Mondelez International, Inc.

Macroeconomic environment

We continue to observe significant market and geopolitical uncertainty, fluctuating consumer demand, inflationary pressures, supply constraints, trade and regulatory uncertainty and exchange rate volatility. As a result, we experienced significantly higher operating costs, including higher overall raw material, labor and energy costs that have continued to rise. In particular, while we expect cocoa costs to be lower in 2026 compared to the current year, we expect to continue to face elevated cocoa costs as compared to historical levels in the near- and medium-term. Refer to Commodity Trends for additional information.

Our overall outlook for future snacks revenue growth remains strong; however, we anticipate ongoing volatility. While we have responded to elevated raw material costs with pricing increases for certain of our products, the elasticity impacts from those pricing increases has adversely impacted consumer demand, particularly in the United States and Europe. We will continue to proactively manage our business in response to the evolving global economic environment, related uncertainty and business risks while also prioritizing and supporting our employees and customers. We continue to take steps to mitigate impacts to our supply chain, operations, technology and assets.

Trade and Regulatory Uncertainty

In many markets, including the United States, a portion of our products, including significant inputs, are imported from other jurisdictions. As of January 2026, the U.S. maintains higher tariffs on imported goods (finished products and inputs) from many trading partners as compared to prior years. Some of these tariffs have increased our costs for finished products, as well as some ingredients and packaging used to produce and distribute our products. In some cases, U.S. tariff policy has also resulted in retaliatory measures on U.S. goods entering foreign markets. For most products and materials imported to the United States from Mexico and Canada, we comply with the terms of the U.S.-Mexico-Canada Agreement and are therefore not subject to tariffs on most products and materials imported from those jurisdictions. However, the current trade environment continues to evolve rapidly and there can be no assurance that such products and materials will continue to be exempt. The implementation of additional protectionist trade measures, and any further retaliatory actions taken in response, could result in increased costs and pricing pressures, disrupt consumer spending patterns, and impact market stability and consumer confidence, any or all of which could adversely affect our operating results.

Additionally, we provide more information on risks related to trade and regulatory uncertainty in our Business Trends section and under Item 1A, Risk Factors.

War in Ukraine

In February 2022, following the Russian military invasion of Ukraine, we stopped production and closed our facilities in Ukraine; since then we have taken steps to protect the safety of our employees and to restore operations at our two manufacturing facilities, which were significantly damaged in March 2022. Refer to Items Affecting Comparability of Financial Results for additional information.

We have suspended new capital investments and our advertising spending in Russia, but as a food company with more than 2,500 employees in the country, we have not ceased operations because we believe that we play a role in the continuity of the food supply. We continue to evaluate the situation in Ukraine and Russia and our ability to control our operating activities and businesses on an ongoing basis and comply with applicable international sanctions. We continue to consolidate both our Ukrainian and Russian subsidiaries. During 2025, Ukraine generated 0.4% and Russia generated 3.7% of our consolidated net revenue. The profitability of and the assets held by our Russian business continue to remain above historic levels. We cannot predict if the recent strength in our Russian business will continue in the future.

Our operations in Russia are subject to risks, including the temporary or permanent loss of assets due to expropriation or further curtailment of our ability to conduct business operations in Russia. In the event this were to occur, this could lead to the partial or full impairment of our Russian assets or deconsolidation of the operations in Russia in future periods, or the termination of and loss of revenue from our business operations, based on actions taken by Russia, other parties or us. For additional information, refer to Item 1A, Risk Factors, including the risk entitled “The war in Ukraine has impacted and could continue to impact our business operations, financial performance and results of operations.”

Developments in the Middle East

In October 2023, conflict developed in the Middle East between Hamas and Israel, and has expanded to other parts of the region. Throughout 2024 and 2025, we experienced limited adverse sales impacts related to this conflict in certain AMEA markets, but this did not have a material impact on our business, results of operations or financial condition. We continue to evaluate the impacts of these developments, including ongoing geopolitical discussions, on our business and we cannot predict if it will have a significant impact in the future.

Extreme Price Growth in Argentina and Other Currency-Related Items

During December 2023, the Argentinean peso significantly devalued. The peso's devaluation and potential resulting distortion on our non-GAAP Organic Net Revenue, Organic Net Revenue growth and other constant currency growth rate measures resulted in our decision to exclude the impact of pricing increases in excess of 26% year-over-year ("extreme pricing") in Argentina, from these measures beginning in the first quarter of 2024. The benchmark of 26% represents the minimum annual inflation rate for each year over a 3-year period which would result in a cumulative inflation rate in excess of 100%, the level at which an economy is considered hyperinflationary under U.S. GAAP. Throughout the following MD&A discussion, we exclude the impact of extreme pricing in Argentina from the net pricing impact of Organic Net Revenue and Organic Net Revenue growth and its related impact on our other non-GAAP financial constant currency growth measures. Additionally within this MD&A discussion, "currency-related items" reflect the impacts of extreme pricing and year-over-year currency translation rate changes. Refer to Non-GAAP financial measuresfor additional information.

Currency-related items impacted our non-GAAP financial measures for the year ended December 31, 2025 as follows:

•Organic Net Revenue: In total, favorable currency-related items of $241 million (0.7 pp) were driven by favorable currency translation rate changes of $192 million (0.6 pp) and extreme pricing of $49 million (0.1 pp). In Emerging Markets, unfavorable currency-related items of $134 million (0.9 pp) were driven by unfavorable currency translation rate changes of $183 million (1.3 pp), partially offset by extreme pricing of $49 million (0.4 pp). In Developed Markets, favorable currency-related items of $375 million (1.7 pp) were driven by favorable currency translation rate changes.

•Adjusted Operating Income: Favorable currency-related items of $94 million were driven by favorable currency translation rate changes of $86 million and extreme pricing of $8 million.

•Adjusted EPS: In 2025, favorable currency-related items of $0.06 were driven by favorable currency translation rate changes of $0.05 and extreme pricing of $0.01.

ERP System Implementation

In July 2024, our Board of Directors approved funding of $1.2 billion for a multi-year systems transformation program to upgrade our global ERP and supply chain systems (the “ERP System Implementation”). ERP System Implementation spending comprises both capital expenditures and operating expenses, of which a majority is expected to relate to operating expenses. The operating expenses associated with the ERP System Implementation represent incremental transformational costs above the normal ongoing level of spending on information technology to support operations. The ERP System Implementation program will be implemented by region in several phases with spending continuing over the next three years, with expected completion by year-end 2028. Refer to Non-GAAP financial measures for additional information.

Acquisitions and Divestitures

During 2024, we completed the acquisition of Evirth (Shanghai) Industrial Co., Ltd. (“Evirth”), a leading manufacturer of cakes and pastries in China. Refer to Note 2, Acquisitions and Divestituresfor additional details.

Equity Method Investment Transactions

JDE Peet’s Transactions (Euronext Amsterdam: “JDEP”)

On August 24, 2025, Keurig Dr Pepper Inc. (Nasdaq: "KDP") and JDEP entered into a definitive agreement under which KDP would acquire JDEP. As a result of that definitive agreement, we became entitled to a cash payment of €145 million ($169 million) from JAB Holding Company (“JAB”) that we received in 2025.

In the first quarter of 2024, we recorded an impairment charge of €612 million ($665 million) related to our JDEP investment. In the fourth quarter of 2024, we sold our remaining 85.9 million shares in JDEP to JAB. We received €2.2 billion ($2.3 billion) of proceeds and recorded a gain on equity method investment transactions of €313 million ($332 million).

In 2023, we sold approximately 9.9 million of our shares, which reduced our ownership interest by 2.0 percentage points, from 19.7% to 17.7%. We received cash proceeds of €255 million ($279 million) and recorded a loss of €21 million ($23 million).

Keurig Dr Pepper Transactions

During the first quarter of 2023, our ownership in KDP fell to below 5% of the outstanding shares, resulting in a change in the accounting for our KDP investment, from equity method investment accounting to accounting for equity interests with readily determinable fair values as we no longer retained significant influence. Prior to the change in accounting for our KDP investment, we sold 30 million shares of that investment. Subsequently in 2023, we sold the remainder of our shares of KDP and exited our investment in the company. In total during 2023, we sold approximately 76 million shares and received proceeds of $2.4 billion.

For additional information, refer to Note 7, Investmentsand Note 9, Financial Instruments.

Mondelēz Global and Canada Retirement Plan Settlements

Mondelēz Global LLC Retirement Plan Settlement

During 2024, we entered into agreements with two third-party insurance companies to purchase buy-in annuity contracts to cover the liabilities associated with the Mondelēz Global LLC Retirement Plan (“MDLZ Global Plan”), the pension plan for U.S. salaried employees. The agreements provided us with the option to elect a buy-out conversion, at which time full responsibility of the MDLZ Global Plan obligations would transfer to the insurance companies. On June 12, 2025 we elected the buy-out conversion and recognized a non-cash pre-tax settlement loss of $282 million as a component of our net periodic pension cost in the second quarter of 2025.

Mondelez Canada Inc. - Trusteed Hourly Retirement Plan and Retirement Plan Settlement

During the third quarter of 2025, we entered into an agreement with a third-party insurance company to buy-out the retiree participants' obligations of the Mondelez Canada Inc. Trusteed Hourly Retirement Plan and Mondelez Canada Inc. Retirement Plan. On September 11, 2025, the obligations were transferred to the insurance company and we recognized a non-cash pre-tax settlement loss of $54 million as a component of our net periodic pension cost in the third quarter of 2025.

For additional information, refer to Note 10, Benefit Plans.

Taxes

We continue to monitor existing and potential future tax reform around the world. Numerous countries have enacted the Organization of Economic Cooperation and Development’s (OECD) model rules for a global minimum tax, effective in 2024. The existing legislation does not have a material impact on our consolidated financial statements. On January 5, 2026, the OECD Inclusive Framework members approved changes to the model rules, including the introduction of a “side by side” rule which would exempt U.S.-parented companies from certain aspects of the global minimum tax regime. The updated model rules will need to be incorporated into local tax legislation to be effective. We do not expect the new rules to have a material impact on our consolidated financial statements.

On July 4, 2025, the OBBBA was signed into U.S. law. While we continue to monitor supplemental guidance released by the government, there was no material impact to our financial statements for the year ended December 31, 2025.