3M CO

3M is a diversified global manufacturer, technology innovator and marketer of a wide variety of products and services. As discussed in Note 1, certain changes are reflective in this document for all applicable periods presented.

As discussed in Note 2, on April 1, 2024, 3M completed the separation of its Health Care business (the Separation) through a pro rata distribution of 80.1% of the outstanding shares of Solventum Corporation (Solventum) to 3M stockholders. As a result, Solventum became an independent public company, 3M no longer consolidates Solventum into 3M’s financial results and the historical net income of Solventum, and applicable assets and liabilities included in the Separation are reported in 3M's consolidated financial statements as discontinued operations.

3M manages its continuing operations in three operating business segments: Safety and Industrial; Transportation and Electronics; and Consumer. From a geographic perspective, EMEA refers to Europe, the Middle East, and Africa on a combined basis.

Unless otherwise noted, any sales change analysis compares the third quarter and the first nine months of 2025 with the corresponding periods in 2024, year-on-year (YoY).

Financial highlights for the third quarter and first nine months of 2025:

1 The Company refers to various "adjusted" amounts or measures on an “adjusted" basis. These exclude special items. These non-GAAP measures are further described and reconciled to the most directly comparable GAAP financial measures in the Certain amounts adjusted for special items - (non-GAAP measures) section below.

2 Organic sales change (which includes both organic volume and selling price impacts), is defined as the change in net sales, absent the impacts from foreign currency translation and acquisitions, net of divestitures. 3M believes this information is useful to investors and management in understanding ongoing operations and in analysis of ongoing operating trends.

Net sales change was driven by strength in safety, general industrial, and electronics, partially offset by known softness in auto aftermarket, while consumer remained soft. Sales change also reflected the YoY impact of the manufactured PFAS products special item.

GAAP operating margins were affected by the YoY impact of special items. These primarily included an increase in net costs for significant litigation impacting operating income from the second quarter 2025 PFAS-related New Jersey Settlement (discussed in Note 17), followed by a decrease in the third quarter resulting from insurance recoveries, a third quarter 2025 charge associated with divestiture activity (discussed in Note 4), and manufactured PFAS products. Both GAAP and adjusted operating margins reflect benefits from growth and productivity (outside of special items), and lower restructuring costs, partially offset by growth investments, as well as gross tariff and foreign currency impacts.

Additionally, margins YoY were impacted by cost dis-synergies (from the ongoing exit of PFAS manufacturing and second quarter 2024 spin of Solventum), and by transition service agreement reimbursement from Solventum, which began in the second quarter of 2024, and by the lower extent of stock-based compensation grants (see the Certain Expenses Impacting Multiple Line Items within Results of Operation discussion below).

GAAP EPS YoY was negatively affected by the net impact of special items. In addition to items relative to operating income discussed above, this primarily included the YOY impact of the change in value of Solventum ownership and a $795 million pre-tax pension settlement charge in the second quarter 2024 (as discussed in Note 13), partially offset by lower imputed interest associated with obligations resulting from significant litigation. Both GAAP and adjusted EPS reflects benefits from growth and productivity (outside of special items) and lower restructuring costs, a second quarter 2025 gain on the sale of an investment (see the Income from Unconsolidated Subsidiaries, Net of Taxes discussion below), and the impact of lower share count. These were partially offset by higher growth investments, gross tariff and foreign currency impacts, and a non-operating interest and pension headwind (apart from pension special item).

Additionally, EPS YoY was impacted by cost dis-synergies (from the ongoing exit of PFAS manufacturing and second quarter 2024 spin of Solventum), and by transition service agreement reimbursement from Solventum, which began in the second quarter of 2024, and by the lower extent of stock-based compensation grants.

3M is progressing toward the exit of PFAS manufacturing by the end of 2025 as discussed Part II, Item 1A, “Risk Factors” of this document. Decisions or circumstances associated with the extent and type of remaining non-PFAS activity at particular locations and impacts on assets and potential obligations, among other factors, could result in additional expenses.

Additional information regarding certain items impacting pre-2025 periods that may also be relevant in 2025 can be found in the Overview section of Part II, Item 7 as well as in further sections of 3M’s 2024 Annual Report on Form 10-K.