Kraft Heinz Co

The non-GAAP financial measures we provide in this report should be viewed in addition to, and not as an alternative for, results prepared in accordance with U.S. GAAP.

To supplement the condensed consolidated financial statements prepared in accordance with U.S. GAAP, we have presented Organic Net Sales, Adjusted Operating Income, and Adjusted EPS, which are considered non-GAAP financial measures. The non-GAAP financial measures presented may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define these non-GAAP financial measures in the same way. These measures are not substitutes for their comparable U.S. GAAP financial measures, such as net sales, net income/(loss), operating income(loss), diluted EPS, or other measures prescribed by U.S. GAAP, and there are limitations to using non-GAAP financial measures.

Management uses these non-GAAP financial measures to assist in comparing our performance on a consistent basis for purposes of business decision making by removing the impact of certain items that management believes do not directly reflect our underlying operations. We believe that Organic Net Sales, Adjusted Operating Income, and Adjusted EPS provide important comparability of underlying operating results, allowing investors and management to assess the Company’s operating performance on a consistent basis.

Management believes that presenting our non-GAAP financial measures is useful to investors because it (i) provides investors with meaningful supplemental information regarding financial performance by excluding certain items, (ii) permits investors to view performance using the same tools that management uses to budget, make operating and strategic decisions, and evaluate historical performance, and (iii) otherwise provides supplemental information that may be useful to investors in evaluating our results. We believe that the presentation of these non-GAAP financial measures, when considered together with the corresponding U.S. GAAP financial measures and the reconciliations to those measures, provides investors with additional understanding of the factors and trends affecting our business than could be obtained absent these disclosures.

Organic Net Sales is defined as net sales excluding, when they occur, the impact of currency, acquisitions and divestitures, and a 53rd week of shipments. We calculate the impact of currency on net sales by holding exchange rates constant at the previous year’s exchange rate, with the exception of highly inflationary subsidiaries, for which we calculate the previous year’s results using the current year’s exchange rate.

Adjusted Operating Income is defined as operating income excluding, when they occur, the impacts restructuring activities, deal costs, separation costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized; once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, and certain non-ordinary course legal and regulatory matters.

Adjusted EPS is defined as diluted EPS excluding, when they occur, the impacts of restructuring activities, deal costs, separation costs, unrealized losses/(gains) on commodity hedges, impairment losses, certain non-ordinary course legal and regulatory matters, losses/(gains) on the sale of a business, other losses/(gains) related to acquisitions and divestitures (e.g., tax and hedging impacts), nonmonetary currency devaluation (e.g., remeasurement gains and losses), debt prepayment and extinguishment (benefit)/costs, and certain significant discrete income tax items, and including, when they occur, adjustments to reflect preferred stock dividend payments on an accrual basis.

Reconciliation of Net Sales to Organic Net Sales

(dollars in millions)

Reconciliation of Operating Income/(Loss) to Adjusted Operating Income

(dollars in millions)

Reconciliation of Diluted EPS to Adjusted EPS

(a) Gross expenses/(income) included in restructuring activities were income of $23 million ($18 million after-tax) for the three months ended March 28, 2026 and expenses of $4 million ($3 million after-tax) for the three months ended March 29, 2025 and were recorded in the following income statement line items:

•Cost of products sold included expenses of $23 million for the three months ended March 28, 2026 and income of $2 million for the three months ended March 29, 2025; and

•SG&A included income of $1 million for the three months ended March 28, 2026 and expenses of $6 million for the three months ended March 29, 2025; and

•Other expense/(income) included income of $45 million for the three months ended March 28, 2026.

(b) Gross income included in unrealized losses/(gains) on commodity hedges was $178 million ($134 million after-tax) for the three months ended March 28, 2026 and $1 million ($1 million after-tax) for the three months ended March 29, 2025, and were recorded in cost of products sold.

(c) Gross impairment losses included the following:

•Intangible asset impairment losses of $13 million ($13 million after-tax) for the three months ended March 28, 2026, which were recorded in SG&A.

(d) Gross expenses included in separation costs were $56 million ($45 million after-tax) for the three months ended March 28, 2026 and were recorded in SG&A.

(e) Gross expenses/(income) included in losses/(gains) on sale of business was income of $3 million ($29 million after-tax) for the three months ended March 28, 2026 and were recorded in other expense/(income).

(f) Gross expenses included in nonmonetary currency devaluation were $12 million ($12 million after-tax) for the three months ended March 28, 2026 and $14 million ($14 million after-tax) for the three months ended March 29, 2025 and were recorded in other expense/(income).

(g) Certain significant discrete income tax items were an expense of $13 million for the three months ended March 29, 2025. The expense represents movement in the valuation allowance against deferred tax assets in our subsidiary in Brazil and adjustments recorded to the deferred tax asset and valuation allowance related to the transfer of business operations to a wholly-owned subsidiary in the Netherlands in December 2024.