liabilities. We have an obligation to return the cash related to these borrowings in accordance with the agreements, which are collateralized by our government bonds. Fixed income investments are valued at exit prices quoted in active or non-active markets or based on observable inputs.
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Hedge funds and related investments are privately-offered managed pools primarily structured as limited liability entities. General members or partners of these limited liability entities serve as portfolio managers and are thus responsible for the fund’s underlying investment decisions. Underlying investments within these funds may include long and short public and private equities, corporate, mortgage and sovereign debt, options, swaps, forwards and other derivative positions. These funds have varying degrees of leverage, liquidity and redemption provisions.
These investments are primarily valued based on the NAVs of the funds. These values represent the per-unit price at which new investors are permitted to invest and existing investors are permitted to exit. When NAVs as of the end of the year have not been received, we estimate fair value by adjusting the most recently reported NAVs for market events and cash flows between the interim date and the end of the year.
Private equity and related investments include both investments in private equity and investments in mezzanine, distressed, co-investments and other structures. Private equity funds generally participate in buyout and venture capital strategies through unlisted equity and debt instruments. These funds may also borrow at the underlying entity level. Mezzanine and distressed funds generally invest in the debt of public or private companies with additional participation through warrants or other equity options.
Derivative instruments include risk-mitigating futures and are valued based upon valuation statements received from each counterparty .
Retirement Compensation Arrangements
Retirement compensation arrangements fund a portion of our Canadian nonregistered pension plans. As required by Canadian tax rules, approximately 50 percent of these assets are invested into a non-interest bearing refundable tax account held by the Canada Revenue Agency. This portion of the portfolio does not earn returns. The remaining portion is invested in a portfolio of equities.
Managing Risk
Investments and contracts are subject to risks including market price, interest rate, credit, currency and liquidity risks. We mitigate these risks to our pension plan asset portfolios through advisory agreements, investment in diversified portfolios, inclusion of fixed income investments that align with plan liabilities and investment in assets designed to address both currency and liquidity considerations. In addition, we and our investment advisers perform regular monitoring with ongoing qualitative assessments, quantitative assessments and investment and operational due diligence.
Valuation of Our Plan Assets
Pension assets are stated at fair value or NAV. Fair value is based on the amount that would be received to sell an asset or paid to settle a liability in an orderly transaction between market participants at the reporting date. We consider both observable and unobservable inputs that reflect assumptions applied by market participants when setting the exit price of an asset or liability in an orderly transaction within the principal market for that asset or liability.
We value the pension plan assets based upon the observability of exit pricing inputs and classify pension plan assets based upon the lowest level input that is significant to the fair value measurement of the pension plan assets in their entirety. Refer to Note 1: Summary of Significant Accounting Policies for details on the fair value hierarchy. The availability of observable market data is monitored to assess the appropriate classification of financial instruments within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require the transfer of financial instruments from one fair value level to another. We evaluate the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total net assets available for benefits.
Investments for which fair value is measured using the NAV per share as a practical expedient are not categorized within the fair value hierarchy.
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The net pension plan assets, when categorized in accordance with this fair value hierarchy, are as follows:
DOLLAR AMOUNTS IN MILLIONS
LEVEL 1
LEVEL 2
LEVEL 3
TOTAL
LEVEL 1
LEVEL 2
LEVEL 3
TOTAL
Pension trust investments:
Cash and short-term investments
Public equity investments
Fixed income investments:
Corporate
Government
Repurchase agreements
Hedge funds and related investments (1)
Private equity and related investments (1)
Derivative instruments (2)
Total pension trust investments measured at fair value (1)
Canadian nonregistered plan assets:
Cash and short-term investments
Public equity investments
Total Canadian nonregistered plan assets measured at fair value
Total plan assets measured at fair value (1)
December 31, 2025 and 2024 exclude $ 392 million and $ 479 million, respectively, of hedge fund and private equity investments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient, which are not required to be classified in the fair value hierarchy. Additionally, December 31, 2025 and 2024 exclude $ 5 million and $ 7 million of accrued liabilities, respectively.
Derivative instruments include futures contracts. The fair value and aggregate notional value of these contracts were $ ( 1 ) million and $ 594 million at December 31, 2025 , respectively, and $( 1 ) million and $ 664 million at December 31, 2024 , respectively.
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ACTIVITY OF PLANS
Net Periodic Benefit Cost
Our net periodic benefit cost and the assumptions used to estimate it are shown in the following table.
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
Net periodic benefit cost:
Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost (credit)
Settlement charges
Net periodic benefit cost
Actuarial Assumptions Used in
Estimating Our Pension and
OPEB Net Periodic Benefit Cost:
Discount rate (1)
Expected return on assets (2)
Rate of compensation increase (3)
Lump sum distributions
election (4)
Weighted healthcare cost trend
rate (5)
For the U.S. defined benefit plans, the discount rate assumption was 5.70 %, 5.20 % and 5.40 % for 2025, 2024 and 2023, respectively. For the Canadian defined benefit plans, the discount rate assumption was 4.70 % for both 2025 and 2024 and 5.30 % for 2023. For U.S. OPEB plans, the discount rate assumption was 5.50 %, 5.10 % and 5.40 %, for 2025, 2024 and 2023, respectively. For Canadian OPEB plans, the discount rate assumption was 4.50 %, 4.60 % and 5.30 % for 2025, 2024 and 2023, respectively. For lump sum distributions (for U.S. qualified salaried and nonqualified plans only), the interest and mortality assumptions are the same as those mandated by the Pension Protection Act of 2006 for benefits commencing in the current year.
Determining our expected return requires a high degree of judgment. We consider actual pension fund asset performance over multiple years and current and expected valuation levels in the global equity and credit markets. Historical fund returns are used as a base and we place added weight on more recent pension plan asset performance.
For the U.S. defined benefit plans, the rate of compensation increase assumption for 2025, 2024 and 2023 was between 2.00 % - 13.00 % for salaried participants and was decreasing with participant age. For the Canadian defined benefit plans, the rate of compensation increase assumption for salaried participants was 1.00 % - 2.75 % for 2025, 2024 and 2023. The rate of compensation increase assumption for hourly participants was 2.00 % - 2.75 % for 2025, 2024 and 2023.
U.S. qualified salaried and nonqualified plans only.
For OPEB plans during 2025, the assumed weighted healthcare cost trend rate was 7.00 % and 5.06 % for U.S. Pre-Medicare participants and Canadian OPEB plans, respectively.
Pension Plan Contributions and Benefit Payments
Established funding standards govern the funding requirements for our qualified and registered pension plans. We fund the benefit payments of our nonqualified and nonregistered plans as benefit payments come due.
During 2025, we made a voluntary contribution of $ 200 million for our U.S. qualified pension plans in conjunction with the 2025 Retiree Annuity Purchase. Additionally, we made contributions and/or benefit payments of $ 12 million f or our U.S. nonqualified pension plans, $ 2 million for our Canadian nonregistered plans and less than $ 1 million for our Canadian registered pension plans.
During 2026, based on estimated year-end asset values and projections of plan liabilities, we expect to make contributions and/or benefit payments of approximately:
$ 8 million for our U.S. nonqualified pension plans,
$ 2 million for our Canadian non-registered plans and
less than $ 1 million f or our Canadian registered plan (required contribution).
We do not anticipate contributions being required for our U.S. qualified pension plan for 2026.
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OPEB Benefit Payments
During 2025, we contributed $ 2 million and $ 3 million to our U.S. and Canadian OPEB plans, respectively. In 2026, we expect to make contributions of $ 8 million in total for our U.S. and Canadian OPEB plans, including $ 3 million expected to be required to cover benefit payments under collectively bargained contractual obligations.
Estimated Projected Benefit Payments for the Next 10 Years
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
UNION-ADMINISTERED MULTIEMPLOYER BENEFIT PLANS
We contribute to multiemployer defined benefit plans under the terms of collective-bargaining agreements. These plans cover a small number of our employees and on an annual basis our contributions are immaterial.
These plans have different risks than single-employer plans. Our contributions may be used to fund benefits for employees of other participating employers. If we choose to stop participating, we may be required to pay a withdrawal liability based on the underfunded status of the plan . If another participating employer stops contributing to the plan, we may become responsible for remaining plan unfunded obligations.
NOTE 9: ACCRUED LIABILITIES
Accrued liabilities were comprised of the following:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Compensation and employee benefit costs
Current portion of lease liabilities (Note 16)
Customer rebates, volume discounts and deferred income
Interest
Taxes payable
Other
Total
NOTE 10: LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
OUR LINE OF CREDIT
In June 2025, we amended and restated our senior unsecured revolving credit facility to extend the expiration date to June 2030 , while increasing borrowing capacity from $ 1.5 billion to $ 1.75 billion. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread. As of December 31, 2025 and 2024, we had no outstanding borrowings on the revolving credit facility. We were in compliance with the revolving credit facility covenants as of December 31, 2025 and December 31, 2024.
OUR COMMERCIAL PAPER PROGRAM
In November 2025, we established a commercial paper program under which we may issue short-term, unsecured commercial paper notes pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. Under this program, we may issue notes from time to time in an aggregate amount not to exceed $ 1.75 billion outstanding at any time. The notes will have maturities of up to 397 days from the date of issue and will not be subject to voluntary prepayment or redemption prior to maturity. We use our revolving credit facility as a liquidity backstop for the repayment of short-term unsecured notes issued under the commercial paper program. There were no notes outstanding under this program as of December 31, 2025.
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LETTERS OF CREDIT AND SURETY BONDS
The amounts of letters of credit and surety bonds we have entered into as of the end of the last two years are included in the following table:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Letters of credit
Surety bonds
Our compensating balance requirement for our letters of credit was $ 3 million as of December 31, 2025 and December 31, 2024 .
NOTE 11: LONG-TERM DEBT, NET
This note provides details about:
debt issued and extinguished and
long-term debt and related maturities.
Our long-term debt includes notes, debentures and other borrowings.
DEBT ISSUED AND EXTINGUISHED
In November 2025, the Arkansas Development Finance Authority issued resource recovery revenue bonds for our benefit in the aggregate principal amount of $ 102 million. The net proceeds after deducting the discount, underwriting fees and issuance costs were $ 101 million. The proceeds from the issuance of these bonds were deposited directly into a restricted trust account to be used for the specific purpose for which the money was raised, which is generally to finance capital expenditures for the construction of our TimberStrand ® facility in Monticello, Arkansas. We will pay a term interest rate of 3.875 percent until October 2032, at which point the interest rate will reset. We are obligated to repay the principal amount in October 2065. Refer to Note 21: Restricted Cash for details on the portion of the proceeds which remained in the account as of December 31, 2025.
In August 2025, we entered into an $ 800 million senior unsecured term loan agreement that will mature in August 2028 . Net proceeds after fees were $ 799 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread. Additionally, we utilized approximately $ 500 million of the net proceeds of the term loan to partially redeem our $ 750 million 4.75 percent senior unsecured notes due in May 2026.
In March 2025, we repaid our $ 71 million 7.95 percent debentures at maturity. We also entered into a $ 300 million senior unsecured term loan that will mature in April 2030 . Net proceeds after fees were $ 299 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread.
In January 2025, we repaid our $ 139 million 8.50 percent debentures at maturity.
Over the course of 2023, we refinanced approximately $ 1 billion of debt.
In December 2023, we entered into a $ 250 million senior unsecured term loan that will mature in December 2028 . Net proceeds after fees were
$ 249 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed upon
base rate plus a spread. The facility also provides flexibility to enter into a mutually agreed fixed rate.
In December 2023, we repaid our $ 860 million 5.207 percent private note at maturity, funded by cash on hand, including the proceeds from our
short-term investments which matured in fourth quarter 2023.
In July 2023, we repaid our $ 118 million 7.125 percent notes at maturity.
In May 2023, we completed an offering of debt securities by issuing $ 750 million of 4.750 percent notes due in May 2026 . The net proceeds after
deducting the discount, underwriting fees and issuance costs were $ 743 million.
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LONG-TERM DEBT AND RELATED MATURITIES
The following table lists our long-term debt by types and interest rates at the end of our last two years and includes the current portion.
Long-Term Debt by Types and Interest Rates (Includes Current Portion)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
8.50 % debentures due 2025
7.95 % debentures due 2025
7.85 % debentures due 2026
7.70 % debentures due 2026
7.35 % debentures due 2026
4.75 % notes due 2026
6.95 % debentures due 2027
Variable-rate term loan matures 2028
Variable-rate term loan matures 2028
4.00 % notes due 2029
4.00 % notes due 2030
Variable-rate term loan matures 2030
7.375 % debentures due 2032
6.875 % debentures due 2033
3.375 % debentures due 2033
4.00 % debentures due 2052
3.875 % loan due 2065 (1)
Other
Total principal long-term debt
Less: unamortized discounts
Less: unamortized debt expense
Total
Principal due within one year
This loan has a 3.875 % interest rate until October 2032, at which point the interest rate will reset.
Amounts of Long-Term Debt Due Annually for the Next Five Years and Thereafter
DOLLAR AMOUNTS IN MILLIONS (1)
Thereafter
Excludes $ 35 million of unamortized discounts and capitalized debt expense.
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NOTE 12: FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF DEBT
The estimated carrying value and fair value of our long-term debt consisted of the following:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31, 2025
DECEMBER 31, 2024
CARRYING
VALUE
FAIR VALUE
(LEVEL 2)
CARRYING
VALUE
FAIR VALUE
(LEVEL 2)
Long-term debt (including current maturities) and line of credit:
Fixed rate
Variable rate
Total Debt
To estimate the fair value of fixed rate long-term debt, we used the market approach, which is based on quoted market prices we received for the same types and issues of our debt. We believe that our variable-rate long-term debt and line of credit instruments have net carrying values that approximate their fair value with only insignificant differences. The inputs to the valuations of our long-term debt are based on market data obtained from independent sources or information derived principally from observable market data. The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at the measurement date.
FAIR VALUE OF DERIVATIVE INSTRUMENTS DESIGNATED AS CASH FLOW HEDGES
The Derivative Instruments section of Note 1: Summary of Significant Accounting Policies provides information about how we account for derivative instruments as cash flow hedges.
Interest Rate Swap Hedging Relationship
In 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $ 800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $ 800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $ 800 million term loan. No comparable activity was present as of and for the year ended December 31, 2024.
An unrealized loss on interest rate swaps designated as cash flow hedging instruments of $ 3 million was recognized in "Other comprehensive income" in our Consolidated Statement of Comprehensive Income for the year ended December 31, 2025. The unrealized loss of $ 3 million was recorded in "Accumulated other comprehensive loss" on our Consolidated Balance Sheet as of December 31, 2025.
As of December 31, 2025, the current and noncurrent fair value of interest rate swaps designated as cash flow hedging instruments in a liability position of $ 1 million and $ 2 million are recorded in " Accrued Liabilities " and " Other Liabilities " on our Consolidated Balance Sheet , respectively.
Foreign Currency Hedging Relationship
In 2025, we entered into forward contracts with the risk management objective of reducing foreign exchange risk associated with the variability in cash flows from the settlement of forecasted foreign currency-denominated purchases of equipment. Our forward contracts provide the right to buy specified quantities of euros during predetermined future periods at predetermined future rates. As of December 31, 2025, all forward contracts with an aggregate notional amount of $ 32 million were designated as cash flow hedging instruments of hedged forecasted foreign-currency denominated purchases of equipment. No comparable activity was present as of and for the year ended December 31, 2024.
An unrealized gain on forward contracts designated as cash flow hedging instruments of $ 6 million was recognized in “Other comprehensive income” in our Consolidated Statement of Comprehensive Income for the year ended December 31, 2025. The unrealized gain of $ 6 million was recorded in “Accumulated other comprehensive loss” on our Consolidated Balance Sheet as of December 31, 2025.
As of December 31, 2025, the current and noncurrent fair value of forward contracts designated as cash flow hedging instruments in an asset position of $ 2 million and $ 1 million a re recorded in " Prepaid expenses and other current assets " and " Other assets " on our Consolidated Balance Sheet , respectively.
FAIR VALUE OF OTHER FINANCIAL INSTRUMENTS
We believe that our other financial instruments, including cash and cash equivalents, short-term investments, mutual fund investments held in grantor trusts, receivables and payables, have net carrying values that approximate their fair values with only insignificant differences. This is primarily due to the short-term nature of these instruments and the allowance for doubtful accounts.
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NOTE 13: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES
This note provides details about our:
legal proceedings,
environmental matters and
commitments and other contingencies.
LEGAL PROCEEDINGS
We are party to various legal proceedings arising in the ordinary course of business. We are not currently a party to any legal proceeding that management believes could have a material adverse effect on our Consolidated Balance Sheet , Consolidated Statement of Operations or Consolidated Statement of Cash Flows .
ENVIRONMENTAL MATTERS
Under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) – commonly known as the “Superfund” – and similar state laws, we are a party to various proceedings related to the cleanup of hazardous waste sites and have been notified that we may be a potentially responsible party related to the cleanup of other hazardous waste sites for which proceedings have not yet been initiated.
Kalamazoo River Site Remediation
We have received notification from the Environmental Protection Agency (EPA) and have acknowledged that we are a potentially responsible party in a portion of the Kalamazoo River Superfund site in southwest Michigan. Our involvement in the remediation site is based on our operation of the Plainwell, Michigan mill, located within the remediation site, from 1954 to 1970. Several other companies also have been deemed potentially responsible parties as past or present owners or operators of facilities within the site, or as arrangers under CERCLA.
We cooperated with other parties to jointly implement an administrative order issued by the EPA on April 14, 2016, with respect to a portion of the site comprising a stretch of the river approximately 1.7 miles long referred to as the Otsego Township Dam Area. During third quarter 2018, implementation of this administrative order was completed.
In 2010, the company, along with others, was named as a defendant by Georgia-Pacific Consumer Products LP, Fort James Corporation and Georgia-Pacific LLC in an action seeking contribution under CERCLA for remediation costs relating to a certain area within the site. On March 29, 2018, the U.S. District Court issued an opinion and order assigning the company responsibility for 5 percent of approximately $ 50 million in past costs incurred by the plaintiffs. The remaining 95 percent of this pool of past costs incurred was allocated to the plaintiffs and other defendants. The opinion and order does not establish allocation for future remediation costs, and accordingly, we may incur additional costs in connection with future remediation tasks for other areas of the site.
In 2022, the Sixth Circuit Court of Appeals reversed the District Court opinion, finding that Georgia-Pacific’s claims for cost contributions in the specific area of the site were time barred by the statute of limitations. Georgia-Pacific filed a petition for writ of certiorari with the U.S. Supreme Court, which was denied during fourth quarter 2023 and redirected to the district court for further proceedings. In 2024, the U.S. District Court issued a final judgment dismissing Georgia-Pacific’s claims for past costs but also issued a declaratory judgment finding all three parties (Georgia-Pacific, International Paper and the company) liable to each other for future costs incurred by any party. On appeal, the Sixth Circuit Court of Appeals reversed the declaratory judgment issued by the District Court and the U.S. Supreme Court subsequently denied Georgia-Pacific’s petition for writ of certiorari. As a result, the company was found not responsible for prior costs incurred by Georgia-Pacific.
Port of Everett Site Remediation
In 2008, the Port of Everett (the “Port”) filed a lawsuit in Snohomish County Superior Court in Everett, Washington (“the Court”) against the company seeking contribution and recovery of remedial action costs resulting from alleged environmental contamination at one of the company’s former mill sites. The company owned and operated a mill at the site from 1902 until 1980 and sold the mill to the Port in 1983. The lawsuit was stayed and placed on inactive status during the period between 2015 and 2024.
In 2024, the Port requested the Court to lift the stay on this matter and set a new trial date, which was subsequently granted. Trial in this matter is currently set for May 26, 2026. In November 2024, the Washington State Department of Ecology, which maintains oversight of the cleanup at the site, selected a remedy as part of the Cleanup Action Plan (“CAP”) for the site. The CAP does not establish an allocation of costs among potentially responsible parties, which includes Weyerhaeuser and the Port, and the Court has not issued any judgments as of December 2025 indicating allocation of costs. Accordingly, we may incur costs in connection with future remediation activities that exceed our current estimates. In connection with ongoing developments in this matter, we updated our estimated liability associated with the site and recorded a pretax charge of $ 18 million during fourth quarter 2025 within “Other operating costs, net” in our Consolidated Statement of Operations .
We have established accruals for estimated remediation costs for these sites and other matters for which we are a potentially responsible party. These accruals are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet .
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Changes in the Accrual for Environmental Remediation
DOLLAR AMOUNTS IN MILLIONS
Accrual balance as of December 31, 2024
Charges and adjustments, net
Payments
Accrual balance as of December 31, 2025
We change our accrual to reflect:
new information on any site concerning implementation of remediation alternatives,
updates on prior cost estimates and new sites and
costs incurred to remediate sites.
Estimates. We believe it is reasonably possible, based on currently available information and analysis, that remediation costs for all identified sites may exceed our existing accruals by up to $ 282 million. This estimate, in which those additional costs may be incurred over several years, is the upper end of the range of reasonably possible additional costs. The estimate:
is much less certain than the estimates on which our accruals currently are based and
uses assumptions that are less favorable to us among the range of reasonably possible outcomes.
In estimating our current accruals and the possible range of additional future costs, we:
assumed we will not bear the entire cost of remediation of every site,
took into account the ability of other potentially responsible parties to participate and
considered each party’s financial condition and probable contribution on a per-site basis.
We have not recorded any amounts for potential recoveries from insurance carriers.
Asset Retirement Obligations
We have obligations associated with the retirement of tangible long-lived assets consisting primarily of reforestation obligations related to forest management licenses in Canada and obligations to close and cap landfills. Some of our sites have asbestos containing materials. We have met our current legal obligation to identify and manage these materials. In situations where we cannot reasonably determine when asbestos containing materials might be removed from the sites, we have not recorded an accrual because the fair value of the obligation cannot be reasonably estimated. As of December 31, 2025 and December 31, 2024, we had an asset retirement obligation of $ 29 million and $ 34 million, respectively. These obligations are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet .
COMMITMENTS AND OTHER CONTINGENCIES
Product Remediation Contingency and Recovery
In July 2017, we announced we were implementing a solution to address concerns regarding our TJI ® Joists coated with our former Flak Jacket ® Protection product. This issue was isolated to Flak Jacket product manufactured after December 1, 2016 and did not affect any of our other products.
During the year ended December 31, 2024, we received a product remediation recovery of $ 25 million related to our prior remediation efforts for Flak Jacket. The recovery is attributable to our Wood Products segment and was recorded within “Other operating costs, net” in our Consolidated Statement of Operations . There were no product remediation recoveries recorded during the years ended December 31, 2025 and 2023.
NOTE 14: SHAREHOLDERS’ INTEREST
This note provides details about:
preferred and preference shares,
common shares,
share repurchase programs and
accumulated other comprehensive loss.
PREFERRED AND PREFERENCE SHARES
We ha d no pre ferred shares or preference shares outstanding as of December 31, 2025 or December 31, 2024. We have authorization to issue 7 million preferred shares with a par value of $ 1.00 per share and 40 million pre ference sh ares with a par value of $ 1.00 per share.
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COMMON SHARES
The number of common shares we have outstanding changes when:
new shares are issued,
stock options are exercised,
restricted stock units or performance share units vest,
stock equivalent units are settled in common shares,
shares are tendered,
shares are repurchased or
shares are canceled.
Reconciliation of Our Common Share Activity
SHARES IN THOUSANDS
Outstanding at beginning of year
Stock options exercised
Issued for vested restricted stock units
Issued for vested performance share units
Repurchased
Outstanding at end of year
SHARE REPURCHASE PROGRAMS
During second quarter 2025, we completed the $ 1 billion purchase authorization under the share repurchase program approved by the board in
September 2021 (the 2021 Repurchase Program). On May 8, 2025, we announced the board approved a new share repurchase program (the 2025 Repurchase Program) under which we are authorized to repurchase up to $ 1 billion of outstanding shares. Concurrently, the board terminated the completed purchase authorization under the 2021 Repurchase Program.
We repurchased 6,141,671 common shares for approximately $ 160 million (including transaction fees) under the share repurchase programs during 2025. As of December 31, 2025, we had remaining authorization of $ 938 million for future share repurchases.
During 2024, we repurch ased 4,887,821 common shares for approximately $ 153 million (including t ransaction fees) under the 2021 Repurchase Program.
During 2023 , we repurchased 4,054,952 common shares for approximately $ 125 million (including transaction fees) under the 2021 Repurchase Program.
All common stock repurchases under the share repurchase programs were made in open-market transactions. We record share repurchases upon trade date as opposed to the settlement date when cash is disbursed. We record a liability for repurchases that have not yet been settled as of period end. There w ere no unsettled shares as of December 31, 2025 . There were 12,436 unsettled shares (less than $ 1 million) as of December 31, 2024 and 13,866 unsettled shares (approximately $ 1 million) as of December 31, 2023.
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ACCUMULATED OTHER COMPREHENSIVE LOSS
Changes in amounts included in our accumulated other comprehensive loss by component are:
DOLLAR AMOUNTS IN MILLIONS
Pension (1)
Balance at beginning of period
Other comprehensive loss before reclassifications
Amounts reclassified from accumulated other comprehensive loss
to earnings (2)(3)
Total other comprehensive income (loss)
Balance at end of period
Other post-employment benefits (1)
Balance at beginning of period
Other comprehensive income (loss) before reclassifications
Amounts reclassified from accumulated other comprehensive loss
to earnings (2)
Total other comprehensive income (loss)
Balance at end of period
Translation adjustments and other
Balance at beginning of period
Translation adjustments
Unrealized gain on cash flow hedges (1)
Total other comprehensive income (loss)
Balance at end of period
Accumulated other comprehensive loss, end of period
Amounts are presented net of tax.
Amounts of actuarial loss and prior service (cost) credit are components of net periodic benefit cost. See Note 8: Pension and Other Post-Employment Benefit Plans .
Amounts include an after-tax settlement charge of $ 111 million related to our pension plans for the year ended December 31, 2025. There were no settlement charges related to our pension plans for the years ended December 31, 2024 and December 31, 2023. See Note 8: Pension and Other Post-Employment Benefit Plans for further detail.
NOTE 15: SHARE-BASED COMPENSATION
This note provides details about:
our Long-Term Incentive Compensation Plan (2022 Plan),
how we account for share-based awards,
tax benefits of share-based awards,
types of share-based compensation,
unrecognized share-based compensation and
deferred compensation stock equivalent units.
Share-based compensation expense was:
$ 43 million in 2025,
$ 43 million in 2024 and
$ 36 million in 2023.
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OUR LONG-TERM INCENTIVE COMPENSATION PLAN
Our long-term incentive plan provides for share-based awards that include:
restricted stock,
restricted stock units (RSUs),
performance shares and
performance share units (PSUs).
We may issue future grants of up to 20 million shares under the 2022 Plan. We also have the right to reissue forfeited and expired grants. The Compensation Committee of our board of directors annually establishes an overall pool of stock awards available for grants based on performance.
For stock-settled awards, we issue new stock into the marketplace and generally do not repurchase shares in connection with issuance of new awards.
Our common shares would increase by approximately 24 million shares if all share-based awards were exercised or vested. These include:
all outstanding share-based awards at December 31, 2025 and
all remaining RSUs and PSUs that could be granted under the 2022 Plan.
HOW WE ACCOUNT FOR SHARE-BASED AWARDS
We recognize the cost of share-based awards using a fair-value-based measurement in our Consolidated Statement of Operations over the required service period — generally the period from the date of the grant to the date when it is fully vested. Special situations include:
Awards that vest upon retirement — the required service period ends on the date an employee is eligible for retirement, including early retirement.
Awards that continue to vest following job elimination or the sale of a business — the required service period ends on the date the employment from the company is terminated.
In these special situations, compensation expense from share-based awards is recognized over a period that is shorter than the stated vesting period. Forfeitures are recognized in compensation expense as they occur.
TAX BENEFITS OF SHARE-BASED AWARDS
Our total income tax benefit from share-based awards recognized in our Consolidated Statement of Operations for the last three years was:
$ 5 million in 2025,
$ 6 million in 2024 and
$ 5 million in 2023.
Tax benefits from share-based awards are accrued as stock compensation expense and realized when restricted shares, performance shares, RSUs and PSUs vest.
TYPES OF SHARE-BASED COMPENSATION
Our share-based compensation is in the form of RSUs and PSUs.
RESTRICTED STOCK UNITS
Through the 2022 Plan, we award RSUs — grants that entitle the holder to shares of our stock as the award vests.
The Details
Our RSUs granted in 2025, 2024 and 2023 generally:
vest ratably over four years ;
immediately vest in the event of death or disability while employed;
continue to vest upon retirement at an age of at least 62, in accordance with the vesting terms of the awards, but a portion of the award is forfeited if retirement occurs before the one-year anniversary of the grant;
continue vesting for one year in the event of involuntarytermination due to job elimination;
immediately vest in the case of a change of control, if the successor company does not assume the award or, if assumed, within two years of the effective date of the change in control the recipient is terminated other than for cause or leaves for good reason (as defined in the award terms and conditions) and
will be forfeited upon termination of employment in all other situations including early retirement prior to age 62.
Our Accounting
The fair value of our RSUs is the market price of our stock on the grant date of the awards.
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We generally record share-based compensation expense for RSUs over the four-year vesting period. Generally, for RSUs that continue to vest following the termination of employment, we record the share-based compensation expense over a required service period that is less than the stated vesting period.
Activity
The following table shows our RSU activity for 2025:
RESTRICTED
WEIGHTED
AVERAGE
STOCK UNITS
GRANT-DATE
(IN THOUSANDS)
FAIR VALUE
Nonvested at December 31, 2024
Granted
Vested
Forfeited
Nonvested at December 31, 2025 (1)
As of December 31, 2025, there were approximately 261 thousand RS Us that had met the requisite service period and will be released as identified in the grant terms.
The weighted average grant-date fair value for RSUs was:
$ 29.70 for 2025 grants,
$ 32.92 for 2024 grants and
$ 33.81 for 2023 grants.
The total grant-date fair value of RSUs vested was:
$ 25 million in 2025,
$ 24 million in 2024 and
$ 22 million in 2023.
Nonvested RSUs accrue dividends that are paid out when RSUs vest. Any RSUs forfeited will not receive dividends.
As RSUs vest, a portion of the shares awarded is withheld to cover employee taxes. As a result, the number of stock units vested and the number of common shares issued will differ.
PERFORMANCE SHARE UNITS
Through the 2022 Plan, we award PSUs — grants that entitle the holder to shares of our stock as the award vests.
The Details
The final number of shares granted in 2025, 2024 and 2023 will vest between a range of 0 percent to 150 percent of each grant’s target, depending upon actual company total shareholder return (TSR) compared against the TSR of an industry peer group. TSR assumes full reinvestment of dividends.
The vesting provisions for PSUs granted in 2025, 2024 and 2023 were generally as follows:
awards vest on March 1st following the end of the performance period, in each case as long as the individual remains employed by the company;
in the event of death or disability while employed, awards continue to be earned and settled based on actual company performance;
upon retirement at an age of at least 62, awards continue to vest in accordance with the vesting terms of the award, but a portion of the award is forfeited if retirement occurs before the one-year anniversary of the grant;
awards continue vesting for one year in the event of involuntarytermination due to job elimination and the second anniversary of the grant date has passed;
in the case of a change of control during the performance period, awards are deemed earned at target performance and (i) vest as of the change of control date if the successor company does not assume the award or (ii) if assumed, vest upon termination of employment if, within two years of the effective date of the change in control, the recipient is involuntarilyterminated other than for cause or leaves for good reason (as defined in the award terms and conditions);
awards will be forfeited upon termination of employment in all other situations including early retirement prior to age 62 and
awards vest at a maximum of 100 percent of target value in the event of negative absolute company TSR.
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Our Accounting
Since the awards contain a market condition, the effect of the market condition is reflected in the grant-date fair value which is estimated using a Monte Carlo simulation model. This model estimates the TSR ranking of the company over the performance period. Compensation expense is based on the estimated probable number of earned awards and recognized over the vesting period on an accelerated basis. Generally, compensation expense would not be reversed if the market condition is not achieved, provided the requisite service period has been completed.
Weighted Average Assumptions Used in Estimating the Value of PSUs
GRANTS
GRANTS
GRANTS
Performance period
Risk-free rate
Volatility
Valuation date closing stock price
Activity
The following table shows our PSU activity for 2025:
PERFORMANCE SHARE UNITS
WEIGHTED
AVERAGE
GRANT-DATE
(IN THOUSANDS)
FAIR VALUE
Nonvested at December 31, 2024
Granted at target
Vested
Forfeited
Performance adjustment
Nonvested at December 31, 2025 (1)
As of December 31, 2025, there were approximately 181 thousand PSUs that had met the requisite service period and will be released as identified in the grant terms.
The weighted average grant-date fair value for PSUs was:
$ 32.50 for 2025 grants,
$ 37.90 for 2024 grants and
$ 37.58 for 2023 grants.
The total grant-date fair value of PSUs vested was:
$ 7 million in 2025,
$ 12 million in 2024 and
$ 8 million in 2023.
Nonvested PSUs accrue dividends that are paid out when PSUs vest. Any PSUs forfeited will not receive dividends.
As PSUs vest, a portion of the shares awarded is withheld to cover participant taxes. As a result, the number of share units vested and the number of common shares issued will differ.
UNRECOGNIZED SHARE-BASED COMPENSATION
As of December 31, 2025, our unrecognized share-based compensation cost for all types of share-based awards included $ 54 million related to non-vested equity-classified share-based compensation arrangements. These are expected to be recognized over a weighted average period of approximately 2.3 years.
DEFERRED COMPENSATION STOCK EQUIVALENT UNITS
Certain employees and our board of directors may defer compensation into stock equivalent units.
The Details
Eligible employees:
may choose to defer all or part of their bonus into stock equivalent units and
receive a 15 percent premium if the deferral is for at least five years.
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Our directors:
receive a portion of their annual retainer fee in the form of RSUs, which vest over one year and may be deferred into stock equivalent units;
may choose to defer some or all of the remainder of their annual retainer fee into stock equivalent units and
do not receive a premium for their deferrals.
Employees and directors also choose when the deferrals will be paid out, although no deferrals may be paid until after the separation from service of the employee or director.
Our Accounting
We settle all deferred compensation accounts in cash for our employees. Our directors receive shares of common stock as payment for stock equivalent units, except that any directors who are subject to federal or provincial taxation in Canada have the choice to receive a cash amount equal to the fair market value of the company’s common stock on the date of payment. In addition, we credit all stock equivalent accounts with dividend equivalents. The number of common shares to be issued in the future to directors is 484 thousand as of December 31, 2025.
Stock equivalent units are liability-classified awards and remeasured to fair value at every reporting date.
The fair value of a stock equivalent unit is equal to the market price of our stock.
Activity
The number of stock equivalent units outstanding in our deferred compensation accounts was:
498 thousand as of December 31, 2025,
506 thousand as of December 31, 2024 and
530 thousand as of December 31, 2023.
NOTE 16: LEASES
The majority of our operating leases are related to our office and warehouse space, and our financing leases are related to vehicles and warehouse space. Our leases have remaining lease terms of approximately 1 year to 25 years . Options to renew, extend or terminate a lease are reflected in our lease terms when we believe it is reasonably certain we will exercise that option. When our leases do not provide an implicit or an explicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments.
Lease Expense
DOLLAR AMOUNTS IN MILLIONS
Operating lease costs
Financing lease costs
Total lease costs
Supplemental Cash Flow Information
DOLLAR AMOUNTS IN MILLIONS
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases
Financing cash flows for financing leases (1)
ROU assets obtained in exchange for new (modified) lease liabilities:
Operating leases
Financing leases
Interest expense related to financing leases was immaterial during 2025, 2024 and 2023 .
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Supplemental Balance Sheet Information Related to Leases
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
LEASES
BALANCE SHEET CLASSIFICATION
Assets
Operating lease ROU assets
Other assets
Financing lease ROU assets
Property and equipment, net
Total leased assets
Liabilities
Current:
Operating lease liabilities
Accrued liabilities
Financing lease liabilities
Accrued liabilities
Noncurrent:
Operating lease liabilities
Other liabilities
Financing lease liabilities
Other liabilities
Total lease liabilities
Weighted Average Remaining Lease Term
DECEMBER 31,
DECEMBER 31,
Operating leases
9 years
10 years
Financing leases
4 years
3 years
Weighted Average Discount Rate
DECEMBER 31,
DECEMBER 31,
Operating leases
Financing leases
Maturities of Lease Liabilities as of December 31, 2025
DOLLAR AMOUNTS IN MILLIONS
OPERATING
LEASES
FINANCING
LEASES
Thereafter
Total lease payments
Less: interest
Total present value of lease liabilities
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NOTE 17: OTHER OPERATING COSTS, NET
Other operating costs, net:
includes both recurring and non-recurring income and expense items and
can fluctuate from year to year.
Income and Expense Items Included in Other Operating Costs, Net
DOLLAR AMOUNTS IN MILLIONS
Environmental remediation charges
Gain on lumber mill sale
Insurance recoveries
Litigation expense, net
Product remediation recovery
Research and development expenses
Restructuring, impairments and other charges
Other, net
Total other operating costs, net
ASSET IMPAIRMENT
During third quarter 2024, we recorded a $ 10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill. The loss was attributable to our Wood Products segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
ENVIRONMENTAL REMEDIATION
During fourth quarter 2025, we recorded an $ 18 million noncash environmental remediation charge. This charge was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
During second quarter 2023, we recorded an $ 11 million noncash environmental remediation charge. This charge was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
INSURANCE RECOVERIES
During third quarter 2025, we received a $ 26 million insurance recovery. This recovery was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
During fourth quarter 2023, we received a $ 14 million insurance recovery related to property damage and business interruption for certain of our mills in the southern U.S. as a result of severe winter storm damage in first quarter 2021. This recovery was attributable to our Wood Products segment and was recorded within “Other operating costs, net” in our Consolidated Statement of Operations .
GAIN ON LUMBER MILL SALE
During third quarter 2025, we recorded a $ 29 million gain from the sale of our Princeton lumber mill. The gain was attributable to our Wood Products segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
PRODUCT REMEDIATION RECOVERY
Refer to Note 13: Legal Proceedings, Commitments and Contingencies for further information.
NOTE 18: INCOME TAXES
This note provides details about income taxes applicable to our operations, including the following:
earnings before income taxes,
provision for income taxes,
effective income tax rate,
deferred tax assets and liabilities and
unrecognized tax benefits.
The Income Taxes section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our income taxes.
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EARNINGS BEFORE INCOME TAXES
Domestic and Foreign Earnings Before Income Taxes
DOLLAR AMOUNTS IN MILLIONS
Domestic earnings
Foreign earnings
Total earnings before income taxes
PROVISION FOR INCOME TAXES
DOLLAR AMOUNTS IN MILLIONS
Current:
Federal
State
Foreign
Total current
Deferred:
Federal
State
Foreign
Total deferred
Total income tax (benefit) provision
EFFECTIVE INCOME TAX RATE
DOLLAR AMOUNTS IN MILLIONS
Dollars
Percent
Dollars
Percent
Dollars
Percent
U.S. federal statutory income tax
Domestic, Federal
REIT income not subject to federal income tax
Nontaxable and nondeductible items
Intra-entity transfers
Return to provision adjustment
Other
Domestic state and local income taxes, net of federal effect (1)
Foreign tax effects
Canada
Income tax rate differential
Provincial income taxes
Withholding taxes
Other
Total income tax (benefit) provision
In 2025, state and local income taxes in Mississippi and Louisiana contributed to the majority of domestic state income taxes, net of federal effect. In 2024 and 2023, state and local income taxes in Oregon contributed to the majority of domestic state income taxes, net of federal effect.
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INCOME TAXES PAID
DOLLAR AMOUNTS IN MILLIONS
U.S. Federal
U.S. State and local
Foreign
Canada
Subtotal foreign taxes paid
Total income taxes paid
DEFERRED TAX ASSETS AND LIABILITIES
Deferred tax assets and liabilities reflect the future tax effect created by differences between the timing of when income or deductions are recognized for pretax financial book reporting purposes versus income tax purposes. Deferred tax assets represent a future tax benefit (or reduction to income taxes in a future period), while deferred tax liabilities represent a future tax obligation (or increase to income taxes in a future period).
Balance Sheet Classification of Deferred Income Tax Assets (Liabilities)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Net noncurrent deferred tax asset
Net noncurrent deferred tax liability
Net deferred tax asset (liability)
Items Included in Our Deferred Income Tax Assets (Liabilities)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Deferred tax assets:
Pension and post-employment benefits
State tax credits
Environmental reserves
Intra-entity transfers
Net operating loss carryforwards
Other
Gross deferred tax assets
Valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Property, plant and equipment
Other
Net deferred tax liabilities
Net deferred tax asset (liability)
Net Operating Loss and Credit Carryforwards
Our gross federal, state and foreign net operating loss carryforwards as of December 31, 2025 totaled $ 1.5 billion as follows:
Federal — U.S. REITs — $ 245 million that do not expire; U.S. TRSs — $ 561 million that do not expire;
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State — $ 705 million, $ 552 million of the total will begin to expire in 2028 and
Foreign — none currently recorded.
Our gross state credit carryforwards as of December 31, 2025 totaled $ 60 million , which includes $ 10 million that expire from 2026 through 2037 . Our U.S. TRSs hav e $ 8 million in foreign tax credit carryforwards that expire from 2027 through 2031 .
Valuation Allowances
With the exception of the valuation allowance discussed below, we believe it is more likely than not that we will have sufficient future taxable income to realize our deferred tax assets.
Our valuation allowance on our deferred tax assets was $ 81 million as of December 31, 2025, which related to state credits, state net operating losses and foreign tax credits.
UNRECOGNIZED TAX BENEFITS
Unrecognized tax benefits represent potential future obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. In accordance with our accounting policy, we accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense (see Note 1: Summary of Significant Accounting Policies ). The total gross amount of unrecognized tax benefits as of December 31, 2025 and 2024, as well as the activity during those years, were immaterial.
As of December 31, 2025, none of our U.S. federal income tax returns are under examination, with tax years 2022 forward open to examination. We are undergoing examination in foreign jurisdictions for the 2022 tax year, with tax years 2018 forward open to examination. We are undergoing examinations in state jurisdictions for tax years 2020 through 2024, with tax years 2009 forward open to examination. We do not expect that the outcome of any examination will have a material effect on our consolidated financial statements; however, audit outcomes and the timing of audit settlements are subject to significant uncertainty.
TAX LEGISLATION
On July 4, 2025, H.R. 1, commonly known as the One Big, Beautiful Bill Act (the OBBBA), was enacted. The OBBBA contains significant changes to corporate taxation, including accelerated deductions for capital spending, expensing of research and development costs and increased deductibility of interest expense. Additionally, effective for taxable years beginning after December 31, 2025, the value of TRS securities that a REIT may hold will increase from 20 percent to 25 percent of the value of the REIT’s total assets. The enactment of the OBBBA did not materially impact our 2025 financial statements.
NOTE 19: GEOGRAPHIC AREAS
This note provides selected key financial data according to the geographical locations of our customers.
SALES
Our sales to unaffiliated customers outside the U.S. are primarily to customers in Canada, Japan, China and Korea. Our export sales from the U.S. are comprised primarily of logs, lumber and wood chips to customers in those same countries.
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Sales by Geographic Area
DOLLAR AMOUNTS IN MILLIONS
Sales to unaffiliated customers:
Canada
Japan
China
Korea
Other foreign countries
Total
Export sales from the U.S.:
Japan
Canada
China
Korea
Other foreign countries
Total
LONG-LIVED ASSETS
Our long-lived assets used in the generation of revenues in different geographical areas are nearly all in the U.S. and Canada. Our long-lived assets primarily include:
property and equipment, including construction in progress,
timber and timberlands and
minerals and mineral rights.
Long-Lived Assets by Geographic Area
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Canada
Total
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NOTE 20: PRINCETON LUMBER MILL DIVESTITURE
On September 2, 2025, we completed the sale of our Princeton lumber mill for approximately $ 85 million. The total purchase price is inclusive of mill assets, the associated timber licenses in British Columbia and the value of working capital as of the closing date. Pursuant to the transaction closing, a gain on the sale of $ 29 million was recognized within our Wood Products segment in "Other operating costs, net" in our Consolidated Statement of Operations . The transfer of all associated timber licenses in British Columbia remains subject to regulatory approval as of fourth quarter 2025, which we expect will follow in the ensuing months. A portion of the total purchase price is held in escrow as of the date of the sale and will be released in conjunction with the transfer of the associated timber licenses. We recorded this portion within "Receivables, net" and "Other assets, net" on our Consolidated Balance Sheet .
NOTE 21: RESTRICTED CASH
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported on our Consolidated Balance Sheet that sum to the total of the amounts shown in our Consolidated Statement of Cash Flows :
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Cash and cash equivalents
Restricted cash included in prepaid expenses and other current assets (1)
Total cash, cash equivalents and restricted cash
Amounts included in restricted cash as of December 31, 2025 were comprised of the remaining loaned proceeds from the issuance of 3.875 % resource recovery revenue bonds due in October 2065 that were restricted for use to reimburse capital expenditures incurred in the construction of our TimberStrand ® facility in Monticello, Arkansas. In first quarter 2026, we satisfied the contractual restrictions for release of these funds.
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CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
The company’s principal executive officer and principal financial officer have evaluated the effectiveness of the company’s disclosure controls and procedures as of the end of the period covered by this annual report on Form 10-K. Disclosure controls are controls and other procedures that are designed to ensure that information required to be disclosed in the reports filed or submitted under the Securities Exchange Act of 1934, as amended (Act), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s (SEC) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, to allow timely decisions regarding required disclosure.
Based on their evaluation, the company’s principal executive officer and principal financial officer have concluded that the company’s disclosure controls and procedures are effective to ensure that information required to be disclosed complies with the SEC’s rules and forms.
CHANGES IN INTERNAL CONTROL
No changes occurred in the company's internal control over financial reporting during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal control over financial reporting as is defined in the Securities Exchange Act of 1934 rules. Management, under our supervision, conducted an evaluation of the effectiveness of the company’s internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under the framework in Internal Control — Integrated Framework (2013), management concluded that the company’s internal control over financial reporting was effective as of December 31, 2025. The effectiveness of the company’s internal control over financial reporting as of December 31, 2025 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report, which is included herein.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors
Weyerhaeuser Company:
Opinion on Internal Control Over Financial Reporting
We have audited Weyerhaeuser Company and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, cash flows, and changes in equity for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements), and our report dated February 13, 2026 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Seattle, Washington
February 13, 2026
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OTHER INFORMATION
INFORMATION REQUIRED PURSUANT TO FORM 8-K
The following disclosures are provided in compliance with Item 5.02(e) of Form 8-K.
On February 13, 2026, the company’s board of directors approved certain amendments to the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees. The plan, which sets forth the general terms and conditions for the annual cash incentive bonus for employees, including the company’s executive officers, was amended and restated primarily to give the compensation committee of the board of directors greater flexibility to establish performance goals and to clarify management’s authority with respect to non-executive officer plan participant bonus awards.
In accordance with Item 9.01(d) of Form 8-K, a copy of the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees, as amended and restatedeffective as of February 13, 2026, is filed as Exhibit 10(u) to this annual report on Form 10-K.
The foregoing description of the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees, as amended and restatedeffective as of February 13, 2026, is a general description only, does not purport to be complete and is qualified in its entirety by reference to the plan, which is filed as an exhibit to this annual report on Form 10-K and is incorporated herein by reference.
INSIDER TRADING ARRANGEMENTS
During fourth quarter 2025 , no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the company adopted, modified or terminated a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or a non-Rule 10b5-1 trading arrangement.
D IRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
A list of our executive officers and their biographical information can be found in Part I of this report in the Our Business — Information About Our Executive Officers section. Other information required by this item to Form 10-K will be set forth under the headings "Item 1. Election of Directors,” “Corporate Governance” and "Executive Compensation" in our Notice of the 2026 Annual Meeting and Proxy Statement for the company’s Annual Meeting of Shareholders to be held May 15, 2026, which will be filed not later than 120 days after December 31, 2025 (2026 Proxy Statement), and in each case such required information is incorporated herein by reference.
The Weyerhaeuser Code of Ethics applies to our chief executive officer (our principal executive officer), our chief financial officer (our principal financial officer) and our chief accounting officer (our principal accounting officer), as well as other officers, directors and employees of the company. Our Code of Ethics is available on our website at https://www.weyerhaeuser.com/company/values/integrity/. We will satisfy any disclosure requirement under Item 5.05 of Form 8-K regarding any reportable amendment to, or waiver from, any provision of the Code of Ethics by disclosing the nature of any such amendment or waiver on our website within four business days following the date thereof.
EXECUTIVE COMPENSATION
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the headings “Director Compensation," “Executive Compensation,” “Compensation Committee Report” and “Compensation Committee Interlocks and Insider Participation,” and in each case such required information is incorporated herein by reference.
S ECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Stock Information,” and such required information is incorporated herein by reference.
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Corporate Governance,” and such required information is incorporated herein by reference.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Our independent registered public accounting firm is KPMG LLP, Seattle, WA, Auditor Firm ID: 185 .
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Item 3. Ratify Appointment of the Independent Auditors,” and such required information is incorporated herein by reference.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
All financial statement schedules have been omitted because they are not applicable or the required information is included in the consolidated financial statements, or the notes thereto, in Financial Statements and Supplementary Data above.
The agreements included as exhibits to this annual report are included to provide information about their terms and not to provide any other factual or disclosure information about the company or the other parties to the agreements. The agreements may contain representations and warranties by each party to the applicable agreement that were made solely for the benefit of the other party to the agreement and should not be treated as categorical statements of fact, but rather as a way of allocating the risk among the parties if those statements prove to be inaccurate. These representations and warranties may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement, may apply standards of materiality in a way that is different from what may be viewed as material to investors, were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement, and are subject to more recent developments. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time.
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EXHIBITS
Articles of Incorporation
Articles of Incorporation (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q filed on May 6, 2011 – Commission File Number 1-4825, and to Exhibit 3.1 to the Current Report on Form 8-K filed on June 20, 2013 – Commission File Number 1-4825)
Bylaws (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q filed on October 26, 2018 – Commission File Number 1-4825)
Instruments Defining the Rights of Security Holders, Including Indentures
Indenture dated as of April 1, 1986 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 333-36753 )
First Supplemental Indenture dated as of February 15, 1991 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 33-52982)**
Second Supplemental Indenture dated as of February 1, 1993 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 33-59974)**
Third Supplemental Indenture dated as of October 22, 2001 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4(d) to the Registration Statement on Form S-3, Registration No. 333-72356)
Fourth Supplemental Indenture dated as of March 12, 2002 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4.8 from the Registration Statement on Form S-4/A, Registration No. 333-82376)
Fifth Supplemental Indenture dated as of March 30, 2020 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on March 30, 2020 - Commission File Number 1-4825)
Officer’s Certificate dated February 25, 2019 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on February 25, 2019 – Commission File Number 1-4825)
Officer’s Certificate dated March 30, 2020 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on March 30, 2020 – Commission File Number 1-4825)
Officer’s Certificate dated March 9, 2022 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on March 9, 2022 – Commission File Number 1-4825)
Officer’s Certificate dated May 17, 2023 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on May 17, 2023 – Commission File Number 1-4825)
As permitted by SEC regulations, the company has not filed certain instruments defining the rights of holders of long-term debt of the company or its consolidated subsidiaries under which the total amount of securities authorized does not exceed 10% of the total assets of the company and its consolidated subsidiaries. The company agrees to furnish to the SEC upon request a copy of any omitted instrument.
Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4(r) to the Annual Report on Form 10-K for the annual period ended December 31, 2019 – Commission File Number 1-4825)
Material Contracts
Form of Weyerhaeuser Executive Change of Control Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser CEO Change of Control Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Executive Severance Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser CEO Severance Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser Company 2013 Long-Term Incentive Plan (Amended and RestatedEffective August 14, 2020) (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed on October 30, 2020 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2013 Long-Term Incentive Plan Stock Option Award Terms and Conditions (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on April 16, 2013 – Commission File Number 1-4825)*
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Form of Weyerhaeuser Company 2013 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2022 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 24, 2022 – Commission File Number 1-4825)*
Weyerhaeuser Company 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2022 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2023 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 23, 2023 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2023 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 23, 2023 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 24, 2024 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2024 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 24, 2024 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2025 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 28, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2025 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 28, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2026 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 27, 2026 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2026 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 27, 2026 – Commission File Number 1-4825)*
Plum Creek Supplemental Pension Plan (incorporated by reference to Exhibit 10(dd) to the Annual Report on Form 10-K for the annual period ended December 31, 2016 – Commission File Number 1-4825)*
Plum Creek Pension Plan (incorporated by reference to Exhibit 10(ee) to the Annual Report on Form 10-K for the period ended December 31, 2016 – Commission File Number 1-4825)*
Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees (as amended effective February 14, 2020) (incorporated by reference to Exhibit 10(u) to the Annual Report on Form 10-K for the annual period ended December 31, 2019 – Commission File Number 1-4825)*
Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees (as amended effective February 13, 2026)*
Weyerhaeuser Company 2015 Deferred Compensation Plan (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on December 22, 2014 – Commission File Number 1-4825)*
Weyerhaeuser Company 2023 Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 17, 2022 – Commission File Number 1-4825)*
Weyerhaeuser Company Salaried Employees Supplemental Retirement Plan (incorporated by reference to Exhibit 10(p) to the Annual Report on Form 10-K for the annual period ended December 31, 2004 – Commission File Number 1-4825)*
2011 Fee Deferral Plan for Directors of Weyerhaeuser Company (Amended and RestatedEffective January 1, 2016) (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on May 6, 2016 – Commission File Number 1-4825)*
2011 Fee Deferral Plan for Directors of Weyerhaeuser Company (Amended and RestatedEffective August 14, 2020) (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on October 30, 2020 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Director Restricted Stock Unit Award Terms and Conditions for Plan Years beginning May 13, 2022 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Amended and Restated Revolving Credit Facility Agreement dated as of June 30, 2025 among Weyerhaeuser Company, as Borrower, the lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 3, 2025 – Commission File Number 1-4825)
Term Loan Agreement dated as of August 25, 2025 among Weyerhaeuser Company, as Parent, Weyerhaeuser NR Company, as Borrower, the lenders party thereto, and Truist Bank, as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 28, 2025 – Commission File Number 1-4825)
Guarantee Agreement dated as of August 25, 2025 between Weyerhaeuser Company, as Guarantor, and Truist Bank, as Administrative Agent (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on August 28, 2025 – Commission File Number 1-4825)
Weyerhaeuser Company Insider Trading Policy (incorporated by reference to Exhibit 19 to the Annual Report on Form 10-K for the annual period ended December 31, 2024 – Commission File Number 1-4825)
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Subsidiaries of the Registrant
Consent of Independent Registered Public Accounting Firm
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended
Certification pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350)
Weyerhaeuser Compensation Recovery Policy (incorporated by reference to Exhibit 97 to the Annual Report on Form 10-K for the annual period ended December 31, 2023 – Commission File Number 1-4825)*
The cover page from Weyerhaeuser Company’s Annual Report on Form 10-K for the year ended December 31, 2024 has been formatted in Inline XBRL.
* Denotes a management contract or compensatory plan or arrangement.
** Filed in paper - hyperlink not required pursuant to Rule 105 of Regulation S-T
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized February 13, 2026.
WEYERHAEUSER COMPANY
/s/ DEVIN W. STOCKFISH
Devin W. Stockfish
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities indicated February 13, 2026.
/s/ DEVIN W. STOCKFISH
/s/ DAVID M. WOLD
Devin W. Stockfish
Principal Executive Officer and Director
David M. Wold
Principal Financial Officer
/s/ ALEX G. WHITNEY
/s/ KIM WILLIAMS
Alex G. Whitney
Principal Accounting Officer
Kim Williams
Director
/s/ SARA GROOTWASSINK LEWIS
/s/ RICK R. HOLLEY
Sara Grootwassink Lewis
Director
Rick R. Holley
Chairman of the Board and Director
/s/ NICOLE W. PIASECKI
/s/ AL MONACO
Nicole W. Piasecki
Director
Al Monaco
Director
/s/ LAWRENCE A. SELZER
/s/ DEIDRA C. MERRIWETHER
Lawrence A. Selzer
Director
Deidra C. Merriwether
Director
/s/ MARK A. EMMERT
/s/ JAMES C. O’ROURKE
Mark A. Emmert
Director
James C. O’Rourke
Director
/s/ RICHARD BECKWITT
Richard Beckwitt
Director
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more available supply. However, additional mill capacity being added in the U.S. South has led to tightening of markets in certain geographies. Our Real Estate, Energy and Natural Resources segment is affected by a variety of factors, including the general state of the economy, local real estate market conditions, the level of construction activity in the U.S. and evolution of emerging renewable energy and carbon-related markets.
Ongoing U.S. trade policy changes have resulted in macroeconomic uncertainty and increased cautiousness by consumers. These policies, along with potential countermeasures by other countries, have the potential to affect supply and demand trends, import and export dynamics, and pricing for our products. Trade and tariff policies are generally separate from the annual establishment and collection of anti-dumping and countervailing duties (AD/CVD) placed on certain products and countries, such as for Canadian softwood lumber.
The discussion below includes a number of publicly available data points, many of which are obtained from U.S. federal government institutions. Due to the federal government shutdown that ended in November, availability of these data points is limited to October or November 2025. All other data points are updated through fourth quarter 2025.
Home sales and building activity continue to moderate in response to elevated mortgage interest rates, reduced affordability and lower consumer confidence. While overall housing inventory remains historically low across many markets, there has been some increase in unsold new and existing single-family units. On a seasonally adjusted annual basis, as reported by the U.S. Census Bureau, housing starts for October 2025 averaged 1.2 million units, a 7.0 percent decrease from third quarter 2025. Single-family starts averaged 874 thousand units in October 2025, a 1.0 percent decrease from third quarter 2025. Multi-family starts averaged 372 thousand units in October 2025, an 18.4 percent decrease from third quarter 2025. Single-family construction is the primary driver for our business as compared to multi-family due to the amount of wood products used. Sales of newly built single-family homes averaged a seasonally adjusted annual rate of 737 thousand units for October 2025, a 5.9 percent increase from third quarter 2025, driven by builder incentives and moderate relief in mortgage rates. Notwithstanding current macroeconomic uncertainty and potential impacts to housing demand, we expect a favorable U.S. housing construction market over the medium to long-term, supported by strong demographics in the key home buying age cohorts and a decade of under building.
Repair and remodeling expenditures decreased 0.6 percent from third quarter 2025 to the end of November 2025, according to the Census Bureau Advance Retail Spending report. While there continues to be steady demand due to growing home equity and the lock-in effect of lower mortgage rates compared to current rates, many homeowners have been more cautious in discretionary spending on large projects. Recent softness has been reflected in both the do-it-yourself (DIY) and professionally built segments, largely driven by subdued consumer confidence, elevated interest rates and concerns around the trajectory of the economy. Slower sales of existing homes have also contributed to muted activity as there is often an increase in upgrades and repairs before and after the sale of a home. Over the longer term, we expect this sector to return to historical growth trends driven by recent deferrals in repair and remodel spending, higher levels of home equity and an aging U.S. housing stock, with a median age of 46 years.
In U.S. wood product markets, soft end use demand and steady supply have led to continued price weakness in commodity products. In fourth quarter 2025, the Random Lengths Framing Lumber Composite price averaged $378/MBF and the OSB Composite averaged $234/MSF, both near multi-decade lows on an inflation-adjusted basis. Over the course of fourth quarter 2025, composite prices for lumber increased from $367/MBF to $385/MBF and composite prices for OSB decreased from $237/MSF to $230/MSF. The Framing Lumber Composite began the fourth quarter on a slight upward trajectory supported by improving Western SPF pricing and broader concerns around the Section 232 tariff, which took effect in October. As the quarter progressed, ample product supply and seasonally softer demand led to lower composite pricing through early December. By quarter end, product supply decreased and demand improved as buyers replenished lean inventories. This drove price gains across North American lumber markets, with a notable increase in Southern Yellow Pine. For OSB, soft product pricing in fourth quarter 2025 was largely driven by lower demand in response to the seasonal reduction in new home construction activity. In September 2025, Weyerhaeuser elected to moderate production across its lumber mill set in response to the softer demand environment, and maintained a lower operating posture through year end 2025. When combined with the volume impact associated with the sale of the company’s sawmill in Princeton, British Columbia – which was sold in late third quarter 2025 – Weyerhaeuser’s lumber production volumes decreased by 14 percent in fourth quarter 2025 compared to the prior quarter. The company expects to return to a more normalized operating posture in first quarter 2026.
In Western log markets, Douglas-fir sawlog prices decreased 5.6 percent in fourth quarter 2025 compared with third quarter 2025, as reported by Fastmarkets RISI Log Lines based on Weyerhaeuser’s sales mix. Log prices in the domestic market faced downward pressure as supply remained ample, and mills continued to carry elevated log inventories and navigate a challenging lumber market. In the South, delivered sawlog prices decreased 2.3 percent in fourth quarter 2025 compared to third quarter 2025 and declined 2.3 percent from fourth quarter 2024, as reported by TimberMart-South. Delivered pine pulpwood prices decreased 2.1 percent in fourth quarter 2025 compared to third quarter 2025 and declined 4.7 percent from fourth quarter 2024 as reported by TimberMart-South. In general, Southern log supply remains ample and wood product and fiber mills continue to align production with end-market demand. Pulpwood prices have been more challenged in several localized regions following recent mill closures.
Currency exchange rates, available supply from other countries and trade policy affect our export businesses. In Japan, total housing starts decreased 7.4 percent year-to-date through December compared to the same period in 2024, while the key Post and Beam segment saw a 4.0 percent decrease, in part due to more stringent building permit requirements which went into effect on April 1, 2025. The slowing demand has been partially offset by a decrease in lumber imports to Japan from Europe and reduced inventories of European lumber in the Japanese market. In China, during fourth quarter 2025 regulators lifted the March 4, 2025 suspension of log imports from the U.S. As a result, Weyerhaeuser is in the early stages of re-establishing its log export program to strategic customers in China.
Interest rates affect our business primarily through their impact on mortgage rates and housing affordability, their general impact on the economy and their influence on our capital management activities. Actions by the U.S. Federal Reserve, the overall condition of the economy and fluctuations in financial markets are all factors that influence long-term interest rates. 30-year mortgage rates, which are generally correlated with long-term interest rates, decreased from 6.3 percent in third quarter 2025 to 6.2 percent in fourth quarter 2025, according to economic data from Freddie Mac. Many builders have been able to offset higher mortgage rates through discounts, mortgage rate buydowns and modifying product offerings such as home sizes and finishes. Higher rates have also locked in many existing homeowners from selling, thereby reducing inventories of existing homes for sale which has led to incremental demand for available new homes.
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Increased inflation affects the cost of our operations across each of our business segments, including costs for raw materials, transportation, energy and labor. The Consumer Price Index increased at an annual rate of 2.7 percent as of December 2025 compared to 3.0 percent as of September 2025. This rate is markedly down from prior periods of elevated inflation. While we can offset some of our costs that are affected by inflation through our sales activities, operational excellence initiatives and procurement practices, not all costs associated with inflation can be fully mitigated or passed on to the customer.
The condition of the labor market affects all of our businesses as it relates to our ability to attract and retain employees and contractors. The unemployment rate remained level at 4.4 percent in third quarter 2025 and fourth quarter 2025.
Governments and businesses across the globe have publicly expressed that climate change is a compelling issue requiring considerable responsive action; many have made significant commitments toward decarbonizing activities and operations and reducing greenhouse gas emissions. Achieving these commitments will require significant efforts, including modifying operations, investing in low-carbon technologies or purchasing credits to reduce environmental impacts. Although political and broader sentiment for climate change mitigation activities and related investments can fluctuate, we expect that over the long-term, climate change will continue to be a significant social concern and priority. With that in mind, we believe we are uniquely positioned to help others achieve climate change mitigation goals through our Climate Solutions business.
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FINANCIAL PERFORMANCE SUMMARY
Net Sales by Segment
Contribution to Earnings by Segment
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RESULTS OF OPERATIONS
In reviewing our results of operations, it is important to understand these terms:
Sales realizations refer to net selling prices — this includes selling price plus freight minus normal sales deductions.
Net contribution (charge) to earnings refers to earnings (loss) before interest expense and income taxes.
CONSOLIDAT ED RESULTS
HOW WE DID
Summary of Financial Results
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
AMOUNT OF CHANGE
Net sales
Costs of sales
Operating income
Net earnings
Basic and diluted earnings per share
COMPARING 2025 WITH 2024
Net Sales
Net sales decreased $219 million — 3 percent — primarily due to a $264 million decrease in Wood Products net sales attributable to decreased sales realizations across most product lines, as well as an $18 million decrease in Timberlands net sales to unaffiliated customers attributable to decreased log sales realizations and volumes in the Western region. These decreases were partially offset by a $63 million increase in Real Estate, Energy and Natural Resources net sales attributable to an increase in average price per acre sold.
Costs of Sales
Costs of sales increased $69 million — 1 percent — primarily due to increased sales volumes for structural lumber, oriented strand board and softwood plywood within our Wood Products segment, partially offset by a decrease in acres sold in our Real Estate, Energy and Natural Resources segment and decreased Western sales volumes in our Timberlands segment.
Operating Income
Operating income increased $46 million — 7 percent — primarily due to:
a $266 million increase in gain on sale of timberlands (refer to: Note 4: Timberland Acquisitions and Divestitures );
a $43 million increase in insurance recoveries;
a $29 million gain on the sale of our Princeton lumber mill in third quarter 2025;
a $27 million decrease in general and administrative expenses and
a $10 million decrease in noncash impairment charges.
These changes were partially offset by:
a $288 million decrease in consolidated gross margin (see discussion of components above);
a $25 million decrease in product remediation recoveries received and
an $18 million noncash environmental remediation charge recorded in fourth quarter 2025.
Refer to the breakout of these items in Note 17: Other Operating Costs, Net .
Net Earnings
Net earnings decreased $72 million — 18 percent — primarily due to a $178 million increase in non-operating and other post-employment benefit costs, primarily attributable to a $145 million noncash pension settlement charge (refer to: Note 8: Pension and Other Post-Employment Benefit Plans ), as well as a $31 million decrease in interest income and other. These changes were partially offset by a $95 million decrease in tax expense (refer to Income Taxes ) and the $46 million increase in operating income discussed above.
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TIMBE RLANDS
HOW WE DID
We report sales volumes and fee harvest volumes for our Timberlands segment in Our Business/What We Do/Timberlands .
Net Sales and Net Contribution to Earnings for Timberlands
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales to unaffiliated customers:
Delivered logs:
West
South
North
Total
Stumpage and pay-as-cut timber
Recreational and other lease revenue
Other products (1)
Subtotal net sales to unaffiliated customers
Intersegment net sales
Total segment net sales
Costs of sales
Operating income
Interest income and other
Net contribution to earnings
Other products include sales of seeds and seedlings from our nursery operations and wood chips.
COMPARING 2025 WITH 2024
Net Sales — Unaffiliated Customers
Net sales to unaffiliated customers decreased $18 million — 1 percent — primarily due to a $48 million decrease in Western log sales attributable to a 4 percent decrease in sales volumes and a 3 percent decrease in sales realizations. This decrease was partially offset by a $10 million increase in Southern log sales attributable to a 1 percent increase in sales volumes, as well as a $9 million increase in stumpage and pay-as-cut timber sales attributable to increased sales realizations and sales volumes.
Intersegment Sales
Intersegment sales increased $38 million — 7 percent — primarily due to a 3 percent increase in sales realizations, as well as a 3 percent increase in sales volumes.
Costs of Sales
Costs of sales decreased $22 million — 1 percent — primarily due to decreased Western sales volumes, partially offset by increased Southern sales volumes.
Net Contribution to Earnings
Net contribution to earnings increased $306 million — 109 percent — primarily due to a $266 million increase in gain on sale of timberlands (refer to Note 4: Timberland Acquisitions and Divestitures ), as well as the change in the components of gross margin, as discussed above.
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REAL ESTATE, ENERGY A ND NATURAL RESOURCES
HOW WE DID
We report acres sold and average price per acre for our Real Estate, Energy and Natural Resources (Real Estate & ENR) segment in Our Business/What We Do/Real Estate, Energy and Natural Resources .
Net Sales and Net Contribution to Earnings for Real Estate, Energy and Natural Resources
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales to unaffiliated buyers:
Real estate
Energy and natural resources
Total segment net sales
Costs of sales
Operating income and Net contribution to earnings
The volume of real estate sales is a function of many factors, including the general state of the economy, demand in local real estate markets, the ability of buyers to obtain financing, the number of competing properties listed for sale, the seasonal nature of sales, the plans of adjacent landowners, our expectations of future price appreciation, the timing of harvesting activities and the availability of government and not-for-profit funding. In any period, the average price per acre will vary based on the location and physical characteristics of parcels sold.
COMPARING 2025 WITH 2024
Net Sales
Net sales increased $63 million — 16 percent — primarily due to an increase in average price per acre sold and an increase in right-of-way easements and royalty income from our Energy and Natural Resources business, partially offset by a decrease in acres sold.
Costs of Sales
Costs of sales decreased $35 million — 23 percent — primarily due to a decrease in acres sold.
Operating Income and Net Contribution to Earnings
Operating income and net contribution to earnings increased $99 million — 46 percent — primarily due to the change in the components of gross margin, as discussed above.
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WOOD PR ODUCTS
HOW WE DID
We report sales volumes and annual production data for our Wood Products segment in Our Business/What We Do/Wood Products .
Net Sales and Net Contribution to Earnings for Wood Products
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Net sales:
Structural lumber
Oriented strand board
Engineered solid section
Engineered I-joists
Softwood plywood
Medium density fiberboard
Complementary building products
Other products produced (1)
Total segment net sales
Costs of sales
Operating income and Net contribution to earnings
Other products produced sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations.
COMPARING 2025 WITH 2024
Net Sales
Net sales decreased $264 million — 5 percent — primarily due to:
a $217 million decrease in oriented strand board sales attributable to a 25 percent decrease in sales realizations, partially offset by a 4 percent increase in sales volumes;
a $59 million decrease in engineered solid section sales attributable to a 7 percent decrease in sales realizations and a 1 percent decrease in sales volumes;
a $50 million decrease in complementary building products sales attributable to a decrease in sales volumes across most products;
a $47 million decrease in engineered I-joist sales attributable to a 7 percent decrease in sales realizations and a 5 percent decrease in sales volumes;
a $24 million decrease in medium density fiberboard sales attributable to a 14 percent decrease in sales volumes and a 1 percent decrease in sales realizations and
a $3 million decrease in softwood plywood sales attributable to a 7 percent decrease in sales realizations, partially offset by a 5 percent increase in sales volumes.
These decreases were partially offset by a $131 million increase in structural lumber sales attributable to a 5 percent increase in sales volumes and a 1 percent increase in sales realizations, as well as a $5 million increase in other products produced sales attributable to an increase in wood chip sales volumes.
Costs of Sales
Costs of sales increased $158 million — 3 percent — primarily due to increased sales volumes for structural lumber, oriented strand board and softwood plywood.
Operating Income and Net Contribution to Earnings
Operating income and net contribution to earnings decreased $402 million — 88 percent — primarily due to the change in the components of gross margin, as discussed above, as well as a $25 million product remediation recovery recorded in second quarter 2024. These changes were partially offset by a $10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill recorded in third quarter 2024 and a $29 million gain related to the sale of our Princeton lumber mill recorded in third quarter 2025 (refer to the breakout of these items in Note 17: Other Operating Costs, Net ).
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UNALLOCAT ED ITEMS
Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as:
share-based compensation,
pension and post-employment costs,
elimination of intersegment profit in inventory and LIFO — the last-in, first-out method,
foreign exchange transaction gains and losses resulting from changes in exchange rates primarily related to our U.S. dollar denominated cash and debt balances that are held by our Canadian subsidiary, as well as
interest income and other.
Net Charge to Earnings for Unallocated Items
DOLLAR AMOUNTS IN MILLIONS
AMOUNT OF CHANGE
Unallocated corporate function and variable compensation expense
Liability classified share-based compensation
Foreign exchange gain
Elimination of intersegment profit in inventory and LIFO
Other, net
Operating loss
Non-operating pension and other post-employment benefit costs
Interest income and other
Net charge to earnings
Net charge to earnings increased by $166 million — 65 percent — primarily due to:
a $178 million increase in non-operating pension and other post-employment benefit costs, primarily attributable to a $145 million pension settlement charge (refer to Note 8: Pension and Other Post-Employment Benefit Plans );
a $30 million decrease in interest income and other, primarily attributable to a decrease in cash and cash equivalents and
a $12 million increase in unallocated corporate function and variable compensation expense.
These changes were partially offset by a $48 million decrease in other, net, primarily attributable to a $30 million increase in insurance recoveries, as well as a $7 million increase in the benefit from elimination of intersegment profit in inventory and LIFO.
INTEREST EXPENSE
Our net interest expense incurred for the last two years was:
$273 million in 2025 and
$269 million in 2024.
Interest expense increased by $4 million compared to 2024 primarily due to $3 million of debt extinguishment costs incurred in conjunction with the partial redemption of our $750 million 4.75 percent senior unsecured notes due in May 2026, as well as a series of debt issuances and retirements in 2025 that increased our outstanding debt, partially offset by a decrease in our weighted average interest rate.
Refer to Note 11: Long-Term Debt, Net for further information.
INCOME TAXES
As a REIT, we generally are not subject to federal corporate level income taxes on REIT taxable income that is distributed to shareholders. Historical distributions to shareholders, including amounts and tax characteristics, are summarized in the table below.
AMOUNTS PER SHARE
Common - capital gain distribution
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We are required to pay corporate income taxes on earnings of our TRSs, which include our Wood Products segment and portions of our Timberlands and Real Estate & ENR segments' earnings. Our provision for income taxes is primarily driven by earnings generated by our TRSs.
Our provision for income taxes the last two years was:
$64 million benefit in 2025 and
$31 million expense in 2024.
Income tax expense decreased by $95 million compared to 2024, resulting in a net benefit position, primarily due to a significant decrease in our TRS earnings in 2025 and the effect of a $34 million tax benefit related to the noncash pretax settlement charge recorded in connection with our U.S. pension plan, as well as a decrease in our effective tax rate.
Refer to Note 8: Pension and Other Post-Employment Benefit Plans and Note 18: Income Taxes for further information.
LIQUIDITY AND CAPITAL RESOURCES
We are committed to maintaining an appropriate capital structure that provides financial flexibility and enables us to protect the interests of our shareholders and meet our obligations to our lenders, while also maintaining access to all major financial markets. As of December 31, 2025, we had $464 million in cash and cash equivalents, $1.75 billion of availability on our line of credit, which expires in June 2030, and $1.75 billion of availability on our commercial paper program. We believe we have sufficient liquidity to meet our cash requirements for the foreseeable future.
CASH FROM OPERATIONS
Consolidated net cash from operations was:
$562 million in 2025 and
$1,008 million in 2024.
COMPARING 2025 WITH 2024
Net cash from operations decreased by $446 million, primarily due to decreased cash inflows from our business operations, as well as a $201 million increase in pension and post-employment benefit contributions and payments, as discussed below. Refer to Note 8: Pension and Other Post-Employment Benefit Plans for further information .
Pension Contributions and Benefit Payments Made and Expected
During 2025, we contributed a total of $219 million to our pension and post-employment benefit plans, including a $200 million voluntary contribution to our U.S. qualified pension plan, compared to a total of $18 million during 2024.
For 2026, we expect to contribute approximately $20 million to our pension and post-employment benefit plans. Refer to Note 8: Pension and Other Post-Employment Benefit Plans for further information .
INVESTING IN OUR BUSINESS
Cash from investing activities includes items such as:
capital expenditures for property, equipment and reforestation,
acquisitions and divestitures of timberlands,
proceeds from sales of assets and operations and
purchases and maturities of short-term investments.
Consolidated net cash from investing activities was:
$(475) million in 2025 and
$(636) million in 2024.
COMPARING 2025 WITH 2024
Net cash from investing activities increased by $161 million, primarily due to a $405 million increase in proceeds from the sale of timberlands and a $61 million increase in proceeds from the sale of our Princeton lumber mill, partially offset by a $218 million increase in cash spent on the acquisition of timberlands and a $59 million increase in capital expenditures for property and equipment.
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Summary of Capital Spending by Business Segment
DOLLAR AMOUNTS IN MILLIONS
Timberlands
Wood Products
Unallocated Items
Total
During fourth quarter 2024, we announced our plan to invest approximately $500 million to build a new TimberStrand ® facility in Monticello, Arkansas. This capital outlay may be sourced from cash on hand or through future financing, as deemed appropriate. Construction began in 2025, with the goal of starting operations in 2027. Once completed, the new facility will increase our engineered wood products capacity by approximately 10 million cubic feet. In 2025, we had $109 million in capital expenditures related to the construction of this facility.
We expect our capital expenditures for 2026 to be approximately $400-$450 million, excluding approximately $300 million of investment in our Monticello engineered wood products facility. We exclude this investment for purposes of calculating our annual Adjusted Funds Available for Distribution (Adjusted FAD), as used in our flexible cash return framework. The amount we spend on capital expenditures could change due to:
future economic conditions,
environmental regulations,
changes in the composition of our business,
weather,
timing of equipment purchases and
capital needs related to other business opportunities.
FINANCING
Cash from financing activities includes items such as:
issuances and payments of debt and
payments for cash dividends and repurchasing stock.
Consolidated net cash from financing activities was:
$(290) million in 2025 and
$(852) million in 2024.
COMPARING 2025 WITH 2024
Net cash from financing activities increased by $562 million, primarily due to a $1,199 million increase in net proceeds from issuance of long-term debt and a $78 million decrease in cash paid for dividends, partially offset by a $712 million increase in payments on long-term debt.
LONG-TERM DEBT
Our consolidated long-term debt (including current portion) was:
$5,572 million as of December 31, 2025 and
$5,076 million as of December 31, 2024.
The $496 million increase in our long-term debt during 2025 is primarily attributable to:
the August 2025 issuance of an $800 million senior unsecured term loan;
the March 2025 issuance of a $300 million senior unsecured term loan and
the November 2025 loan of $102 million related to resource recovery revenue bonds.
These issuances were partially offset by:
the August 2025 partial repayment of approximately $500 million of our $750 million 4.75 percent senior unsecured notes;
the January 2025 repayment of our $139 million 8.50 percent debentures and
the March 2025 repayment of our $71 million 7.95 percent debentures.
The weighted average interest rate and the weighted average maturity on our long-term debt as of December 31, 2025 were 5.11 percent and 6.5 years, respectively.
See Note 11: Long-Term Debt, Net for more information.
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LINE OF CREDIT
In June 2025, we amended and restated our senior unsecured revolving credit facility to extend the expiration date to June 2030, while increasing borrowing capacity from $1.5 billion to $1.75 billion. Borrowings will bear interest at a floating rate based on either the adjusted term Secured Overnight Financing Rate (SOFR) plus a spread or a mutually agreed-upon base rate plus a spread. As of December 31, 2025 and 2024, we had no outstanding borrowings on the revolving credit facility.
Refer to Note 10: Line of Credit and Commercial Paper Program for further information.
COMMERCIAL PAPER PROGRAM
In November 2025, we established a commercial paper program under which we may issue short-term, unsecured commercial paper notes pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. Under this program, we may issue notes from time to time in an aggregate amount not to exceed $1.75 billion outstanding at any time. The notes will have maturities of up to 397 days from the date of issue and will not be subject to voluntary prepayment or redemption prior to maturity. We use our revolving credit facility as a liquidity backstop for the repayment of short-term unsecured notes issued under the commercial paper program. There were no notes outstanding under this program as of December 31, 2025.
Refer to Note 10: Line of Credit and Commercial Paper Program for further information.
OUR COVENANTS
Our key covenants include the requirement to maintain:
a minimum total adjusted shareholders' equity of $3.0 billion and
a defined debt-to-total-capital ratio of 65 percent or less.
Our total adjusted shareholders' equity is comprised of:
total shareholders’ equity,
excluding accumulated other comprehensive loss,
minus our investment in our unrestricted subsidiaries.
Our capitalization is comprised of:
total debt,
plus total adjusted shareholders' equity.
As of December 31, 2025, we had:
total adjusted shareholders' equity of $9.7 billion and
a defined debt-to-total-capital ratio of 36.4 percent.
When calculating compliance in accordance with financial debt covenants as of December 31, 2025 and December 31, 2024, we excluded the full amount of accumulated other comprehensive loss of $293 million and $402 million, respectively. See Note 14: Shareholders’ Interest for further information on accumulated other comprehensive loss.
There are no other significant financial debt covenants related to our third-party debt.
INTEREST RATE SWAP HEDGING RELATIONSHIP
During third quarter 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $800 million term loan. No comparable activity was present for the year ended December 31, 2024.
Refer to Note 12: Fair Value of Financial Instruments for further information.
CREDIT RATINGS
As of December 31, 2025, our long-term issuer credit rating was BBB and Baa2 from S&P and Moody’s, respectively.
DIVIDENDS
We paid cash dividends on common shares of:
$606 million in 2025 and
$684 million in 2024.
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The decrease in dividends paid is primarily due to a supplemental dividend of $0.14 per share based on 2023 financial results for a total of $102 million paid in first quarter 2024.
Under our cash return framework, we plan to supplement our base dividend with an additional return of variable cash, as appropriate, in the form of share repurchase and/or a supplemental cash dividend to achieve our targeted total return to shareholders of 75 to 80 percent of annual Adjusted Funds Available for Distribution (Adjusted FAD). For further information on Adjusted FAD see Performance and Liquidity Measures .
SHARE REPURCHASES
During second quarter 2025, we completed the $1 billion purchase authorization under the share repurchase program approved by the board in
September 2021 (the 2021 Repurchase Program). On May 8, 2025, we announced the board approved a new share repurchase program (the 2025 Repurchase Program) under which we are authorized to repurchase up to $1 billion of outstanding shares. Concurrently, the board terminated the completed purchase authorization under the 2021 Repurchase Program.
We repurchased 6.1 million common shares for approximately $160 million (including transaction fees) during the year ended December 31, 2025. We repurchased 4.9 million common shares for approximately $153 million (including transaction fees) in 2024. As of December 31, 2025, we had remaining authorization of $938 million for future share repurchases. For further information on share repurchases see Note 14: Shareholders’ Interest .
OUR CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
More details about our contractual obligations and commercial commitments are in Note 8: Pension and Other Post-Employment Benefit Plans , Note 10: Line of Credit and Commercial Paper Program , Note 11: Long-Term Debt, Net , Note 12: Fair Value of Financial Instruments , Note 13: Legal Proceedings, Commitments and Contingencies , Note 16: Leases and Note 18: Income Taxes .
Significant Contractual Obligations as of December 31, 2025
Significant contractual obligations as of December 31, 2025 include our long-term debt obligations and lease obligations. Refer to Note 11: Long-Term Debt, Net , Note 12: Fair Value of Financial Instruments and Note 16: Leases for further information. Additional significant contractual obligations are included below.
DOLLAR AMOUNTS IN MILLIONS
PAYMENTS DUE BY PERIOD
LESS THAN
MORE THAN
TOTAL
1 YEAR
YEARS
YEARS
5 YEARS
Interest (1)
Purchase obligations (2)
Employee-related obligations (3)
Amounts presented for interest payments assume that all long-term debt obligations outstanding as of December 31, 2025 will remain outstanding until maturity. Interest payments related to our $800 million term loan due in 2028 are treated as fixed due to the impact of the related interest rate swap.
Purchase obligations include agreements to purchase goods or services that are enforceable and legally binding on the company and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions and the approximate timing of the transaction. Purchase obligations exclude arrangements that the company can cancel without penalty.
The timing of certain payments within this category will be triggered by retirements or other events. These payments can include workers compensation, deferred compensation and banked vacation, among other obligations. When the timing of payment is uncertain, the amounts are included in the total column only. Minimum pension funding is required by established funding standards and estimates are not made for 2027 onward. Estimated payments of contractually obligated post-employment benefits are not included due to the uncertainty of payment timing.
OFF-BALANCE SHE ET ARRANGEMENTS
Off-balance sheet arrangements have not had — and are not reasonably likely to have — a material effect on our current or future financial condition, results of operations or cash flows. Note 10: Line of Credit and Commercial Paper Program contains our disclosures of surety bonds and letters of credit.
ENVIRONMENTAL MATTERS, LEGAL PROCEEDINGS AND OTHER CONTINGENCIES
See Note 13: Legal Proceedings, Commitments and Contingencies .
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ACCOUNTING MATTERS
CRIT ICAL ACCOUNTING ESTIMATES
In the preparation of our financial statements we follow established accounting policies and make estimates that affect both the amounts and timing of the recording of assets, liabilities, revenues and expenses. We base our judgments and estimates on historical experience and assumptions we believe are appropriate and reasonable under current circumstances. Actual results, however, could differ materially from the estimated amounts we have recorded. Some of these estimates require judgments about matters that are inherently uncertain. Accounting policies whose application involve a significant level of estimation uncertainty and may have a material effect on our results of operations or financial condition are considered critical accounting estimates.
DISCOUNT RATES FOR PENSION AND POST-EMPLOYMENT BENEFIT PLANS
Discount rates are used to estimate the net present value of our pension and other post-employment plan obligations. These rates are determined at the measurement date by matching current spot rates of high-quality corporate bonds with maturities similar to the timing of expected cash outflows for benefits. The selection of discount rates requires judgment as well as the involvement of actuarial specialists. These specialists assist with selecting yield curves based on published indices for high-quality corporate bonds and projecting the timing and amount of cash flows associated with our obligations to ultimately support our determination of an appropriate discount rate for each plan.
Our discount rates as of December 31, 2025 are:
5.3 percent for our U.S. pension plans — compared with 5.7 percent at December 31, 2024;
5.0 percent for our U.S. post-employment benefit plans — compared with 5.5 percent at December 31, 2024;
4.9 percent for our Canadian pension plans — compared with 4.7 percent at December 31, 2024 and
4.6 percent for our Canadian post-employment benefit plans — compared with 4.5 percent at December 31, 2024.
Pension expenses for 2026 will be based on the 5.3 percent and 4.9 percent assumed discount rates for the U.S. pension plans and the Canadian pension plans, respectively, and the 5.0 percent and 4.6 percent assumed discount rates for the U.S. and Canadian post-employment benefit plans, respectively.
Our discount rates are important in determining the cost of our plans. A 50 basis point decrease in our discount rate would increase expense or reduce a credit by approximately:
$8 million for our U.S. qualified pension plans and
$2 million for our Canadian registered pension plans.
Details about our other significant accounting policies are in Note 1: Summary of Significant Accounting Policies .
PROSPECTIVE ACCOUNTING PRONOUNCEMENTS
A summary of prospective accounting pronouncements is in Note 1: Summary of Significant Accounting Policies .
PERFORMANCE AND LIQUIDITY MEASURES
We use Adjusted EBITDA as a key performance measure to evaluate the performance of the consolidated company and our business segments. This measure should not be considered in isolation from, and is not intended to represent an alternative to, our results reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP). However, we believe Adjusted EBITDA provides meaningful supplemental information for our investors about our operating performance, better facilitates period to period comparisons and is widely used by analysts, lenders, rating agencies and other interested parties. Our definition of Adjusted EBITDA may be different from similarly titled measures reported by other companies. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, depletion, amortization, basis of real estate sold and special items.
Adjusted EBITDA by Segment
DOLLAR AMOUNTS IN MILLIONS
Timberlands
Real Estate & ENR
Wood Products
Unallocated Items
Total
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We reconcile Adjusted EBITDA to net earnings for the consolidated company and to operating income (loss) for the business segments, as those are the most directly comparable U.S. GAAP measures for each.
The table below reconciles Adjusted EBITDA by segment to net earnings for the year ended December 31, 2025:
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
TOTAL
Net earnings
Interest expense, net of capitalized interest
Income taxes
Net contribution (charge) to earnings
Non-operating pension and other post-employment benefit costs (1)
Interest income and other
Operating income (loss)
Depreciation, depletion and amortization
Basis of real estate sold
Special items included in operating income (loss) (2)(3)(4)
Adjusted EBITDA
Non-operating pension and other post-employment benefit costs includes a pretax special item consisting of a $145 million noncash settlement charge related to the transfer of pension plan assets and liabilities to an insurance company through the purchase of a
group annuity contract.
Operating income (loss) for Timberlands includes pretax special items consisting of a $117 million gain on the sale of Georgia and Alabama timberlands and a $149 million gain on the sale of Oregon timberlands.
Operating income (loss) for Wood Products includes a pretax special item consisting of a $29 million gain on the sale of our Princeton lumber mill.
Operating income (loss) for Unallocated Items includes pretax special items consisting of an $18 million noncash environmental remediation charge and a $26 million insurance recovery.
The table below reconciles Adjusted EBITDA by segment to net earnings for the year ended December 31, 2024:
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
TOTAL
Net earnings
Interest expense, net of capitalized interest
Income taxes
Net contribution (charge) to earnings
Non-operating pension and other post-employment benefit costs
Interest income and other
Operating income (loss)
Depreciation, depletion and amortization
Basis of real estate sold
Special items included in operating income (loss) (1)
Adjusted EBITDA
Operating income (loss) for Wood Products includes pretax special items consisting of a $25 million product remediation recovery and a $10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill.
Net Earnings and Net Earnings per Diluted Share Before Special Items (Income Tax Affected)
We reconcile net earnings before special items to net earnings and net earnings per diluted share before special items to net earnings per diluted share, as those are the most directly comparable U.S. GAAP measures. We believe the measures provide meaningful supplemental information for investors about our operating performance, better facilitate period to period comparisons, and are widely used by analysts, lenders, rating agencies and other interested parties.
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The table below reconciles net earnings before special items to net earnings:
DOLLAR AMOUNTS IN MILLIONS
Net earnings
Environmental remediation charge
Gain on sale of lumber mill
Gain on sale of timberlands
Insurance recovery
Pension settlement charge
Product remediation recovery
Restructuring, impairments and other charges
Net earnings before special items
The table below reconciles net earnings per diluted share before special items to net earnings per diluted share:
AMOUNTS PER SHARE
Net earnings per diluted share
Environmental remediation charge
Gain on sale of lumber mill
Gain on sale of timberlands
Insurance recovery
Pension settlement charge
Product remediation recovery
Restructuring, impairments and other charges
Net earnings per diluted share before special items
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Adjusted FAD
We use Adjusted Funds Available for Distribution (Adjusted FAD) to evaluate the company’s liquidity and measure cash generated during the period (net of capital expenditures and significant nonrecurring items) that is available for dividends, repurchases of common shares, debt reduction, acquisitions, and other discretionary and nondiscretionary capital allocation activities. Adjusted FAD should not be considered in isolation from, and is not intended to represent an alternative to, results reported in accordance with U.S. GAAP. However, we believe the measure provides meaningful supplemental information for our investors about our liquidity. Adjusted FAD, as we define it, is net cash from operations adjusted for capital expenditures and significant non-recurring items. Our definition of Adjusted FAD may be different from similarly titled measures reported by other companies, including those in our industry. We reconcile Adjusted FAD to net cash from operations, as that is the most directly comparable U.S. GAAP measure.
The table below reconciles Adjusted FAD to net cash from operations:
DOLLAR AMOUNTS IN MILLIONS
Net cash from operations
Capital expenditures
FAD
Cash from product remediation recovery
Cash contribution to our U.S. qualified pension plan
Monticello engineered wood products facility capital expenditures
Adjusted FAD
Net cash from investing activities
Net cash from financing activities
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QUANTITATIVE AND QUALITATIVE D ISCLOSURES ABOUT MARKET RISK
LONG-TERM DEBT OBLIGATIONS
The following summary of our long-term debt obligations includes:
scheduled principal repayments for the next five years and after;
weighted average interest rates for debt maturing in each of the next five years and after and
estimated fair values of outstanding obligations.
We estimate the fair value of long-term debt based on quoted market prices we receive for the same types and issues of our debt or on the discounted value of the future cash flows using market yields for the same type and comparable issues of debt. Changes in market rates of interest affect the fair value of our fixed-rate debt.
SUMMARY OF LONG-TERM DEBT OBLIGATIONS AS OF DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
THEREAFTER
TOTAL (1)
FAIR VALUE
Fixed-rate debt
Weighted average interest rate
Variable-rate debt (2)
Excludes $35 million of unamortized discounts and capitalized debt expense.
As of December 31, 2025, the weighted average interest rate for our variable-rate debt was 5.05%, excluding estimated patronage refunds and the impact of interest rate swaps.
In 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $800 million term loan. No comparable activity was present as of and for the year ended December 31, 2024.
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FINANCIAL STATEMENTS A ND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors
Weyerhaeuser Company:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Weyerhaeuser Company and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, cash flows, and changes in equity for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 13, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Projected benefit obligations for pensions
As discussed in Notes 1 and 8 to the consolidated financial statements, the Company's projected benefit obligations for pension plans were $1,881 million as of December 31, 2025, which included the projected benefit obligation for the U.S. qualified pension plans. The Company estimates the liability related to their pension plans using actuarial models that include assumptions about the Company’s discount rates.
We identified the evaluation of the Company’s projected benefit obligation for the U.S. qualified pension plans as a critical audit matter. This is due to the sensitivity of the obligation to changes in the discount rate used and the subjectivity in evaluating the rate. Additionally, the assessment of the discount rate required specialized actuarial skills and knowledge.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the U.S. qualified pension obligation process. This included controls related to the actuarial determination of the discount rate used in the valuation of the projected benefit obligation for the U.S. qualified pension plans. These procedures also included analyzing year-over-year changes to the projected cash flows associated with the obligation. Additionally, we involved actuarial professionals with specialized skills and knowledge, who assisted in the evaluation of the Company’s discount rate by:
evaluating the selected yield curve used to determine the discount rate
assessing changes in the discount rate from the prior year against changes in published indices
evaluating the discount rate based on the projected cash flows compared with those of similar plans.
/s/ KPMG LLP
We have served as the Company’s auditor since 2002.
Seattle, Washington
February 13, 2026
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CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
Net sales (Note 3)
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Gain on sale of timberlands (Note 4)
Other operating costs, net (Note 17)
Operating income
Non-operating pension and other post-employment benefit costs (Note 8)
Interest income and other
Interest expense, net of capitalized interest
Earnings before income taxes
Income taxes (Note 18)
Net earnings
Basic and diluted earnings per share (Note 5):
Weighted average shares outstanding (in thousands) (Note 5):
Basic
Diluted
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATEMENT O F COMPREHENSIVE INCOME
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
Comprehensive income:
Net earnings
Other comprehensive income (loss):
Foreign currency translation adjustments
Changes in unamortized actuarial loss, net of tax (expense) benefit of $( 28 ) in 2025, $ 20 in 2024 and $ 17 in 2023
Changes in unamortized net prior service credit, net of tax benefit (expense) of $ 1 in 2025, $( 1 ) in 2024 and $ 2 in 2023
Unrealized net gain on cash flow hedges, net of tax expense of $ 1 in 2025, $ 0 in 2024 and $ 0 in 2023 (Note 12)
Total comprehensive income
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED B ALANCE SHEET
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PAR VALUE
DECEMBER 31,
DECEMBER 31,
ASSETS
Current assets:
Cash and cash equivalents
Receivables, net
Receivables for taxes
Inventories (Note 6)
Assets held for sale (Note 4)
Prepaid expenses and other current assets
Total current assets
Property and equipment, net (Note 7)
Construction in progress
Timber and timberlands at cost, less depletion
Minerals and mineral rights, less depletion
Deferred tax assets (Note 18)
Other assets
Total assets
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt (Notes 11 and 12)
Accounts payable
Accrued liabilities (Note 9)
Total current liabilities
Long-term debt, net (Notes 11 and 12)
Deferred tax liabilities (Note 18)
Deferred pension and other post-employment benefits (Note 8)
Other liabilities
Total liabilities
Commitments and contingencies (Note 13)
Equity:
Weyerhaeuser shareholders’ interest (Notes 14 and 15):
Common shares: $ 1.25 par value; authorized 1,360 million shares; issued and outstanding: 720,531 thousand shares at December 31, 2025 and 725,845 thousand shares at December 31, 2024
Other capital
Retained earnings
Accumulated other comprehensive loss (Note 14)
Total equity
Total liabilities and equity
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATE MENT OF CASH FLOWS
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS
Cash flows from operations:
Net earnings
Noncash charges (credits) to earnings:
Depreciation, depletion and amortization
Basis of real estate sold
Deferred income taxes, net (Note 18)
Pension and other post-employment benefits (Note 8)
Share-based compensation expense (Note 15)
Gain on lumber mill sale (Note 20)
Gain on sale of timberlands (Note 4)
Other
Change in:
Receivables, net
Receivables and payables for taxes
Inventories
Prepaid expenses and other current assets
Accounts payable and accrued liabilities
Pension and post-employment benefit contributions and payments (Note 8)
Other
Net cash from operations
Cash flows from investing activities:
Capital expenditures for property and equipment
Capital expenditures for timberlands reforestation
Acquisition of timberlands (Note 4)
Proceeds from lumber mill sale (Note 20)
Proceeds from sale of timberlands (Note 4)
Purchase of short-term investments
Maturities of short-term investments
Other
Net cash from investing activities
Cash flows from financing activities:
Cash dividends on common shares
Net proceeds from issuance of long-term debt (Note 11)
Payments on long-term debt (Note 11)
Repurchases of common shares (Note 14)
Other
Net cash from financing activities
Net change in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of year
Cash, cash equivalents and restricted cash at end of year
Cash paid during the year for:
Interest, net of amounts capitalized of $ 11 in 2025, $ 10 in 2024 and $ 7 in 2023
Income taxes, net of refunds
See accompanying Notes to Consolidated Financial Statements .
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2025
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES
Common shares:
Balance at beginning of year
Issued for exercise of stock options and vested units
Repurchases of common shares (Note 14)
Balance at end of year
Other capital:
Balance at beginning of year
Issued for exercise of stock options
Repurchases of common shares (Note 14)
Share-based compensation
Other transactions, net
Balance at end of year
Retained earnings:
Balance at beginning of year
Net earnings
Dividends on common shares
Balance at end of year
Accumulated other comprehensive loss:
Balance at beginning of year
Other comprehensive income (loss)
Balance at end of year
Total equity:
Balance at end of year
Dividends paid per common share
See accompanying Notes to Consolidated Financial Statements .
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INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1:
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NOTE 2:
BUSINESS SEGMENTS
NOTE 3:
REVENUE RECOGNITION
NOTE 4:
TIMBERLAND ACQUISITIONS AND DIVESTITURES
NOTE 5:
NET EARNINGS PER SHARE
NOTE 6:
INVENTORIES
NOTE 7:
PROPERTY AND EQUIPMENT, NET
NOTE 8:
PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS
NOTE 9:
ACCRUED LIABILITIES
NOTE 10:
LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
NOTE 11:
LONG-TERM DEBT, NET
NOTE 12:
FAIR VALUE OF FINANCIAL INSTRUMENTS
NOTE 13:
LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES
NOTE 14:
SHAREHOLDERS’ INTEREST
NOTE 15:
SHARE-BASED COMPENSATION
NOTE 16:
LEASES
NOTE 17:
OTHER OPERATING COSTS, NET
NOTE 18:
INCOME TAXES
NOTE 19:
GEOGRAPHIC AREAS
NOTE 20:
PRINCETON LUMBER MILL DIVESTITURE
NOTE 21:
RESTRICTED CASH
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies describe:
our election to be taxed as a real estate investment trust,
how we report our results,
changes in how we report our results and
how we account for certain key items.
REAL ESTATE INVESTMENT TRUST (REIT)
We are organized as a REIT. Our holding company and two subsidiaries, which collectively hold most of the timberland assets related to our Timberlands segment, each operate as a REIT for federal income tax purposes. We also own Taxable REIT Subsidiaries (TRSs), which collectively hold the assets relating to our Wood Products segment and portions of our Timberlands and Real Estate, Energy and Natural Resources (Real Estate & ENR) segments. REIT income can be distributed to shareholders without first paying corporate level tax, which substantially eliminates the double taxation of income. We expect to derive most of our REIT income from investments in timberlands, including the sale of standing timber through pay-as-cut sales contracts and lump sum timber deeds. We continue to be required to pay federal corporate income taxes on earnings of our TRSs.
HOW WE REPORT OUR RESULTS
Our report includes:
consolidated financial statements,
our business segments,
estimates,
fair value measurements and
foreign currency translation.
Consolidated Financial Statements
Our consolidated financial statements provide an overall view of our results and financial condition. They include our accounts and the accounts of entities that we control, including majority-owned domestic and foreign subsidiaries.
They do not include our intercompany transactions and accounts, which are eliminated.
Throughout these Notes to Consolidated Financial Statements , unless specified otherwise, references to “Weyerhaeuser,” "the company," “we” and “our” refer to the consolidated company.
Our Business Segments
Reportable business segments are determined based on the company’s "management approach," as defined by Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting . The management approach is based on the way the chief operating decision maker organizes the segments within a company for making decisions about resources to be allocated and assessing their performance.
We are principally engaged in:
growing and harvesting timber;
maximizing the value of our acreage through the sale of higher and better use (HBU) properties and monetizing the value of surface and subsurface assets through leases and royalties and
manufacturing, distributing and selling products made from trees.
Our business segments are organized based primarily on products and services.
SEGMENT
PRODUCTS AND SERVICES
Timberlands
Logs, timber, recreational leases and other products.
Real Estate & ENR
Real Estate (sales of timberlands) and ENR (rights to explore for and extract hard minerals, construction materials, natural gas production, wind and solar).
Wood Products
Structural lumber, oriented strand board, engineered wood products and building materials distribution.
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We also transfer raw materials, semi-finished materials and end products among our business segments. Because of this intracompany activity, accounting for our business segments involves pricing products transferred between our business segments at current market values.
Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses, interest income and other.
Estimates
We prepare our financial statements according to U.S. generally accepted accounting principles (U.S. GAAP). This requires us to make estimates and assumptions during our reporting periods and at the date of our financial statements. The estimates and assumptions affect our:
reported amounts of assets, liabilities and equity;
disclosure of contingent assets and liabilities and
reported amounts of revenues and expenses.
While we believe the assumptions used in preparing these estimates are appropriate and reasonable, actual results can and do differ from those estimates and assumptions.
Fair Value Measurements
We use a fair value hierarchy in accounting for certain nonfinancial assets and liabilities including:
long-lived assets (asset groups) measured at fair value for an impairment assessment;
pension plan assets measured at fair value and
asset retirement obligations initially measured at fair value.
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions.
The fair value hierarchy consists of the following three levels:
Level 1: Inputs are unadjusted quoted prices for identical assets or liabilities traded in an active market.
Level 2: Inputs are quoted prices in non-active markets for which pricing inputs are observable either directly or indirectly at the reporting date.
Level 3: Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.
Foreign Currency Translation
We translate foreign currencies into U.S. dollars in two ways:
assets and liabilities — at the exchange rates in effect as of our balance sheet date and
revenues and expenses — at average monthly exchange rates throughout the year.
CHANGES IN HOW WE REPORT OUR RESULTS
Changes in how we report our results come from:
reclassification of certain balances and results from prior years to make them consistent with our current reporting and
accounting changes made upon our adoption of new accounting guidance.
Reclassifications
We have reclassified certain balances and results from prior years to be consistent with our 2025 reporting. This makes balances comparable from year to year. Our reclassifications had no effect on consolidated net earnings or equity.
HOW WE ACCOUNT FOR CERTAIN KEY ITEMS
This section provides information about how we account for certain key items related to:
capital investments,
financing our business and
our operations.
ITEMS RELATED TO CAPITAL INVESTMENTS
Key items related to accounting for capital investments pertain to property and equipment, timber and timberlands and impairment of long-lived assets.
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Property and Equipment
We maintain property accounts on an individual asset basis and account for them as follows:
Improvements to and replacements of major units of property are capitalized.
Maintenance, repairs and minor replacements are expensed.
Depreciation is calculated using a straight-line method at rates based on estimated service lives.
Costs associated with logging roads that we intend to utilize for a period longer than one year are capitalized. These roads are then amortized over an estimated service life.
Cost and accumulated depreciation of property sold or retired are removed from the accounts and the gain or loss is included in earnings.
Timber and Timberlands
We carry timber and timberlands at cost less depletion. Depletion refers to the carrying value of timber that is harvested or sold.
Key activities affecting how we account for timber and timberlands include:
reforestation,
depletion and
forest management in Canada.
Reforestation. Generally, we capitalize initial site preparation and planting costs as reforestation and then expense costs after the first planting as they are incurred or over the period of expected benefit. These expensed costs include:
fertilization,
vegetation and insect control,
pruning and precommercial thinning and
property taxes.
Accounting practices for these costs do not change when timber becomes merchantable and harvesting starts.
Timber Depletion. To determine depletion rates, we divide the net carrying value of timber by the related volume of timber estimated to be available over the growth cycle. To determine the growth cycle volume of timber, we consider:
regulatory and environmental constraints,
our management strategies,
inventory data improvements,
growth rate revisions and recalibrations and
known dispositions and inoperable acres.
In addition, the duration of the harvest cycle varies by geographic region and species of timber.
Depletion rate calculations do not include estimates for:
future silviculture or sustainable forest management costs associated with existing stands;
future reforestation costs associated with a stand's final harvest and
future volume in connection with the replanting of a stand subsequent to its final harvest.
We include the cost of timber harvested in the carrying values of raw materials and product inventories. As these inventories are sold to third parties, we include them in costs of sales.
Forest Management in Canada. We manage timberlands under long-term licenses in various Canadian provinces that are:
granted by the provincial governments;
granted for initial periods of 15 to 25 years and
renewable provided we meet reforestation, operating and management guidelines.
Calculation of the fees we pay on the timber we harvest:
varies from province to province,
is tied to product market pricing and
depends upon the allocation of land management responsibilities in the license.
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Impairment of Long-Lived Assets
We review the carrying value of long-lived assets whenever an event or a change in circumstance indicates that the carrying value of the asset or asset group may not be recoverable through future operations. The carrying value is the original cost, less accumulated depreciation and any past impairments recorded. If we evaluate recoverability, we are required to estimate future cash flows and residual values of the asset or asset group. Key assumptions used in developing estimates of future cash flows and residual values could include probability of alternative outcomes, product pricing, raw material cost and product sales. An impairment occurs when the carrying value of a long-lived asset is greater than the amount that could be recovered from the estimated undiscounted future cash flows of the asset and greater than fair market value (the amount we could receive if we were to sell the asset).
Impaired assets held for use are written down to fair value, while impaired assets held for sale are written down to fair value less cost to sell. We determine fair value based on:
appraisals,
market pricing of comparable assets,
discounted value of estimated future cash flows from the asset,
replacement values of comparable assets and
agreed upon sale price or offer price.
Key assumptions used in developing estimates of fair value would include the estimated future cash flows used to assess recoverability, discount rates and probability of alternative outcomes.
ITEMS RELATED TO FINANCING OUR BUSINESS
Key items related to financing our business include financial instruments, cash equivalents and concentration of risk.
Financial Instruments
We estimate the fair value of financial instruments where appropriate. The assumptions we use — including the discount rate and estimates of cash flows — can significantly affect the fair value. These values are estimates and may not match the amounts we would realize upon sale or settlement of our financial positions.
Derivative Instruments. At times, we may manage exposure to certain risks by entering into derivative instruments. We do not enter into derivative instruments for speculative purposes.
We record all derivative instruments on our Consolidated Balance Sheet at fair value. We are allowed to net settle transactions with respective counterparties for certain derivative instruments; however, we have not offset derivative asset and liability balances on our Consolidated Balance Sheet .
For derivative instruments that are designated as hedging instruments in a qualifying cash flow hedge, the hedging instrument’s income or loss is reported as a component of other comprehensive income (loss) and recorded in accumulated other comprehensive loss on our Consolidated Balance Sheet . The income or loss is subsequently reclassified into net earnings when the hedged transaction affects net earnings in the same line item as the underlying hedged transaction in our Consolidated Statement of Operations . Where applicable, the initial value of hedged components excluded from the assessment of effectiveness are amortized over the life of the hedging instrument, using a systematic and rational method, and recognized in the same line item as the hedged transaction.
Cash flows from derivative instruments designated as hedging instruments are classified in the same category as the cash flows from the respective hedged transaction.
See Note 12: Fair Value of Financial Instruments .
Cash Equivalents
Cash equivalents are investments with maturities of 90 days or less at the date of purchase. We state cash equivalents at cost, which approximates market.
Concentration of Risk
We disclose customers that represent a concentration of risk. As of December 31, 2025 and December 31, 2024 , no customer accounted for 10 percent or more of our net sales.
ITEMS RELATED TO OPERATIONS
Key items related to operations include revenue recognition, inventories, shipping and handling costs, income taxes, pension and other post-employment benefit plans and contingent liabilities.
Revenue Recognition
Refer to Note 3: Revenue Recognition for details on how we account for revenue.
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Inventories
We state inventories at the lower of cost or net realizable value. Cost includes labor, materials and production overhead. LIFO applies to major inventory products held at our U.S. domestic locations. We began to use the LIFO method for domestic products in the 1940s as required to conform with the tax method elected. Subsequent acquisitions of entities added new products under the moving average cost or FIFO — the first-in, first-out — methods and those products continue to be recognized under those methods. The moving average cost or FIFO method applies to the balance of our domestic raw material and product inventories, all material and supply inventories and all foreign inventories.
Shipping and Handling Costs
We classify shipping and handling costs in "Costs of sales" in our Consolidated Statement of Operations .
Income Taxes
We account for income taxes under the asset and liability method. Unrecognized tax benefits represent potential future funding obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. Accrued interest and penalties related to unrecognized tax benefits are recognized as a component of income tax expense.
We recognize deferred tax assets and liabilities to reflect:
future tax consequences due to differences between the carrying amounts for financial reporting purposes and the tax bases of certain items and
net operating loss and tax credit carryforwards.
To measure deferred tax assets and liabilities, we:
determine when the differences between carrying amounts and tax bases of affected items are expected to be recovered or resolved and
use enacted tax rates expected to apply to taxable income in those years.
Pension and Other Post-Employment Benefit Plans
We recognize the overfunded or underfunded status of our defined benefit pension and other post-employment benefit plans on our Consolidated Balance Sheet and recognize changes in the funded status through comprehensive income (loss) in the year in which the changes occur.
Actuarial valuations determine the amount of the pension and other post-employment benefit obligations and the net periodic benefit cost we recognize. The net periodic benefit cost includes:
cost of benefits provided in exchange for employees’ services rendered during the year;
interest cost of the obligations;
expected long-term return on plan assets;
gains or losses on plan settlements and curtailments;
amortization of prior service costs and plan amendments over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the participants affected by the plan amendment are inactive and
amortization of cumulative unrecognized net actuarial gains and losses — generally in excess of 10 percent of the greater of the benefit obligation or the combination of market-related and fair value of plan assets at the beginning of the year — over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the plan participants are inactive.
Pension plans. We have defined benefit pension plans covering appr oximately 30 percent of our employees. Determination of benefits differs for salaried, hourly and union employees as follows:
Salaried employee benefits are based on each employee’s highest monthly earnings for five consecutive years during the final 10 years before retirement.
Hourly and union employee benefits generally are stated amounts for each year of service.
Union employee benefits are set through collective-bargaining agreements.
We contribute to our U.S. and Canadian pension plans according to established funding standards. The funding standards for the plans are:
U.S. pension plans — according to the Employee Retirement Income Security Act of 1974 and
Canadian pension plans — according to the applicable provincial pension act and the Income Tax Act.
Post-employment benefits other than pensions. We provide certain post-employment healthcare and life insurance benefits for some retired employees. In some cases, we pay a portion of the cost of the benefit. Note 8: Pension and Other Post-Employment Benefit Plans provides additional information about our post-employment benefit plans.
Estimates for pension and other post-employment benefit plans. Estimates we use in accounting for our pension and other post-employment benefit plans include the:
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fair value of our plan assets;
expected long-term rate of return on plan assets and
discount rates.
At the end of every year, we review our estimates with external advisers and make adjustments as appropriate. We use these estimates to calculate plan asset and liability information as of year-end as well as pension and post-employment expense for the following year. Actual experience that differs from our estimates and subsequent changes in our estimates could have a significant effect on our financial position, results of operations and cash flows.
Fair value of plan assets. Plan assets are assets of the pension plan trusts that fund the benefits provided under the pension plans. The fair value of our plan assets estimates the amount that would be received if we were to sell each asset in an orderly transaction between market participants at the reporting date. We estimate the fair value of these assets based on the information available during the year-end reporting process.
Refer to Note 8: Pension and Other Post-Employment Benefit Plans for information about the assets held within our pension plans and their related valuation methods.
Expected long-term rate of return on plan assets. Our expected long-term rate of return is our estimate of the return that our plan assets will earn over time. This rate is used in determining the net periodic benefit or cost we recognize for our plans.
Factors we consider in determining our expected long-term rate of return include:
historical returns for a portfolio of assets similar to our expected allocation and
expected future performance of similar asset classes.
The actual return on plan assets in any given year may vary from our expected long-term rate of return. Actual returns on plan assets affect the funded status of the plans. Differences between actual returns on plan assets and the expected long-term rate of return are reflected as adjustments to accumulated other comprehensive loss, a component of total equity.
Discount rates. Discount rates are used to estimate the net present value of our plan obligations. The discount rates are determined at the measurement date by matching current spot rates of high-quality corporate bonds with maturities similar to the timing of expected cash outflows for benefits.
Contingent Liabilities
We are subject to lawsuits, investigations and other claims related to environmental remediation, product and other matters, and are required to assess the likelihood of any adverse judgments or outcomes to these matters, as well as the amount or range of potential loss.
We record contingent liabilities when:
it becomes probable that a loss has been incurred and
the amount of loss can be reasonably estimated.
Assessing probability of loss and estimating the amount of loss can require analysis of multiple factors, such as:
historical experience,
evaluations of relevant legal and environmental authorities and regulations,
judgments about the potential actions of third-party claimants and courts and
consideration of potential environmental remediation methods.
In addition to contingent liabilities recorded for probable losses, we disclose contingent liabilities when there is a reasonable possibility that a loss may have been incurred.
Recorded contingent liabilities are based on the best information available and actual losses in any future period are inherently uncertain. Future expenditures for environmental remediation obligations are not discounted to their present value. If estimated probable future losses or actual losses exceed our recorded liability for such claims, we record additional charges. These exposures and proceedings can be significant and the ultimate outcomes could be material to our operating results or cash flows in any given period. Recoveries of environmental remediation costs from other parties are recorded as assets when the recovery is deemed probable and does not exceed the amount of losses previously recorded. See Note 13: Legal Proceedings, Commitments and Contingencies for more information.
NEW ACCOUNTING PRONOUNCEMENTS
Income Taxes
In 2025 , we adopted the FASB Accounting Standards Update (ASU) 2023-09 , “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which expands annual income tax disclosures to disaggregate rate reconciliations and income taxes paid by nature and jurisdiction. The adoption of this standard did no t impact our Consolidated Statement of Operations , Consolidated Balance Sheet or Consolidated Statement of Cash Flows . The expanded disclosures are incorporated in Note 18: Income Taxes .
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Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which expands annual and interim disclosure requirements for certain income statement expenses. The new guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The adoption of the new guidance will not impact our Consolidated Statement of Operations , Consolidated Balance Sheet or Consolidated Statement of Cash Flows . We plan to incorporate these expanded disclosures beginning in fourth quarter 2027.
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NOTE 2: BUSINESS SEGMENTS
Our business segments and how we account for those segments are discussed in Note 1: Summary of Significant Accounting Policies . This note provides key financial data by business segment and information about our chief operating decision maker.
KEY FINANCIAL DATA BY BUSINESS SEGMENT
Sales, Significant Segment Expenses and Net Contribution (Charge) to Earnings
DOLLAR AMOUNTS IN MILLIONS
UNALLOCATED
REAL
ITEMS AND
ESTATE
WOOD
INTERSEGMENT
TIMBERLANDS
& ENR
PRODUCTS
ELIMINATIONS
CONSOLIDATED
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Net sales to unaffiliated customers
Intersegment sales
Total
Costs of sales
Gross margin
Selling expenses
General and administrative expenses
Other segment items (1)
Net contribution (charge) to earnings
Other segment items for each reportable segment includes recurring and non-recurring income and expense items. For our Timberlands segment, this includes a legal benefit in 2023 and gains on the sale of timberlands in 2023 and 2025. For our Wood Products segment, this includes insurance recoveries in 2023, product remediation recoveries and an impairment charge related to the indefinite curtailment of our New Bern lumber mill in 2024, and a gain on the sale of our Princeton lumber mill in 2025. For Unallocated Items, this includes a legal expense in 2023, noncash environmental remediation charges in 2023 and 2025, as well as non-operating pension and other post-employment benefit costs, interest income and other and insurance recoveries for all periods presented. Refer to Note 17: Other Operating Costs, Net for additional information.
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The chief operating decision maker, our president and chief executive officer, evaluates segment performance and allocates capital based on the net contribution (charge) to earnings of the respective segments. This measure is used to monitor budget versus actual results and to benchmark performance against competitors, as well as to evaluate segment performance for capital allocation decisions. An analysis and reconciliation of our business segment information to the consolidated financial statements are included below:
Reconciliation of Net Contribution to Earnings to Net Earnings
DOLLAR AMOUNTS IN MILLIONS
Net contribution to earnings
Interest expense, net of capitalized interest
Income before income taxes
Income taxes
Net earnings
Additional Financial Information
DOLLAR AMOUNTS IN MILLIONS
REAL ESTATE
WOOD
UNALLOCATED
TIMBERLANDS
& ENR
PRODUCTS
ITEMS
CONSOLIDATED
Depreciation, depletion and amortization
Capital expenditures
Total Assets
DOLLAR AMOUNTS IN MILLIONS
TIMBERLANDS AND
WOOD
UNALLOCATED
REAL ESTATE & ENR
PRODUCTS
ITEMS
CONSOLIDATED
Total assets (1)
Assets attributable to the Real Estate & ENR segment are combined with total assets for the Timberlands segment as we do not produce separate balance sheets internally.
NOTE 3: REVENUE RECOGNITION
A majority of our revenue is derived from sales of delivered logs and manufactured wood products. We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers .
PERFORMANCE OBLIGATIONS
A performance obligation, as defined in ASC Topic 606, is a promise in a contract to transfer a distinct good or service to a customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue at the point in time, or over the period, in which the performance obligation is satisfied.
Performance obligations associated with delivered log sales are typically satisfied when the logs are delivered to our customers’ mills or delivered to an ocean vessel in the case of export sales. Performance obligations associated with the sale of wood products are typically satisfied when the products are shipped. We have elected, as an accounting policy, to treat shipping and handling that is performed after a customer obtains control of the product as an activity required to fulfill the promise to transfer the good; therefore we will not evaluate this requirement as a separate performance obligation.
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Customers are generally invoiced shortly after logs are delivered or after wood products are shipped, with payment generally due within a month or less of the invoice date. ASC Topic 606 requires entities to consider significant financing components of contracts with customers, though allows for the use of a practical expedient when the period between satisfaction of a performance obligation and payment receipt is one year or less. Given the nature of our revenue transactions, we have elected to utilize this practical expedient.
Performance obligations associated with real estate sales are generally met when placed into escrow and all conditions of closing have been satisfied.
CONTRACT ESTIMATES
Substantially all of our performance obligations are satisfied as of a point in time. Therefore, there is little judgment in determining when control transfers for our business segments as described above.
The transaction price for log sales generally equals the amount billed to our customer for logs delivered during the accounting period. For the limited number of log sales subject to a long-term supply agreement, the transaction price is variable but is known at the time of billing. For wood products sales, the transaction price is generally the amount billed to the customer for the products shipped but may be reduced slightly for estimated cash discounts and rebates.
There are no significant contract estimates related to the real estate business.
CONTRACT BALANCES
In general, customers are billed and a receivable is recorded as we ship and/or deliver wood products and logs. We generally receive payment shortly after products have been received by our customers. Contract asset and liability balances are immaterial.
For real estate sales, the company receives the entire consideration in cash at closing.
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MAJOR PRODUCTS
A Reconciliation of Revenue Recognized by our Major Products:
DOLLAR AMOUNTS IN MILLIONS
Net sales to unaffiliated customers:
Timberlands segment
Delivered logs:
West
Domestic sales
Export grade sales
Subtotal West
South
North
Subtotal delivered logs sales
Stumpage and pay-as-cut timber
Recreational and other lease revenue
Other (1)
Net sales attributable to Timberlands segment
Real Estate & ENR segment
Real estate
Energy and natural resources
Net sales attributable to Real Estate & ENR segment
Wood Products segment
Structural lumber
Oriented strand board
Engineered solid section
Engineered I-joists
Softwood plywood
Medium density fiberboard
Complementary building products
Other (2)
Net sales attributable to Wood Products segment
Total
Other Timberlands sales includes sales of seeds and seedlings from our nursery operations as well as wood chips.
Other Wood Products sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations.
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NOTE 4: TIMBERLAND ACQUISITIONS AND DIVESTITURES
VIRGINIA DIVESTITURE
In February 2026, we completed the sale of 108 thousand acres of Virginia timberlands for approximately $ 193 million . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations. However, the related assets did meet the relevant criteria to be classified as held for sale on our current period Consolidated Balance Sheet . As of December 31, 2025, assets held for sale of $ 128 million within our Timberlands segment were included in "Assets held for sale" on our Consolidated Balance Sheet .
GEORGIA AND ALABAMA DIVESTITURE
In December 2025 , we completed the sale of 86 thousand acres of Georgia and Alabama timberlands for $ 216 million , which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $ 117 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
OREGON DIVESTITURE
In October 2025, we completed the sale of 28 thousand acres of Oregon timberlands for $ 190 million, which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $ 149 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
NORTH CAROLINA AND VIRGINIA ACQUISITION
In August 2025, we completed the purchase of 117 thousand acres of North Carolina and Virginia timberlands for $ 364 million. We recorded $ 361 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 3 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
WASHINGTON ACQUISITION
In August 2025, we completed the purchase of approximately 10 thousand acres of Washington timberlands for $ 95 million. We recorded $ 94 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
ALABAMA ACQUISITIONS
In July 2024, we announced acquisitions totaling 84 thousand acres of Alabama timberlands for $ 244 million. The first transaction was completed in May 2024 and was comprised of 13 thousand acres for $ 48 million. We recorded $ 47 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The second transaction was completed in August 2024 and was comprised of 32 thousand acres for $ 82 million. We recorded $ 81 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The third transaction was completed in October 2024 and was comprised of 39 thousand acres for $ 114 million. We recorded $ 113 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
SOUTHERN TIMBERLANDS ACQUISITION AND DIVESTITURE
In December 2023, we completed the sale of 63 thousand acres of South Carolina timberlands f or $ 166 million , which is net of purchase price adjustments and closing costs. This transaction was structured as a like-kind exchange along with the acquisition discussed below. As a result of the sale, we recorde d an $ 84 million gain in the Timberlands segment in our Consolidated Statement of Operations . This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.
In December 20 23, we completed the purchase of 61 thousand acres of timberlands across the Carolinas and Mississ ippi for $ 159 million, which is net of purchase price adjustments. As a result of the pu rchase, we recorded $ 157 million of timberland assets in “Timber and timberlands at cost, less depletion” and $ 2 million of related as sets in “Property and equipment, net” on our Consolidated Balance Sheet .
MISSISSIPPI ACQUISITION
In July 2023, we completed the purchase of 22 thousand acres of Mississippi timberlands for approximately $ 60 million. We recorded $ 59 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet .
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NOTE 5: NET EARNINGS PER SHARE
Our basic and diluted earnings per share for the last three years were:
$ 0.54 in 2024 and
HOW WE CALCULATE BASIC AND DILUTED NET EARNINGS PER SHARE
Basic earnings per share is net earnings available to common shareholders divided by the weighted average number of our outstanding common shares, including stock equivalent units where there is no circumstance under which those shares would not be issued.
Diluted earnings per share is net earnings available to common shareholders divided by the sum of the:
weighted average number of our outstanding common shares and
the effect of our outstanding dilutive potential common shares.
Dilutive potential common shares may include:
outstanding stock options,
restricted stock units and
performance share units.
Calculation of Weighted Average Number of Outstanding Common Shares – Dilutive
SHARES IN THOUSANDS
Weighted average number of outstanding shares — basic
Dilutive potential common shares:
Stock options
Restricted stock units
Performance share units
Total effect of outstanding dilutive potential common shares
Weighted average number of outstanding common shares — dilutive
We use the treasury stock method to calculate the dilutive effect of our outstanding stock options, restricted stock units and performance share units. Share-based payment awards that are contingently issuable upon the achievement of specified performance or market conditions are included in our diluted earnings per share calculation in the period in which the conditions are satisfied.
SHARES EXCLUDED FROM DILUTIVE EFFECT
The following shares were not included in the computation of diluted earnings per share because they were either antidilutive or the required performance or market conditions were not met. Some or all of these shares may be dilutive potential common shares in future periods.
Potential Shares Not Included in the Computation of Diluted Earnings per Share
SHARES IN THOUSANDS
Stock options
Performance share units
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NOTE 6: INVENTORIES
Inventories include raw materials, work-in-process and finished goods as well as materials and supplies, as shown below:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
LIFO inventories:
Logs
Lumber, plywood, oriented strand board and fiberboard
Other products
Moving average cost or FIFO inventories:
Logs
Lumber, plywood, oriented strand board, fiberboard and engineered wood products
Other products
Materials and supplies
Total
If we used FIFO for all LIFO inventories, our stated inventories would have been higher by $ 121 million as of December 31, 2025 and $ 115 million as of December 31, 2024.
HOW WE ACCOUNT FOR OUR INVENTORIES
The Inventories section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our inventories.
NOTE 7: PROPERTY AND EQUIPMENT, NET
Property and equipment includes land, buildings and improvements, machinery and equipment, roads and other items.
Carrying Value of Property and Equipment and Estimated Service Lives
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
RANGE OF LIVES
Property and equipment, at cost:
Land
Buildings and improvements
Machinery and equipment
Roads
Other
Total cost
Accumulated depreciation and amortization
Property and equipment, net
SERVICE LIVES AND DEPRECIATION
In general, additions are classified into components, each with its own estimated useful life as determined at the time of purchase.
Depreciation and amortization expense for property and equipment was:
$ 282 million in 2025,
$ 273 million in 2024 and
$ 261 million in 2023 .
NOTE 8: PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS
This note provides details about defined benefit and defined contribution plans we sponsor for our employees. The Pension and Other Post-Employment Benefit Plans section of Note 1: Summary of Significant Accounting Policies provides information about how we account for pension and other post-employment plans and benefits.
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PLANS WE SPONSOR
OVERVIEW OF PLANS
The defined benefit pension plans we sponsor in the U.S. and Canada differ according to each country’s requirements. In the U.S., we have plans that qualify under the Internal Revenue Code (qualified plans), as well as plans for select employees that provide additional benefits not qualified under the Internal Revenue Code (nonqualified plans). In Canada, we have plans that are registered under the Income Tax Act and applicable provincial pension acts (registered plans), as well as nonregistered plans for select employees that provide additional benefits that may not be registered under the Income Tax Act or provincial pension acts (nonregistered plans). We also sponsor other post-employment benefit (OPEB) plans in the U.S. and Canada, including retiree medical and life insurance plans. Our defined benefit pension plans were closed to newly hired and rehired salaried and non-union employees effective January 1, 2014, and were closed to union employees at various dates over the course of 2014 to 2019.
We sponsor various defined contribution plans for our U.S. and Canadian salaried and hourly employees. Our contributions to these plans were $ 38 million, $ 37 million and $ 35 million in 2025, 2024 and 2023, respectively.
Actions to Reduce Pension Plan Obligations
As part of our continued efforts to reduce pension plan obligations, we transferred approximate ly $ 455 million of U.S. qualified pension plan liabilities to an insurance company through the purchase of a group annuity contract in November 2025 (2025 Retiree Annuity Purchase). The contract purchase was funded from $ 440 million of U.S. qualified pension plan assets. In connection with this transaction, we recorded a noncash pretax settlement charge of $ 145 million during 2025. This settlement charge accelerated the recognition of previously unrecognized losses in "Accumulated Other Comprehensive Loss" that would have been recognized in subsequent periods, and is classified as "Non-operating pension and other post-employment benefits costs" in our Consolidated Statement of Operations .
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FUNDED STATUS OF PLANS
The funded status of the plans we sponsor is determined by comparing the projected benefit obligation with the fair value of plan assets at the end of the year. The following table demonstrates how our plans' funded status is reflected on our Consolidated Balance Sheet .
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
Projected benefit obligation at beginning of year
Service cost
Interest cost
Actuarial loss (gain) (1)
Plan participants’ contributions
Benefits paid, including lump sum and annuity transfers
Foreign currency translation and other
Projected benefit obligation at end of year
Fair value of plan assets at beginning of year (estimated)
Actual return on plan assets
Employer contributions and benefit payments
Plan participants’ contributions
Benefits paid, including lump sum and annuity transfers
Other, including foreign currency translation
Fair value of plan assets at end of year (estimated)
Presentation on our Consolidated Balance Sheet: (2)
Noncurrent assets
Current liabilities
Noncurrent liabilities
Funded status (3)
Accumulated benefit obligation at end of year
Actuarial Assumptions Used in Estimating Our Pension and OPEB Benefit Obligations:
Discount rate (4)
Rate of compensation increase (5)
Lump sum distributions election (6)
Healthcare cost trend rate:
Assumed for next year (7)
Ultimate (7)
Year when rate will reach ultimate (7)
Actuarial loss (gain) is primarily due to year-over-year changes in discount rates.
Assets and liabilities on our Consolidated Balance Sheet are different from the cumulative income or expense that we have recorded associated with the plans. The differences are actuarial loss (gain) and prior service (cost) credit that are deferred and amortized into periodic benefit costs in future periods. Unamortized amounts are recorded in "Accumulated Other Comprehensive Loss", which is a component of total equity on our Consolidated Balance Sheet . The Accumulated Other Comprehensive Loss section of Note 14: Shareholders' Interest details changes in these amounts by component.
For pension plans with a projected benefit obligation exceeding plan assets, the projected benefit obligation and fair value of plan assets were $ 1.6 billion and $ 1.2 billion at December 31, 2025 , respectively, and $ 2.0 billion and $ 1.5 billion at December 31, 2024, respectively. For pension plans with an accumulated benefit obligation exceeding plan assets, the accumulated benefit obligation and fair value of plan assets were $ 1.6 billion and $ 1.2 billion at December 31, 2025 , respectively, and $ 2.0 billion and $ 1.5 billion at December 31, 2024, respectively.
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For the U.S. defined benefit plans, the discount rate assumption was 5.3 % and 5.7 % for 2025 and 2024, respectively. For the Canadian defined benefit plans, the discount rate assumption was 4.9 % and 4.7 % for 2025 and 2024, respectively. For U.S. OPEB plans, the discount rate assumption was 5.0 % and 5.5 % for 2025 and 2024, respectively. For Canadian OPEB plans, the discount rate assumption was 4.6 % a nd 4.5 % for 2025 and 2024, respectively. For lump sum distributions (for U.S. qualified salaried and nonqualified plans only), the interest and mortality assumptions are the same as those mandated by the Pension Protection Act of 2006 for benefits commencing in the current year.
For the U.S. defined benefit plans, the rate of compensation increase assumption for both 2025 and 2024 was between 2.00 % - 13.00 % for salaried participants and was decreasing with participant age. For the Canadian defined benefit plans, the rate of compensation increase assumption was 1.00 % - 2.75 % and 2.00 % - 2.75 % for salaried and hourly participants, respectively, for both 2025 and 2024.
U.S. qualified salaried and nonqualified plans only.
For U.S. OPEB plans, the healthcare cost trend rate assumption for the next year for Pre-Medicare was 7.00 % for both 2025 and 2024. The ultimate healthcare cost trend rate was 4.50 % for both 2025 and 2024 and the assumption for the year the ultimate healthcare cost trend rate is reached was 2036 and 2035 in 2025 and 2024, respectively. For Canadian OPEB plans, the healthcare cost trend rate assumption for the next year was 4.99 % a nd 5.06 % for 2025 and 2024, respectively. The ultimate healthcare cost trend rate was 4.00 % and the assumption for the year the ultimate healthcare cost trend rate is reached was 2040 for both 2025 and 2024 .
PENSION ASSETS
Our Investment Policies and Strategies
Our investment policies, strategies and advisory agreements guide and direct how the funds are managed for the benefit plans we sponsor. These funds include our:
U.S. Pension Trust — funds our U.S. qualified pension plans;
Canadian Pension Trust — funds our Canadian registered pension plans and
Retirement Compensation Arrangements — fund a portion of our Canadian nonregistered pension plans.
U.S. and Canadian Pension Trusts
In 2018, we began to shift pension plan assets to an allocation that more closely aligns with our pension plan liability profile. Our former investment strategy included investments primarily in hedge funds and private equity funds. These asset classes are now in redemption and run-off mode. However, given the long-term nature of these investments, they will continue to comprise a portion of the plan assets for several years. We expect all investments in redemption to be redeemed at amounts materially consistent with their net asset values (NAV). As these investments are redeemed or liquidated, cash proceeds available for investment will be invested in accordance with our current investment strategy.
Our investment strategy targets a percentage allocation to growth assets and a percentage allocation to liability hedging assets based on each plan’s funded status. We expect to increase the allocation to liability hedging assets over time as the funded status of the pension plans improves. Growth assets may include investments in global public equities, hedge funds (which are in redemption), private equity assets (which are in run-off mode), fixed income and real estate and infrastructure. Liability hedging assets may include corporate credit and government issued fixed income securities as well as treasury futures selected to align with the plan liabilities.
Assets within our U.S. and Canadian pension trusts were invested as follows:
DECEMBER 31,
DECEMBER 31,
Cash and short-term investments (1)
Public equity investments (2)
Fixed income investments: (3)
Corporate
Government
Repurchase agreements
Hedge funds and related investments (4)(5)
Private equity and related investments (5)(6)
Derivative instruments, net (7)
Accrued liabilities
Total
Cash and short-term investments are valued at cost, which approximates market.
Public equity investments are valued at exit prices quoted in active markets.
Fixed income investments include publicly traded corporate and government issued debt. These bonds have varying maturities, credit quality and sector exposure and are selected to align with the duration of our plan liabilities. We have an obligation to return the cash related to these borrowings in accordance with the agreements, which are collateralized by our government bonds. Fixed income investments are valued at exit prices quoted in active or non-active markets or based on observable inputs.
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Hedge funds and related investments are privately-offered managed pools primarily structured as limited liability entities. General members or partners of these limited liability entities serve as portfolio managers and are thus responsible for the fund’s underlying investment decisions. Underlying investments within these funds may include long and short public and private equities, corporate, mortgage and sovereign debt, options, swaps, forwards and other derivative positions. These funds have varying degrees of leverage, liquidity and redemption provisions.
These investments are primarily valued based on the NAVs of the funds. These values represent the per-unit price at which new investors are permitted to invest and existing investors are permitted to exit. When NAVs as of the end of the year have not been received, we estimate fair value by adjusting the most recently reported NAVs for market events and cash flows between the interim date and the end of the year.
Private equity and related investments include both investments in private equity and investments in mezzanine, distressed, co-investments and other structures. Private equity funds generally participate in buyout and venture capital strategies through unlisted equity and debt instruments. These funds may also borrow at the underlying entity level. Mezzanine and distressed funds generally invest in the debt of public or private companies with additional participation through warrants or other equity options.
Derivative instruments include risk-mitigating futures and are valued based upon valuation statements received from each counterparty .
Retirement Compensation Arrangements
Retirement compensation arrangements fund a portion of our Canadian nonregistered pension plans. As required by Canadian tax rules, approximately 50 percent of these assets are invested into a non-interest bearing refundable tax account held by the Canada Revenue Agency. This portion of the portfolio does not earn returns. The remaining portion is invested in a portfolio of equities.
Managing Risk
Investments and contracts are subject to risks including market price, interest rate, credit, currency and liquidity risks. We mitigate these risks to our pension plan asset portfolios through advisory agreements, investment in diversified portfolios, inclusion of fixed income investments that align with plan liabilities and investment in assets designed to address both currency and liquidity considerations. In addition, we and our investment advisers perform regular monitoring with ongoing qualitative assessments, quantitative assessments and investment and operational due diligence.
Valuation of Our Plan Assets
Pension assets are stated at fair value or NAV. Fair value is based on the amount that would be received to sell an asset or paid to settle a liability in an orderly transaction between market participants at the reporting date. We consider both observable and unobservable inputs that reflect assumptions applied by market participants when setting the exit price of an asset or liability in an orderly transaction within the principal market for that asset or liability.
We value the pension plan assets based upon the observability of exit pricing inputs and classify pension plan assets based upon the lowest level input that is significant to the fair value measurement of the pension plan assets in their entirety. Refer to Note 1: Summary of Significant Accounting Policies for details on the fair value hierarchy. The availability of observable market data is monitored to assess the appropriate classification of financial instruments within the fair value hierarchy. Changes in economic conditions or model-based valuation techniques may require the transfer of financial instruments from one fair value level to another. We evaluate the significance of transfers between levels based upon the nature of the financial instrument and size of the transfer relative to total net assets available for benefits.
Investments for which fair value is measured using the NAV per share as a practical expedient are not categorized within the fair value hierarchy.
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The net pension plan assets, when categorized in accordance with this fair value hierarchy, are as follows:
DOLLAR AMOUNTS IN MILLIONS
LEVEL 1
LEVEL 2
LEVEL 3
TOTAL
LEVEL 1
LEVEL 2
LEVEL 3
TOTAL
Pension trust investments:
Cash and short-term investments
Public equity investments
Fixed income investments:
Corporate
Government
Repurchase agreements
Hedge funds and related investments (1)
Private equity and related investments (1)
Derivative instruments (2)
Total pension trust investments measured at fair value (1)
Canadian nonregistered plan assets:
Cash and short-term investments
Public equity investments
Total Canadian nonregistered plan assets measured at fair value
Total plan assets measured at fair value (1)
December 31, 2025 and 2024 exclude $ 392 million and $ 479 million, respectively, of hedge fund and private equity investments that are measured at fair value using the NAV per share (or its equivalent) as a practical expedient, which are not required to be classified in the fair value hierarchy. Additionally, December 31, 2025 and 2024 exclude $ 5 million and $ 7 million of accrued liabilities, respectively.
Derivative instruments include futures contracts. The fair value and aggregate notional value of these contracts were $ ( 1 ) million and $ 594 million at December 31, 2025 , respectively, and $( 1 ) million and $ 664 million at December 31, 2024 , respectively.
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ACTIVITY OF PLANS
Net Periodic Benefit Cost
Our net periodic benefit cost and the assumptions used to estimate it are shown in the following table.
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
Net periodic benefit cost:
Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost (credit)
Settlement charges
Net periodic benefit cost
Actuarial Assumptions Used in
Estimating Our Pension and
OPEB Net Periodic Benefit Cost:
Discount rate (1)
Expected return on assets (2)
Rate of compensation increase (3)
Lump sum distributions
election (4)
Weighted healthcare cost trend
rate (5)
For the U.S. defined benefit plans, the discount rate assumption was 5.70 %, 5.20 % and 5.40 % for 2025, 2024 and 2023, respectively. For the Canadian defined benefit plans, the discount rate assumption was 4.70 % for both 2025 and 2024 and 5.30 % for 2023. For U.S. OPEB plans, the discount rate assumption was 5.50 %, 5.10 % and 5.40 %, for 2025, 2024 and 2023, respectively. For Canadian OPEB plans, the discount rate assumption was 4.50 %, 4.60 % and 5.30 % for 2025, 2024 and 2023, respectively. For lump sum distributions (for U.S. qualified salaried and nonqualified plans only), the interest and mortality assumptions are the same as those mandated by the Pension Protection Act of 2006 for benefits commencing in the current year.
Determining our expected return requires a high degree of judgment. We consider actual pension fund asset performance over multiple years and current and expected valuation levels in the global equity and credit markets. Historical fund returns are used as a base and we place added weight on more recent pension plan asset performance.
For the U.S. defined benefit plans, the rate of compensation increase assumption for 2025, 2024 and 2023 was between 2.00 % - 13.00 % for salaried participants and was decreasing with participant age. For the Canadian defined benefit plans, the rate of compensation increase assumption for salaried participants was 1.00 % - 2.75 % for 2025, 2024 and 2023. The rate of compensation increase assumption for hourly participants was 2.00 % - 2.75 % for 2025, 2024 and 2023.
U.S. qualified salaried and nonqualified plans only.
For OPEB plans during 2025, the assumed weighted healthcare cost trend rate was 7.00 % and 5.06 % for U.S. Pre-Medicare participants and Canadian OPEB plans, respectively.
Pension Plan Contributions and Benefit Payments
Established funding standards govern the funding requirements for our qualified and registered pension plans. We fund the benefit payments of our nonqualified and nonregistered plans as benefit payments come due.
During 2025, we made a voluntary contribution of $ 200 million for our U.S. qualified pension plans in conjunction with the 2025 Retiree Annuity Purchase. Additionally, we made contributions and/or benefit payments of $ 12 million f or our U.S. nonqualified pension plans, $ 2 million for our Canadian nonregistered plans and less than $ 1 million for our Canadian registered pension plans.
During 2026, based on estimated year-end asset values and projections of plan liabilities, we expect to make contributions and/or benefit payments of approximately:
$ 8 million for our U.S. nonqualified pension plans,
$ 2 million for our Canadian non-registered plans and
less than $ 1 million f or our Canadian registered plan (required contribution).
We do not anticipate contributions being required for our U.S. qualified pension plan for 2026.
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OPEB Benefit Payments
During 2025, we contributed $ 2 million and $ 3 million to our U.S. and Canadian OPEB plans, respectively. In 2026, we expect to make contributions of $ 8 million in total for our U.S. and Canadian OPEB plans, including $ 3 million expected to be required to cover benefit payments under collectively bargained contractual obligations.
Estimated Projected Benefit Payments for the Next 10 Years
DOLLAR AMOUNTS IN MILLIONS
PENSION
OPEB
UNION-ADMINISTERED MULTIEMPLOYER BENEFIT PLANS
We contribute to multiemployer defined benefit plans under the terms of collective-bargaining agreements. These plans cover a small number of our employees and on an annual basis our contributions are immaterial.
These plans have different risks than single-employer plans. Our contributions may be used to fund benefits for employees of other participating employers. If we choose to stop participating, we may be required to pay a withdrawal liability based on the underfunded status of the plan . If another participating employer stops contributing to the plan, we may become responsible for remaining plan unfunded obligations.
NOTE 9: ACCRUED LIABILITIES
Accrued liabilities were comprised of the following:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Compensation and employee benefit costs
Current portion of lease liabilities (Note 16)
Customer rebates, volume discounts and deferred income
Interest
Taxes payable
Other
Total
NOTE 10: LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM
OUR LINE OF CREDIT
In June 2025, we amended and restated our senior unsecured revolving credit facility to extend the expiration date to June 2030 , while increasing borrowing capacity from $ 1.5 billion to $ 1.75 billion. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread. As of December 31, 2025 and 2024, we had no outstanding borrowings on the revolving credit facility. We were in compliance with the revolving credit facility covenants as of December 31, 2025 and December 31, 2024.
OUR COMMERCIAL PAPER PROGRAM
In November 2025, we established a commercial paper program under which we may issue short-term, unsecured commercial paper notes pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. Under this program, we may issue notes from time to time in an aggregate amount not to exceed $ 1.75 billion outstanding at any time. The notes will have maturities of up to 397 days from the date of issue and will not be subject to voluntary prepayment or redemption prior to maturity. We use our revolving credit facility as a liquidity backstop for the repayment of short-term unsecured notes issued under the commercial paper program. There were no notes outstanding under this program as of December 31, 2025.
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LETTERS OF CREDIT AND SURETY BONDS
The amounts of letters of credit and surety bonds we have entered into as of the end of the last two years are included in the following table:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Letters of credit
Surety bonds
Our compensating balance requirement for our letters of credit was $ 3 million as of December 31, 2025 and December 31, 2024 .
NOTE 11: LONG-TERM DEBT, NET
This note provides details about:
debt issued and extinguished and
long-term debt and related maturities.
Our long-term debt includes notes, debentures and other borrowings.
DEBT ISSUED AND EXTINGUISHED
In November 2025, the Arkansas Development Finance Authority issued resource recovery revenue bonds for our benefit in the aggregate principal amount of $ 102 million. The net proceeds after deducting the discount, underwriting fees and issuance costs were $ 101 million. The proceeds from the issuance of these bonds were deposited directly into a restricted trust account to be used for the specific purpose for which the money was raised, which is generally to finance capital expenditures for the construction of our TimberStrand ® facility in Monticello, Arkansas. We will pay a term interest rate of 3.875 percent until October 2032, at which point the interest rate will reset. We are obligated to repay the principal amount in October 2065. Refer to Note 21: Restricted Cash for details on the portion of the proceeds which remained in the account as of December 31, 2025.
In August 2025, we entered into an $ 800 million senior unsecured term loan agreement that will mature in August 2028 . Net proceeds after fees were $ 799 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread. Additionally, we utilized approximately $ 500 million of the net proceeds of the term loan to partially redeem our $ 750 million 4.75 percent senior unsecured notes due in May 2026.
In March 2025, we repaid our $ 71 million 7.95 percent debentures at maturity. We also entered into a $ 300 million senior unsecured term loan that will mature in April 2030 . Net proceeds after fees were $ 299 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread.
In January 2025, we repaid our $ 139 million 8.50 percent debentures at maturity.
Over the course of 2023, we refinanced approximately $ 1 billion of debt.
In December 2023, we entered into a $ 250 million senior unsecured term loan that will mature in December 2028 . Net proceeds after fees were
$ 249 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed upon
base rate plus a spread. The facility also provides flexibility to enter into a mutually agreed fixed rate.
In December 2023, we repaid our $ 860 million 5.207 percent private note at maturity, funded by cash on hand, including the proceeds from our
short-term investments which matured in fourth quarter 2023.
In July 2023, we repaid our $ 118 million 7.125 percent notes at maturity.
In May 2023, we completed an offering of debt securities by issuing $ 750 million of 4.750 percent notes due in May 2026 . The net proceeds after
deducting the discount, underwriting fees and issuance costs were $ 743 million.
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LONG-TERM DEBT AND RELATED MATURITIES
The following table lists our long-term debt by types and interest rates at the end of our last two years and includes the current portion.
Long-Term Debt by Types and Interest Rates (Includes Current Portion)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
8.50 % debentures due 2025
7.95 % debentures due 2025
7.85 % debentures due 2026
7.70 % debentures due 2026
7.35 % debentures due 2026
4.75 % notes due 2026
6.95 % debentures due 2027
Variable-rate term loan matures 2028
Variable-rate term loan matures 2028
4.00 % notes due 2029
4.00 % notes due 2030
Variable-rate term loan matures 2030
7.375 % debentures due 2032
6.875 % debentures due 2033
3.375 % debentures due 2033
4.00 % debentures due 2052
3.875 % loan due 2065 (1)
Other
Total principal long-term debt
Less: unamortized discounts
Less: unamortized debt expense
Total
Principal due within one year
This loan has a 3.875 % interest rate until October 2032, at which point the interest rate will reset.
Amounts of Long-Term Debt Due Annually for the Next Five Years and Thereafter
DOLLAR AMOUNTS IN MILLIONS (1)
Thereafter
Excludes $ 35 million of unamortized discounts and capitalized debt expense.
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NOTE 12: FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF DEBT
The estimated carrying value and fair value of our long-term debt consisted of the following:
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31, 2025
DECEMBER 31, 2024
CARRYING
VALUE
FAIR VALUE
(LEVEL 2)
CARRYING
VALUE
FAIR VALUE
(LEVEL 2)
Long-term debt (including current maturities) and line of credit:
Fixed rate
Variable rate
Total Debt
To estimate the fair value of fixed rate long-term debt, we used the market approach, which is based on quoted market prices we received for the same types and issues of our debt. We believe that our variable-rate long-term debt and line of credit instruments have net carrying values that approximate their fair value with only insignificant differences. The inputs to the valuations of our long-term debt are based on market data obtained from independent sources or information derived principally from observable market data. The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at the measurement date.
FAIR VALUE OF DERIVATIVE INSTRUMENTS DESIGNATED AS CASH FLOW HEDGES
The Derivative Instruments section of Note 1: Summary of Significant Accounting Policies provides information about how we account for derivative instruments as cash flow hedges.
Interest Rate Swap Hedging Relationship
In 2025, we entered into interest rate swaps with the risk management objective of managing exposure to interest rate volatility by converting variable rate debt obligations associated with our new $ 800 million term loan into fixed rate payments. The interest rate swaps provide the right to make fixed rate payments to the counterparty in exchange for variable, SOFR-based payments on a monthly settlement schedule. As of December 31, 2025, our interest rate swap agreements with an aggregate notional amount of $ 800 million were designated as cash flow hedging instruments of variable, SOFR-based interest payments on our $ 800 million term loan. No comparable activity was present as of and for the year ended December 31, 2024.
An unrealized loss on interest rate swaps designated as cash flow hedging instruments of $ 3 million was recognized in "Other comprehensive income" in our Consolidated Statement of Comprehensive Income for the year ended December 31, 2025. The unrealized loss of $ 3 million was recorded in "Accumulated other comprehensive loss" on our Consolidated Balance Sheet as of December 31, 2025.
As of December 31, 2025, the current and noncurrent fair value of interest rate swaps designated as cash flow hedging instruments in a liability position of $ 1 million and $ 2 million are recorded in " Accrued Liabilities " and " Other Liabilities " on our Consolidated Balance Sheet , respectively.
Foreign Currency Hedging Relationship
In 2025, we entered into forward contracts with the risk management objective of reducing foreign exchange risk associated with the variability in cash flows from the settlement of forecasted foreign currency-denominated purchases of equipment. Our forward contracts provide the right to buy specified quantities of euros during predetermined future periods at predetermined future rates. As of December 31, 2025, all forward contracts with an aggregate notional amount of $ 32 million were designated as cash flow hedging instruments of hedged forecasted foreign-currency denominated purchases of equipment. No comparable activity was present as of and for the year ended December 31, 2024.
An unrealized gain on forward contracts designated as cash flow hedging instruments of $ 6 million was recognized in “Other comprehensive income” in our Consolidated Statement of Comprehensive Income for the year ended December 31, 2025. The unrealized gain of $ 6 million was recorded in “Accumulated other comprehensive loss” on our Consolidated Balance Sheet as of December 31, 2025.
As of December 31, 2025, the current and noncurrent fair value of forward contracts designated as cash flow hedging instruments in an asset position of $ 2 million and $ 1 million a re recorded in " Prepaid expenses and other current assets " and " Other assets " on our Consolidated Balance Sheet , respectively.
FAIR VALUE OF OTHER FINANCIAL INSTRUMENTS
We believe that our other financial instruments, including cash and cash equivalents, short-term investments, mutual fund investments held in grantor trusts, receivables and payables, have net carrying values that approximate their fair values with only insignificant differences. This is primarily due to the short-term nature of these instruments and the allowance for doubtful accounts.
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NOTE 13: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES
This note provides details about our:
legal proceedings,
environmental matters and
commitments and other contingencies.
LEGAL PROCEEDINGS
We are party to various legal proceedings arising in the ordinary course of business. We are not currently a party to any legal proceeding that management believes could have a material adverse effect on our Consolidated Balance Sheet , Consolidated Statement of Operations or Consolidated Statement of Cash Flows .
ENVIRONMENTAL MATTERS
Under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) – commonly known as the “Superfund” – and similar state laws, we are a party to various proceedings related to the cleanup of hazardous waste sites and have been notified that we may be a potentially responsible party related to the cleanup of other hazardous waste sites for which proceedings have not yet been initiated.
Kalamazoo River Site Remediation
We have received notification from the Environmental Protection Agency (EPA) and have acknowledged that we are a potentially responsible party in a portion of the Kalamazoo River Superfund site in southwest Michigan. Our involvement in the remediation site is based on our operation of the Plainwell, Michigan mill, located within the remediation site, from 1954 to 1970. Several other companies also have been deemed potentially responsible parties as past or present owners or operators of facilities within the site, or as arrangers under CERCLA.
We cooperated with other parties to jointly implement an administrative order issued by the EPA on April 14, 2016, with respect to a portion of the site comprising a stretch of the river approximately 1.7 miles long referred to as the Otsego Township Dam Area. During third quarter 2018, implementation of this administrative order was completed.
In 2010, the company, along with others, was named as a defendant by Georgia-Pacific Consumer Products LP, Fort James Corporation and Georgia-Pacific LLC in an action seeking contribution under CERCLA for remediation costs relating to a certain area within the site. On March 29, 2018, the U.S. District Court issued an opinion and order assigning the company responsibility for 5 percent of approximately $ 50 million in past costs incurred by the plaintiffs. The remaining 95 percent of this pool of past costs incurred was allocated to the plaintiffs and other defendants. The opinion and order does not establish allocation for future remediation costs, and accordingly, we may incur additional costs in connection with future remediation tasks for other areas of the site.
In 2022, the Sixth Circuit Court of Appeals reversed the District Court opinion, finding that Georgia-Pacific’s claims for cost contributions in the specific area of the site were time barred by the statute of limitations. Georgia-Pacific filed a petition for writ of certiorari with the U.S. Supreme Court, which was denied during fourth quarter 2023 and redirected to the district court for further proceedings. In 2024, the U.S. District Court issued a final judgment dismissing Georgia-Pacific’s claims for past costs but also issued a declaratory judgment finding all three parties (Georgia-Pacific, International Paper and the company) liable to each other for future costs incurred by any party. On appeal, the Sixth Circuit Court of Appeals reversed the declaratory judgment issued by the District Court and the U.S. Supreme Court subsequently denied Georgia-Pacific’s petition for writ of certiorari. As a result, the company was found not responsible for prior costs incurred by Georgia-Pacific.
Port of Everett Site Remediation
In 2008, the Port of Everett (the “Port”) filed a lawsuit in Snohomish County Superior Court in Everett, Washington (“the Court”) against the company seeking contribution and recovery of remedial action costs resulting from alleged environmental contamination at one of the company’s former mill sites. The company owned and operated a mill at the site from 1902 until 1980 and sold the mill to the Port in 1983. The lawsuit was stayed and placed on inactive status during the period between 2015 and 2024.
In 2024, the Port requested the Court to lift the stay on this matter and set a new trial date, which was subsequently granted. Trial in this matter is currently set for May 26, 2026. In November 2024, the Washington State Department of Ecology, which maintains oversight of the cleanup at the site, selected a remedy as part of the Cleanup Action Plan (“CAP”) for the site. The CAP does not establish an allocation of costs among potentially responsible parties, which includes Weyerhaeuser and the Port, and the Court has not issued any judgments as of December 2025 indicating allocation of costs. Accordingly, we may incur costs in connection with future remediation activities that exceed our current estimates. In connection with ongoing developments in this matter, we updated our estimated liability associated with the site and recorded a pretax charge of $ 18 million during fourth quarter 2025 within “Other operating costs, net” in our Consolidated Statement of Operations .
We have established accruals for estimated remediation costs for these sites and other matters for which we are a potentially responsible party. These accruals are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet .
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Changes in the Accrual for Environmental Remediation
DOLLAR AMOUNTS IN MILLIONS
Accrual balance as of December 31, 2024
Charges and adjustments, net
Payments
Accrual balance as of December 31, 2025
We change our accrual to reflect:
new information on any site concerning implementation of remediation alternatives,
updates on prior cost estimates and new sites and
costs incurred to remediate sites.
Estimates. We believe it is reasonably possible, based on currently available information and analysis, that remediation costs for all identified sites may exceed our existing accruals by up to $ 282 million. This estimate, in which those additional costs may be incurred over several years, is the upper end of the range of reasonably possible additional costs. The estimate:
is much less certain than the estimates on which our accruals currently are based and
uses assumptions that are less favorable to us among the range of reasonably possible outcomes.
In estimating our current accruals and the possible range of additional future costs, we:
assumed we will not bear the entire cost of remediation of every site,
took into account the ability of other potentially responsible parties to participate and
considered each party’s financial condition and probable contribution on a per-site basis.
We have not recorded any amounts for potential recoveries from insurance carriers.
Asset Retirement Obligations
We have obligations associated with the retirement of tangible long-lived assets consisting primarily of reforestation obligations related to forest management licenses in Canada and obligations to close and cap landfills. Some of our sites have asbestos containing materials. We have met our current legal obligation to identify and manage these materials. In situations where we cannot reasonably determine when asbestos containing materials might be removed from the sites, we have not recorded an accrual because the fair value of the obligation cannot be reasonably estimated. As of December 31, 2025 and December 31, 2024, we had an asset retirement obligation of $ 29 million and $ 34 million, respectively. These obligations are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet .
COMMITMENTS AND OTHER CONTINGENCIES
Product Remediation Contingency and Recovery
In July 2017, we announced we were implementing a solution to address concerns regarding our TJI ® Joists coated with our former Flak Jacket ® Protection product. This issue was isolated to Flak Jacket product manufactured after December 1, 2016 and did not affect any of our other products.
During the year ended December 31, 2024, we received a product remediation recovery of $ 25 million related to our prior remediation efforts for Flak Jacket. The recovery is attributable to our Wood Products segment and was recorded within “Other operating costs, net” in our Consolidated Statement of Operations . There were no product remediation recoveries recorded during the years ended December 31, 2025 and 2023.
NOTE 14: SHAREHOLDERS’ INTEREST
This note provides details about:
preferred and preference shares,
common shares,
share repurchase programs and
accumulated other comprehensive loss.
PREFERRED AND PREFERENCE SHARES
We ha d no pre ferred shares or preference shares outstanding as of December 31, 2025 or December 31, 2024. We have authorization to issue 7 million preferred shares with a par value of $ 1.00 per share and 40 million pre ference sh ares with a par value of $ 1.00 per share.
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COMMON SHARES
The number of common shares we have outstanding changes when:
new shares are issued,
stock options are exercised,
restricted stock units or performance share units vest,
stock equivalent units are settled in common shares,
shares are tendered,
shares are repurchased or
shares are canceled.
Reconciliation of Our Common Share Activity
SHARES IN THOUSANDS
Outstanding at beginning of year
Stock options exercised
Issued for vested restricted stock units
Issued for vested performance share units
Repurchased
Outstanding at end of year
SHARE REPURCHASE PROGRAMS
During second quarter 2025, we completed the $ 1 billion purchase authorization under the share repurchase program approved by the board in
September 2021 (the 2021 Repurchase Program). On May 8, 2025, we announced the board approved a new share repurchase program (the 2025 Repurchase Program) under which we are authorized to repurchase up to $ 1 billion of outstanding shares. Concurrently, the board terminated the completed purchase authorization under the 2021 Repurchase Program.
We repurchased 6,141,671 common shares for approximately $ 160 million (including transaction fees) under the share repurchase programs during 2025. As of December 31, 2025, we had remaining authorization of $ 938 million for future share repurchases.
During 2024, we repurch ased 4,887,821 common shares for approximately $ 153 million (including t ransaction fees) under the 2021 Repurchase Program.
During 2023 , we repurchased 4,054,952 common shares for approximately $ 125 million (including transaction fees) under the 2021 Repurchase Program.
All common stock repurchases under the share repurchase programs were made in open-market transactions. We record share repurchases upon trade date as opposed to the settlement date when cash is disbursed. We record a liability for repurchases that have not yet been settled as of period end. There w ere no unsettled shares as of December 31, 2025 . There were 12,436 unsettled shares (less than $ 1 million) as of December 31, 2024 and 13,866 unsettled shares (approximately $ 1 million) as of December 31, 2023.
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ACCUMULATED OTHER COMPREHENSIVE LOSS
Changes in amounts included in our accumulated other comprehensive loss by component are:
DOLLAR AMOUNTS IN MILLIONS
Pension (1)
Balance at beginning of period
Other comprehensive loss before reclassifications
Amounts reclassified from accumulated other comprehensive loss
to earnings (2)(3)
Total other comprehensive income (loss)
Balance at end of period
Other post-employment benefits (1)
Balance at beginning of period
Other comprehensive income (loss) before reclassifications
Amounts reclassified from accumulated other comprehensive loss
to earnings (2)
Total other comprehensive income (loss)
Balance at end of period
Translation adjustments and other
Balance at beginning of period
Translation adjustments
Unrealized gain on cash flow hedges (1)
Total other comprehensive income (loss)
Balance at end of period
Accumulated other comprehensive loss, end of period
Amounts are presented net of tax.
Amounts of actuarial loss and prior service (cost) credit are components of net periodic benefit cost. See Note 8: Pension and Other Post-Employment Benefit Plans .
Amounts include an after-tax settlement charge of $ 111 million related to our pension plans for the year ended December 31, 2025. There were no settlement charges related to our pension plans for the years ended December 31, 2024 and December 31, 2023. See Note 8: Pension and Other Post-Employment Benefit Plans for further detail.
NOTE 15: SHARE-BASED COMPENSATION
This note provides details about:
our Long-Term Incentive Compensation Plan (2022 Plan),
how we account for share-based awards,
tax benefits of share-based awards,
types of share-based compensation,
unrecognized share-based compensation and
deferred compensation stock equivalent units.
Share-based compensation expense was:
$ 43 million in 2025,
$ 43 million in 2024 and
$ 36 million in 2023.
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OUR LONG-TERM INCENTIVE COMPENSATION PLAN
Our long-term incentive plan provides for share-based awards that include:
restricted stock,
restricted stock units (RSUs),
performance shares and
performance share units (PSUs).
We may issue future grants of up to 20 million shares under the 2022 Plan. We also have the right to reissue forfeited and expired grants. The Compensation Committee of our board of directors annually establishes an overall pool of stock awards available for grants based on performance.
For stock-settled awards, we issue new stock into the marketplace and generally do not repurchase shares in connection with issuance of new awards.
Our common shares would increase by approximately 24 million shares if all share-based awards were exercised or vested. These include:
all outstanding share-based awards at December 31, 2025 and
all remaining RSUs and PSUs that could be granted under the 2022 Plan.
HOW WE ACCOUNT FOR SHARE-BASED AWARDS
We recognize the cost of share-based awards using a fair-value-based measurement in our Consolidated Statement of Operations over the required service period — generally the period from the date of the grant to the date when it is fully vested. Special situations include:
Awards that vest upon retirement — the required service period ends on the date an employee is eligible for retirement, including early retirement.
Awards that continue to vest following job elimination or the sale of a business — the required service period ends on the date the employment from the company is terminated.
In these special situations, compensation expense from share-based awards is recognized over a period that is shorter than the stated vesting period. Forfeitures are recognized in compensation expense as they occur.
TAX BENEFITS OF SHARE-BASED AWARDS
Our total income tax benefit from share-based awards recognized in our Consolidated Statement of Operations for the last three years was:
$ 5 million in 2025,
$ 6 million in 2024 and
$ 5 million in 2023.
Tax benefits from share-based awards are accrued as stock compensation expense and realized when restricted shares, performance shares, RSUs and PSUs vest.
TYPES OF SHARE-BASED COMPENSATION
Our share-based compensation is in the form of RSUs and PSUs.
RESTRICTED STOCK UNITS
Through the 2022 Plan, we award RSUs — grants that entitle the holder to shares of our stock as the award vests.
The Details
Our RSUs granted in 2025, 2024 and 2023 generally:
vest ratably over four years ;
immediately vest in the event of death or disability while employed;
continue to vest upon retirement at an age of at least 62, in accordance with the vesting terms of the awards, but a portion of the award is forfeited if retirement occurs before the one-year anniversary of the grant;
continue vesting for one year in the event of involuntarytermination due to job elimination;
immediately vest in the case of a change of control, if the successor company does not assume the award or, if assumed, within two years of the effective date of the change in control the recipient is terminated other than for cause or leaves for good reason (as defined in the award terms and conditions) and
will be forfeited upon termination of employment in all other situations including early retirement prior to age 62.
Our Accounting
The fair value of our RSUs is the market price of our stock on the grant date of the awards.
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We generally record share-based compensation expense for RSUs over the four-year vesting period. Generally, for RSUs that continue to vest following the termination of employment, we record the share-based compensation expense over a required service period that is less than the stated vesting period.
Activity
The following table shows our RSU activity for 2025:
RESTRICTED
WEIGHTED
AVERAGE
STOCK UNITS
GRANT-DATE
(IN THOUSANDS)
FAIR VALUE
Nonvested at December 31, 2024
Granted
Vested
Forfeited
Nonvested at December 31, 2025 (1)
As of December 31, 2025, there were approximately 261 thousand RS Us that had met the requisite service period and will be released as identified in the grant terms.
The weighted average grant-date fair value for RSUs was:
$ 29.70 for 2025 grants,
$ 32.92 for 2024 grants and
$ 33.81 for 2023 grants.
The total grant-date fair value of RSUs vested was:
$ 25 million in 2025,
$ 24 million in 2024 and
$ 22 million in 2023.
Nonvested RSUs accrue dividends that are paid out when RSUs vest. Any RSUs forfeited will not receive dividends.
As RSUs vest, a portion of the shares awarded is withheld to cover employee taxes. As a result, the number of stock units vested and the number of common shares issued will differ.
PERFORMANCE SHARE UNITS
Through the 2022 Plan, we award PSUs — grants that entitle the holder to shares of our stock as the award vests.
The Details
The final number of shares granted in 2025, 2024 and 2023 will vest between a range of 0 percent to 150 percent of each grant’s target, depending upon actual company total shareholder return (TSR) compared against the TSR of an industry peer group. TSR assumes full reinvestment of dividends.
The vesting provisions for PSUs granted in 2025, 2024 and 2023 were generally as follows:
awards vest on March 1st following the end of the performance period, in each case as long as the individual remains employed by the company;
in the event of death or disability while employed, awards continue to be earned and settled based on actual company performance;
upon retirement at an age of at least 62, awards continue to vest in accordance with the vesting terms of the award, but a portion of the award is forfeited if retirement occurs before the one-year anniversary of the grant;
awards continue vesting for one year in the event of involuntarytermination due to job elimination and the second anniversary of the grant date has passed;
in the case of a change of control during the performance period, awards are deemed earned at target performance and (i) vest as of the change of control date if the successor company does not assume the award or (ii) if assumed, vest upon termination of employment if, within two years of the effective date of the change in control, the recipient is involuntarilyterminated other than for cause or leaves for good reason (as defined in the award terms and conditions);
awards will be forfeited upon termination of employment in all other situations including early retirement prior to age 62 and
awards vest at a maximum of 100 percent of target value in the event of negative absolute company TSR.
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Our Accounting
Since the awards contain a market condition, the effect of the market condition is reflected in the grant-date fair value which is estimated using a Monte Carlo simulation model. This model estimates the TSR ranking of the company over the performance period. Compensation expense is based on the estimated probable number of earned awards and recognized over the vesting period on an accelerated basis. Generally, compensation expense would not be reversed if the market condition is not achieved, provided the requisite service period has been completed.
Weighted Average Assumptions Used in Estimating the Value of PSUs
GRANTS
GRANTS
GRANTS
Performance period
Risk-free rate
Volatility
Valuation date closing stock price
Activity
The following table shows our PSU activity for 2025:
PERFORMANCE SHARE UNITS
WEIGHTED
AVERAGE
GRANT-DATE
(IN THOUSANDS)
FAIR VALUE
Nonvested at December 31, 2024
Granted at target
Vested
Forfeited
Performance adjustment
Nonvested at December 31, 2025 (1)
As of December 31, 2025, there were approximately 181 thousand PSUs that had met the requisite service period and will be released as identified in the grant terms.
The weighted average grant-date fair value for PSUs was:
$ 32.50 for 2025 grants,
$ 37.90 for 2024 grants and
$ 37.58 for 2023 grants.
The total grant-date fair value of PSUs vested was:
$ 7 million in 2025,
$ 12 million in 2024 and
$ 8 million in 2023.
Nonvested PSUs accrue dividends that are paid out when PSUs vest. Any PSUs forfeited will not receive dividends.
As PSUs vest, a portion of the shares awarded is withheld to cover participant taxes. As a result, the number of share units vested and the number of common shares issued will differ.
UNRECOGNIZED SHARE-BASED COMPENSATION
As of December 31, 2025, our unrecognized share-based compensation cost for all types of share-based awards included $ 54 million related to non-vested equity-classified share-based compensation arrangements. These are expected to be recognized over a weighted average period of approximately 2.3 years.
DEFERRED COMPENSATION STOCK EQUIVALENT UNITS
Certain employees and our board of directors may defer compensation into stock equivalent units.
The Details
Eligible employees:
may choose to defer all or part of their bonus into stock equivalent units and
receive a 15 percent premium if the deferral is for at least five years.
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Our directors:
receive a portion of their annual retainer fee in the form of RSUs, which vest over one year and may be deferred into stock equivalent units;
may choose to defer some or all of the remainder of their annual retainer fee into stock equivalent units and
do not receive a premium for their deferrals.
Employees and directors also choose when the deferrals will be paid out, although no deferrals may be paid until after the separation from service of the employee or director.
Our Accounting
We settle all deferred compensation accounts in cash for our employees. Our directors receive shares of common stock as payment for stock equivalent units, except that any directors who are subject to federal or provincial taxation in Canada have the choice to receive a cash amount equal to the fair market value of the company’s common stock on the date of payment. In addition, we credit all stock equivalent accounts with dividend equivalents. The number of common shares to be issued in the future to directors is 484 thousand as of December 31, 2025.
Stock equivalent units are liability-classified awards and remeasured to fair value at every reporting date.
The fair value of a stock equivalent unit is equal to the market price of our stock.
Activity
The number of stock equivalent units outstanding in our deferred compensation accounts was:
498 thousand as of December 31, 2025,
506 thousand as of December 31, 2024 and
530 thousand as of December 31, 2023.
NOTE 16: LEASES
The majority of our operating leases are related to our office and warehouse space, and our financing leases are related to vehicles and warehouse space. Our leases have remaining lease terms of approximately 1 year to 25 years . Options to renew, extend or terminate a lease are reflected in our lease terms when we believe it is reasonably certain we will exercise that option. When our leases do not provide an implicit or an explicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments.
Lease Expense
DOLLAR AMOUNTS IN MILLIONS
Operating lease costs
Financing lease costs
Total lease costs
Supplemental Cash Flow Information
DOLLAR AMOUNTS IN MILLIONS
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases
Financing cash flows for financing leases (1)
ROU assets obtained in exchange for new (modified) lease liabilities:
Operating leases
Financing leases
Interest expense related to financing leases was immaterial during 2025, 2024 and 2023 .
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Supplemental Balance Sheet Information Related to Leases
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
LEASES
BALANCE SHEET CLASSIFICATION
Assets
Operating lease ROU assets
Other assets
Financing lease ROU assets
Property and equipment, net
Total leased assets
Liabilities
Current:
Operating lease liabilities
Accrued liabilities
Financing lease liabilities
Accrued liabilities
Noncurrent:
Operating lease liabilities
Other liabilities
Financing lease liabilities
Other liabilities
Total lease liabilities
Weighted Average Remaining Lease Term
DECEMBER 31,
DECEMBER 31,
Operating leases
9 years
10 years
Financing leases
4 years
3 years
Weighted Average Discount Rate
DECEMBER 31,
DECEMBER 31,
Operating leases
Financing leases
Maturities of Lease Liabilities as of December 31, 2025
DOLLAR AMOUNTS IN MILLIONS
OPERATING
LEASES
FINANCING
LEASES
Thereafter
Total lease payments
Less: interest
Total present value of lease liabilities
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NOTE 17: OTHER OPERATING COSTS, NET
Other operating costs, net:
includes both recurring and non-recurring income and expense items and
can fluctuate from year to year.
Income and Expense Items Included in Other Operating Costs, Net
DOLLAR AMOUNTS IN MILLIONS
Environmental remediation charges
Gain on lumber mill sale
Insurance recoveries
Litigation expense, net
Product remediation recovery
Research and development expenses
Restructuring, impairments and other charges
Other, net
Total other operating costs, net
ASSET IMPAIRMENT
During third quarter 2024, we recorded a $ 10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill. The loss was attributable to our Wood Products segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
ENVIRONMENTAL REMEDIATION
During fourth quarter 2025, we recorded an $ 18 million noncash environmental remediation charge. This charge was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
During second quarter 2023, we recorded an $ 11 million noncash environmental remediation charge. This charge was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
INSURANCE RECOVERIES
During third quarter 2025, we received a $ 26 million insurance recovery. This recovery was attributable to our Unallocated segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
During fourth quarter 2023, we received a $ 14 million insurance recovery related to property damage and business interruption for certain of our mills in the southern U.S. as a result of severe winter storm damage in first quarter 2021. This recovery was attributable to our Wood Products segment and was recorded within “Other operating costs, net” in our Consolidated Statement of Operations .
GAIN ON LUMBER MILL SALE
During third quarter 2025, we recorded a $ 29 million gain from the sale of our Princeton lumber mill. The gain was attributable to our Wood Products segment and was recorded within "Other operating costs, net" in our Consolidated Statement of Operations .
PRODUCT REMEDIATION RECOVERY
Refer to Note 13: Legal Proceedings, Commitments and Contingencies for further information.
NOTE 18: INCOME TAXES
This note provides details about income taxes applicable to our operations, including the following:
earnings before income taxes,
provision for income taxes,
effective income tax rate,
deferred tax assets and liabilities and
unrecognized tax benefits.
The Income Taxes section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our income taxes.
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EARNINGS BEFORE INCOME TAXES
Domestic and Foreign Earnings Before Income Taxes
DOLLAR AMOUNTS IN MILLIONS
Domestic earnings
Foreign earnings
Total earnings before income taxes
PROVISION FOR INCOME TAXES
DOLLAR AMOUNTS IN MILLIONS
Current:
Federal
State
Foreign
Total current
Deferred:
Federal
State
Foreign
Total deferred
Total income tax (benefit) provision
EFFECTIVE INCOME TAX RATE
DOLLAR AMOUNTS IN MILLIONS
Dollars
Percent
Dollars
Percent
Dollars
Percent
U.S. federal statutory income tax
Domestic, Federal
REIT income not subject to federal income tax
Nontaxable and nondeductible items
Intra-entity transfers
Return to provision adjustment
Other
Domestic state and local income taxes, net of federal effect (1)
Foreign tax effects
Canada
Income tax rate differential
Provincial income taxes
Withholding taxes
Other
Total income tax (benefit) provision
In 2025, state and local income taxes in Mississippi and Louisiana contributed to the majority of domestic state income taxes, net of federal effect. In 2024 and 2023, state and local income taxes in Oregon contributed to the majority of domestic state income taxes, net of federal effect.
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INCOME TAXES PAID
DOLLAR AMOUNTS IN MILLIONS
U.S. Federal
U.S. State and local
Foreign
Canada
Subtotal foreign taxes paid
Total income taxes paid
DEFERRED TAX ASSETS AND LIABILITIES
Deferred tax assets and liabilities reflect the future tax effect created by differences between the timing of when income or deductions are recognized for pretax financial book reporting purposes versus income tax purposes. Deferred tax assets represent a future tax benefit (or reduction to income taxes in a future period), while deferred tax liabilities represent a future tax obligation (or increase to income taxes in a future period).
Balance Sheet Classification of Deferred Income Tax Assets (Liabilities)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Net noncurrent deferred tax asset
Net noncurrent deferred tax liability
Net deferred tax asset (liability)
Items Included in Our Deferred Income Tax Assets (Liabilities)
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Deferred tax assets:
Pension and post-employment benefits
State tax credits
Environmental reserves
Intra-entity transfers
Net operating loss carryforwards
Other
Gross deferred tax assets
Valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Property, plant and equipment
Other
Net deferred tax liabilities
Net deferred tax asset (liability)
Net Operating Loss and Credit Carryforwards
Our gross federal, state and foreign net operating loss carryforwards as of December 31, 2025 totaled $ 1.5 billion as follows:
Federal — U.S. REITs — $ 245 million that do not expire; U.S. TRSs — $ 561 million that do not expire;
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State — $ 705 million, $ 552 million of the total will begin to expire in 2028 and
Foreign — none currently recorded.
Our gross state credit carryforwards as of December 31, 2025 totaled $ 60 million , which includes $ 10 million that expire from 2026 through 2037 . Our U.S. TRSs hav e $ 8 million in foreign tax credit carryforwards that expire from 2027 through 2031 .
Valuation Allowances
With the exception of the valuation allowance discussed below, we believe it is more likely than not that we will have sufficient future taxable income to realize our deferred tax assets.
Our valuation allowance on our deferred tax assets was $ 81 million as of December 31, 2025, which related to state credits, state net operating losses and foreign tax credits.
UNRECOGNIZED TAX BENEFITS
Unrecognized tax benefits represent potential future obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. In accordance with our accounting policy, we accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense (see Note 1: Summary of Significant Accounting Policies ). The total gross amount of unrecognized tax benefits as of December 31, 2025 and 2024, as well as the activity during those years, were immaterial.
As of December 31, 2025, none of our U.S. federal income tax returns are under examination, with tax years 2022 forward open to examination. We are undergoing examination in foreign jurisdictions for the 2022 tax year, with tax years 2018 forward open to examination. We are undergoing examinations in state jurisdictions for tax years 2020 through 2024, with tax years 2009 forward open to examination. We do not expect that the outcome of any examination will have a material effect on our consolidated financial statements; however, audit outcomes and the timing of audit settlements are subject to significant uncertainty.
TAX LEGISLATION
On July 4, 2025, H.R. 1, commonly known as the One Big, Beautiful Bill Act (the OBBBA), was enacted. The OBBBA contains significant changes to corporate taxation, including accelerated deductions for capital spending, expensing of research and development costs and increased deductibility of interest expense. Additionally, effective for taxable years beginning after December 31, 2025, the value of TRS securities that a REIT may hold will increase from 20 percent to 25 percent of the value of the REIT’s total assets. The enactment of the OBBBA did not materially impact our 2025 financial statements.
NOTE 19: GEOGRAPHIC AREAS
This note provides selected key financial data according to the geographical locations of our customers.
SALES
Our sales to unaffiliated customers outside the U.S. are primarily to customers in Canada, Japan, China and Korea. Our export sales from the U.S. are comprised primarily of logs, lumber and wood chips to customers in those same countries.
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Sales by Geographic Area
DOLLAR AMOUNTS IN MILLIONS
Sales to unaffiliated customers:
Canada
Japan
China
Korea
Other foreign countries
Total
Export sales from the U.S.:
Japan
Canada
China
Korea
Other foreign countries
Total
LONG-LIVED ASSETS
Our long-lived assets used in the generation of revenues in different geographical areas are nearly all in the U.S. and Canada. Our long-lived assets primarily include:
property and equipment, including construction in progress,
timber and timberlands and
minerals and mineral rights.
Long-Lived Assets by Geographic Area
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Canada
Total
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NOTE 20: PRINCETON LUMBER MILL DIVESTITURE
On September 2, 2025, we completed the sale of our Princeton lumber mill for approximately $ 85 million. The total purchase price is inclusive of mill assets, the associated timber licenses in British Columbia and the value of working capital as of the closing date. Pursuant to the transaction closing, a gain on the sale of $ 29 million was recognized within our Wood Products segment in "Other operating costs, net" in our Consolidated Statement of Operations . The transfer of all associated timber licenses in British Columbia remains subject to regulatory approval as of fourth quarter 2025, which we expect will follow in the ensuing months. A portion of the total purchase price is held in escrow as of the date of the sale and will be released in conjunction with the transfer of the associated timber licenses. We recorded this portion within "Receivables, net" and "Other assets, net" on our Consolidated Balance Sheet .
NOTE 21: RESTRICTED CASH
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported on our Consolidated Balance Sheet that sum to the total of the amounts shown in our Consolidated Statement of Cash Flows :
DOLLAR AMOUNTS IN MILLIONS
DECEMBER 31,
DECEMBER 31,
Cash and cash equivalents
Restricted cash included in prepaid expenses and other current assets (1)
Total cash, cash equivalents and restricted cash
Amounts included in restricted cash as of December 31, 2025 were comprised of the remaining loaned proceeds from the issuance of 3.875 % resource recovery revenue bonds due in October 2065 that were restricted for use to reimburse capital expenditures incurred in the construction of our TimberStrand ® facility in Monticello, Arkansas. In first quarter 2026, we satisfied the contractual restrictions for release of these funds.
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CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
The company’s principal executive officer and principal financial officer have evaluated the effectiveness of the company’s disclosure controls and procedures as of the end of the period covered by this annual report on Form 10-K. Disclosure controls are controls and other procedures that are designed to ensure that information required to be disclosed in the reports filed or submitted under the Securities Exchange Act of 1934, as amended (Act), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s (SEC) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, to allow timely decisions regarding required disclosure.
Based on their evaluation, the company’s principal executive officer and principal financial officer have concluded that the company’s disclosure controls and procedures are effective to ensure that information required to be disclosed complies with the SEC’s rules and forms.
CHANGES IN INTERNAL CONTROL
No changes occurred in the company's internal control over financial reporting during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal control over financial reporting as is defined in the Securities Exchange Act of 1934 rules. Management, under our supervision, conducted an evaluation of the effectiveness of the company’s internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under the framework in Internal Control — Integrated Framework (2013), management concluded that the company’s internal control over financial reporting was effective as of December 31, 2025. The effectiveness of the company’s internal control over financial reporting as of December 31, 2025 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report, which is included herein.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors
Weyerhaeuser Company:
Opinion on Internal Control Over Financial Reporting
We have audited Weyerhaeuser Company and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, cash flows, and changes in equity for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements), and our report dated February 13, 2026 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Seattle, Washington
February 13, 2026
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OTHER INFORMATION
INFORMATION REQUIRED PURSUANT TO FORM 8-K
The following disclosures are provided in compliance with Item 5.02(e) of Form 8-K.
On February 13, 2026, the company’s board of directors approved certain amendments to the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees. The plan, which sets forth the general terms and conditions for the annual cash incentive bonus for employees, including the company’s executive officers, was amended and restated primarily to give the compensation committee of the board of directors greater flexibility to establish performance goals and to clarify management’s authority with respect to non-executive officer plan participant bonus awards.
In accordance with Item 9.01(d) of Form 8-K, a copy of the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees, as amended and restatedeffective as of February 13, 2026, is filed as Exhibit 10(u) to this annual report on Form 10-K.
The foregoing description of the Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees, as amended and restatedeffective as of February 13, 2026, is a general description only, does not purport to be complete and is qualified in its entirety by reference to the plan, which is filed as an exhibit to this annual report on Form 10-K and is incorporated herein by reference.
INSIDER TRADING ARRANGEMENTS
During fourth quarter 2025 , no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the company adopted, modified or terminated a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or a non-Rule 10b5-1 trading arrangement.
D IRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
A list of our executive officers and their biographical information can be found in Part I of this report in the Our Business — Information About Our Executive Officers section. Other information required by this item to Form 10-K will be set forth under the headings "Item 1. Election of Directors,” “Corporate Governance” and "Executive Compensation" in our Notice of the 2026 Annual Meeting and Proxy Statement for the company’s Annual Meeting of Shareholders to be held May 15, 2026, which will be filed not later than 120 days after December 31, 2025 (2026 Proxy Statement), and in each case such required information is incorporated herein by reference.
The Weyerhaeuser Code of Ethics applies to our chief executive officer (our principal executive officer), our chief financial officer (our principal financial officer) and our chief accounting officer (our principal accounting officer), as well as other officers, directors and employees of the company. Our Code of Ethics is available on our website at https://www.weyerhaeuser.com/company/values/integrity/. We will satisfy any disclosure requirement under Item 5.05 of Form 8-K regarding any reportable amendment to, or waiver from, any provision of the Code of Ethics by disclosing the nature of any such amendment or waiver on our website within four business days following the date thereof.
EXECUTIVE COMPENSATION
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the headings “Director Compensation," “Executive Compensation,” “Compensation Committee Report” and “Compensation Committee Interlocks and Insider Participation,” and in each case such required information is incorporated herein by reference.
S ECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Stock Information,” and such required information is incorporated herein by reference.
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Corporate Governance,” and such required information is incorporated herein by reference.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Our independent registered public accounting firm is KPMG LLP, Seattle, WA, Auditor Firm ID: 185 .
Information required by this item to Form 10-K will be set forth in the 2026 Proxy Statement under the heading “Item 3. Ratify Appointment of the Independent Auditors,” and such required information is incorporated herein by reference.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
All financial statement schedules have been omitted because they are not applicable or the required information is included in the consolidated financial statements, or the notes thereto, in Financial Statements and Supplementary Data above.
The agreements included as exhibits to this annual report are included to provide information about their terms and not to provide any other factual or disclosure information about the company or the other parties to the agreements. The agreements may contain representations and warranties by each party to the applicable agreement that were made solely for the benefit of the other party to the agreement and should not be treated as categorical statements of fact, but rather as a way of allocating the risk among the parties if those statements prove to be inaccurate. These representations and warranties may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement, may apply standards of materiality in a way that is different from what may be viewed as material to investors, were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement, and are subject to more recent developments. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time.
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EXHIBITS
Articles of Incorporation
Articles of Incorporation (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q filed on May 6, 2011 – Commission File Number 1-4825, and to Exhibit 3.1 to the Current Report on Form 8-K filed on June 20, 2013 – Commission File Number 1-4825)
Bylaws (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q filed on October 26, 2018 – Commission File Number 1-4825)
Instruments Defining the Rights of Security Holders, Including Indentures
Indenture dated as of April 1, 1986 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 333-36753 )
First Supplemental Indenture dated as of February 15, 1991 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 33-52982)**
Second Supplemental Indenture dated as of February 1, 1993 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference from the Registration Statement on Form S-3, Registration No. 33-59974)**
Third Supplemental Indenture dated as of October 22, 2001 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4(d) to the Registration Statement on Form S-3, Registration No. 333-72356)
Fourth Supplemental Indenture dated as of March 12, 2002 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4.8 from the Registration Statement on Form S-4/A, Registration No. 333-82376)
Fifth Supplemental Indenture dated as of March 30, 2020 between Weyerhaeuser Company and The Bank of New York Mellon Trust Company, N.A. (as successor to JPMorgan Chase Bank, formerly known as The Chase Manhattan Bank and Chemical Bank), a national banking association, as Trustee (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on March 30, 2020 - Commission File Number 1-4825)
Officer’s Certificate dated February 25, 2019 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on February 25, 2019 – Commission File Number 1-4825)
Officer’s Certificate dated March 30, 2020 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on March 30, 2020 – Commission File Number 1-4825)
Officer’s Certificate dated March 9, 2022 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on March 9, 2022 – Commission File Number 1-4825)
Officer’s Certificate dated May 17, 2023 executed by Weyerhaeuser Company, as Issuer (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on May 17, 2023 – Commission File Number 1-4825)
As permitted by SEC regulations, the company has not filed certain instruments defining the rights of holders of long-term debt of the company or its consolidated subsidiaries under which the total amount of securities authorized does not exceed 10% of the total assets of the company and its consolidated subsidiaries. The company agrees to furnish to the SEC upon request a copy of any omitted instrument.
Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4(r) to the Annual Report on Form 10-K for the annual period ended December 31, 2019 – Commission File Number 1-4825)
Material Contracts
Form of Weyerhaeuser Executive Change of Control Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser CEO Change of Control Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Executive Severance Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser CEO Severance Agreement, as in effect as of November 13, 2025 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on November 18, 2025 – Commission File Number 1-4825)*
Weyerhaeuser Company 2013 Long-Term Incentive Plan (Amended and RestatedEffective August 14, 2020) (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed on October 30, 2020 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2013 Long-Term Incentive Plan Stock Option Award Terms and Conditions (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on April 16, 2013 – Commission File Number 1-4825)*
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Form of Weyerhaeuser Company 2013 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2022 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 24, 2022 – Commission File Number 1-4825)*
Weyerhaeuser Company 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2022 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2023 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 23, 2023 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2023 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 23, 2023 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 24, 2024 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2024 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 24, 2024 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2025 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 28, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2025 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 28, 2025 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Performance Share Unit Award Terms and Conditions for Plan Year 2026 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 27, 2026 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Restricted Stock Unit Award Terms and Conditions for Plan Year 2026 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 27, 2026 – Commission File Number 1-4825)*
Plum Creek Supplemental Pension Plan (incorporated by reference to Exhibit 10(dd) to the Annual Report on Form 10-K for the annual period ended December 31, 2016 – Commission File Number 1-4825)*
Plum Creek Pension Plan (incorporated by reference to Exhibit 10(ee) to the Annual Report on Form 10-K for the period ended December 31, 2016 – Commission File Number 1-4825)*
Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees (as amended effective February 14, 2020) (incorporated by reference to Exhibit 10(u) to the Annual Report on Form 10-K for the annual period ended December 31, 2019 – Commission File Number 1-4825)*
Weyerhaeuser Company Amended and Restated Annual Incentive Plan for Salaried Employees (as amended effective February 13, 2026)*
Weyerhaeuser Company 2015 Deferred Compensation Plan (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on December 22, 2014 – Commission File Number 1-4825)*
Weyerhaeuser Company 2023 Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 17, 2022 – Commission File Number 1-4825)*
Weyerhaeuser Company Salaried Employees Supplemental Retirement Plan (incorporated by reference to Exhibit 10(p) to the Annual Report on Form 10-K for the annual period ended December 31, 2004 – Commission File Number 1-4825)*
2011 Fee Deferral Plan for Directors of Weyerhaeuser Company (Amended and RestatedEffective January 1, 2016) (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on May 6, 2016 – Commission File Number 1-4825)*
2011 Fee Deferral Plan for Directors of Weyerhaeuser Company (Amended and RestatedEffective August 14, 2020) (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on October 30, 2020 – Commission File Number 1-4825)*
Form of Weyerhaeuser Company 2022 Long-Term Incentive Plan Director Restricted Stock Unit Award Terms and Conditions for Plan Years beginning May 13, 2022 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on May 13, 2022 – Commission File Number 1-4825)*
Amended and Restated Revolving Credit Facility Agreement dated as of June 30, 2025 among Weyerhaeuser Company, as Borrower, the lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 3, 2025 – Commission File Number 1-4825)
Term Loan Agreement dated as of August 25, 2025 among Weyerhaeuser Company, as Parent, Weyerhaeuser NR Company, as Borrower, the lenders party thereto, and Truist Bank, as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 28, 2025 – Commission File Number 1-4825)
Guarantee Agreement dated as of August 25, 2025 between Weyerhaeuser Company, as Guarantor, and Truist Bank, as Administrative Agent (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on August 28, 2025 – Commission File Number 1-4825)
Weyerhaeuser Company Insider Trading Policy (incorporated by reference to Exhibit 19 to the Annual Report on Form 10-K for the annual period ended December 31, 2024 – Commission File Number 1-4825)
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Subsidiaries of the Registrant
Consent of Independent Registered Public Accounting Firm
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended
Certification pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350)
Weyerhaeuser Compensation Recovery Policy (incorporated by reference to Exhibit 97 to the Annual Report on Form 10-K for the annual period ended December 31, 2023 – Commission File Number 1-4825)*
The cover page from Weyerhaeuser Company’s Annual Report on Form 10-K for the year ended December 31, 2024 has been formatted in Inline XBRL.
* Denotes a management contract or compensatory plan or arrangement.
** Filed in paper - hyperlink not required pursuant to Rule 105 of Regulation S-T
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized February 13, 2026.
WEYERHAEUSER COMPANY
/s/ DEVIN W. STOCKFISH
Devin W. Stockfish
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities indicated February 13, 2026.
/s/ DEVIN W. STOCKFISH
/s/ DAVID M. WOLD
Devin W. Stockfish
Principal Executive Officer and Director
David M. Wold
Principal Financial Officer
/s/ ALEX G. WHITNEY
/s/ KIM WILLIAMS
Alex G. Whitney
Principal Accounting Officer
Kim Williams
Director
/s/ SARA GROOTWASSINK LEWIS
/s/ RICK R. HOLLEY
Sara Grootwassink Lewis
Director
Rick R. Holley
Chairman of the Board and Director
/s/ NICOLE W. PIASECKI
/s/ AL MONACO
Nicole W. Piasecki
Director
Al Monaco
Director
/s/ LAWRENCE A. SELZER
/s/ DEIDRA C. MERRIWETHER
Lawrence A. Selzer
Director
Deidra C. Merriwether
Director
/s/ MARK A. EMMERT
/s/ JAMES C. O’ROURKE
Mark A. Emmert
Director
James C. O’Rourke
Director
/s/ RICHARD BECKWITT
Richard Beckwitt
Director
WEYERHAEUSER COMPANY > 2025 ANNUAL REPORT AND FORM 10-K 115
