3M CO

The section entitled Business Segmentsin Item 1 within 3M's 2024 Annual Report on Form 10-K provides an overview of 3M’s business segments including discussion of 3M products that are included in each business segment. In addition, disclosures relating to 3M’s business segments are provided in Note 19. 3M manages its continuing operations in three business segments. The reportable segments are Safety and Industrial; Transportation and Electronics; and Consumer.

First quarter 2025 results: Sales in Safety and Industrial were up 0.5 percent in U.S. dollars.

•Sales increased in electrical markets, industrial adhesives and tapes, roofing granules, industrial specialties and personal safety, and decreased in automotive aftermarket and abrasives.

•Growth primarily came from electrical markets with strong demand for cable accessories from construction of data centers and renewable energy projects and from industrial adhesives and tapes with strength in industrial and electronic bonding solutions driven by continued share gains in structural adhesives.

Business segment operating income margins increased YoY driven by benefits from growth, lower restructuring costs, productivity partially offset by continued growth investments in the business, timing of stock-based compensation and cost dis-synergies due to the spin of Solventum.

Adjusting for special item net costs for significant litigation (non-GAAP measure) related to respirator mask/asbestos, business segment operating income margins increased YoY from 24.3 percent to 25.5 percent. Refer to the Certain amounts adjusted for special items - (non-GAAP measures) section below for additional details.

First quarter 2025 results: Sales in Transportation and Electronics were down 5.4 percent in U.S. dollars.

•Sales increased in commercial branding and transportation and decreased in advanced materials, electronics and automotive and aerospace.

•Growth was negatively impacted by headwinds related to PFAS manufactured products.

•The electronics business was negatively impacted by lower device demand, while the automotive OEM business was down reflecting continued weakness in auto builds, particularly in Europe and the U.S. This was partially offset by growth from commercial aircraft and defense related business in aerospace and from project wins in advanced materials.

Business segment operating income margins decreased YoY due to challenging comparison against last year's strong share gains from spec-in wins and new product introductions in automotive and consumer electronics, cost dis-synergies due to the spin of Solventum and exit of PFAS manufacturing, continued growth investments in the business, timing of stock-based compensation partially offset by benefits from growth, lower restructuring costs and productivity.

Adjusting for special item PFAS manufactured products (non-GAAP measure), sales of $1,816 million were down 0.4 percent YoY in U.S. dollars, or up 1.1 percent organically while business segment operating income margins decreased YoY from 26.3 percent to 21.5 percent. Refer to the Certain amounts adjusted for special items - (non-GAAP measures) section below for additional details.

First quarter 2025 results: Sales in Consumer were down 1.4 percent in U.S. dollars.

•Sales increased in consumer safety and well-being, were flat in home improvement and home and auto care and decreased in packaging and expression.

•Growth was led by consumer safety & well-being driven by demand for Filtrete™ filters and respiratory products.

•Home improvement and home and auto care were both flat with growth driven by investment and new product innovation in paint protection and Meguiar’s™ auto care partially offset by soft consumer spending, principally in Command™ and packaging and expression.

Business segment operating income margins increased YoY driven by benefits from growth, productivity, and lower restructuring costs partially offset by continued growth investments in the business, timing of stock-based compensation and cost dis-synergies due to the spin of Solventum.

Corporate and Other: Outside of 3M's reportable operating segments, 3M has Corporate and Other which is not a reportable business segment as it does not meet the segment reporting criteria. Because Corporate and Other includes a variety of miscellaneous items, it is subject to fluctuation on a quarterly and annual basis. Corporate and Other are further described in Note 19.

Other corporate operating expenses, net, decreased YoY in the first three months of 2025 primarily due to the extent of transition arrangement income from divested businesses (and associated costs) largely related to Solventum's April 2024 Separation as well as the extent of non-discontinued operations-eligible former Solventum-allocated costs included in Corporate and Other prior to the Separation. Refer to the Certain amounts adjusted for special items - (non-GAAP measures) section and Note 19 for additional details on the components of corporate special items and their impact.

Certain amounts adjusted for special items - (non-GAAP measures)

In addition to reporting financial results in accordance with U.S. GAAP, 3M also provides certain non-GAAP measures. These measures are not in accordance with, nor are they a substitute for GAAP measures, and may not be comparable to similarly titled measures used by other companies.

Certain measures adjust for the impacts of special items. Special items for the periods presented include the items described in the section entitled “Description of special items”. Because 3M provides certain information with respect to business segments, it is noteworthy that special items impacting operating income (loss) are reflected in Corporate and Other, except as described with respect to net costs for significant litigation and manufactured PFAS products items in the “Description of special items” section. The reconciliations below, therefore, also include impacted segments as applicable.

This document contains measures for which 3M provides the reported GAAP measure and a non-GAAP measure adjusted for special items. The document also contains additional measures which are not defined under U.S. GAAP. These measures and reasons 3M believes they are useful to investors (and, as applicable, used by 3M) include:

Special items for the periods presented include:

Net costs for significant litigation:

•These relate to 3M's respirator mask/asbestos (which include Aearo and non-Aearo items), PFAS-related other environmental, and Combat Arms Earplugs matters (as discussed in Note 17). Net costs include the impacts of changes in accrued liabilities (including interest imputation on applicable settlement obligations), legal costs, and insurance recoveries, along with the associated tax impacts. Associated tax impacts of significant litigation include impacts on Foreign Derived Intangible Income (FDII), Global Intangible Low Taxed Income (GILTI), foreign tax credits and tax costs of repatriation. 3M does not consider the elements of the net costs associated with these matters to be normal, operating expenses related to the Company’s ongoing operations, revenue generating activities, business strategy, industry, and regulatory environment. Net costs related to respirator mask/asbestos are reflected as special items in the Safety and Industrial business segment while those impacting operating income (loss) associated with PFAS-related other environmental and Combat Arms Earplugs matters are reflected as corporate special items in Corporate and Other.

Divestiture costs:

•These include certain limited costs that were not eligible to be included within discontinued operations related to separating and divesting substantially an entire business segment of 3M following public announcement of its intended divestiture. As a result of completion of the April 2024 separation of Solventum, this includes the tax cost of updating 3M’s previous indefinite reinvestment plans on past unrepatriated earnings through the period of the Separation’s close and to tax positions retained by 3M.

Manufactured PFAS products:

•These amounts relate to sales and estimates of income (loss) regarding manufactured PFAS products that 3M plans to exit by the end of 2025 included within the Transportation and Electronics business segment. Estimated income does not contemplate impacts on non-operating items such as net interest income/expense and the non-service cost components portion of defined benefit plan net periodic benefit costs.

Solventum ownership - change in value:

•This amount relates to the change in value of 3M's retained ownership interest in Solventum common stock reflected in other expense (income), net.