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What changed in International Flavors & Fragrances's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of International Flavors & Fragrances's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+395 added−515 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in International Flavors & Fragrances's 2025 10-K

395 paragraphs added · 515 removed · 257 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

65 edited+10 added−42 removed24 unchanged
Biggest changeIn order to ensure our supply of raw materials, achieve favorable pricing and provide timely transparency regarding inflationary trends to our customers, we continue to focus on: • purchasing under contract with fixed or formula-based pricing for set time periods; • entering into hedging for raw materials we purchase that can be hedged against liquid commodity assets; • entering into supplier relationships to gain access to supplies we would not otherwise have; • implementing indexed pricing; • reducing the complexity of our formulations; • evaluating the profitability of whether to buy or make an ingredient; • sourcing from local countries with our own procurement professionals; and • periodically assessing our supply base with a view towards greater cost efficiencies and improvements.
Biggest changeTo ensure a reliable supply of raw materials, achieve favorable pricing and provide timely pricing information to our customers, we continue to focus on: • negotiating contracts with fixed or formula-based pricing for defined periods • hedging raw materials that can be linked to liquid commodity assets • building strategic supplier relationships to access critical materials • implementing indexed pricing models 5 Table of Contents • reducing formulation complexity • evaluating make-versus-buy decisions for ingredients • sourcing locally through in-country procurement professionals • periodically assessing our supply base to drive cost efficiency and improvement Manufacturing and Distribution As of December 31, 2025, we had approximately 170 manufacturing facilities, creative centers and application laboratories located in approximately 30 different countries.
The global market for our products has expanded, primarily as a result of an increase in demand for, and an increase in the variety of, consumer products. The market for our products is highly competitive.
The global market for our products has expanded, primarily as a result of an increase in demand for, and in the variety of, consumer products. The market for our products is highly competitive.
Our main competitors consist of (1) other large global companies, such as Givaudan, DSM-Firmenich, Symrise, Kerry, ADM, and Novonesis, (2) mid-sized companies, (3) numerous regional and local manufacturers and (4) consumer product companies who may develop their own competing products.
Our main competitors consist of (1) other large global companies, such as Givaudan, Novonesis, DSM-Firmenich, Symrise, Kerry, and ADM, (2) mid-sized companies, (3) numerous regional and local manufacturers and (4) consumer product companies who may develop their own competing products.
We offer corresponding development opportunities to include specialized courses for employees globally by partnering with leading institutions and universities to help provide the latest training and development offerings at all levels. We also offer to our employees an extensive library of on-demand courses and materials on leadership, management and professional skills development.
We offer corresponding development opportunities to include specialized courses for employees globally by partnering with leading institutions and universities to help provide the latest training and development offerings at all levels. We also offer our employees an extensive library of on-demand courses and materials on leadership, management and professional skills development.
To compete more successfully, we must make continued investments in customer relationships and tailor our research and development efforts to anticipate customers’ needs, provide effective service and secure and maintain inclusion on these “core lists.” Private label manufacturers, mostly medium-sized, local or small food manufacturers, constitute a growing segment in certain markets where we are active.
To compete successfully, we must make continued investments in customer relationships and tailor our research and development efforts to anticipate customers’ needs, provide effective service and secure and maintain inclusion on these “core lists.” Private label manufacturers, mostly medium-sized, local or small food manufacturers, constitute a growing segment in certain markets where we are active.
Our products are sold principally to manufacturers of dairy, meat, beverages, snacks, savory, sweet, baked goods, grain processors and other foods, personal care products, soaps and detergents, cleaning products, perfumes, dietary supplements, food protection, infant, elderly and animal nutrition, functional food, pharmaceutical and oral care products.
Our products are sold principally to manufacturers of dairy, meat, beverages, snacks, savory and sweet goods, baked goods, grain processors and other foods, personal care products, soaps and detergents, cleaning products, perfumes, dietary supplements, food protection, infant, elderly and animal nutrition, functional food, and oral care products.
These agencies include (1) the Food and Drug Administration and equivalent international agencies that regulate flavors, pharmaceutical excipients and other ingredients in consumer products, (2) the Environmental Protection Agency and equivalent international agencies that regulate our manufacturing facilities, as well as fragrance products (including encapsulation systems), (3) the Occupational Safety and Health Administration and equivalent international agencies that regulate the working conditions in our manufacturing, research laboratories and creative centers, (4) local and international agencies that regulate trade and customs, (5) the Drug Enforcement Administration and other local or international agencies that regulate controlled chemicals that we use in our operations, (6) the Chemical Registration/Notification authorities that regulate chemicals that we use in, or transport to, the various countries in which we manufacture and/or market our products, and (7) the U.S.
These agencies include (1) the Food and Drug Administration and equivalent international agencies that regulate flavors and other ingredients in consumer products, (2) the Environmental Protection Agency and equivalent international agencies that regulate our manufacturing facilities, as well as fragrance products (including encapsulation systems), (3) the Occupational Safety and Health Administration and equivalent international agencies that regulate the working conditions in our manufacturing, research laboratories and creative centers, (4) local and international agencies that regulate trade and customs, (5) the Drug Enforcement Administration and other local or international agencies that regulate controlled chemicals that we use in our operations, (6) the Chemical Registration/Notification authorities that regulate chemicals that we use in, or transport to, the various countries in which we manufacture and/or market our products, and (7) the U.S.
Gonçalves served as President, Specialty Ingredients and Global Foods from February 2020 to November 2023. Prior to joining ADM, Ms. Gonçalves served for more than 25 years at Monsanto, now part of Bayer, in a variety of senior leadership roles, including Senior Vice President, U.S. Country Division Head and President for Europe and the Middle East.
Gonçalves Lourenço served as President, Specialty Ingredients and Global Foods from February 2020 to November 2023. Prior to joining ADM, Ms. Gonçalves Lourenço served for more than 25 years at Monsanto, now part of Bayer, in a variety of senior leadership roles, including Senior Vice President, U.S. Country Division Head and President for Europe and the Middle East.
The business’s enzyme solutions also allow our customers to provide low sugar, high fiber and lactose-free dairy products. 3 Table of Contents Home & Personal Care produces enzymes for laundry and dishwashing detergents, cleaning and textiles to help enhance the product and process performance of products in the fabric and home care, textiles and industrials and personal care markets.
The business’s enzyme solutions also allow our customers to provide low sugar, high fiber and lactose-free dairy products. Home & Personal Care produces enzymes for laundry and dishwashing detergents, cleaning and textiles to help enhance the product and process performance of products in the fabric and home care, textiles and industrials and personal care markets.
Natural food protection ingredients consist of natural antioxidants and anti-microbials used for natural food preservation and shelf-life extension for beverages, cosmetic and healthcare products, pet food and feed additives. Ingredients also includes savory solutions (such as spices, marinades, mixtures) and inclusion products (such as products combining flavorings with fruit, vegetables and other natural ingredients), formerly part of Food Designs.
Natural food protection ingredients consist of natural antioxidants and anti-microbials used for natural food preservation and shelf-life extension for beverages, cosmetic and healthcare products, pet food and feed additives. Food Ingredients also includes savory solutions (such as spices, marinades, and mixtures) and inclusion products (such as products combining flavorings with fruit, vegetables and other natural ingredients).
Our products are sold principally to manufacturers of dairy, meat, beverages, snacks, savory, sweet, baked goods, grain processors and other foods, personal care products, soaps and detergents, cleaning products, perfumes, dietary supplements, food protection, infant, elderly and animal nutrition, functional food, pharmaceutical and oral care products.
Our products are sold principally to manufacturers of dairy, meat, beverages, snacks, savory, sweet, baked goods, grain processors and other foods, personal care products, soaps and detergents, cleaning products, perfumes, dietary supplements, food protection, infant, elderly and animal nutrition, functional food, bio-fuel, and oral care products.
Stephen Landsman has served as our Executive Vice President, Business Development since August 2024. Previously, Mr. Landsman served as Group General Counsel from May 2018 to July 2024 and Global Head of Mergers and Acquisitions from June 2017 to May 2018 with Syngenta. Prior to joining Syngenta, Mr.
Stephen Landsman has served as our Executive Vice President, General Counsel since July 2025. From August 2024 to July 2025, Mr. Landsman served as our Executive Vice President, Business Development. Previously, Mr. Landsman served as Group General Counsel from May 2018 to July 2024 and Global Head of Mergers and Acquisitions from June 2017 to May 2018 with Syngenta.
Muller served as SVP Global Sales, Innovation and Marketing at DuPont from 2013 to 2015 and held various leadership roles in marketing and sales within Sensient and DuPont Nutrition and Health, formerly Danisco from 2001 to 2013. Mr. Muller began his career at Sabores y Fragancias in 1984 as a fragrance compounder.
Muller served as SVP Global Sales, Innovation and Marketing at DuPont from 2013 to 2015 and held various leadership roles in marketing and sales within Sensient and DuPont Nutrition 9 Table of Contents and Health, formerly Danisco from 2001 to 2013. Mr. Muller began his career at Sabores y Fragancias in 1984 as a fragrance compounder.
We believe that our ability to create products with the sustainability related attributes customers expect and compete successfully in the various sub-market is based on: • our in-depth understanding of consumers, • vertical integration, • innovation and technological advances from our research and development activities and, as applicable, our scientists, • our ability to tailor products to customers’ needs, • our ability to manufacture products on a global scale, and • broad-based regulatory capabilities.
We believe that our ability to create products with the sustainability-related attributes customers expect and compete successfully in the various sub-markets is based on, among other things: • our in-depth understanding of our customers and consumers, • vertical integration, • innovation and technological advances from our research and development activities and, as applicable, our scientists, • our ability to tailor products to customers’ needs, and • our ability to manufacture products on a global scale.
Culture and Values Our culture is based on our four corporate values of passion, partnership, persistence and principled, and the expression of these values can be seen and felt throughout our history. Our employees appreciate that they contribute to products that touch and enhance the lives of millions of people around the world.
Culture and Values Our culture is based on our four corporate values of passionate, partners, persistent and principled, and the expression of these values can be seen and felt throughout our history. Our employees appreciate that they contribute to products that touch and enhance the lives of millions of people around the world.
As of December 31, 2024, we purchased approximately 20,000 different raw materials sourced from an extensive network of domestic and international suppliers and distributors. Natural ingredients are derived from flowers, fruits and other botanical products, as well as from plant, animal and marine products, and commodity crops like wheat, corn and soy.
As of December 31, 2025, we sourced approximately 20,000 different raw materials from a broad network of domestic and international suppliers and distributors. Natural ingredients are derived from flowers, fruits and other botanical products, as well as from plant, animal and marine products, and commodity crops like wheat, corn and soy.
As of December 31, 2024, we employed approximately 3,400 people globally in research and development activities (including innovation, creation and design activities).
As of December 31, 2025, we employed approximately 3,000 people globally in research and development activities (including innovation, creation and design activities).
Flavors include a range of flavor compounds and natural taste solutions that are ultimately used by our customers in savory products (soups, sauces, meat, fish, poultry, snacks, etc.), beverages (juice drinks, carbonated or flavored beverages, spirits, etc.), sweets (bakery products, candy, cereal, chewing gum, etc.), and dairy products (yogurt, ice cream, cheese, etc.).
Taste Our Taste segment consists of the development and production of a range of flavor compounds and natural taste solutions that are ultimately used by our customers in a diverse variety of products, including savory products (soups, sauces, meat, fish, poultry, snacks, etc.), beverages (juice drinks, carbonated or flavored beverages, spirits, etc.), sweets (bakery products, candy, cereal, chewing gum, etc.), and dairy products (yogurt, ice cream, cheese, etc.).
As a result, we hold global leadership positions in the Food & Beverage, Home & Personal Care and Health & Wellness markets, and across key Tastes, Textures, Scents, Nutrition, Enzymes, Cultures, Soy Proteins, Pharmaceutical Excipients and Probiotics categories. Sales in 2024 were $11.484 billion.
As a result, we hold global leadership positions in the Food & Beverage, Home & Personal Care and Health & Wellness markets, and across key Tastes, Textures, Scents, Nutrition, Enzymes, Cultures, Soy Proteins and Probiotics categories, among others. Sales in 2025 were $10.890 billion.
Prior to joining Honeywell, he worked in research and plant management roles for Hoechst AG. 10 Table of Contents Leticia Gonçalves will serve as our President, Health & Biosciences starting March 2025. Previously, Ms. Gonçalves was ADM’s President, Precision Fermentation and ADM Ventures from December 2023 to February 2025. Prior to that, Ms.
Prior to joining Honeywell, he worked in research and plant management roles for Hoechst AG. Leticia Gonçalves Lourenço has served as our President, Health & Biosciences since March 2025. Previously, Ms. Gonçalves Lourenço was ADM’s President, Precision Fermentation and ADM Ventures from December 2023 to February 2025. Prior to that, Ms.
ITEM 1. BUSINESS. We are a leading creator and manufacturer of food, beverage, health & biosciences, scent and pharma solutions and complementary adjacent products, including natural health ingredients, which are used in a wide variety of consumer products.
ITEM 1. BUSINESS. We are a leading creator and manufacturer of products for application in food, beverage, health & biosciences, and scent, as well as complementary adjacent products, including natural health ingredients, all of which are used in a wide variety of consumer and end-use products.
Cultures & Food Enzymes provides products that aim to serve the global demand for healthy, natural, clean label and fermented food for fresh dairy, cheese, bakery and brewing products. Such products contribute to extended shelf life, stability, taste and texture, helping our customers to improve their product offerings.
Health provides ingredients for dietary supplements, functional food and beverage, specialized nutrition and pharma. Food Biosciences provides products that aim to serve the global demand for healthy, natural, clean label and fermented food for fresh dairy, cheese, bakery and brewing products. Such products contribute to extended shelf life, stability, taste and texture, helping our customers to improve their product offerings.
We have seen an increase in registration and reporting requirements concerning the use of certain chemicals in a number of countries, such as Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”) regulations in the European Union, as well as similar regulations in other countries. 7 Table of Contents In addition, we are subject to various rules relating to health, work safety and the environment at the local and international levels in the various countries in which we operate.
We have seen an increase in registration and reporting requirements concerning the use of certain chemicals in a number of countries, such as Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”) regulations in the European Union, as well as similar regulations in other countries. 6 Table of Contents In addition to product-specific regulations, we are subject to health, workplace safety, and environmental standards at both local and international levels.
We completed the divestiture of our Cosmetic Ingredients business, previously within the Scent segment, on April 2, 2024. Fragrance Compounds are unique and proprietary combinations of multiple fragrance ingredients that are ultimately used by our customers in their consumer goods. Our creative and commercial teams within fragrance compounds are organized into two broad categories: fine fragrances and consumer fragrances.
The Scent segment is comprised of Fragrance Compounds and Fragrance Ingredients. Fragrance Compounds are unique and proprietary combinations of multiple fragrance ingredients that are ultimately used by our customers in their consumer goods. Our creative and commercial teams within fragrance compounds are organized into two broad categories: fine fragrances and consumer fragrances.
In addition, we continue to support transparency and accountability through our submission to CDP Climate Change, Water Security and Forests. IFF continues to be listed in the FTSE4Good Index series as well as being named as one of America’s Most Responsible Companies by Newsweek.
We continue to support transparency and accountability through our submission to CDP Climate Change, Water Security and Forests, specifically named to CDP’s A list for climate change for the tenth time since 2015. Lastly, we continue to be listed in the FTSE4Good Index series as well as being named as one of America’s Most Responsible Companies by Newsweek.
Landsman served as Executive Vice President, General Counsel and Corporate Secretary for Univar, Inc. from 2013 to 2017. Prior to that, Mr. Landsman served as Vice President, General Counsel and Corporate Secretary at Nalco Company from 2003 to 2013, following various leadership positions within Nalco since 1990. Ana Paula Teles de Mendonça has served as President, Scent since April 2024.
Prior to joining Syngenta, Mr. Landsman served as Executive Vice President, General Counsel and Corporate Secretary for Univar, Inc. from 2013 to 2017. Prior to that, Mr. Landsman served as Vice President, General Counsel and Corporate Secretary at Nalco Company from 2003 to 2013, following various leadership positions within Nalco since 1990.
Previously, Ms. Mendonça served as our Senior Vice President, Commercial Excellence from December 2022 to February 2024. Prior to that, she served as Vice President, President Global Ingredients & Regional General Manager, North America, Consumer Fragrances since February 2022, and, before that, as Vice President, Regional General Manager, North America, Consumer Fragrances since January 2016. Ms.
Prior to that, she served as Vice President, President Global Ingredients & Regional General Manager, North America, Consumer Fragrances since February 2022, and, before that, as Vice President, Regional General Manager, North America, Consumer Fragrances since January 2016. Ms.
Erik Fyrwald (1) 65 Chief Executive Officer and member of our Board of Directors Yuvraj Arora (1) 53 President, Taste and Chief Commercial Officer Deborah Borg (1) 48 Executive Vice President, Chief People & Culture Officer Michael DeVeau (1) 44 Executive Vice President, Chief Financial Officer Ralf Finzel (1) 61 Executive Vice President, Global Operations Officer Leticia Gonçalves (1)(2) 50 President, Health & Biosciences Simon Herriott (1)(2) 61 President, Health & Biosciences Jennifer Johnson (1) 50 Executive Vice President, General Counsel and Corporate Secretary Stephen Landsman 65 Executive Vice President, Business Development Ana Paula Teles de Mendonça (1) 56 President, Scent Andres Muller (1) 60 President, Food Ingredients Angela Strzelecki (1) 58 President, Pharma Solutions Vivek Verma 56 Executive Vice President, Chief Information Officer _____________________ (1) These individuals are executive officers and file reports under Section 16 of the Securities Exchange Act of 1934.
Erik Fyrwald (1) 66 Chief Executive Officer and member of our Board of Directors Yuvraj Arora (1) 54 President, Taste and Chief Commercial Officer Deborah Borg (1) 49 Executive Vice President, Chief People & Culture Officer Michael DeVeau (1) 45 Executive Vice President, Chief Financial Officer Ralf Finzel (1) 62 Executive Vice President, Global Operations Officer Leticia Gonçalves Lourenço (1) 51 President, Health & Biosciences Stephen Landsman (1) 66 Executive Vice President, General Counsel Ana Paula Teles de Mendonça (1) 57 President, Scent Andres Muller (1) 61 President, Food Ingredients Vivek Verma 57 Executive Vice President, Chief Information Officer _____________________ (1) These individuals are executive officers and file reports under Section 16 of the Securities Exchange Act of 1934. 8 Table of Contents J.
Fyrwald joined us from Syngenta, where he served as Chief Executive Officer since 2016. Prior to his role at Syngenta, Mr.
Erik Fyrwald has served as our Chief Executive Officer and a member of our Board of Directors since February 2024. Mr. Fyrwald joined us from Syngenta, where he served as Chief Executive Officer since 2016. Prior to his role at Syngenta, Mr.
Verma held several other leadership positions at American Express as well as Vice President, Division CIO and management consulting roles with GlaxoSmithKline, Bristol Myers Squibb and PricewaterhouseCoopers.
Verma served as Vice President of Global Infrastructure Operations at American Express, a multinational financial services company. Prior to that, Mr. Verma held several other leadership positions at American Express as well as Vice President, Division CIO and management consulting roles with GlaxoSmithKline, Bristol Myers Squibb and PricewaterhouseCoopers.
Flavors also include value-added spices and seasoning ingredients for meat, food service, convenience, alternative protein and culinary products. Health & Biosciences Our Health & Biosciences segment consists of the development and production of an advanced biotechnology-derived portfolio of enzymes, food cultures, probiotics and specialty ingredients for food and non-food applications.
Health & Biosciences Our Health & Biosciences segment consists of the development and production of an advanced biotechnology-derived portfolio of enzymes, food cultures, probiotics and specialty ingredients for food and non-food applications.
Across these four pillars, the Company continued to achieve notable recognitions in 2024. For example, we qualified as a constituent of the Dow Jones Sustainability Indices, North America, for the fifth consecutive year, a best-in-class benchmark for investors who recognize that sustainable business practices are critical to generating long-term shareholder value.
In addition, we maintained our position as a constituent of the Dow Jones Sustainability Indices, North America, a best-in-class benchmark for investors who recognize that sustainable business practices are critical to generating long-term shareholder value.
Consumer insights, science and creativity are at the heart of our Scent business, and, along with our unique portfolio of natural and synthetic ingredients, global footprint, innovative technologies and know-how, and customer intimacy, we believe make us a market leader in scent products. The Scent segment is comprised of Fragrance Compounds and Fragrance Ingredients.
Scent Our Scent segment creates fragrance compounds and fragrance ingredients that are integral elements in the world’s finest perfumes and best-known household and personal care products. Consumer insights, science and creativity are at the heart of our Scent business, along with our unique portfolio of natural and synthetic ingredients, global footprint, innovative technologies and know-how, and customer intimacy.
Using the knowledge gained from our consumer insights programs and business unit needs, we strategically focus our resources around key research and development platforms that address or anticipate consumer needs or preferences. Our innovation-based platforms are aligned with key consumer insight-led growth themes: improving home and personal care, empowering wellbeing and healthy lives, transforming food systems and accelerating climate solutions.
Guided by our consumer insights programs and business unit priorities, we strategically align our resources around key research and development platforms that address or anticipate consumer needs. These platforms reflect growth themes driven by consumer insights, such as improving home and personal care, empowering wellbeing and healthy lives, transforming food systems and accelerating climate solutions.
Our business is geographically diverse, with sales in the U.S. representing approximately 28% of sales in 2024. No other country represented more than 10% of sales. In 2024, no customer accounted for 10% or more of sales. Our Product Offerings As of December 31, 2024, our business consisted of four segments: Nourish, Health & Biosciences, Scent and Pharma Solutions.
Our business is geographically diverse, with sales in the U.S. representing approximately 28% of sales in 2025. No other country represented more than 10% of sales. In 2025, no customer accounted for 10% or more of sales.
Ingredients include a diversified portfolio across natural and plant-based specialty food ingredients derived from herbs and plants that provide texturizing solutions used in the food industry, food protection solutions used in food and beverage products, as well as specialty soy and pea protein with value-added formulations, emulsifiers and sweeteners.
Food Ingredients Our Food Ingredients segment consists of a diversified portfolio across natural, artificial and plant-based specialty food ingredients that provide functional properties solutions for food and beverage products, as well as specialty soy and pea protein with value-added formulations, emulsifiers and sweeteners.
Manufacturing and Distribution As of December 31, 2024, we had approximately 150 manufacturing facilities, creative centers and application laboratories located in approximately 40 different countries. Our major manufacturing facilities are located in the United States, The Netherlands, Spain, Germany, Indonesia, Turkey, Brazil, Mexico, Slovenia, China, India, Ireland, Norway, Finland, Denmark, Belgium and Singapore.
Our major manufacturing sites are located in the United States, The Netherlands, Spain, Germany, Indonesia, Turkey, Brazil, Mexico, Slovenia, China, India, Ireland, Norway, Finland, Denmark, Belgium and Singapore.
Creative Application Through our global network of creative centers and application laboratories, we create or adapt the basic Nourish, Health & Biosciences, Scent and Pharma Solutions products that we have developed in the research and development process to commercialize for use in our customers’ consumer products.
Creative Application Through our global network of creative centers and application laboratories, we transform the Taste, Health & Biosciences, Scent and Food Ingredients (and, prior to its disposition, Pharma Solutions) products that we have developed in the research and development process into commercially viable solutions for our customers.
Our principal basic research and development activities are located in Union Beach, New Jersey; Wilmington, Delaware; Palo Alto, California; Brabrand, Denmark; and Leiden, The Netherlands.
We have developed unique molecules and delivery systems for our customers that serve as the foundations of successful products around the world. Our principal basic research and development activities are located in Union Beach, New Jersey; Wilmington, Delaware; Palo Alto, California; Brabrand, Denmark; and Leiden, The Netherlands.
We continue to monitor existing and pending laws and regulations and while the impact of regulatory changes cannot be predicted with certainty, compliance has not had, and is not expected to have a material adverse effect on capital expenditure, earnings or competitive position.
We continuously monitor existing and emerging regulations, and although the impact of future changes cannot be predicted with certainty, compliance has not had, and is not expected to have, a material adverse effect on our capital expenditures, earnings, or competitive position. Our products and operations are regulated by governmental agencies in the local markets in which we operate.
In recent years, there has been an increase in the stringency of environmental regulation and enforcement of environmental standards, and the costs of compliance have risen significantly, a trend we expect will continue in the future.
Our manufacturing facilities worldwide must comply with environmental regulations governing air emissions, wastewater discharge, hazardous material usage, waste disposal, and remediation of existing contamination. In recent years, there has been an increase in the stringency of environmental regulation and enforcement of environmental standards, and the costs of compliance have risen significantly, a trend we expect will continue in the future.
The SEC maintains an Internet website, www.sec.gov, that contains reports, proxy and information statements and other information that we file electronically with the SEC.
The SEC maintains an Internet website, www.sec.gov, that contains reports, proxy and information statements and other information that we file electronically with the SEC. Information on, or accessible through, our website is not incorporated by reference into this Form 10-K.
Most of our formulas are treated as trade secrets and remain our proprietary assets. Our business is not materially dependent upon any individual patent, trademark or license.
These efforts often result in stronger value propositions for our customers. Most of our formulas are treated as trade secrets and remain proprietary assets. Our business is not materially dependent upon any individual patent, trademark or license. Supply Chain Procurement Our products rely on both natural and synthetic ingredients.
Our robust culture ambassador and colleague community program continues to engage a broad portion of the IFF community in building common identity and shared purpose and strengthen engagement and motivation by providing programming on IFF values and providing recognition of individuals who exemplify them. 8 Table of Contents IFF strives to have a culture on inclusion and belonging where all employees can thrive.
Our robust culture ambassador and colleague community program engage a broad portion of the IFF community in building common identity and shared purpose as well as strengthening engagement and motivation by providing programming on IFF values and recognition of individuals who exemplify them. 7 Table of Contents Leadership and Development Our leadership development efforts empower employees to become forward-looking, inspiring and capable decision-makers, agents of change and great leaders.
Governmental Regulation We develop, produce and market our products in a number of jurisdictions around the world and are subject to federal, regional and local legislation and regulations in various countries.
Governmental Regulation We develop, produce and market our products in a number of jurisdictions around the world which are subject to federal, regional and local legislation and regulations in various countries. Our products used in industries such as food and beverage, dietary supplements, home and personal care, and animal feed, must comply with strict quality, regulatory, and environmental standards.
We focus and invest substantial resources in the research and development of new and innovative molecules, compounds, formulations and technologies and the application of these to our customers’ products.
We have strong product and application development pipelines built upon a global network of research and development, as well as regulatory and product stewardship capabilities. 4 Table of Contents We invest substantial resources in the research and development of new and innovative molecules, compounds, formulations and technologies and the application of these to our customers’ products.
After numerous R&D and sales roles, he formed his own flavors and fragrances company, which Bush Boake Allen later acquired in 2000. Angela Strzelecki has served as our President, Pharma Solutions since February 2021. From 2019 to February 2021, Dr. Strzelecki was Global Business Director, Pharma Solutions for the N&B Business.
After numerous R&D and sales roles, he formed his own flavors and fragrances company, which Bush Boake Allen later acquired in 2000. Vivek Verma has served as our Executive Vice President, Chief Information Officer since February 2021 and had previously served as our Senior Vice President, Chief Information Officer from 2016 to February 2021. Before joining the Company, Mr.
The business also produces patented enzymatic polymers that are renewable, biodegradable alternatives to functional ingredients used in home cleaning and beauty care products. Animal Nutrition produces feed enzymes and animal health solutions that help to improve nutrition, welfare, performance and sustainability of livestock animal farming. Grain Processing produces yeasts and enzymes for biofuel production and carbohydrate processing.
Animal Nutrition produces feed enzymes and animal health solutions that help to improve nutrition, welfare, performance and sustainability of livestock animal farming. 3 Table of Contents Grain Processing produces yeasts and enzymes for biofuel production and carbohydrate processing.
Pharma Solutions Our Pharma Solutions segment produces, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling the development of more effective pharmaceutical finished dosage formulations. Our excipients are used in prescription and over-the-counter pharmaceuticals and dietary supplements.
Pharma Solutions Our former Pharma Solutions segment produced, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used in prescription and over-the-counter pharmaceuticals and dietary supplements.
Research and Development We consider our research and development infrastructure to be one of our key competencies and critical to our ability to provide differentiated products to our customers. We have strong product and application development pipelines built upon a global network that includes research and development, as well as regulatory and product stewardship capabilities.
Research and Development We consider our research and development infrastructure to be one of our key competencies and critical to our ability to provide differentiated products to our customers.
Consumer preferences tend to drive change in our markets, and as science evolves and sustainability continues to be a key factor to customers and consumers, we must continue to strengthen our research and development platforms and adapt our capabilities to provide differentiated products.
Consumer preferences tend to drive change in our markets, and as science advances and sustainability continues to be an important factor to customers and consumers, we continue to strengthen our consumer insights and research and development platforms. Consumer Insights Innovation begins with understanding the consumer and anticipating emerging industry trends.
At those locations, our scientists and application engineers, while collaborating with our other research and development centers around the world, support the: • discovery of new materials; • development of new technologies, such as delivery systems; • creation of new compounds; and • enhancement of existing ingredients and compounds.
These centers, in collaboration with our global research and development network, drive: • discovery of new materials; • development of new technologies, such as delivery systems; • creation of new compounds; and • enhancement of existing ingredients and compounds.
As of December 31, 2024, we had approximately 22,400 employees worldwide, of whom approximately 24% are employed in the United States. Our workforce plans and talent management programs support our employees to best deliver the business strategy and ensure their development and engagement.
As of December 31, 2025, we had approximately 21,500 employees worldwide, of whom approximately 5,500 are employed in the United States. We continue to invest in our workforce, culture and leadership and development programs to support employee engagement and performance.
Executive Officers of Registrant Below is a list of the executive officers of the Company and other significant employees who are members of our Executive Leadership Team as of February 28, 2025. 9 Table of Contents Name Age Position J.
Our principal executive offices are located at 521 West 57th Street, New York, New York 10019 and 200 Powder Mill Road, Wilmington, Delaware 19803. Executive Officers of Registrant Below is a list of the executive officers of the Company and other significant employees who are members of our Executive Leadership Team as of February 27, 2026. Name Age Position J.
Our perfumers harness creativity and leverage our innovative captive molecules, sustainable natural ingredients obtained with innovative processes, biotech ingredients, data science, and consumer insights to create unique and inspiring fragrances driving consumer preferences. Our fine fragrances focus on perfumes and colognes, creating global and local namesake brands, from high luxury to mass market, from market leading to ultra-niche products.
Our fine fragrances focus on perfumes and colognes, creating global and local namesake brands, from high luxury to mass market, from market leading to ultra-niche products.
To cultivate our employees’ talent and build sustainable long-lasting careers at IFF, we provide tools that enable our employees to envision their career journeys in the form of articulated career “ladders” and “frameworks”.
A full portfolio of proprietary leadership development programs and an overarching talent management system is in place to support growth of leaders and at all levels. To cultivate our employees’ talent and build sustainable long-lasting careers at IFF, we provide tools that enable our employees to envision their career journeys and facilitate internal mobility.
For more detailed information about risks related to our supply chain, please refer to Item 1A, “Risk Factors” – “Supply chain disruptions, geopolitical developments, climate-change events, natural disasters, public health crises, tariffs and trade wars, and other events may adversely affect our business, our procurement of raw materials, and our development, manufacturing, distribution or sale of our products, and thus may impact our productivity, business and financial results.” Sustainability In 2021 , we launched a refreshed and comprehensive sustainability roadmap, the ‘Do More Good Plan’ ( “ the Plan ” ), which aligns with IFF’s strategy for long-term growth and value creation.
For more detailed information about risks related to our supply chain, please refer to Item 1A, “Risk Factors” – “Trade wars, tariffs, sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters, public health or human rights crises, and other events may adversely affect our sourcing of raw materials, and our development, manufacturing, distribution or sale of our products . ” Sustainability Our approach to sustainability is rooted in our Company’s purpose statement and our ongoing commitment to ‘Do More Good’ for people and planet.
Among many other applications, this biotechnology-driven portfolio includes cultures for use in fermented foods such as yogurt, cheese and fermented beverages, probiotic strains, many with documented clinical health claims for use as dietary supplements and through industrial fermentation the production of enzymes and microorganisms that provide product and process performance benefits to household detergents, animal feed, ethanol production and brewing.
Among many other applications, our portfolio includes cultures for use in fermented foods such as yogurt, cheese and fermented beverages, probiotic strains, household detergents, animal feed, ethanol production and brewing. Health & Biosciences is comprised of Health, Food Biosciences, Home & Personal Care, Animal Nutrition and Grain Processing.
Our consumer science, insight and marketing teams interpret trends, monitor product launches, analyze quantitative market data and conduct numerous consumer interviews annually. Based on this information, we develop innovative and proprietary programs to evaluate potential products that enable us to understand the emotional connections between a prospective product and the consumer.
Through our consumer insight programs, we develop a deep understanding of what consumers value, enabling us to focus our research, development, and creative efforts effectively. Our consumer science, insights, and marketing teams interpret trends, monitor product launches, analyze quantitative market data, and conduct numerous consumer interviews annually.
As of December 31, 2024, we have 894 granted U.S. patents, and 458 pending U.S. patent applications, as well as thousands of other granted patents and pending patent applications around the world. We have developed many unique molecules and delivery systems for our customers that are used as the foundations of successful products around the world.
By aligning our capabilities with these platforms, we ensure the proper support for each initiative, enabling successful commercialization of our products. As of December 31, 2025, we have 849 granted U.S. patents, and 451 pending U.S. patent applications, as well as thousands of other granted patents and pending patent applications around the world.
They contain varying numbers of organic chemicals that are responsible for the fragrance, flavor, antioxidant properties and nutrition of the natural products. Natural products are purchased directly from farms or in processed and semi-processed forms. Some natural products are used in compounds in the state in which they are obtained and others are used after further processing.
These materials contain diverse organic chemicals that are responsible for the fragrance, flavor, antioxidant properties and nutritional value. We purchase natural products directly from farms or in processed and semi-processed forms. Some are used as-is, while others undergo additional processing. Natural products, combined with various chemicals, also serve as raw materials for the manufacture of synthetic ingredients through chemical processes.
Occupational Safety and Health Administration (“OSHA”) standards which apply to all of our sites in conjunction with any local regulations.
Occupational Safety and Health Administration (“OSHA”) standards which apply to all our sites in conjunction with any local regulations. We emphasize safety governance (setting and updating comprehensive safety policies and procedures), training (based on IFF policies and local regulatory requirements) and culture (characterized by awareness and communication) to support an injury-free workplace.
Thus, 4 Table of Contents starting in the first quarter of 2025, our business segments will consist of Taste, Food Ingredients, Health & Biosciences, Scent, and, until the completion of the sale of the Pharma Solutions business disposal group, Pharma Solutions. Consumer Insights, Research and Product Development Process The markets in which we compete require constant innovation to remain competitive.
We completed the divestiture of our Pharma Solutions disposal group, which included certain adjacent businesses, on May 1, 2025 and we divested our nitrocellulose business, which was within our Pharma Solutions segment, on May 9, 2025. Consumer Insights, Research and Product Development Process The markets in which we operate require constant innovation to remain competitive.
In addition to creating new products, our researchers and product development teams advise customers on ways to improve their existing products by moderating or substituting current ingredients with more readily accessible or less expensive materials enhancing their yield, or helping to increase or improve functionality of their formulations. This often results in creating a better value proposition for our customers.
Our product development team partners with our scientists and researchers to optimize consumer appeal and relevance of our product offerings. This collaborative process ensures offerings are refined and ready for integration into final consumer products. Beyond creating new products, our teams advise customers on improving existing formulations, whether by substituting ingredients for cost efficiency, enhancing yield, or improving functionality.
We in turn are required to meet strict standards which, in recent years, have become increasingly stringent and affect both existing as well as new products.
These requirements have become increasingly stringent in recent years, impacting both existing and new products, and compliance with these standards can result in high capital expenditures, which may be significant in certain periods.
Removed
Nourish As a leading creator of ingredients and solutions, we help our customers deliver on the promise of healthy and delicious foods and drinks that appeal to consumers. We create products in our regional creative centers which allows us to satisfy local customer preferences, while also helping to ensure regulatory compliance and production standards.
Added
Our Product Offerings During the year ended December 31, 2025, our business consisted of five segments: Taste, Food Ingredients, Health & Biosciences, Scent and, until the completion of the divestitures of both the Pharma Solutions and Nitrocellulose disposal groups in May 2025, Pharma Solutions.
Removed
We develop thousands of different Nourish offerings, most of which are tailor-made, and we continually develop new ingredients and solutions to meet changing consumer preferences and customer needs.
Added
Effective January 1, 2025, our former Nourish segment was restructured into two newly designated operating segments: Taste and Food Ingredients.
Removed
Our Nourish segment consists of an innovative and broad portfolio of natural-based ingredients to enhance nutritional value, texture and functionality in a wide range of beverage, dairy, bakery, confectionery and culinary applications and consists of Ingredients and Flavors.
Added
Taste also includes value-added spices and seasoning ingredients for meat, food service, convenience, alternative protein and culinary products.
Removed
During the fourth quarter of 2022, we announced our entry into an agreement to sell a portion of the Savory Solutions business and completed the divestiture on May 31, 2023.
Added
The business also produces patented enzymatic polymers that are renewable, biodegradable alternatives to functional ingredients used in home cleaning and beauty care products.
Removed
Health & Biosciences is comprised of Health, Cultures & Food Enzymes, Home & Personal Care, Animal Nutrition and Grain Processing. Health provides ingredients for dietary supplements, functional food and beverage, specialized nutrition and pharma.
Added
Leveraging this information, we design proprietary programs to evaluate potential products and uncover the emotional connections between consumers and prospective offerings. This ability to predict product success enhances brand equity, drives market share growth, and delivers greater returns for both our customers and IFF.
Removed
Scent Our Scent segment creates fragrance compounds and fragrance ingredients that are integral elements in the world’s finest perfumes and best-known household and personal care products.
Added
Our creative teams, composed of marketing, consumer science, insights, and technical experts collaborate closely with customers to deliver experiences that meet consumer expectations in markets around the world. New product development is driven by customer requests for specific solutions or IFF internal initiatives informed by consumer insights.
Removed
We completed the divestiture of our Flavor Specialty Ingredients business on August 1, 2023.
Added
This aligns with our Company’s strategy for long-term growth and value creation. Through this commitment, we focus on the interconnected pillars of conscious sourcing, partnerships of impact, intentional innovation and operating for the future. Across these four pillars, our Company continued to achieve notable recognitions in 2025.
Removed
The Flavor Specialty Ingredients business previously comprised of natural flavor extracts, specialty botanical extracts, distillates, essential oils, citrus products, aroma chemicals and natural gums and resins, which are used for food, beverage and flavors, and are often sold directly to food and beverage manufacturers who use them in producing consumer products.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese risks include, but are not limited to, the following: • We have a substantial amount of indebtedness that could materially adversely affect, among other things, our financial condition, our ability to return capital to our shareholders, needed investments into our business, and our credit ratings. 11 Table of Contents • If we are unable to successfully execute our strategic transformation, including our portfolio optimization, it may have a material adverse effect on our business, results of operations and financial condition. • Regulatory, consumer and economic trends may result in significant costs or adversely affect demand for our products which may have a negative impact on our operating results and future growth. • Our results of operations may be negatively impacted by the outcome of uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits. • Supply chain disruptions, geopolitical developments, climate-change events, natural disasters, public health crises, tariffs and trade wars, and other events may adversely affect our business, our procurement of raw materials, and our development, manufacturing, distribution or sale of our products, and thus may impact our productivity, business and financial results. • Inflationary trends and pricing uncertainty, including in the price of our input costs, such as raw materials, transportation and energy, could adversely affect our business and financial results in the short term and result in uncertainties in the long term. • Our performance may be adversely impacted if we are not successful in managing our inventory and/or working capital balances. • Our business is highly competitive, and if we are unable to compete effectively our sales and results of operations will suffer. • A significant portion of our sales is generated from a limited number of large multi-national customers, which are currently under competitive pressures that may affect the demand for our products and profitability. • We may not successfully develop and introduce new products that meet our customers’ needs, which may adversely affect our results of operations. • A significant data breach or other disruption to our information technology systems could disrupt our operations, resulting in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations. • We are subject to risks associated with the potential use of AI in our own operations and by third-party partners that we may engage with. • We have made investments in and continue to expand our business into emerging markets, which exposes us to certain risks. • The impact of currency fluctuation or devaluation in the international markets in which we operate may negatively affect our results of operations. • International economic, political, legal, compliance and business factors could negatively affect our financial statements, operations and growth. • We are subject to increasing customer, consumer, shareholder and regulatory focus on sustainability, which may result in additional costs in order to meet new requirements, including adversely affecting our stock price, results of operations and access to capital. • If we fail to successfully enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, or successfully manage such transactions, it could adversely affect our business and growth opportunities. • Our ability to declare and pay dividends is subject to certain considerations. • Our success depends on attracting and retaining talented people within our business and our management team.
Biggest changeThese risks include, but are not limited to, the following: • Consumer demand and preferences, as well as regulatory trends may impact demand for our products, which may have a negative effect on our operating results and future growth. • Our business is highly competitive, and if we are unable to compete effectively our sales and results of operations will suffer. • If we are unable to successfully execute our strategic transformation, or enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, it may have a material adverse effect on our business, results of operations and financial condition. • Our performance may be adversely impacted if we are not successful in managing our inventory and/or working capital balances. • Our results of operations may be negatively impacted by the outcome of uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits. • Trade wars, tariffs, sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters, public health and human rights crises, and other events may adversely affect our sourcing of raw materials, and our development, manufacturing, distribution or sale of our products. • Increases in input costs, including raw materials, transportation, and energy, have been exacerbated by recent inflationary pressures. • A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations. • We are exposed to AI-related risks and opportunities that if we fail to properly manage, could result in material liabilities, or otherwise materially adversely affect our business, results of operations, and financial condition. • The impact of currency fluctuation or devaluation in the international markets in which we operate may negatively affect our results of operations. • International economic, political, legal, compliance and business factors could negatively affect our financial statements, operations and growth. • Our inability to recruit, retain or transition employees could adversely affect our ability to compete and achieve our strategic goals. • Any impairment of our tangible or intangible long-lived assets, including goodwill, may adversely impact our profitability. 10 Table of Contents • We are subject to customer, consumer, shareholder and regulatory focus on sustainability, which may result in additional costs in order to meet new requirements, including adversely affecting our stock price, results of operations and access to capital. • Our ability to declare and pay dividends is subject to certain considerations. • We have a substantial amount of indebtedness that could materially adversely affect, among other things, our financial condition, our ability to return capital to our shareholders, needed investments into our business and our credit ratings.
Our funding obligations for our pension and postretirement plans could adversely affect our earnings and cash flows. The funding obligations for our pension plans are impacted by the performance of the financial markets, particularly the equity markets and interest rates.
Our funding obligations for our pension and postretirement plans could adversely affect our earnings and cash flows. Our funding obligations for our pension plans are impacted by the performance of the financial markets, particularly the equity markets and interest rates.
These risks, which can vary substantially by location, include the following: • governmental laws, regulations and policies adopted to manage national economic and macroeconomic conditions, such as increases in taxes, austerity measures that may impact consumer spending, monetary policies that may impact inflation rates, employment regulations, currency fluctuations or controls and sustainability of resources; • changes in environmental, health and safety permits or regulations, such as regulations related to biodiversity or the continued implementation and evolution of the European Union’s REACH regulations and similar regulations that are 20 Table of Contents being evaluated and adopted in other markets, or the ban on microplastics recently adopted by the European Commission (“EC”) and the burdens and costs of our compliance with such regulations which may differ significantly across jurisdictions; • increased product labeling and ingredient prohibitions in specific markets that may impact consumer preferences, products costs and/or customer acceptance; • the imposition of or changes in customs, tariffs, quotas, trade barriers, other trade protection measures, import or export licensing requirements, and sanctions on trade with certain countries, imposed by the U.S. or other countries, which could adversely affect our cost or ability to import raw materials or export our products to other markets; • risks and costs arising from our ability to cater to local demand and customer preferences, language and cultural differences; • the movement for increased unionization in the U.S. and internationally may lead to labor instability, employee turnover, increased labor costs or production and operation disruptions; • changes in the laws and policies that govern foreign investment in the countries in which we operate, including the risk of expropriation or nationalization, the costs and ability to repatriate the profit that we generate in these countries; • risks and costs associated with negative publicity on social media as a result of increased regulatory scrutiny, potential misinformation and/or targeted campaigns; • risks and costs associated with complying with anti-money laundering and counter-terrorism financing laws; • risks and costs associated with complying with the U.S.
These risks, which can vary substantially by location, include the following: • governmental laws, regulations and policies adopted to manage national economic and macroeconomic conditions, such as increases in taxes, austerity measures that may impact consumer spending, monetary policies that may impact inflation rates, employment regulations, currency fluctuations or controls and sustainability of resources; • changes in environmental, health and safety permits or regulations, such as regulations related to biodiversity or the continued implementation and evolution of the European Union’s REACH regulations and similar regulations that are being evaluated and adopted in other markets, or the ban on microplastics recently adopted by the European Commission (“EC”) and the burdens and costs of our compliance with such regulations which may differ significantly across jurisdictions; • increased product labeling and ingredient prohibitions in specific markets that may impact consumer preferences, products costs and/or customer acceptance; • the imposition of or changes in customs, tariffs, quotas, trade barriers, other trade protection measures, import or export licensing requirements, and sanctions on trade with certain countries, imposed by the U.S. or other countries, which could adversely affect our cost or ability to import raw materials or export our products to other markets; • risks and costs arising from our ability to cater to local demand and customer preferences, language and cultural differences; • the movement for increased unionization and collective labor activity in the U.S. and internationally may lead to labor instability, employee turnover, increased labor costs or production and operation disruptions; • changes in the laws and policies that govern foreign investment in the countries in which we operate, including the risk of expropriation or nationalization, the costs and ability to repatriate the profit that we generate in these countries; • risks and costs associated with negative publicity on social media as a result of increased regulatory scrutiny, potential misinformation and/or targeted campaigns; • risks and costs associated with complying with anti-money laundering and counter-terrorism financing laws; • risks and costs associated with complying with the U.S.
Our future effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in liabilities for uncertain tax positions, cost of repatriations or changes in tax laws or their interpretation.
Our future effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in liabilities for uncertain tax positions, cost of repatriations or changes in tax laws, regulations, or their interpretation.
Such events and changes in circumstances could include a sustained decrease in our market capitalization, increased competition or unexpected loss of market share, increased input costs beyond projections (for example due to regulatory or industry changes), our inability to recognize the anticipated benefits of acquisitions, unexpected business disruptions (for example due to a natural disaster, public health crises, such as pandemics or epidemics or loss of a customer, supplier, or other significant business relationship), acts by governments and courts, operating results falling short of projections, or significant adverse changes in the markets in which we operate.
Such events and changes in circumstances could include a sustained decrease in our market capitalization, increased competition or unexpected loss of market share, increased input costs beyond projections (for example due to regulatory or industry changes), our inability to recognize the anticipated benefits of acquisitions, unexpected business disruptions (for example due to a natural disaster, public health crisis, such as pandemics or epidemics or loss of a customer, supplier, or other significant business relationship), acts by governments and courts, operating results falling short of projections, or significant adverse changes in the markets in which we operate.
Further, the use of AI to draft patent applications may lead to inaccuracies or omissions in the applications, potentially resulting in weakened patent protection or possible outright rejection based on intellectual property ownership and inventorship.
The use of AI to draft patent applications may lead to inaccuracies or omissions in the applications, potentially resulting in weakened patent protection or possible outright rejection based on intellectual property ownership and inventorship.
Any of these changes could have a material adverse effect on our profitability. We have and will continue to implement transfer pricing policies among our various operations located in different countries. These transfer pricing policies are a significant component of the management and compliance of our operations across international boundaries and overall financial results.
Any of these changes could have a material adverse effect on our operating results. We have and will continue to implement transfer pricing policies among our various operations located in different countries. These transfer pricing policies are a significant component of the management and compliance of our operations across international boundaries and overall financial results.
If we are not able to successfully mitigate such risks, we could experience disruptions in production or increased costs, which may result in decrease in our gross margin or reduced sales, and have a material adverse effect on our productivity, business, results of operations and financial condition.
If we are not able to successfully mitigate such risks, we could experience disruptions in production, which may result in decrease in our gross margin or reduced sales, and have a material adverse effect on our productivity, business, results of operations and financial condition.
For those intellectual property rights that are protected as trade secrets, this litigation could result in even higher costs, and potentially the loss of certain rights, since we would not have a perfected intellectual property right that precludes others from 26 Table of Contents making, using or selling our products or processes.
For those intellectual property rights that are protected as trade secrets, this litigation could result in even higher costs, and potentially the loss of certain rights, since we would not have a perfected intellectual property right that precludes others from making, using or selling our products or processes.
In the event that we determine that changes are warranted in the assumptions used, such as the discount rate, expected long-term rate of return on assets, or expected health care costs, our future pension and postretirement benefit expenses could increase or decrease.
In the event that we determine that changes are warranted in the assumptions used, such as the discount rate, expected long-term rate of return on 17 Table of Contents assets, or expected health care costs, our future pension and postretirement benefit expenses could increase or decrease.
We expect to continue to pay dividends to our shareholders; however, our Board may reduce, suspend or discontinue the payment of dividends at any time. The Company announced in February 2024 that it had updated its dividend policy, reducing the expected quarterly dividend approximately 50% to enable faster deleveraging of the balance sheet and provide improved financial flexibility.
We expect to continue to pay dividends to our shareholders; however, our Board may reduce, suspend or discontinue the payment of dividends at any time. For instance, we announced in February 2024 that we had updated its dividend policy, reducing the expected quarterly dividend approximately 50% to enable faster deleveraging of the balance sheet and provide improved financial flexibility.
In August 2022, the U.S. government enacted legislation commonly referred to as the “Inflation Reduction Act”, which, among other things, imposed a minimum “book” tax on certain corporations effective for taxable years beginning after December 31, 2022 and created a new excise tax on stock repurchases made by certain publicly traded corporations after December 31, 2022.
In August 2022, the U.S. government enacted legislation commonly referred to as the “Inflation Reduction Act”, which, among other things, imposed a minimum “book” tax on certain corporations effective for taxable years beginning after 20 Table of Contents December 31, 2022 and created a new excise tax on stock repurchases made by certain publicly traded corporations after December 31, 2022.
During 2024, approximately 72% of our combined net sales were to customers outside the U.S. and we intend to continue expansion of our international operations. As a result, our business is increasingly exposed to risks inherent in international operations.
In 2025, approximately 72% of our combined net sales were to customers outside the U.S., and we intend to continue expansion of our international operations. As a result, our business is increasingly exposed to risks inherent in international operations.
We could incur significant costs in connection with legal actions to assert our intellectual property rights against third parties or to defend ourselves from third-party assertions of invalidity, infringement, misappropriation or other claims.
We could incur significant costs in connection with legal actions to assert our intellectual property rights against third parties or to defend ourselves from third-party assertions of invalidity, infringement, 19 Table of Contents misappropriation or other claims.
If we are not successful in managing our inventory balances and shrinkage, our results of and cash flows from operations may be negatively affected. We sell certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements, some of which are sponsored by certain customers.
If we are not successful in managing our inventory balances, our results of operations and cash flows may be negatively affected. Relatedly, we also sell certain accounts receivable on a non-recourse basis to unrelated financial institutions under “factoring” agreements, some of which are sponsored by certain customers.
Risk Factors We routinely encounter and address risks in conducting our business. Some of these risks may cause our future results to be different - sometimes materially different - than we presently anticipate. Below are material risks we have identified that could adversely affect our business.
Risk Factors We routinely encounter and address risks in conducting our business. Some of these risks may cause our future results to be different - sometimes materially different – than in the past or than we presently anticipate. Below are some of the risks we have identified that could adversely affect our business.
Our results of operations may be negatively impacted by the outcome of uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits.
Our results of operations may be negatively impacted by legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits.
Effective January 1, 2025, our Nourish segment has been restructured into two newly designated operating segments: Taste and Food Ingredients. This change in management reporting necessitates the reallocation of goodwill between the two reporting units and the performance of a goodwill impairment test both prior to and subsequent to the change.
Effective January 1, 2025, our Nourish segment was restructured into two newly designated operating segments and reporting units: Taste and Food Ingredients. This change in management reporting necessitated the reallocation of goodwill between the two reporting units and the performance of a goodwill impairment test both prior to and subsequent to the change.
If we are unable to meet production requirements, we can lose customer orders, which can adversely affect our future growth or we may be required to make incremental capital investments to ensure supply.
If we are unable to meet production requirements, we can lose customer orders, which can adversely affect our future 18 Table of Contents growth or we may be required to make incremental capital investments to ensure supply.
We may also be exposed to serious adverse health claims related to undetected poor quality of raw materials, internal system failures to adequately reduce or eliminate certain hazards (such as pathogens, allergens, contaminants, pesticides, physical hazards, etc.) or products that are not in line with required or agreed specifications.
We may also be exposed to serious adverse health claims related to undetected poor quality of raw materials, internal system failures to adequately reduce or eliminate certain hazards (such as pathogens, allergens, contaminants, pesticides, physical hazards, etc.) or products that are not in line with required or agreed specifications. Compliance risks are further compounded by operational complexities.
Poor results of operations, liquidity or financial condition-particularly as we work towards implementation of our ongoing strategic transformation and our portfolio optimization strategy-may increase the likelihood of shareholder litigation.
Poor results of operations, liquidity or financial condition-particularly as we work towards implementation of our ongoing strategic transformation and our portfolio optimization strategy-may also increase litigation risk.
If these non-compliance issues reoccur in China or occur or in any other jurisdiction, we may lose business and may be required to incur capital spending above previous expectations, close a plant, or operate a plant at significantly reduced production levels on a permanent basis, and our operating results and cash flows from operations may be adversely affected.
If these non-compliance issues occur, we may lose business and may be required to incur capital spending above previous expectations, close a plant, or operate a plant at significantly reduced production levels on a permanent basis, and our operating results and cash flows may be adversely affected.
In addition, competition laws and regulations continue to be actively enforced by competition authorities in the U.S., the European Union and other jurisdictions where IFF is active.
In addition, antitrust and competition laws and regulations continue to be actively enforced by competition authorities in the U.S., the European Union and other jurisdictions where we are active.
Dividends are authorized and determined by our Board of Directors in its sole discretion and depend upon a number of factors, including: • cash available for dividends; • our results of operations and anticipated future results of operations; • our financial condition, including our current or forecasted future cash flows provided by our operating activities (after deducting anticipated future capital expenditures and other commitments required to carry out our operations and business strategy); • our operating expenses; • restrictions in our credit agreement related to the issuance of dividends, including minimum capital requirements; and • other general and economic conditions or other factors our Board of Directors deems to be relevant.
Dividends are authorized and determined by our Board of Directors in its sole discretion and depend upon a number of factors, including: • cash available for dividends; • our results of operations and anticipated future results of operations; • our financial condition, including our current or forecasted future cash flows provided by our operating activities (after deducting anticipated future capital expenditures and other commitments required to carry out our operations and business strategy); • our operating expenses; • potential restrictions in our financing documents that may be instituted from time to time; and • other general and economic conditions or other factors our Board of Directors deems to be relevant.
Our failure to comply with competition laws and regulations can expose the Company to, among other things, high fines, damage actions, reputation harm, and disruptions to our business, and expose our employees civil or criminal penalties.
Our failure to comply with competition laws and regulations can expose us to, among other things, high fines, damage actions (including private causes of action), reputation harm, and disruptions to our business, and expose our employees to civil or criminal penalties.
The increased focus on sustainability has resulted and may continue to result in new and changing regulations, including the need to comply with different regulatory regimes in different jurisdictions, and customer requirements that could affect us.
At the same time, we face increasing regulatory reporting requirements related to sustainability topics. The increased focus on sustainability has resulted and may continue to result in new and changing regulations, including the need to comply with different regulatory regimes in different jurisdictions, and customer requirements that could affect us.
The impact of currency fluctuation or devaluation in the international markets in which we operate may negatively affect our results of operations. We have significant operations outside the U.S., the results of which are reported in the local currency and then translated into U.S. dollars at applicable exchange rates for inclusion in our consolidated financial statements.
We have significant operations outside the U.S., the results of which are reported in the local currency and then translated into U.S. dollars at applicable exchange rates for inclusion in our consolidated financial statements.
The global nature of our business, our size and employee count, the significance of our international revenue, our focus on emerging markets and presence in regulated industries create various domestic and local regulatory challenges and subject us to risks associated with our international operations. The U.S.
The global nature of our business, our size and workforce, the significance of our international revenue, our focus on emerging markets, and our presence in regulated industries expose us to complex domestic and international regulatory challenges and risks associated with global operations. We are subject to the U.S.
Analyses, results or business processes relying on AI may also be deficient, inaccurate, or biased and we may fail to identify in a timely fashion or at all, if or to the extent that is the case. Furthermore, AI can exacerbate our cybersecurity or IT risks.
Separately, analyses, results or business processes relying on AI may also be deficient, inaccurate, or biased and we may fail to identify in a timely fashion or at all, if or to the extent that is the case. Furthermore, as discussed above, AI can amplify cybersecurity and IT risks and introduce compliance challenges as regulations evolve.
A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations.
These factors are beyond our control and may materially affect our business and financial condition. A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations.
International economic, political, legal, compliance and business factors could negatively affect our financial statements, operations and growth. We operate on a global basis, with manufacturing and sales facilities in or supply arrangements with companies based in the U.S., Europe, Africa, the Middle East, Latin America, and Greater Asia.
International economic, political, legal, compliance and business factors could negatively affect our financial statements, operations and growth. We operate on a global basis, with manufacturing sites, supply arrangements and sales presence in the U.S., Europe, Africa, the Middle East, Latin America, and Greater Asia. We also continue to expand our presence in emerging markets across the world.
Given the international scope of our business, we also sell certain of our products to countries that are subject to U.S. and other sanctions under general licenses and authorizations related to such products, technologies and transactions. For example, the U.S., the European Union and other countries have imposed sanctions and export controls on Russia, Belarus and occupied regions of Ukraine.
Given our global footprint, we also sell certain products to countries subject to U.S. and other jurisdictions’ sanctions under general licenses and authorizations. For example, the U.S., European Union, and other jurisdictions have imposed sanctions and export controls on Russia, Belarus, and occupied regions of Ukraine.
Additionally, the use of AI may lead to the weakening or loss of intellectual property rights, where AI-generated inventions or creations may not be properly attributed to the rightful inventors, potentially resulting in disputes over intellectual property ownership and inventorship rights.
AI may also weaken IP rights, where AI-generated inventions or creations may not be properly attributed to the rightful inventors, potentially resulting in additional disputes over intellectual property ownership and inventorship rights.
If we were required to indemnify DuPont pursuant to the Tax Matters Agreement as described above, this indemnification obligation may be substantial and could have a material adverse effect on us, including with respect to our financial condition and results of operations. Moreover, we are not indemnified for tax liabilities related to pre-spin-off periods.
If we were required to indemnify DuPont under the TMA, this indemnification obligation may be substantial and could have a material adverse effect on us, including with respect to our financial condition and results of operations. Moreover, we are not indemnified by Dupont for most tax liabilities related to periods prior to the N&B Transaction.
Changes to management, including turnover of our top executives, and significant shortfalls in recruitment, retention or transition of employees or our management team could adversely affect our ability to compete and achieve our strategic goals. • If we are unable to successfully market to our expanded and diverse customer base, our operating results and future growth may be adversely affected. • Any impairment of our tangible or intangible long-lived assets, including goodwill, may adversely impact our profitability. • Our funding obligations for our pension and postretirement plans could adversely affect our earnings and cash flows. • If we are unable to comply with regulatory requirements and industry standards, including those regarding product safety, quality, efficacy and environmental impact, we could incur significant costs and suffer reputational harm which could adversely affect results of operations. • Defects, quality issues (including product recalls), inadequate disclosure or misuse with respect to the products and capabilities could adversely affect our business, reputation and results of operations. 12 Table of Contents • Failure to comply with environmental protection laws may cause us to close, relocate or operate one or more of our plants at reduced production levels, and expose us to civil or criminal liability, which could adversely affect our operating results and future growth. • We could be adversely affected by violations, by us or our counterparties, of U.S. or foreign anti-bribery and anti-corruption laws and regulations, applicable sanctions or competition laws and regulations in the jurisdictions in which we operate or ethical business practices and related laws and regulations. • Our ability to compete effectively depends on our ability to protect our intellectual property rights. • Changes in our tax rates, the adoption of new U.S. or international tax legislation, or changes in existing tax laws could expose us to additional tax liabilities that may affect our future results. • The N&B Transaction could result in significant tax liability, and we may be obligated to indemnify DuPont for any such tax liability imposed on DuPont. • If we fail to comply with data protection laws in the U.S. and abroad, we may be subject to fines, penalties and other costs.
Indebtedness and related covenants could adversely affect our liquidity, flexibility, and cost of capital. • Our funding obligations for our pension and postretirement plans could adversely affect our earnings and cash flows. • A disruption in our manufacturing operations could adversely affect our profitability. • If we are unable to comply with regulatory requirements and industry standards, including those regarding product safety, quality, efficacy and environmental impact, we could incur significant costs and suffer reputational harm which could adversely affect results of operations. • Failure to comply with environmental protection laws may cause us to close, relocate or operate one or more of our plants at reduced production levels, and expose us to civil or criminal liability, which could adversely affect our operating results and future growth. • We could be adversely affected by violations, by us or our counterparties, of U.S. or foreign anti-bribery, international trade, anti-corruption, antitrust or competition laws and regulations, applicable sanctions or employment and human rights or employment regulations. • Our ability to compete effectively depends on our ability to protect our intellectual property rights. • Changes in our tax rates, the adoption of new U.S. or international tax legislation, or changes in existing tax laws could expose us to additional tax liabilities that may affect our future results. • The N&B Transaction could result in significant tax liability, and we may be obligated to indemnify DuPont for any such tax liability imposed on DuPont. • If we fail to comply with data protection laws in the U.S. and abroad, we may be subject to fines, penalties and other costs.
We operate or may pursue opportunities in some jurisdictions, such as China, India, Brazil, Russia and Africa, that pose potentially elevated risks of fraud or corruption or increased risk of internal control issues. In certain jurisdictions, compliance with anti-bribery laws may conflict with local customs and practices.
We operate and may pursue opportunities in jurisdictions such as China, India, Brazil, Russia, and certain African countries, which present elevated risks of fraud, corruption, and internal control challenges. In certain regions, compliance with anti-bribery laws may conflict with local customs and practices.
Large multi-national customers’ market share, especially in the consumer product industry, continues to be pressured by new smaller companies and specialty players that cater to or are more adept at adjusting to the latest consumer trends, including towards natural products and clean labels, changes in the retail landscape (including e-commerce and consolidation), and increased competition from private labels, which have resulted and may continue to result in decreased demand for our products by such multi-national customers and volume erosion, especially in our Nourish business.
Multinational customers have been facing their own competitive challenges, such as pressures by new smaller companies and specialty players that cater to or are more adept at adjusting to the latest consumer trends, including towards natural products and clean labels, changes in the retail landscape (including e-commerce and consolidation), and increased competition from private labels, which have resulted and may continue to result in decreased demand for our products.
A Spinco Tainting Act is generally any action (or inaction) within our control or under the control of N&B or their affiliates, any event involving our common stock or the common stock of N&B or any assets of N&B or its subsidiaries, or any breach by N&B or any of its subsidiaries of any factual representations, assumptions, or undertakings made by it, in each case, that would affect the non-recognition treatment of the spin-off and internal reorganizations for U.S. federal income tax purposes, as described above.
Under the TMA, IFF and N&B are required to indemnify Dupont for any taxes resulting from a “Spinco Tainting Act.” A Spinco Tainting Act is generally any action (or inaction) within our control or under the control of N&B or their affiliates, any event involving our common stock or the common stock of N&B or any assets of N&B or its subsidiaries, or any breach by N&B or any of its subsidiaries of any factual representations, assumptions, or undertakings made by it, in each case, that would affect the non-recognition treatment of the RMT (or other internal reorganizations prior to the N&B Transaction) to Dupont.
From time to time we are involved in a number of legal claims, regulatory investigations, shareholder litigation and other litigation, including claims related to intellectual property, product liability, competition and antitrust, personal injury, environmental matters and indirect taxes.
We are or may be, from time to time, involved in legal claims, regulatory investigations, and litigation, including matters related to competition and antitrust, environmental issues, intellectual property, product liability, personal injury, commercial disputes, employment and labor matters, false or deceptive advertising, and indirect taxes.
Additionally, while we have insurance coverage designed to address certain aspects of cyber risks in place, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise. We are subject to risks associated with the potential use of AI in our own operations and by third-party partners that we may engage with.
Additionally, while we have insurance coverage designed to address certain aspects of cyber risks in place, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise.
Many countries routinely examine transfer pricing policies of taxpayers subject to their jurisdiction, challenge transfer pricing policies aggressively where there is potential non-compliance and impose significant interest charges and penalties where non-compliance is determined. However, governmental authorities could challenge these policies more aggressively in the future and, if challenged, we may not prevail.
Many countries routinely examine transfer pricing policies of taxpayers subject to their jurisdiction, challenge transfer pricing policies aggressively where there is potential non-compliance and impose significant interest charges and penalties where non-compliance is determined. We could suffer significant costs related to one or more challenges to our transfer pricing policies.
We could be adversely affected by violations, by us or our counterparties, of U.S. or foreign anti-bribery and anti-corruption laws and regulations, applicable sanctions or competition laws and regulations in the jurisdictions in which we operate or ethical business practices and related laws and regulations.
We could be adversely affected by violations, by us or our counterparties, of U.S. or foreign anti-bribery, international trade, anti-corruption, antitrust or competition laws and regulations, applicable sanctions or employment and human rights or employment regulations.
At the same time, AI is already changing and has the potential to further significantly change the way we or our competitors do business by, among other things, accelerating research and development, creating efficiencies, improving supply chain, productivity and other processes, customer experience, talent management and decision-making.
Such risks may result in loss of confidential information, litigation, regulatory penalties, damages, reputational harm. At the same time, AI is already changing the way we and our competitors do business by, among other things, accelerating research and development, creating efficiencies, improving supply chain, productivity and other processes, customer experience, talent management and decision-making.
IFF’s business, operating results and financial condition could be materially and adversely impacted in future periods if IFF’s accounting judgments and estimates related to these models prove to be inaccurate. 23 Table of Contents To the extent any of our acquisitions, including the acquisitions of Frutarom and the N&B Business, do not perform as anticipated and our underlying assumptions and estimates related to their fair value determination are not met, whether due to internal or external factors, the value of goodwill and other long-lived assets may be negatively affected and we may be required to record impairment charges.
To the extent any of our businesses do not perform as anticipated and our underlying assumptions and estimates related to their fair value determination are not met, whether due to internal or external factors, the value of goodwill and other long-lived assets may be negatively affected and we may be required to record impairment charges.
If we are unable to successfully execute our strategic transformation, including our portfolio optimization, it may have a material adverse effect on our business, results of operations and financial condition. As a part of our ongoing strategic transformation and our portfolio optimization strategy, we continue to evaluate and work towards divestitures or strategic transactions.
If we are unable to successfully execute our strategic transformation, or enter into or close collaborations, joint ventures, partnerships, acquisitions, or divestitures, it may have a material adverse effect on our business, results of operations and financial condition.
Should we choose not to participate, or if these programs were no longer available, it could reduce our cash flows from operations in the period in which the arrangement ends. Our business is highly competitive, and if we are unable to compete effectively our sales and results of operations will suffer. The markets in which we compete are highly competitive.
Should we choose not to participate, or if these programs were no longer available, it could reduce our cash flows from operations in the period in which the arrangement ends. Similarly, our failure to maintain proper control over collection of receivables and payment of payables could similarly impact our cash flows and results of operations.
The timing or volumes in our customers’ orders 14 Table of Contents are generally at our customers’ discretion. Customers may cancel, reduce or postpone orders with us on relatively short notice. If we are unable to anticipate or react to these trends in a timely and cost-effective manner, our productivity, results of operations and future growth may be adversely affected.
If we are unable to anticipate or react to these trends in a timely and cost-effective manner, our productivity, results of operations and future growth may be adversely affected.
We and our third-party providers are subject to the risks posed by such incidents, which can take many forms, including code anomalies, “Acts of God,” data leakage, hardware or software failures, human errors, cyber extortion, password theft or introduction of viruses, malware and ransomware, including through phishing emails.
The risks and potential threats can take many forms, such as code anomalies, “Acts of God,” data leakage, hardware or software failures, human errors, cyber extortion, password theft or introduction of viruses, malware and ransomware, including through phishing emails. Geopolitical conflicts, such as those in the Middle East and Russia-Ukraine, further heighten cyber risk.
Supply chain disruptions, geopolitical developments, climate-change events, natural disasters, public health crises, tariffs and trade wars, and other events may adversely affect our business, our procurement of raw materials, and our development, manufacturing, distribution or sale of our products, and thus may impact our productivity, business and financial results.
Unfavorable outcomes in these or future matters could materially affect our profitability and financial condition. Trade wars, tariffs, sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters, public health or human rights crises, and other events may adversely affect our sourcing of raw materials, and our development, manufacturing, distribution or sale of our products.
See, also “—We are subject to risks associated with the potential use of AI in our own operations and by third-party partners that we may engage with.” Protecting intellectual property related to biotechnology is particularly challenging because theft can be difficult to detect and biotechnology can be self-replicating. Accordingly, the impact of such theft can be significant.
See, also “—We are exposed to AI-related risks and opportunities that if we fail to properly manage, could materially adversely affect our business, results of operations, and financial condition.” Protecting intellectual property related to biotechnology is particularly challenging because theft can be difficult to detect and biotechnology can be self-replicating. Accordingly, the impact of such theft can be significant.
A significant portion of our assets consists of long-lived assets, including tangible assets such as our manufacturing facilities, and intangible assets, including goodwill and customer relationships.
A significant portion of our assets consists of long-lived assets, including tangible assets such as our manufacturing facilities, and intangible assets, including goodwill and customer relationships. As of December 31, 2025, we had $14.3 billion of intangible assets and goodwill, primarily arising from the acquisitions of Frutarom and N&B.
The occurrence of any one or more of these factors could increase our costs and adversely affect our results of operations. We are subject to increasing customer, consumer, shareholder and regulatory focus on sustainability, which may result in additional costs in order to meet new requirements, including adversely affecting our stock price, results of operations and access to capital.
We are subject to customer, consumer, shareholder and regulatory focus on sustainability, which may result in additional costs in order to meet new requirements, including adversely affecting our stock price, results of operations and access to capital. 16 Table of Contents Our customers, consumers and shareholders continue to be sensitive to environmental-related and other long-term sustainability issues.
The use of AI by us, our employees or any of our third-party partners may result in unauthorized disclosure of personal data, proprietary information and trade secrets, commercially sensitive or confidential information of IFF, our employees or our partners.
The use of AI by us, our employees or any of our third-party partners may create risks, such as unauthorized disclosure of personal data, privacy risks, trade secrets, or confidential information, and potential receipt or use of third-party proprietary data, which could lead to intellectual property loss or disputes.
Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates and market factors.
Refer to Part II, Item 7 and Note 1 and Note 12 to the Consolidated Financial Statements for additional information. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates and market factors.
In addition, and as further described in our consolidated financial statements, we are subject to antitrust and competition investigations in the United States and Europe, as well as class action lawsuits against us and certain of our competitors in the United States and Canada, alleging violations of antitrust laws and related claims.
As further described in our consolidated financial statements, we are currently subject to antitrust investigations in a number of countries and class action lawsuits in the U.S. and Canada alleging antitrust violations by us and certain of our competitors. Additional suits and investigations may follow, and outcomes are uncertain.
Moreover, management will make significant accounting judgments and estimates for the application of acquisition accounting under GAAP, and the underlying valuation models.
Moreover, management will make significant accounting judgments and estimates for the application of acquisition accounting under GAAP, and the underlying valuation models. IFF’s operating results could be materially and adversely impacted in future periods if IFF’s accounting judgments and estimates related to these models prove to be inaccurate.
Risks Related to Our Business and Industry We have a substantial amount of indebtedness that could materially adversely affect, among other things, our financial condition, our ability to return capital to our shareholders, needed investments into our business and our credit ratings. As of December 31, 2024, our total debt was $8.977 billion.
Any reduction in the amount of dividends we pay to shareholders could have an adverse effect on the trading price of our common stock. We have a substantial amount of indebtedness that could materially adversely affect, among other things, our financial condition, our ability to return capital to our shareholders, needed investments into our business and our credit ratings.
For instance, product liability claims may arise due to the fact that we supply products to the food and beverage, functional food, pharma/nutraceutical and personal care industries. Our manufacturing and other facilities may expose us to environmental claims, claims of personal injury (including from alleged exposure to facilities’ emissions), regulatory investigations and potential fines.
For instance, product liability claims may arise from supplying ingredients to food, beverage, and personal care industries, while the operation of our facilities may expose us to environmental and personal injury claims, regulatory actions, and fines.
Compliance with sanctions laws is highly technical and requires careful oversight, and it is possible that actions taken by us, our subsidiaries or our suppliers may cause us to be in breach with these laws, which could have a material adverse effect to our business.
As a result, we have restricted exports to these regions to permitted products that meet essential needs. Compliance with sanctions laws is highly technical and requires rigorous oversight. Any inadvertent breach by us, our subsidiaries, or suppliers could have a material adverse effect on our business.
Our performance may be adversely impacted if we are not successful in managing our inventory and/or working capital balances. We evaluate our inventory balances of materials based on shelf life, expected sourcing levels, known uses and anticipated demand based on forecasted customer order activity and changes in our product/sales mix.
Our performance may be adversely impacted if we are not successful in managing our inventory and/or working capital balances. We manage inventory based on shelf life, sourcing levels, and anticipated demand. Effective inventory control is critical to meeting customer needs without incurring excess storage costs.
We continue to evaluate its impact as further guidance becomes available. The N&B Transaction could result in significant tax liability, and we may be obligated to indemnify DuPont for any such tax liability imposed on DuPont.
These changes are unpredictable and as such, it is difficult to predict the cumulative effect of such tax laws and regulations on our operating results. The N&B Transaction could result in significant tax liability, and we may be obligated to indemnify DuPont for any such tax liability imposed on DuPont.
We can make no assurances that we would be able to properly manage any shift in focus or that any changes to our business would ultimately prove successful. If we are unable to successfully market to our expanded and diverse customer base, our operating results and future growth may be adversely affected.
We can make no assurances that we would be able to properly manage any shift in focus or that any changes to our business would ultimately prove successful. Any impairment of our tangible or intangible long-lived assets, including goodwill, may adversely impact our profitability.
Changing worker and talent market expectations around flexible work models and relocation has also impacted our ability to retain talent. In addition, the loss of any member of our senior management could materially adversely affect our ability to execute our business plan and strategy.
Thus, our ability to effectively compete with our competitors and to grow our business could be adversely affected. In addition, the loss of any member of our senior management could materially adversely affect our ability to execute our business plan and strategy.
Changes to interest rate policy as managed by the Federal Reserve Bank to counter inflationary trends and potential changes in trade policy may further impact such exchange rates. Further volatility or unfavorable movements in currency exchange rates may adversely impact our financial condition, cash flows or liquidity.
Further volatility or unfavorable movements in currency exchange rates may adversely impact our financial condition, cash flows or liquidity.
The N&B spin-off and certain aspects of the pre-spin-off internal reorganizations to form N&B could be taxable to DuPont if N&B or we were to engage in a “Spinco Tainting Act” (as defined in the Tax Matters Agreement, by and among DuPont, N&B and IFF, a form of which is attached to IFF’s registration statement on Form S-4 (Registration Number 333-238072)).
In connection with the N&B Transaction, IFF, N&B, and Dupont entered into a Tax Matters Agreement, a form of which is attached to IFF’s registration statement on Form S-4 (Registration Number 333-238072) (“TMA”).
Competition for employees can be intense and if we are unable to successfully integrate, motivate and reward our employees, we may not be able to retain them. If we are unable to retain our employees or attract new employees in the future, our ability to effectively compete with our competitors and to grow our business could be adversely affected.
Competition for skilled labor particularly in scientific, tech and specialized fields may pose a risk to continued business operations, or increased labor costs. If we are unable to successfully transition, integrate, motivate and reward our employees, we may not be able to retain them or attract new employees.
How we react to material future developments, as well as how our competitors and customers react to those developments, could also affect our future results.
How we react to material future developments, as well as how our competitors and customers react to those developments, could also affect our future results. Risks Related to Our Business and Industry Consumer demand and preferences, as well as regulatory trends may impact demand for our products, which may have a negative effect on our operating results and future growth.
Any failure to capitalize on the AI benefits to the same degree or with the same speed as our competitors may put us in a disadvantageous position and render our intellectual property portfolio less valuable. If we are unable to successfully manage these risks, it may have a material adverse effect on our business, results of operations and financial condition.
Any failure to capitalize on the AI benefits to the same degree or with the same speed as our competitors may put us in a disadvantageous position. The impact of currency fluctuation or devaluation in the international markets in which we operate may negatively affect our results of operations.
Foreign Corrupt Practices Act (the “FCPA”) and similar anti-bribery and anti-corruption laws and regulations in other countries generally prohibit companies and their intermediaries from making improper payments to foreign officials for the purpose of obtaining or keeping business or for other commercial 25 Table of Contents advantage.
Foreign Corrupt Practices Act (“FCPA”) and similar anti-bribery and anti-corruption laws in other jurisdictions, which generally prohibit companies and their intermediaries from making improper payments to foreign officials to obtain or retain business or secure other commercial advantages. U.S. public companies must also maintain accurate books and records and implement adequate internal accounting controls.
These and other monetary policies to counter inflation could negatively affect our borrowing costs and those of our customers and suppliers, as well as exchange rates and other macroeconomic factors. 16 Table of Contents If we are unable to increase the prices of our products to our customers to offset inflationary cost trends, or if we are unable to achieve cost savings to offset such cost increases, we could fail to meet our cost expectations, and our profits and operating results could be adversely affected.
If we are unable to increase the prices of our products to our customers to offset increased input cost trends, or if we are unable to achieve cost savings to offset such cost increases, our profits and operating results could be adversely affected. Our ability to price our products competitively is critical to maintain and grow our sales.
Our insurance may not be adequate to protect us from potential material expenses related to pending and future claims and our current levels of insurance may not be available in the future at commercially reasonable prices. Any of these factors could adversely affect our profitability and results of operations.
Enforcement actions could result in regulators imposing significant fines, penalties, or business restrictions, adversely affecting results of operations, liquidity, or financial condition, and overall business. Our insurance coverage may be insufficient to protect us from potential material expenses related to pending and future claims and unavailable at reasonable cost in the future.
Our ability to price our products competitively to timely reflect higher input costs is critical to maintain and grow our sales. Increases in prices of our products to customers or the impact of the broader inflationary environment on our customers may continue to lead to declines in demand and sales volumes.
However, possible increases in prices of our products to customers or the impact of the broader macroeconomic environment on our customers may continue to lead to declines in demand and sales volumes. We may also be unable to accurately predict or hedge cost fluctuations or anticipate the impact of price increases, while competitors may adapt more effectively.
IFF has been increasingly using or considering using AI tools in its operations, research and development and other areas. Many of our third-party partners also utilize or are considering utilizing certain AI tools.
We are exposed to AI-related risks and opportunities that if we fail to properly manage, could result in material liabilities, or otherwise materially adversely affect our business, results of operations, and financial condition. We have been increasingly using AI tools in our operations, research and development and other areas. Many of our third-party partners also utilize AI tools.
A significant portion of our sales is generated from a limited number of large multi-national customers, which are currently under competitive pressures that may affect the demand for our products and profitability. During 2024, our 25 largest customers, a majority of which were multi-national consumer products companies, collectively accounted for approximately 33% of our sales in the aggregate.
These factors are beyond our control and could negatively impact our results of operations. Additionally, a significant portion of our sales comes from a relatively small number of large multinational customers. In 2025, our 25 largest customers, a majority of which were multinational consumer products companies, collectively accounted for approximately 32% of our sales.
Any allegations of non-compliance with such laws and regulations could have a disruptive effect on our operations in such jurisdiction, including interruptions of business or loss of third-party relationships, which may negatively impact our results of operations or financial condition.
Allegations of non-compliance could disrupt operations, damage relationships with third parties, and negatively impact our financial condition and results of operations. A determination that we violated such laws could result in severe civil or criminal penalties, significant fines, loss of licenses or permits, and reputational harm.
IFF may be exposed to risks in cases where IFF utilizes AI in connection with certain business activities now or in the future, in cases where, whether known or unknown to IFF, IFF personnel, use AI for our business or at IFF locations, or in cases where our third-party partners, whether or not known to IFF, use AI in their business activities (which we may not be in a position to control).
We may be exposed to AI-related risks in cases where we, our employees, or our third party partners, in each case whether or not known to us, use AI tools, as well as in cases where we fail to adopt AI tools at a pace or breath as our competitors.
These and other consumer and regulatory trends could affect the types and volumes of our ingredients and compounds that our customers include in their consumer product offerings and, therefore, the demand for our products, which, among other things, can impact our ability to meet certain productivity levels.
Moreover, given that the timing or volumes in our customers’ orders are generally at our customers’ discretion, customers may cancel, reduce or postpone orders with us on relatively short notice. These and other consumer and regulatory trends may continue to affect the demand for our products and impact our ability to meet certain productivity levels.
We believe that these preventative actions provide adequate measures of protection against information security breaches/incidents and generally reduce our cybersecurity risks, however, cybersecurity incidents, data breaches and operational disruptions are constantly evolving, becoming more sophisticated, including through the increasing use of AI, and conducted by groups and individuals with a wide range of expertise and motives, including foreign governments, cyber terrorists, cyber criminals, malicious employees and other insiders and outsiders.
While these measures mitigate cybersecurity risks, potential threats are constantly evolving and becoming more sophisticated, and conducted by a diverse group of actors, such as foreign governments, cyber terrorists, cyber criminals, malicious employees and other insiders and outsiders.
We, directly or indirectly through our suppliers, are subject to risks, inherent in agriculture, development, manufacturing, distribution or sale on a global scale, including natural disasters, global or local health crises, international conflicts, terrorist acts, geopolitical developments, trade wars, industrial accidents, environmental events, climate change events (including severe weather events), strikes and other labor disputes, disruptions in supply chain or information systems, political or economic crises (such as uncertainty related to protracted U.S. federal government funding negotiations or inflation), disruption or loss of key research or manufacturing sites, product quality control, safety and environmental compliance issues, regulatory requirements, as well as other external factors over which neither our suppliers nor we have control.
These include trade wars (including tariffs and duties), sanctions, geopolitical developments, supply chain disruptions, environmental events, natural disasters and public health crises, terrorism, industrial accidents, labor disputes, political or economic crises, as well as other external factors over which neither our suppliers nor we have control.
Along with other macroeconomic uncertainty we are experiencing such as a highly inflationary global environment and supply chain disruptions discussed elsewhere in these risk factors, we have experienced and continue to expect volatility in global foreign currency exchange rates.
Along with other macroeconomic uncertainty, we have experienced and continue to expect volatility in global foreign currency exchange rates. Changes to interest rate policy as managed by the Federal Reserve Bank or other central banks and potential changes in trade policy may 14 Table of Contents further impact such exchange rates.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

5 edited+2 added−3 removed23 unchanged
Biggest changeOur Audit Committee receives from management updates, at least quarterly, on material security risks, including any material incidents, relevant industry developments, threat vectors and material risks identified in periodic penetration tests or vulnerability scans.
Biggest changeOur Audit Committee receives from management updates, at least quarterly, on material security risks, including any material incidents, relevant industry developments, threat vectors and material risks identified in periodic penetration tests or vulnerability scans. 22 Table of Contents These updates also include material legal and legislative developments concerning InfoSec, our approach to complying with applicable law and material engagement with regulators concerning IT and InfoSec.
For more detailed information about risks related to our cybersecurity, refer to Item 1A, “Risk Factors” —“A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations.” 29 Table of Contents Governance The Board of Directors is responsible for overseeing and reviewing with management the Company’s InfoSec risks and the policies and practices established to manage such risks.
For more detailed information about risks related to our cybersecurity, refer to Item 1A, “Risk Factors” —“A significant data breach or other disruption to our information technology systems could disrupt our operations, result in the loss of confidential information or personal data, and adversely impact our reputation, productivity, business or results of operations.” Governance The Board of Directors is responsible for overseeing and reviewing with management the Company’s InfoSec risks and the policies and practices established to manage such risks.
ITEM 1C. CYBERSECURITY. Risk Management and Strategy 28 Table of Contents Our comprehensive Incident Response Plan outlines processes to identify, detect, assess, respond to and recover from threats, including cybersecurity threats.
ITEM 1C. CYBERSECURITY. Risk Management and Strategy Our comprehensive Incident Response Plan outlines processes to identify, detect, assess, respond to and recover from threats, including cybersecurity threats.
Based on industry baselines and discussions throughout our membership in various global InfoSec communities, we believe that these preventative actions provide adequate measures of protection against information security breaches/incidents and reduce our cybersecurity risks.
Based on industry baselines and discussions throughout our membership in various global InfoSec communities, we believe that these preventative actions are designed to reduce cybersecurity risk and the likelihood and impact of potential information security incidents.
The ERM Committee meets with our Executive Leadership Team and presents at least annually to our Board of Directors on the ERM process and on our risk mitigation actions, including providing reporting focused on compliance and cybersecurity risks.
The Board receives regular reports on the ERM process and the risk mitigation activities, including reports focused on compliance, human capital, cybersecurity, and sustainability risks.
Removed
In addition, our Enterprise Risk Management (“ERM”) program considers cybersecurity risks alongside other company risks. Our enterprise risk professionals consult with cross-organizational leaders to gather information necessary to identify cybersecurity risks, evaluate their likelihood and severity, identify necessary mitigations and assess the potential impact of those mitigations on residual risk.
Added
In addition, our Enterprise Risk Management (“ERM”) program is designed to identify and assess our global risks and to develop steps to mitigate and manage risks.
Removed
Our ERM Committee, chaired by the Chief Financial Officer (“CFO”) and General Counsel (“GC”), and comprised of senior leaders representing each risk domain, integrates global risks, including cybersecurity and compliance, to ensure appropriate prioritization of resources and alignment across the Company.
Added
As part of our risk management practices, we, under the direction and ownership of the Executive Leadership Team, have established risk champions and ambassadors throughout the organization to identify, 21 Table of Contents assess, map, and mitigate these exposures on a regular basis in discussion with functional risk owners.
Removed
These updates also include material legal and legislative developments concerning InfoSec, our approach to complying with applicable law and material engagement with regulators concerning IT and InfoSec.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur principal owned and leased properties, as of December 31, 2024, are as follows: Europe, Africa & the Middle East North America Greater Asia Latin America Owned Leased Owned Leased Owned Leased Owned Leased Plant 37 12 16 13 16 5 12 3 Office 2 53 — 6 1 20 — 5 Laboratory 3 13 1 7 — 12 — 2 Warehouse 2 14 — 9 — 4 2 7 Other 10 5 — 6 10 8 3 2 54 97 17 41 27 49 17 19 Our principal executive offices are located at 521 West 57th Street, New York, New York and 200 Powder Mill Road, Wilmington, Delaware.
Biggest changeOur principal owned and leased properties, as of December 31, 2025, are as follows: Europe, Africa & the Middle East North America Greater Asia Latin America Total Owned Leased Owned Leased Owned Leased Owned Leased Owned Leased Plant 37 12 17 7 19 4 13 3 86 26 Office 1 43 — 2 1 12 — 2 2 59 Laboratory 3 16 2 11 2 19 1 6 8 52 Warehouse 2 15 — 7 — 3 1 4 3 29 Other 7 1 — 4 7 2 2 1 16 8 50 87 19 31 29 40 17 16 115 174 Our principal executive offices are located at 521 West 57th Street, New York, New York and 200 Powder Mill Road, Wilmington, Delaware.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed1 unchanged
Biggest changeThe Company’s material legal proceedings are described in Part II, Item 8 of this Form 10-K in the Notes to Consolidated Financial Statements in Note 21, “Commitments and Contingencies” under the heading “Litigation.” For more detailed information about risks related to legal proceedings, refer to Item 1A, “Risk Factors” – “Our results of operations may be negatively impacted by the outcome of 30 Table of Contents uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits.” ITEM 4.
Biggest changeThe Company’s material legal proceedings are described in Part II, Item 8 of this Form 10-K in the Notes to Consolidated Financial Statements in Note 21, “Commitments and Contingencies” under the heading “Litigation.” For more detailed information about risks related to legal proceedings, refer to Item 1A, “Risk Factors” – “Our results of operations may be negatively impacted by the outcome of uncertainties related to legal claims, disputes, investigations and litigation, including the ongoing antitrust and competition investigations and related class action lawsuits.” ITEM 4.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeITEM 4. Mine Safety Disclosures 31 PART II ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 31 ITEM 6. [Reserved] 32 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 32 ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 48
Biggest changeITEM 4. Mine Safety Disclosures 23 PART II ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 ITEM 6. [Reserved] 24 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 24 ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 43

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

2 edited+2 added−3 removed2 unchanged
Biggest changeTitle of Class Number of shareholders of record as of February 24, 2025 Common stock, par value 12 1 /2¢ per share 2,993 Issuer Purchases of Equity Securities. None. Performance Graph.
Biggest changeTitle of Class Number of shareholders of record as of February 20, 2026 Common stock, par value 12 1 /2¢ per share 2,766 Issuer Purchases of Equity Securities. The following information summarizes information with respect to the Company’s purchase of its common stock during the year ended December 31, 2025, reported on a settlement date basis.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. 23 Table of Contents Market Information.
Removed
The following graph compares a shareholder’s cumulative total return for the last five fiscal years as if such amounts had been invested in: (i) our common stock; (ii) the stocks included in the S&P 500 Index; (iii) the stocks included in the S&P 500 Consumer Staples Index; and (iv) the stocks included in the S&P 500 Specialty Chemicals Index.
Added
Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs (1) Approximate dollar value of shares that may yet be purchased under the plans or programs (1) (Dollars in Millions) October 1-31, 2025 210,002 $ 62.83 210,002 $ 487 November 1-30, 2025 174,872 65.17 174,872 475 December 1-31, 2025 199,041 66.29 199,041 462 Total 583,915 $ 64.71 583,915 $ 462 (1) As announced on August 5, 2025, our Board of Directors authorized a repurchase plan of up to $500 million of common stock.
Removed
The graph is based on historical stock prices and measures total shareholder return, which takes into account both changes in stock price and dividends.
Added
The program began on October 1, 2025 and does not have a specified term of termination date. Subject to market conditions, we expect to repurchase all shares under this authorization, in open market or privately negotiated transactions, including pursuant to Rule 10b5-1 under the Exchange Act, and in block trades, or a combination of the foregoing.
Removed
The total return assumes that dividends were reinvested daily and is based on a $100 investment on December 31, 2019. 31 Table of Contents SOURCE: S&P Capital IQ Year-end Data 2019 2020 2021 2022 2023 2024 International Flavors & Fragrances $ 100.00 $ 86.66 $ 122.67 $ 87.89 $ 70.78 $ 75.21 S&P 500 Index $ 100.00 $ 118.40 $ 152.39 $ 124.79 $ 157.59 $ 197.02 S&P 500 Consumer Staples Index $ 100.00 $ 110.75 $ 131.38 $ 130.57 $ 131.24 $ 150.76 S&P 500 Specialty Chemicals Index $ 100.00 $ 117.17 $ 151.20 $ 109.69 $ 127.39 $ 125.91

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

90 edited+71 added−57 removed25 unchanged
Biggest changeThe increase in gross profit was primarily driven by volume increases and productivity gains, offset in part by the effect of exchange rate variations and the net impact of the change in business portfolio mix due to divestitures of $133 million. 34 Table of Contents RESULTS OF OPERATIONS Year Ended December 31, Change (DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 Net sales $ 11,484 $ 11,479 $ 12,440 — % (8) % Cost of sales 7,360 7,798 8,289 (6) % (6) % Gross profit 4,124 3,681 4,151 12 % (11) % Research and development (R&D) expenses 671 636 603 6 % 5 % Selling and administrative (S&A) expenses 1,995 1,787 1,768 12 % 1 % Restructuring and other charges 29 68 12 (57) % NMF Amortization of acquisition-related intangibles 610 680 727 (10) % (6) % Impairment of goodwill 64 2,623 2,250 (98) % 17 % Impairment of long-lived assets — — 120 NMF (100) % Gains on sale of assets (11) (3) (3) 267 % — % Operating profit (loss) 766 (2,110) (1,326) (136) % 59 % Interest expense 305 380 336 (20) % 13 % (Gains) losses on business disposals (346) 23 (11) NMF — % Loss on assets classified as held for sale 347 — — NMF — % Other expense (income), net 182 5 (26) NMF (119) % Income (loss) before taxes 278 (2,518) (1,625) (111) % 55 % Provision for income taxes 31 45 239 (31) % (81) % Net income (loss) 247 (2,563) (1,864) (110) % 38 % Net income attributable to non-controlling interest 4 4 7 — % (43) % Net income (loss) attributable to IFF shareholders $ 243 $ (2,567) $ (1,871) (109) % 37 % Net income (loss) per share — basic and diluted $ 0.95 $ (10.05) $ (7.32) (109) % 37 % Gross margin 35.9 % 32.1 % 33.4 % NMF (130) bps R&D as a percentage of sales 5.8 % 5.5 % 4.8 % 30 bps 70 bps S&A as a percentage of sales 17.4 % 15.6 % 14.2 % 180 bps 140 bps Operating margin 6.7 % (18.4) % (10.7) % NMF NMF Effective tax rate 11.2 % (1.8) % (14.7) % NMF NMF Segment net sales Nourish $ 5,871 $ 6,060 $ 6,829 (3) % (11) % Health & Biosciences 2,212 2,081 2,339 6 % (11) % Scent 2,440 2,393 2,301 2 % 4 % Pharma Solutions 961 945 971 2 % (3) % Consolidated $ 11,484 $ 11,479 $ 12,440 — % (8) % _______________________ NMF: Not meaningful Cost of sales includes the cost of materials and manufacturing expenses.
Biggest changeThe decrease in gross profit was primarily driven by the impact of divestitures of $264 million and the effect of exchange rate variations, offset in part by volume increases and productivity gains. 26 Table of Contents RESULTS OF OPERATIONS Year Ended December 31, Change (DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) 2025 2024 2023 2025 vs. 2024 2024 vs. 2023 Net sales $ 10,890 $ 11,484 $ 11,479 (5) % — % Cost of sales 6,952 7,360 7,798 (6) % (6) % Gross profit 3,938 4,124 3,681 (5) % 12 % Research and development (R&D) expenses 694 671 636 3 % 6 % Selling and administrative (S&A) expenses 1,834 1,995 1,787 (8) % 12 % Restructuring and other charges 70 29 68 141 % (57) % Amortization of acquisition-related intangibles 568 610 680 (7) % (10) % Impairment of goodwill 1,153 64 2,623 NMF (98) % Losses (Gains) on sale of assets 1 (11) (3) (109) % 267 % Operating (loss) profit (382) 766 (2,110) (150) % (136) % Interest expense 229 305 380 (25) % (20) % Gain on extinguishment of debt (488) — — NMF NMF Losses (Gains) on business disposals 109 (346) 23 (132) % — % Loss on assets classified as held for sale 115 317 — NMF — % Other expense, net 65 182 5 (64) % NMF (Loss) income before taxes (412) 308 (2,518) (234) % (112) % Provision for income taxes (53) 41 69 (229) % (41) % Net (loss) income (359) 267 (2,587) (234) % (110) % Net income attributable to non-controlling interest 2 4 4 (50) % — % Net (loss) income attributable to IFF shareholders $ (361) $ 263 $ (2,591) (237) % (110) % Net income (loss) per share — basic and diluted $ (1.41) $ 1.04 $ (10.14) (236) % (110) % Gross margin 36.2 % 35.9 % 32.1 % 30 bps NMF R&D as a percentage of sales 6.4 % 5.8 % 5.5 % 60 bps 30 bps S&A as a percentage of sales 16.8 % 17.4 % 15.6 % (60) bps 180 bps Operating margin (3.5) % 6.7 % (18.4) % NMF NMF Effective tax rate 12.9 % 13.3 % (2.7) % (40) bps NMF Segment net sales Taste $ 2,481 $ 2,428 $ 2,303 2 % 5 % Food Ingredients 3,278 3,365 3,692 (3) % (9) % Health & Biosciences 2,283 2,203 2,071 4 % 6 % Scent 2,479 2,439 2,393 2 % 2 % Pharma Solutions 369 1,049 1,020 (65) % 3 % Consolidated $ 10,890 $ 11,484 $ 11,479 (5) % — % _______________________ NMF: Not meaningful Cost of sales includes the cost of materials and manufacturing expenses.
Interest Expense Interest expense decreased $75 million to $305 million in 2024 compared to $380 million in 2023. The decrease in interest expense was due to lower debt outstanding. See Note 14 for additional information. (Gains) Losses on Business Disposals (Gains) losses on business disposals increased to $(346) million in 2024 compared to $23 million in 2023.
Interest Expense Interest expense decreased $75 million to $305 million in 2024 compared to $380 million in 2023. The decrease in interest expense was due to lower debt outstanding. See Note 14 for additional information. Losses (Gains) on Business Disposals Losses (Gains) on business disposals increased to $(346) million in 2024 compared to $23 million in 2023.
During 2023, based on the quantitative impairment test using the income approach, we determined that the carrying value of the Nourish reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.623 billion in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the year ended December 31, 2023.
During 2023, based on the quantitative impairment test using the income approach, we determined that the carrying value of the previous Nourish reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.623 billion in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the year ended December 31, 2023.
Impairment of Goodwill The impairment of goodwill was $64 million in 2024 compared to $2.623 billion in 2023, which was related to the Pharma Solutions disposal group and Nourish reporting units, respectively. See Note 1, Note 4, and Note 12 for additional information.
Impairment of Goodwill The impairment of goodwill was $64 million in 2024 compared to $2.623 billion in 2023, which was related to the Pharma Solutions disposal group and Nourish reporting units, respectively. See Note 1, Note 3, and Note 12 for additional information.
In performing the quantitative impairment test, we determined that the fair value of the reporting units exceeded their carrying values and determined that there was no further impairment of goodwill in these reporting units as of November 30, 2024.
In performing the quantitative impairment test, we determined that the fair value of the reporting units exceeded their carrying values and determined that there was no further impairment of goodwill in these reporting units as of November 30, 2025.
New Accounting Standards See Note 1 to the Consolidated Financial Statements for a discussion of recent accounting pronouncements. Non-GAAP Financial Measures We use non-GAAP financial measures in this Form 10-K, including: (i) currency neutral metrics, (ii) comparable portfolio metrics and (iii) adjusted operating EBITDA and adjusted operating EBITDA margin.
New Accounting Standards See Note 1 to the Consolidated Financial Statements for a discussion of recent accounting pronouncements. 41 Table of Contents Non-GAAP Financial Measures We use non-GAAP financial measures in this Form 10-K, including: (i) currency neutral metrics, (ii) comparable portfolio metrics and (iii) adjusted operating EBITDA and adjusted operating EBITDA margin.
Accordingly, as of December 31, 2024, we had a deferred tax liability of approximately $154 million for the effect of repatriating the funds to the U.S., attributable to various non-U.S. subsidiaries. There is no deferred tax liability associated with non-U.S. subsidiaries where we intend to indefinitely reinvest the earnings to fund local operations and/or capital projects.
Accordingly, as of December 31, 2025, we had a deferred tax liability of approximately 155 million for the effect of repatriating the funds to the U.S., attributable to various non-U.S. subsidiaries. There is no deferred tax liability associated with non-U.S. subsidiaries where we intend to indefinitely reinvest the earnings to fund local operations and/or capital projects.
We also provide the non-GAAP measure net debt solely for the purpose of providing information on the Company’s compliance with debt covenants contained in its debt agreements. Our non-GAAP financial measures are defined below. 45 Table of Contents These non-GAAP financial measures are intended to provide additional information regarding our underlying operating results and comparable year-over-year performance.
We also provide the non-GAAP measure net debt solely for the purpose of providing information on our compliance with debt covenants contained in its debt agreements. Our non-GAAP financial measures are defined below. These non-GAAP financial measures are intended to provide additional information regarding our underlying operating results and comparable year-over-year performance.
Any public statements or disclosures made by us following this report that modify or impact any of the forward-looking statements contained in or accompanying this report will be deemed to modify or supersede such outlook or other forward-looking statements in or accompanying this report. 47 Table of Contents
Any public statements or disclosures made by us following this report that modify or impact any of the forward-looking statements contained in or accompanying this report will be deemed to modify or supersede such outlook or other forward-looking statements in or accompanying this report.
For the annual impairment test as of November 30, 2024, the Company performed quantitative impairment tests by comparing the fair value of the reporting units with their carrying amounts. We assessed the fair value of the reporting units using an income approach.
For the annual impairment test as of November 30, 2025, we performed quantitative impairment tests by comparing the fair value of the reporting units with their carrying amounts. We assessed the fair value of the reporting units using an income approach.
These non-GAAP measures should not be considered in isolation or as substitutes for analysis of the Company’s results under GAAP and may not be comparable to other companies’ calculation of such metrics.
These non-GAAP measures should not be considered in isolation or as substitutes for analysis of our results under GAAP and may not be comparable to other companies’ calculation of such metrics.
We are also committed to maintaining our history of paying a dividend to investors determined by our Board of Directors at its discretion based on various factors. Capital Resources Operating cash flow provides the primary source of funds for capital investment needs, dividends paid to shareholders and debt service repayments.
We are committed to maintaining our history of paying a dividend to investors which is determined by our Board of Directors at its discretion based on various factors. Capital Resources Operating cash flow provides the primary source of funds for capital investment needs, dividends paid to shareholders, treasury share repurchases and debt service repayments.
Term Loan and Revolving Credit Facility Our credit agreements contain various covenants, limitations and events of default customary for similar facilities for similarly rated borrowers, including the requirement for us to maintain, at the end of each fiscal quarter, a ratio of net debt for borrowed money to credit adjusted EBITDA in respect of the previous 12-month period.
Revolving Credit Facility Our Revolving credit agreement contains various covenants, limitations and events of default customary for similar facilities for similarly rated borrowers, including the requirement for us to maintain, at the end of each fiscal quarter, a ratio of net debt for borrowed money to credit adjusted EBITDA in respect of the previous 12-month period.
While we believe that the assumptions used in the impairment test were reasonable, changes in key assumptions, including lower revenue growth, adjusted operating EBITDA margin, terminal growth rates or increase in discount rates could result in a future impairment. Such impairment could have a material effect on our Consolidated Statements of Operations and Balance Sheets.
While management believes that the assumptions used in the impairment test were reasonable, changes in key assumptions, including lower revenue growth, operating margin, terminal growth rates or increase in discount rates could result in a future impairment. Such impairment could have a material effect on our Consolidated Statements of Operations and Balance Sheets.
Pension Plan in 2024. See Note 8 and Note 9 for additional information. Income Taxes The effective tax rate in 2024 was 11.2% compared to (1.8)% in 2023. The year-over-year increase was primarily driven by an increase in pre-tax income, changes in the mix of earnings, the tax impact of business divestitures and certain non-recurring tax benefits.
See Note 8 and Note 9 for additional information. Income Taxes The effective tax rate in 2024 was 13.3% compared to (2.7)% in 2023. The year-over-year increase was primarily driven by an increase in pre-tax income, changes in the mix of earnings, the tax impact of business divestitures and certain non-recurring tax benefits.
(2) Comparable portfolio results for 2024 and 2023 exclude the impact of divestitures.
(2) Comparable portfolio results for 2023 exclude the impact of divestitures.
In 2024 and 2023, we spent approximately $32 million and $23 million on capital projects and $136 million and $139 million in operating expenses and governmental charges, respectively, for the purpose of complying with such regulations. Expenditures for these purposes will continue for the foreseeable future.
In 2025 and 2024, we spent approximately $22 million and $32 million on capital projects and $119 million and $136 million in operating expenses and governmental charges, respectively, for the purpose of complying with such regulations. Expenditures for these purposes will continue for the foreseeable future.
On a comparable basis, Scent Segment Adjusted Operating EBITDA increased 25% in 2024 compared to 2023 led by primarily volume increases and productivity gains. Comparable portfolio results exclude the impact of the divestitures of the FSI business and Cosmetic Ingredients business, with an impact of approximately $45 million.
On a comparable basis, Scent Segment Adjusted Operating EBITDA increased 21% in 2024 compared to 2023 led by primarily volume increases and productivity gains. Comparable portfolio results exclude the impact of the divestitures of the Flavors Specialty Ingredients business and Cosmetic Ingredients business of approximately $45 million.
See Note 4 to the Consolidated Financial Statements for additional information. During 2023, we determined that the carrying value of the Nourish reporting unit exceeded its fair value and recorded an impairment charge of $2.623 billion in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the year ended December 31, 2023.
During 2023, we determined that the carrying value of the Nourish reporting unit exceeded its fair value and recorded an impairment charge of $2.623 billion in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the year ended December 31, 2023.
As of December 31, 2024, the Company had purchase commitment obligations of approximately $367 million, with approximately $206 million payable within 12 months. Critical Accounting Policies and Use of Estimates Our significant accounting policies are more fully described in Note 1 to the Consolidated Financial Statements.
As of December 31, 2025, we had purchase commitment obligations of approximately $415 million, with approximately $184 million payable within 12 months. Critical Accounting Policies and Use of Estimates Our significant accounting policies are more fully described in Note 1 to the Consolidated Financial Statements.
As of December 31, 2024, the Company had fixed lease payment obligations of approximately $782 million, with approximately $117 million payable within 12 months. See Note 15 to the Consolidated Financial Statements for a further discussion of our various lease arrangements.
As of December 31, 2025, we had fixed lease payment obligations of approximately $811 million, with approximately $131 million payable within 12 months. See Note 15 to the Consolidated Financial Statements for a further discussion of our various lease arrangements.
See Note 1, Note 11 and Note 12 to the Consolidated Financial Statements for additional information.
See Note 12 to the Consolidated Financial Statements for additional information.
The loss in 2023 primarily relates to the sale of the FSI business, the sale of a portion of the Savory Solutions business, and liquidation of a business in Russia for the sale of the portion of the Savory Solutions business. See Note 4 for additional information.
The loss in 2023 primarily relates to the sale of the Flavors Specialty Ingredients business, the sale of a portion of the Savory Solutions business, and liquidation of a business in Russia for the sale of the portion of the Savory Solutions business. See Note 3 for additional information.
Cautionary Statement Under the Private Securities Litigation Reform Act of 1995 Statements in this Form 10-K, which are not historical facts or information, are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995.
Cautionary Statement Under the Private Securities Litigation Reform Act of 1995 This Form 10-K includes statements that are not historical facts and are “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995.
See Note 10 for additional information. Segment Adjusted Operating EBITDA Results The Company uses Segment Adjusted Operating EBITDA for internal reporting and performance measurement purposes. Segment Adjusted Operating EBITDA is defined as Income (Loss) Before Taxes before depreciation and amortization expense, interest expense, restructuring and other charges and certain items that are not related to recurring operations.
Segment Adjusted Operating EBITDA Results We use Segment Adjusted Operating EBITDA for internal reporting and performance measurement purposes. Segment Adjusted Operating EBITDA is defined as (Loss) Income Before Taxes before depreciation and amortization expense, interest expense, restructuring and other charges and certain items that are not related to recurring operations.
Reconciliations of credit adjusted EBITDA to net income and net debt to total debt are as follows: (DOLLARS IN MILLIONS) Year Ended December 31, 2024 Net income $ 243 Interest expense 305 Income taxes 31 Depreciation and amortization 1,015 Specified items (1) 434 Non-cash items (2) 197 Credit Adjusted EBITDA $ 2,225 _______________________ (1) Specified items consisted of restructuring and other charges, impairment of goodwill, acquisition, divestiture and integration costs, strategic initiatives costs, regulatory costs and other costs that are not related to recurring operations.
Reconciliations of credit adjusted EBITDA to net income and net debt to total debt are as follows: (DOLLARS IN MILLIONS) Year Ended December 31, 2025 Net income $ (359) Interest expense 229 Income taxes (53) Depreciation and amortization 962 Specified items (1) 1,018 Non-cash items (2) 303 Credit Adjusted EBITDA $ 2,100 _______________________ (1) Specified items consisted of restructuring and other charges, impairment of goodwill, acquisition, divestiture and integration costs, strategic initiatives costs, regulatory costs and other costs that are not related to recurring operations.
As of December 31, 2024, the Company had postretirement obligations of approximately $40 million, with approximately $4 million payable within 12 months. Purchase Commitments The Company has various purchase commitments that include agreements for raw material procurement and contractual capital expenditures.
As of December 31, 2025, we had postretirement obligations of approximately $40 million payable within 10 years, with approximately $4 million payable within 12 months. Purchase Commitments We have various purchase commitments that include agreements for raw material procurement and contractual capital expenditures.
Pension and Other Postretirement Obligations As of December 31, 2024, the Company had pension funding obligations of approximately $445 million, with approximately $40 million payable within 12 months. See Note 8 to the Consolidated Financial Statements for a further discussion of our retirement plans.
Pension and Other Postretirement Obligations As of December 31, 2025, we had pension funding obligations of approximately $521 million payable within 10 years, with approximately $46 million payable within 12 months. See Note 8 to the Consolidated Financial Statements for a further discussion of our retirement plans.
Loss on Assets Classified as Held for Sale Loss on assets classified as held for sale was $347 million in 2024. This related to assets classified as held for sale for the Pharma Solutions disposal group and the portion of the Savory Solutions business in Turkey.
Loss on Assets Classified as Held for Sale Loss on assets classified as held for sale was $317 million in 2024. This related to assets classified as held for sale for the Pharma Solutions disposal group and a portion of the Savory Solutions business in Turkey. See Note 4 for additional information.
See Note 4 for additional information. 37 Table of Contents Other Expense (Income), Net Other expense (income), net, increased $177 million to $182 million in 2024 compared to $5 million in 2023. $153 million of increased expense was driven by increased pension-related expense, $130 million of which was due to a settlement loss that was recognized upon termination of the International Flavors & Fragrances Inc.
Other Expense, Net Other expense, net, increased $177 million to $182 million in 2024 compared to $5 million in 2023. $153 million of increased expense was driven by increased pension-related expense, $130 million of which was due to a settlement loss that was recognized upon termination of the International Flavors & Fragrances Inc. Pension Plan in 2024.
As we repatriate these funds to the U.S., we will be required to pay income taxes in certain U.S. states and applicable foreign withholding taxes during the period when such repatriation occurs.
We regularly repatriate cash from our non-U.S. subsidiaries to fund financial obligations in the U.S. As we repatriate these funds to the U.S., we will be required to pay income taxes in certain U.S. states and applicable foreign withholding taxes during the period when such repatriation occurs.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. (UNLESS INDICATED OTHERWISE, DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) OVERVIEW Company Background We are organized into four reportable operating segments: Nourish, Health & Biosciences, Scent and Pharma Solutions.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. (UNLESS INDICATED OTHERWISE, DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS) OVERVIEW Company Background In 2025, we were organized into five reportable operating segments: Taste, Food Ingredients, Health & Biosciences, Scent and, until its divestiture in May 2025, Pharma Solutions.
Cash Flows Used In Financing Activities Cash flows used in financing activities in 2024 were $1.606 billion compared to $1.851 billion in 2023.
Cash Flows Used In Financing Activities Cash flows used in financing activities in 2025 were $3.091 billion compared to $1.606 billion in 2024.
Liquidity and Capital Resources Cash, Cash Equivalents and Restricted Cash We had cash, cash equivalents and restricted cash of approximately $471 million, inclusive of $2 million currently in Assets held for sale on the Consolidated Balance Sheets, at December 31, 2024 compared to $735 million, inclusive of $26 million in Assets held for sale on the Consolidated Balance Sheets, at December 31, 2023 and of this balance, the majority was held outside the United States.
Liquidity and Capital Resources Cash, Cash Equivalents and Restricted Cash We had cash, cash equivalents and restricted cash of approximately $590 million on the Consolidated Balance Sheets, at December 31, 2025 compared to $471 million, inclusive of $2 million in Assets held for sale on the Consolidated Balance Sheets, at December 31, 2024.
The Company’s material cash requirements include the following contractual and other obligations. Borrowings and Interest on Borrowings As of December 31, 2024, the Company had outstanding floating and fixed rate notes with varying maturities for an aggregate principal amount of approximately $8.891 billion (collectively the “Notes”), with approximately $1.413 billion payable within 12 months.
Our material cash requirements include the following contractual and other obligations. Borrowings and Interest on Borrowings As of December 31, 2025, we had outstanding fixed rate notes with varying maturities for an aggregate principal amount of approximately $5.637 billion (collectively the “Notes”), with approximately $940 million payable within 12 months.
On a currency neutral basis, Pharma Solutions sales also increased 2% in 2024 compared to the 2023 period as the impact of exchange rate variations was flat. Performance in the Pharma Solutions operating segment was driven by volume growth in industrial markets.
On a comparable currency neutral basis, Pharma Solutions sales also increased 3% in 2024 compared to the 2023 period driven by volume growth in industrial markets. Exchange rates impact on sales was less than 1%. Performance in the Pharma Solutions operating segment was driven by volume growth in industrial markets.
See Note 14 to the Consolidated Financial Statements for additional information on our credit agreements. Debt Covenants At December 31, 2024, we were in compliance with all financial and other covenants under our credit agreements, including the net debt to credit adjusted EBITDA (1) ratio.
Credit Adjusted EBITDA At December 31, 2025, we were in compliance with all financial and other covenants under our credit agreements, including the net debt to credit adjusted EBITDA (1) ratio.
On a comparable basis, Health & Biosciences Segment Adjusted Operating EBITDA increased 11% in 2024 compared to 2023 led by primarily volume increases and productivity gains.
On a comparable currency neutral basis, Scent Segment Adjusted Operating EBITDA increased 2% in 2025 compared to 2024 led by primarily volume increases and productivity gains.
The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies. On a comparable basis, currency neutral sales increased 6% driven by volume increases across various business lines.
On a comparable currency neutral basis, sales in 2025 increased 2% compared to 2024. Exchange rates impact on sales was less than 1%. The effect of exchange rates can vary by business and region, depending upon the mix of sales priced in U.S. dollars as compared to other currencies.
On a comparable basis, Nourish Segment Adjusted Operating EBITDA increased 18% in 2024 compared to 2023 led by primarily volume increases and productivity gains. Comparable portfolio results exclude the impact of the divestitures of the portion of the Savory Solutions business, Sonarome business and F&E UK business with an impact of approximately $32 million.
On a comparable basis, Taste Segment Adjusted Operating EBITDA increased 21% in 2024 compared to 2023 led by primarily volume increases and favorable net pricing. Comparable portfolio results exclude the impact of the divestitures of the Sonarome business and F&E UK business of approximately $9 million.
Cash Flows Provided By Operating Activities Cash flows provided by operating activities in 2024 were $1.070 billion, or 9.3% of sales, compared to $1.439 billion, or 12.5% of sales, in 2023.
Cash Flows Provided By Operating Activities Cash flows provided by operating activities in 2025 were $850 million, or 7.8% of sales, compared to $1.070 billion, or 9.3% of sales, in 2024.
Comparable portfolio results exclude the impact of divestitures of the portion of the Savory Solutions business, Sonarome business, Flavors & Essences UK business (“F&E UK”), Flavors Specialty Ingredients (“FSI”) business, and Cosmetic Ingredients business (“change in business portfolio mix due to divestitures”), which was approximately $360 million.
Comparable portfolio results exclude the impact of divestitures of the Flavors & Essences UK business (“F&E UK”), Rene Laurent business in France, Cosmetic Ingredients business, and the Pharma Solutions disposal group and Nitrocellulose business (“change in business portfolio mix due to divestitures”), which was approximately $757 million.
We intend our forward-looking statements to speak only as of the time of such statements and do not undertake or plan to update or revise them as more information becomes available or to reflect changes in expectations, assumptions or results. We can give no assurance that such expectations or forward-looking statements will prove to be correct.
We intend our forward-looking statements to speak only as of the time of such statements and do not undertake or plan to update or revise them as more information becomes available or to reflect changes in expectations, assumptions or results, whether as a result of new information, future events or otherwise.
A key factor for commercial success is our inclusion on strategic customers’ core supplier lists, which provides opportunities to expand and win new business. We are on the core supplier lists of a large majority of our global and strategic customers. In 2024, no customer accounted for 10% or more of sales.
A key factor for commercial success is our inclusion on strategic customers’ core supplier lists, which provides opportunities to expand and win new business. We are on the core supplier lists of a large majority of our global and strategic customers. Additionally, a significant portion of our sales comes from a relatively small number of large multinational customers.
The Periodic Assessment of Potential Impairment of Goodwill and Held for Sale Balances As of December 31, 2024, we have goodwill of approximately $9.080 billion. We test goodwill for impairment at the reporting unit level as of November 30 every year or more frequently if events or changes in circumstances indicate the asset might be impaired.
As of December 31, 2025, we have goodwill of approximately $8.269 billion. We test goodwill for impairment at the reporting unit level as of November 30 every year or more frequently if events or changes in circumstances indicate the 40 Table of Contents goodwill might be impaired.
We provide currency neutral calculations in this report to remove the impact of foreign currency exchange rates fluctuations. We calculate currency neutral numbers by translating current year invoiced sale amounts at the exchange rates used for the corresponding prior year period. We use currency neutral results in our analysis of subsidiary and/or segment performance.
We calculate comparable currency neutral numbers by translating current year transactions amounts at the exchange rates used for the corresponding prior year period and adjust prior year results to exclude businesses divested for the comparable period. We use comparable currency neutral results in our analysis of subsidiary and/or segment performance.
(DOLLARS IN MILLIONS) December 31, 2024 Total debt (1) $ 9,005 Adjustments: Cash and cash equivalents (2) 471 Net debt $ 8,534 _______________________ (1) Total debt used for the calculation of net debt consisted of short-term debt, long-term debt, short-term finance lease obligations and long-term finance lease obligations.
(DOLLARS IN MILLIONS) December 31, 2025 Total debt (1) $ 6,026 Adjustments: Cash and cash equivalents 590 Net debt $ 5,436 _______________________ (1) Total debt used for the calculation of net debt consisted of short-term debt, long-term debt, short-term finance lease obligations and long-term finance lease obligations.
As of December 31, 2024, the Company had no borrowings outstanding under the Revolving Credit Facility. See Note 14 to the Consolidated Financial Statements for a further discussion of our various borrowing facilities. Leases The Company has lease arrangements for certain corporate offices, manufacturing facilities, research and development facilities, and certain transportation and office equipment.
See Note 14 to the Consolidated Financial Statements for a further discussion of our various borrowing facilities. Leases We have lease arrangements for certain corporate offices, manufacturing facilities, research and development facilities, and certain transportation and office equipment.
Other Commitments Compliance with existing governmental requirements regulating the discharge of materials into the environment has not materially affected our operations, earnings or competitive position.
See Note 14 to the Consolidated Financial Statements for additional information. Other Contingencies See Note 21 to the Consolidated Financial Statements for information related to Other Contingencies . Other Commitments Compliance with existing governmental requirements regulating the discharge of materials into the environment has not materially affected our operations, earnings or competitive position.
On a currency neutral basis, Scent sales increased 7% in 2024 compared to the 2023 period as exchange rate variations had an unfavorable impact. On a comparable basis, currency neutral sales increased 12% driven by price increases in the Fragrance Compounds business unit and volume increases across all business units.
On a comparable currency neutral basis, Health & Biosciences sales increased 8% in 2024 compared to the 2023 period driven by volume increases across various business units and price increases across Food Biosciences and Grain Processing business units. Exchange rate variations had an unfavorable impact of 2%.
Cash balances held in foreign jurisdictions are, in most circumstances, available to be repatriated to the United States. Effective utilization of the cash generated by our international operations is a critical component of our strategy. We regularly repatriate cash from our non-U.S. subsidiaries to fund financial obligations in the U.S.
The majority of this balance was held outside the United States. Cash balances held in foreign jurisdictions are, in most circumstances, available to be repatriated to the United States. Effective utilization of the cash generated by our international operations is a critical component of our strategy.
As such, during the quarter ended June 30, 2024, the Company recorded a non-cash goodwill impairment charge of $64 million which is presented in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the twelve months ended December 31, 2024.
During 2024, we recorded a goodwill impairment charge of $64 million related to the Pharma Solutions disposal group, which is presented in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the twelve months ended December 31, 2024.
We also use currency neutral numbers when analyzing our performance against our competitors. Impairment of Goodwill During 2024, we determined that the carrying value of the Pharma Solutions disposal group exceeded its fair value and recorded an impairment charge of $64 million in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the year ended December 31, 2024.
See Note 12 to the Consolidated Financial Statements for additional information. During 2024, we determined that the carrying value of the Pharma Solutions disposal group exceeded its fair value and recorded an impairment charge of $64 million in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the year ended December 31, 2024.
Contractual Obligations The Company believes its balances of cash and cash equivalents, which totaled approximately $471 million as of December 31, 2024, inclusive of approximately $2 million currently in Assets held for sale on the Consolidated Balance Sheets, along with cash generated by ongoing operations and access to the Revolving Credit Facility and Commercial Paper as discussed in Note 14 to the Consolidated Financial Statements, will be sufficient to satisfy its cash requirements and capital 42 Table of Contents return program over the next 12 months and beyond.
Contractual Obligations 39 Table of Contents We believe our balances of cash and cash equivalents, which totaled approximately $590 million as of December 31, 2025, along with cash generated by ongoing operations and access to the Revolving Credit Facility and unsecured short-term promissory notes (“Commercial Paper”) as discussed in Note 14 to the Consolidated Financial Statements, will be sufficient to satisfy its cash requirements and capital return program over the next 12 months and beyond.
At December 31, 2024, our net debt to credit adjusted EBITDA (1) ratio was 3.84 to 1.0 as defined by the credit facility agreements, which is below the relevant level provided by our financial covenants of existing outstanding debt.
At December 31, 2025, our net debt to credit adjusted EBITDA (1) ratio was 2.59 to 1.0 as defined by the credit facility agreements, which is below the relevant level provided by our financial covenants of existing outstanding debt. _______________________ (1) Credit adjusted EBITDA and net debt, which are non-GAAP measures used for these covenants, are calculated in accordance with the definition in the debt agreements.
Consumer insights, science and creativity are at the heart of our Scent business, and, along with our unique portfolio of natural and synthetic ingredients, global footprint, innovative technologies and know-how, and customer intimacy, we believe make us a market leader in scent products. The Scent segment is comprised of Fragrance Compounds and Fragrance Ingredients.
Our Scent segment creates fragrance compounds and fragrance ingredients that are integral elements in the world’s finest perfumes and best-known household and personal care products. Consumer insights, science and creativity are at the heart of our Scent business, along with our unique portfolio of natural and synthetic ingredients, global footprint, innovative technologies and know-how, and customer intimacy.
As of December 31, 2024, we had no outstanding borrowings under our $2 billion Revolving Credit Facility. The amount that we are able to draw down under the Revolving Credit Facility is limited by financial covenants as described in more detail below. As of December 31, 2024, our available capacity was $922 million under the Revolving Credit Facility.
The amount that we are able to draw down under the Revolving Credit Facility is limited by financial covenants as described in more detail below. As of December 31, 2025, our available capacity was $2 billion under the Revolving Credit Facility. 38 Table of Contents See Note 14 to the Consolidated Financial Statements for additional information on our credit agreements.
Comparable Adjusted Operating EBITDA by segment was as follows: For the Year Ended December 31, (DOLLARS IN MILLIONS) 2024 2023 Segment Adjusted Operating EBITDA Nourish $ 824 $ 700 Health & Biosciences 654 588 Scent 518 416 Pharma Solutions 209 199 Impact of Business Divestitures — 77 Total 2,205 1,980 Depreciation & Amortization (1,015) (1,142) Interest Expense (305) (380) Other (Expense) Income, net (182) (5) Restructuring and Other Charges (29) (68) Impairment of Goodwill (64) (2,623) Gains (Losses) on Business Disposals 346 (23) Loss on Assets Classified as Held for Sale (347) — Acquisition, Divestiture and Integration Costs (228) (174) Strategic Initiatives Costs (33) (31) Regulatory Costs (73) (50) Other 3 (2) Income (Loss) Before Taxes $ 278 $ (2,518) Segment Adjusted Operating EBITDA margin: Nourish 14.0 % 12.0 % Health & Biosciences 29.6 % 28.3 % Scent 21.2 % 18.3 % Pharma Solutions 21.7 % 21.1 % Consolidated 19.2 % 17.2 % 39 Table of Contents Nourish Segment Adjusted Operating EBITDA Nourish Segment Adjusted Operating EBITDA increased $92 million, or 13% on an adjusted basis, to $824 million (14.0% of segment sales) in 2024 from $732 million (12.1% of segment sales) in 2023.
See Note 10 for additional information. 35 Table of Contents Segment Adjusted Operating EBITDA Results Adjusted Operating EBITDA performance by segment was as follows: % Change in Adjusted Operating EBITDA - 2024 vs. 2023 Reported (1) Comparable Adjusted (1)(2) Taste 18 % 21 % Food Ingredients 11 % 18 % Health & Biosciences 10 % 10 % Scent 10 % 21 % Pharma Solutions 7 % 7 % Total 11 % 16 % Comparable Adjusted Operating EBITDA by segment was as follows: For the Year Ended December 31, (DOLLARS IN MILLIONS) 2024 2023 Segment Adjusted Operating EBITDA Taste $ 460 $ 381 Food Ingredients 408 346 Health & Biosciences 577 524 Scent 545 450 Pharma Solutions 215 202 Impact of Business Divestitures (2) — 77 Total 2,205 1,980 Depreciation & Amortization (1,015) (1,142) Interest Expense (305) (380) Other (Expense) Income, net (182) (5) Restructuring and Other Charges (29) (68) Impairment of Goodwill (64) (2,623) Gains (Losses) on Business Disposals 346 (23) Loss on Assets Classified as Held for Sale (317) — Acquisition, Divestiture and Integration Related Costs (228) (174) Strategic Initiatives Costs (33) (31) Regulatory Costs (73) (50) Entity Realignment Costs (6) (2) Other 9 — Income (Loss) Before Taxes $ 308 $ (2,518) Segment Adjusted Operating EBITDA margin: Taste 18.9 % 16.7 % Food Ingredients 12.1 % 10.0 % Health & Biosciences 26.2 % 25.3 % Scent 22.3 % 19.8 % Pharma Solutions 20.5 % 19.8 % Consolidated 19.2 % 17.2 % _______________________ 36 Table of Contents (1) Refer to Note 7 for a reconciliation of Adjusted Operating EBITDA to Income (Loss) Before Taxes.
Research and Development (R&D) Expenses R&D expenses increased $35 million to $671 million (5.8% of sales) in 2024 compared to $636 million (5.5% of sales) in 2023.
With the decrease in cost of sales, gross margin increased, reflecting the benefit of lower costs and improved productivity. Research and Development (“R&D”) Expenses R&D expenses increased $35 million to $671 million (5.8% of sales) in 2024 compared to $636 million (5.5% of sales) in 2023.
Scent Segment Adjusted Operating EBITDA Scent Segment Adjusted Operating EBITDA increased $57 million, or 12% on a reported basis, to $518 million (21.2% of segment sales) in 2024 from $461 million (19.3% of segment sales) in 2023.
Scent Segment Adjusted Operating EBITDA Scent Segment Adjusted Operating EBITDA increased $49 million, or 10% on a reported basis, to $545 million (22.3% of segment sales) in 2024 from $496 million (20.7% of segment sales) in 2023.
Comparable portfolio results exclude the impact of the divestitures of the FSI business and Cosmetic Ingredients business, with an impact of approximately $116 million. Pharma Solutions 36 Table of Contents Pharma Solutions sales in 2024 increased $16 million, or 2% on a reported basis, to $961 million compared to $945 million in 2023.
Exchange rate variations had an unfavorable impact of 5%. Comparable portfolio results exclude the impact of the divestitures of the Flavors Specialty Ingredients business and Cosmetic Ingredients business, with an impact of approximately $116 million. Pharma Solutions Pharma Solutions sales in 2024 increased $29 million, or 3% on a reported basis, to $1.049 billion compared to $1.020 billion in 2023.
Future interest payments associated with the Notes total approximately $2.777 billion, with approximately $256 million payable within 12 months. The Company also issues unsecured short-term promissory notes (“Commercial Paper”) pursuant to a commercial paper program. As of December 31, 2024, the Company had no Commercial Paper outstanding.
Future interest payments associated with the Notes total approximately $2.268 billion, with approximately $165 million payable within 12 months. We also issue Commercial Paper pursuant to a commercial paper program. As of December 31, 2025, we had $314 million of Commercial Paper outstanding. As of December 31, 2025, we had no borrowings outstanding under the Revolving Credit Facility.
During 2022, we determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the year ended December 31, 2022.
Based on the results of the impairment testing, we determined that the carrying value of the Food Ingredients reporting unit exceeded its fair value and recorded an impairment charge of $1.153 billion. This charge is reflected in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the year ended December 31, 2025.
Pharma Solutions Segment Adjusted Operating EBITDA Pharma Solutions Segment Adjusted Operating EBITDA increased $10 million, or 5% on a reported basis, to $209 million (21.7% of segment sales) in 2024 from $199 million (21.1% of segment sales) in 2023.
Food Ingredients Segment Adjusted Operating EBITDA Food Ingredients Segment Adjusted Operating EBITDA increased $39 million, or 11% on a reported basis, to $408 million (12.1% of segment sales) in 2024 from $369 million (10.0% of segment sales) in 2023.
The increase in R&D expenses was primarily driven by an increase in incentive compensation expense, offset in part by the net impact of the change in business portfolio mix due to divestitures and the effect of exchange rate variations.
The increase in R&D expenses was primarily driven by an increase in employee related costs and operating expenses for R&D related activities, offset in part by the impact of the divestitures and the effect of exchange rate variations.
Certain of such forward-looking information may be identified by such terms as “expect”, “anticipate”, “believe”, “intend”, “outlook”, “may”, “estimate”, “should”, “predict” and similar terms or variations thereof.
Certain of such forward-looking information may be identified by such terms as “expect”, “anticipate”, “believe”, “intend”, “outlook”, “may”, “estimate”, “should”, “predict”, “plan”, “project”, “could”, and similar terms or variations thereof. These statements are not guarantees of future performance and are subject to risks and uncertainties that could lead to materially different outcomes.
On a comparable basis, currency neutral sales increased 4% driven by volume increases across all business units. Comparable portfolio results exclude the impact of the divestitures of the portion of the Savory Solutions business, Sonarome business and F&E UK business with an impact of approximately $244 million.
On a comparable currency neutral basis, Taste sales increased 12% in 2024 compared to the 2023 period, driven by volume increases. Exchange rate variations had an unfavorable impact of 6%. Comparable portfolio results exclude the impact of the divestitures of the Sonarome business and F&E UK business, with an impact of approximately $22 million.
During 2022, based on the quantitative impairment test using the income approach, we determined that the carrying value of the Health & Biosciences reporting unit exceeded its fair value and recorded a goodwill impairment charge of $2.250 billion in the Consolidated Statements of Income (Loss) and Comprehensive Loss for the year ended December 31, 2022.
Based on the results of the impairment testing, we determined that the carrying amount of the Food Ingredients reporting unit exceeded its estimated fair value, and accordingly recognized a goodwill impairment charge of $1.153 billion. This charge is reflected in the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the year ended December 31, 2025.
The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance.
The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance. Important factors are described under “Risk Factors” of this Form 10-K and in our subsequent filings with the SEC.
Our Term Loan and Revolving Credit Facility bear interest at a base rate or a rate equal to Term SOFR plus an adjustment of 0.10% per annum or, in the case of euro-denominated loans, the Euro interbank offered rate, plus, in each case, an applicable margin based on our public debt rating.
Our Revolving Credit Facility bears interest at a base rate or a rate equal to Secured Overnight Financing Rate (“Term SOFR”), or, in the case of euro-denominated loans, the Euro interbank offered rate, plus, in each case, an applicable margin based on our public debt rating. Loans may be prepaid without premium or penalty, subject to customary breakage costs.
Our Health & Biosciences segment consists of the development and production of an advanced biotechnology-derived portfolio of enzymes, food cultures, probiotics and specialty ingredients for food and non-food applications.
Food Ingredients also includes savory solutions (such as spices, marinades, and mixtures) and inclusion products (such as products combining flavorings with fruit, vegetables and other natural ingredients). 24 Table of Contents Our Health & Biosciences segment consists of the development and production of an advanced biotechnology-derived portfolio of enzymes, food cultures, probiotics and specialty ingredients for food and non-food applications.
Health & Biosciences Health & Biosciences sales in 2024 increased $131 million, or 6% on a reported basis, to $2.212 billion compared to $2.081 billion in 2023. On a currency neutral basis, Health & Biosciences sales increased 8% in 2024 compared to the 2023 period as exchange rate variations had an unfavorable impact.
Exchange rate variations had an unfavorable impact of 2%. Comparable portfolio results exclude the impact of the divestiture of the portion of the Savory Solutions business with an impact of approximately $222 million. Health & Biosciences Health & Biosciences sales in 2024 increased $132 million, or 6% on a reported basis, to $2.203 billion compared to $2.071 billion in 2023.
Performance in the Health & Biosciences operating segment was driven by volume increases across various business units and price increases across Cultures & Food Enzymes and Grain Processing business units. Scent Scent sales in 2024 increased $47 million, or 2% on a reported basis, to $2.440 billion compared to $2.393 billion in 2023.
Scent Scent sales in 2024 increased $46 million, or 2% on a reported basis, to $2.439 billion compared to $2.393 billion in 2023. On a comparable currency neutral basis, Scent sales increased 12% in 2024 compared to the 2023 period driven by price increases in the Fragrance Compounds business unit and volume increases across all business units.
Our Pharma Solutions segment produces, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling the development of more effective pharmaceutical finished dosage formulations. Our excipients are used in prescription and over-the-counter pharmaceuticals and dietary supplements.
The Scent segment is comprised of Fragrance Compounds and Fragrance Ingredients. Our former Pharma Solutions segment produced, among other things, a vast portfolio of cellulosics and seaweed-based pharmaceutical excipients, used in prescription and over-the-counter pharmaceuticals and dietary supplements.
Health & Biosciences Segment Adjusted Operating EBITDA Health & Biosciences Segment Adjusted Operating EBITDA increased $66 million, or 11% on an adjusted basis, to $654 million (29.6% of segment sales) in 2024 from $588 million (28.3% of segment sales) in 2023.
Health & Biosciences Segment Adjusted Operating EBITDA Health & Biosciences Segment Adjusted Operating EBITDA increased $17 million, or 3% on a reported basis, to $594 million (26.0% of segment sales) in 2025 from $577 million (26.2% of segment sales) in 2024.
The decrease in cash flows from investing activities from 2023 to 2024 was primarily driven by lower net proceeds received from business divestitures compared to the prior year period, offset in part by decreased additions to property, plant and equipment. 40 Table of Contents We have evaluated and re-prioritized our capital projects and expect that capital spending in 2025 will be approximately 6% of sales.
This increase was offset in part by higher spending on property, plant and equipment during 2025 compared to 2024. We have evaluated and re-prioritized our capital projects and expect that capital spending in 2026 will be approximately 6% of sales.
We determined that we have five reporting units under the Nourish, Health & Biosciences, Scent and Pharma Solutions segments: (1) Nourish, (2) Fragrance Compounds, (3) Fragrance Ingredients, (4) Health & Biosciences and (5) Pharma Solutions. Note that the entire goodwill balance related to Pharma Solutions has been classified as held for sale as of December 31, 2024.
We determined that we have five reporting units under the Food Ingredients, Taste, Scent and Health & Biosciences segments: (1) Food Ingredients, (2) Taste, (3) Fragrance Compounds, (4) Fragrance Ingredients and (5) Health & Biosciences.
Gross Profit Gross profit in 2024 increased $443 million, or 12% on a reported basis, to $4.124 billion (35.9% of sales) compared to $3.681 billion (32.1% of sales) in the 2023 period.
In 2025, no customer accounted for 10% or more of sales. Gross Profit Gross profit in 2025 decreased $186 million, or 5% on a reported basis, to $3.938 billion (36.2% of sales) from $4.124 billion (35.9% of sales) in the 2024 period.
Among many other applications, this biotechnology-driven portfolio includes cultures for use in fermented foods such as yogurt, cheese and fermented beverages, probiotic strains, many with documented clinical health claims for use as dietary supplements and through industrial fermentation the production of enzymes and microorganisms that provide product and process performance benefits to household detergents, animal feed, ethanol production and brewing.
Among many other applications, our portfolio includes cultures for use in fermented foods such as yogurt, cheese and fermented beverages, probiotic strains, household detergents, animal feed, ethanol production and brewing. Health & Biosciences is comprised of Health, Food Biosciences, Home & Personal Care, Animal Nutrition and Grain Processing.
Based on the quantitative impairment test performed, we determined that the Nourish, Health & Biosciences, Fragrance Compounds and Fragrance Ingredients reporting units had excess fair value over carrying value of approximately 22%, 18%, 169% and 37%, respectively.
Based on the quantitative impairment test performed, the Taste, Fragrance Compounds and Fragrance Ingredients reporting units had substantial headroom, as fair value exceeded carrying value by a wide margin, while the fair value of the Health & Biosciences reporting unit exceeded carrying value by 9%.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

8 edited+1 added−1 removed6 unchanged
Biggest changeIn general, with the exception of soy and natural gas, we do not use commodity financial instruments to hedge commodity prices. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. See index to Consolidated Financial Statements on page 50 .
Biggest changeWe generally purchase these commodities based upon market prices that are established with the vendor as part of the purchase process. In general, with the exception of soy and natural gas, we do not use commodity financial instruments to hedge commodity prices. 43 Table of Contents ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
These contracts, and the counterparties to which are major international financial institutions, generally involve the exchange of one currency for a second currency at a future date, have maturities not exceeding twelve months, and are marked-to-market with changes in fair value that are recorded to Other expense (income), net within our Consolidated Statements of Income (Loss) and Comprehensive Loss.
These contracts, and the counterparties to which are major international financial institutions, generally involve the exchange of one currency for a second currency at a future date, have maturities not exceeding twelve months, and are marked-to-market with changes in fair value that are recorded to Other expense, net within our Consolidated Statements of Income (Loss) and Comprehensive Income (Loss).
For the year ended December 31, 2024, our exposure to market risk was estimated using sensitivity analyses, which illustrate the change in the fair value of a derivative financial instrument assuming hypothetical changes in foreign exchange rates and interest rates.
For the year ended December 31, 2025, our exposure to market risk was estimated using sensitivity analyses, which illustrate the change in the fair value of a derivative financial instrument assuming hypothetical changes in foreign exchange rates and interest rates.
Based on a hypothetical decrease or increase of 10% in the applicable balance sheet exchange rates (primarily against the U.S. dollar), the estimated fair value of our foreign currency forward contracts would change by approximately $475 million as of December 31, 2024.
Based on a hypothetical decrease or increase of 10% in the applicable balance sheet exchange rates (primarily against the U.S. dollar), the estimated fair value of our foreign currency forward contracts would change by approximately $199 million as of December 31, 2025.
We have entered into certain cross currency swap agreements in order to mitigate a portion of our net European investments from foreign currency risk. As of December 31, 2024, these swaps were in a liability position with an aggregate fair value of $90 million.
We have entered into certain cross currency swap agreements in order to mitigate a portion of our net European investments from foreign currency risk. As of December 31, 2025, these swaps were in a net liability position with an aggregate fair value of $237 million.
Based on a hypothetical decrease or increase of 10% in the value of the U.S. dollar against the Euro, the estimated fair value of our cross currency swaps would change by approximately $143 million. At December 31, 2024, the fair value of our EUR fixed rate debt was $813 million.
Based on a hypothetical decrease or increase of 10% in the value of the U.S. dollar against the Euro, the estimated fair value of our cross currency swaps would change by approximately $211 million. At December 31, 2025, the fair value of our EUR fixed rate debt was $935 million.
Based on a hypothetical decrease or increase of 10% in foreign exchange rates, the estimated fair value of our EUR fixed rate debt would change by approximately $90 million. At December 31, 2024, the fair value of our USD fixed rate debt was $6.338 billion.
Based on a hypothetical decrease or increase of 10% in foreign exchange rates, the estimated fair value of our EUR fixed rate debt would change by approximately $94 million. At December 31, 2025, the fair value of our USD fixed rate debt was $4.053 billion.
Based on a hypothetical decrease or increase of 1% in interest rates, our annual interest expense would change by approximately $4 million. We purchase certain commodities, such as natural gas, electricity, petroleum-based products and certain crop related items. We generally purchase these commodities based upon market prices that are established with the vendor as part of the purchase process.
Based on a hypothetical decrease or increase of 10% in interest rates, the estimated fair value of our U.S. fixed rate debt would change by approximately $405 million. We purchase certain commodities, such as natural gas, electricity, petroleum-based products and certain crop related items.
Removed
Based on a hypothetical decrease or increase of 10% in interest rates, the estimated fair value of our US fixed rate debt would change by approximately $634 million. At December 31, 2024, the total amount of our outstanding debt subject to interest rate fluctuations was $413 million.
Added
See index to Consolidated Financial Statements on page 45 . ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None.

Other IFF 10-K year-over-year comparisons