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What changed in Masco's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Masco'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.

+140 added−153 removedSource: 10-K (2026-02-10) vs 10-K (2025-02-11)

Top changes in Masco's 2025 10-K

140 paragraphs added · 153 removed · 123 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe that our human capital initiatives work together to help our employees grow and thrive, and cultivate a culture where our employees feel like they belong. We are also committed to keeping our employees healthy and safe in the workplace.
Biggest changeWe are currently focused on: • Building a pipeline of great leaders • Enabling a high-performance and continuous development culture • Supporting holistic well-being and celebrating our people • Providing competitive benefits and compensation • Engaging and retaining our employees by continuously listening and improving We believe that these initiatives work together to help our employees grow and thrive, and cultivate a culture where our employees feel like they belong.
This Report is being posted on our website concurrently with its filing with the SEC. Information contained on our website is not incorporated by reference into this Report or any other report filed with the SEC. Our reports filed with the SEC also may be found on the SEC’s website at www.sec.gov. 6
This Report is being posted on our website concurrently with its filing with the SEC. Information contained on our website is not incorporated by reference into this Report or any other report filed with the SEC. Our reports filed with the SEC also may be found on the SEC’s website at www.sec.gov.
Our BRISTAN™ and HERITAGE™ products are sold primarily in the United Kingdom. • We manufacture acrylic tubs, bath and shower enclosure units , and shower bases and trays . Our DELTA, PEERLESS and MIROLIN ® products are sold primarily to home center retailers in North America.
Our BRISTAN™ and HERITAGE™ products are sold primarily in the United Kingdom. • We manufacture acrylic tubs, bath and shower enclosure units , and shower bases and trays . Our DELTA and MIROLIN ® products are sold primarily to home center retailers in North America.
Competitors for these products include American Bath Group, LLC's Dreamline brand, Fortune Brands Innovations, Inc.'s Moen brand, Gatco Fine Bathware, Kohler Co. and private label brands. 4 Additional Information Intellectual Property We hold numerous U.S. and foreign patents, patent applications, licenses, trademarks, trade names, trade secrets and proprietary manufacturing processes.
Competitors for these products include American Bath Group, LLC's Dreamline brand, Fortune Brands Innovations, Inc.'s Moen brand, Gatco Inc., Kohler Co. and private label brands. 4 Additional Information Intellectual Property We hold numerous U.S. and foreign patents, patent applications, licenses, trademarks, trade names, trade secrets and proprietary manufacturing processes.
Our MIROLIN products are also sold to wholesalers and distributors in Canada. • Our spas, exercise pools, aquatic fitness systems and saunas are manufactured and sold under our HOT SPRING ® , CALDERA ® , FREEFLOW SPAS ® , FANTASY SPAS ® , AQUATERRA ® , LIFESMART ® , ENDLESS POOLS ® , TYLO ® , FINNLEO ® and HELO ® brands, as well as under other trademarks.
Our MIROLIN products are also sold to wholesalers and distributors in Canada. • Our spas, exercise pools, aquatic fitness systems and saunas are manufactured and sold under our HOT SPRING ® , CALDERA ® , FREEFLOW SPAS ® , FANTASY SPAS ® , AQUATERRA ® , LIFESMART ® , ENDLESS POOLS ® , TYLÖ ® , FINNLEO ® and HELO ® brands, as well as under other trademarks.
These products are sold primarily in North America as well as in South America under the brand names BEHR ® , KILZ ® , WHIZZ ® , Elder & Jenks ® and other trademarks to “do‑it‑yourself” and professional customers through home center retailers and other retailers.
These products are sold primarily in North America as well as in South America under the brand names BEHR ® , KILZ ® , WHIZZ ® and other trademarks to “do‑it‑yourself” and professional customers through home center retailers and other retailers.
We believe that our plumbing products are among the leaders in sales in North America and Europe. Competitors of the majority of our products in this segment include Dornbracht AG & Co.
We believe that our plumbing products are among the leaders in sales in North America and Europe. Competitors of the majority of our products in this segment include Dornbracht GmbH & Co.
KG, Zurn Elkay Water Solutions Corporation, Fortune Brands Innovations, Inc.'s Moen, Rohl and Riobel brands, Kohler Co., Lixil Group Corporation’s American Standard and Grohe brands, Spectrum Brands Holdings, Inc.'s Pfister faucets as well as private label and digitally native brands.
KG, Fortune Brands Innovations, Inc.'s Moen, Rohl and Riobel brands, Kohler Co., Lixil Group Corporation’s American Standard and Grohe brands, Spectrum Brands Holdings, Inc.'s Pfister faucets, Villeroy & Boch's Ideal Standard brand, Zurn Elkay Water Solutions Corporation, as well as private label and digitally native brands.
The majority of our faucet, bathing and showering products are sold primarily in North America, Europe and China under the brand names DELTA ® , BRIZO ® , PEERLESS ® , HANSGROHE ® , AXOR ® , KRAUS ® , EASY DRAIN ® , NEWPORT BRASS ® , GINGER ® , BRASSTECH ® and WALTEC ® .
The majority of our faucet, bathing and showering products are sold primarily in North America, Europe and China under the brand names DELTA ® , BRIZO ® , PEERLESS ® , HANSGROHE ® , AXOR ® , KRAUS ® , NEWPORT BRASS ® and WALTEC ® .
Our Chief Human Resources Officer is responsible for developing and executing our human capital strategy and provides regular updates to our Board of Directors’ Compensation and Talent Committee on our progress toward the achievement of these strategic initiatives.
Our Chief Human Resources Officer is responsible for developing and executing our human capital strategy and provides periodic updates to our Board of Directors’ Compensation and Talent Committee on our progress toward the achievement of our human capital initiatives.
These systems include touchless activation, voice activation, controlled volume dispensing and provide for monitoring and controlling the temperature and flow of water and are compatible with a range of faucets, showerheads and other showering components. • We also supply high-quality, custom thermoplastic solutions, extruded plastic profiles and specialized fabrications, as well as PEX tubing, to manufacturers, distributors and wholesalers for use in diverse applications that include faucets and plumbing supplies, appliances, oil and gas equipment and building products.
These systems include touchless activation, voice activation, controlled volume dispensing and provide for monitoring and controlling the temperature and flow of water and are compatible with a range of faucets, showerheads and other showering components. • We also perform electron beam irradiation services and supply high-quality, custom thermoplastic solutions, extruded plastic profiles, specialized fabrications and PEX tubing to manufacturers, distributors and wholesalers for use in diverse applications that include faucets and plumbing supplies, appliances and building products.
Our Decorative Architectural Products segment includes branded cabinet and door hardware, functional hardware, wall plates, hook and hook rail products, and outdoor living hardware, which are manufactured for us and sold to home center retailers, mass retailers, online retailers, other specialty retailers, original equipment manufacturers and wholesalers.
Our Decorative Architectural Products segment includes branded cabinet and door hardware, functional hardware, hook and hook rail products, and outdoor living hardware, which are manufactured for us and sold to home center retailers, online retailers, other specialty retailers, original equipment manufacturers and wholesalers. These products are sold under the LIBERTY ® , FRANKLIN BRASS ® and other trademarks.
Net sales of architectural coatings comprised approximately 32 percent of our consolidated net sales in 2024, 2023, and 2022. Our BEHR products are sold through The Home Depot, our largest customer overall, as well as this segment’s largest customer. Our Behr business grants Behr brand exclusivity in the retail sales channel in North America to The Home Depot.
Net sales of architectural coatings comprised approximately 31 percent of our consolidated net sales in 2025 and 32 percent of our consolidated net sales in 2024 and 2023. Our BEHR products are sold through The Home Depot, our largest customer overall, as well as this segment’s largest customer.
Human Capital Management The performance of our Company is impacted by our human capital management, and as a result we are focused on attracting, developing and retaining highly qualified, engaged employees, who have diverse experiences and backgrounds. We have developed three strategic talent priorities: leadership, diversity, equity and inclusion, and future workforce.
Human Capital Management The performance of our Company is impacted by our human capital management, and as a result we are focused on attracting, developing and retaining highly qualified, engaged employees, who have a range of experiences and backgrounds.
We believe that our solid results of operations and financial position for 2024 resulted from our continued focus on our three strategic pillars: • drive the full potential of our core businesses; • leverage opportunities across our enterprise; and • actively manage our portfolio.
We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders. We believe that our solid results of operations and financial position for 2025 resulted from our continued focus on our strategy to drive the full potential of our core businesses, leverage opportunities across our enterprise, and actively manage our portfolio.
Decorative bath hardware, shower accessories, mirrors and shower doors are sold under the brand names DELTA ® and FRANKLIN BRASS ® and other trademarks to home center retailers, mass retailers, online retailers, other specialty retailers and wholesalers.
Our key competitors in North America include Amerock Hardware, Richelieu Hardware Ltd., Top Knobs and private label brands. Decorative bath hardware, shower accessories and shower doors are sold under the brand names DELTA ® and FRANKLIN BRASS ® and other trademarks to home center retailers, mass retailers, online retailers, other specialty retailers and wholesalers.
Our Workforce At December 31, 2024, we employed approximately 18,000 people. Available Information Our website is www.masco.com.
We are also committed to keeping our employees healthy and safe in the workplace. At December 31, 2025, we employed approximately 18,000 people. Available Information Our website is www.masco.com.
In addition, some of the products in this segment that we import have been and may in the future be subject to duties and tariffs. Decorative Architectural Products Our Decorative Architectural Products segment primarily includes architectural coatings, including paints, primers, specialty coatings, stains and waterproofing products, as well as paint applicators and accessories.
Decorative Architectural Products Our Decorative Architectural Products segment primarily includes architectural coatings, including paints, primers, specialty coatings, stains and waterproofing products, as well as paint applicators and accessories.
Our Business Segments We report our financial results in two segments, our Plumbing Products segment and our Decorative Architectural Products segment, which are aggregated by product similarity.
In 2025, we continued to return value to our shareholders by repurchasing approximately 8.5 million shares of our common stock and increasing our quarterly dividend by approximately seven percent compared to 2024. Our Business Segments We report our financial results in two segments, our Plumbing Products segment and our Decorative Architectural Products segment, which are aggregated by product similarity.
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We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders.
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In addition, we have experienced and may continue to experience significantly higher costs for some of the material inputs and products in this segment that we import as a result of increased duties and tariffs.
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In 2024, we continued to return value to our shareholders by repurchasing approximately 10.0 million shares of our common stock and increasing our quarterly dividend by approximately two percent compared to 2023. In addition, in the third quarter of 2024, we completed the divestiture of our Kichler Lighting business.
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Our Behr business grants to The Home Depot Behr brand exclusivity in the retail sales channel in North America and exclusivity with respect to Kilz branded primer products in the home improvement big box retail sales channel and across online only mass market retail marketplaces in the United States and in the retail sales channel in Canada.
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These products are sold under the LIBERTY ® , BRAINERD ® , FRANKLIN BRASS ® and other trademarks. Our key competitors in North America include Amerock Hardware, Richelieu Hardware Ltd., Top Knobs and private label brands.
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Leadership We support and foster the growth of our employees by providing development opportunities, experiences and tools that build and strengthen leadership capabilities. Our Leadership Profile, which is how we internally describe the capabilities and behaviors that we believe make great leaders, serves as the foundation for how we select, develop and measure the performance of our leaders.
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To develop a sustainable pipeline of leaders, we have robust and proactive talent management and succession planning processes to support our businesses. In addition, our Board of Directors and executive management team regularly review our Company’s critical leadership roles and succession plans. We are focused on building a continuous improvement and learning culture.
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This is supported by frequent and candid feedback discussions about performance and development between employees and their managers, across peers, and within teams. Diversity, Equity and Inclusion ("DE&I") We believe a workplace that encourages different voices, perspectives and backgrounds creates better teams, better solutions and more innovation. We strive to cultivate a sense of belonging for our employees.
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We are focused on the following three key areas: • Our workplace: who we are and how it feels to work at Masco • Our marketplace: how we deliver innovative solutions that meet the needs of all our consumers and customers • Our communities: how we help increase access, equity, and inclusion with our diverse community partners 5 We have developed enterprise-wide initiatives in each strategic focus area and our businesses have developed plans designed to meet their specific needs that are aligned with these initiatives.
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Our executive leadership team, DE&I Councils, and employee resource groups serve as advisors, ambassadors and change agents in implementing our enterprise-wide initiatives and their business unit plans. Our workforce representation statistics are one indicator of our performance in advancing a diverse workforce.
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Following is our workforce representation statistics as of December 31, 2024: • In the U.S., our leadership team is comprised of 34 percent women and 27 percent racially / ethnically diverse individuals, as compared to the EEO-1 benchmark of 26 percent and 24 percent, respectively.
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The EEO-1 leadership benchmark includes executive-level/senior-officials and managers, and first-level officials and managers. • In the U.S., our salaried workforce is comprised of approximately 35 percent women and 31 percent racially / ethnically diverse individuals, as compared to the EEO-1 benchmark of 29 percent and 29 percent, respectively.
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The EEO-1 salaried employees benchmark includes leadership, professionals and technicians. • In the U.S., our hourly workforce, which includes hourly and exception hourly, is comprised of 37 percent women and 55 percent racially / ethnically diverse individuals, as compared to the EEO-1 benchmark of 27 percent and 35 percent, respectively.
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The EEO-1 hourly employees benchmark includes all other EEO categories we did not include in the EEO-1 leadership and salaried benchmark. Future Workforce There are critical capabilities that our employees and our organization need to help us achieve our businesses objectives.
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We leverage our Masco Operating System, our methodology to drive growth and productivity, to ensure that our businesses are focused on building these critical organizational capabilities by ensuring they have the right structure, talent, tools, and training in place.
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Employee Engagement In order to engage and retain our employees, we listen to our employees to understand their perspectives, needs and ideas by leveraging various forums, tools, and methods including surveys to measure key insights related to employee engagement, inclusion, well-being, and leadership, among others. Employee Health and Safety The safety of our employees is integral to our company.
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In support of our safety efforts, we identify, assess, and investigate incidents and injury data, and each year set a goal to improve key safety performance indicators. We communicate and train our workforce on the importance of safe work practices. We also regularly consult with our employees on safety-related improvements to our operations.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeStrategic Risks Our business strategy is focused on residential repair and remodeling activity and, to a lesser extent, on new home construction activity, both of which are impacted by a number of economic and other factors. Our business performance relies on residential repair and remodeling activity and, to a lesser extent, on new home construction activity.
Biggest changeAdditional risks and uncertainties not presently known to us, or that we currently believe to be immaterial, also may adversely impact our business, results of operations and financial position. 5 Strategic Risks Our business strategy is focused on residential repair and remodeling activity and, to a lesser extent, on new home construction activity, both of which are impacted by a number of economic and other factors.
The operations of the third parties on which we depend have been and could in the future be impacted by: changing laws, regulations and government policies, including those related to climate change; cybersecurity breaches; labor availability; raw material shortages; energy availability; supply disruptions; and adverse weather conditions, pandemics, social or civil unrest, wars or conflicts and other force majeure events.
The operations of the third parties on which we depend have been and could in the future be impacted by: changing laws, regulations and government policies, including those related to climate change; cybersecurity breaches; labor availability; raw material shortages; trade policies; energy availability; supply disruptions; and adverse weather conditions, pandemics, social or civil unrest, wars or conflicts and other force majeure events.
In addition, we may use derivative instruments, including commodity hedges. This strategy increases the possibility that we may forego the benefits that might result from favorable fluctuations in prices, which has had and may in the future have an adverse impact on our results of operations and financial position. 8 We are dependent on suppliers and service providers.
In addition, we may use derivative instruments, including commodity hedges. This strategy increases the possibility that we may forego the benefits that might result from favorable fluctuations in prices, which has had and may in the future have an adverse impact on our results of operations and financial position. We are dependent on suppliers and service providers.
We believe that brand reputation is an important factor affecting product selection and that we compete on the basis of product features, innovation, quality, customer service, warranty and price. We sell our products through home center retailers, online retailers, distributors and independent dealers and rely on these customers to market and promote our products to consumers.
We believe that brand reputation is an important factor affecting product selection and that we compete on the basis of product features, innovation, quality, customer service, warranty and price. We sell our products through home center retailers, online retailers, distributors, wholesalers and independent dealers and rely on these customers to market and promote our products to consumers.
The growing e-commerce channel brings an increased number of competitors and greater pricing transparency for consumers, as well as conflicts between our existing distribution channels and a need for different distribution methods. These factors have impacted and could in the future impact our results of operations and financial position.
The growing e-commerce channel brings an increased number of competitors and greater pricing transparency for consumers and customers, as well as conflicts between our existing distribution channels and a need for different distribution methods. These factors have impacted and could in the future impact our results of operations and financial position.
Increases in the cost of the materials we purchase, including as a result of diminished availability, increased tariffs and inflation or unfavorable fluctuations in currency exchange rates have increased and may in the future increase the prices for our products and negatively impact our results of operations and financial position.
Increases in the cost of the materials we purchase, including as a result of diminished availability, increased duties, tariffs and inflation or unfavorable fluctuations in currency exchange rates have increased and may in the future increase the prices for our products and negatively impact our results of operations and financial position.
The long-term performance of our businesses relies on our ability to attract, develop and retain a talented and diverse workforce. For our businesses to be successful, we must invest significant resources to attract, develop and retain highly qualified, talented and diverse employees, who have the experience, knowledge and expertise to implement our strategic and business initiatives.
The long-term performance of our businesses relies on our ability to attract, develop and retain a talented and workforce. For our businesses to be successful, we must invest significant resources to attract, develop and retain highly qualified and talented employees, who have the experience, knowledge and expertise to implement our strategic and business initiatives.
If we are unable to successfully implement our talent strategies, including attracting, developing, engaging and retaining key employees, building strong and diverse leadership teams, developing effective succession planning and successfully executing organizational change and leadership transition, our results of operations and financial position could be adversely impacted.
If we are unable to successfully implement our talent strategies, including attracting, developing, engaging and retaining key employees, building strong leadership teams, developing effective succession planning and successfully executing organizational change and leadership transition, our results of operations and financial position could be adversely impacted.
Although other retailers, dealers, distributors and homebuilders represent other channels of distribution for our products and services, we might not be able to quickly replace, or replace at all, the loss of a substantial portion of our sales to The Home Depot or the loss of all of our sales to either Ferguson or Lowe’s.
Although other retailers, dealers, distributors, wholesalers and homebuilders represent other channels of distribution for our products and services, we might not be able to quickly replace, or replace at all, the loss of a substantial portion of our sales to The Home Depot or the loss of all of our sales to either Ferguson or Lowe’s.
Business and Operational Risks Variability in the cost and availability of our raw materials, component and finished products could impact our results of operations and financial position. We purchase substantial amounts of raw materials, components and finished products from outside sources, including international sources, and we manufacture certain of our products outside of the United States.
Business and Operational Risks Variability in the cost and availability of our raw materials, components and finished products could impact our results of operations and financial position. We purchase substantial amounts of raw materials, components and finished products from outside sources, including international sources, and we manufacture certain of our products outside of the United States.
In addition to the consequences that may occur from interruptions in the current systems we utilize, we continue to invest in new technology systems throughout our company, including implementations of and upgrades to critical systems at our business units.
In addition to the consequences that may occur from interruptions in the current systems we utilize, we continue to invest in new technology systems throughout our company, including implementations and integrations of and upgrades to critical systems at our business units.
We have been and may in the future be negatively impacted by adverse changes or uncertainty involving one or more of the factors listed above. 9 We are also affected by domestic and international laws, regulations and government policies applicable to companies doing business outside of the U.S., or importing and exporting goods and materials.
We have been and may in the future be negatively impacted by adverse changes or uncertainty involving one or more of the factors listed above. 8 We are also affected by domestic and international laws, regulations and government policies applicable to companies doing business outside of the U.S., or importing and exporting goods and materials.
These customers can significantly impact the prices we receive for our products and the terms and conditions on which we do business with them. Additionally, these customers have reduced in the past and may in the future reduce the number of vendors from which they purchase and could make significant changes in their volume of purchases from us.
These customers can significantly impact the prices we receive for our products and the terms and conditions on which we do business with them. Further, these customers have reduced in the past and may in the future reduce the number of vendors from which they purchase and could make significant changes in their volume of purchases from us.
Our intellectual property has been and may again be challenged or infringed upon by third parties, particularly in countries where property rights are not highly developed or protected. In addition, the global nature of our business increases the risk that we may be unable to obtain or maintain our intellectual property rights on reasonable terms.
Our intellectual property has been and may again be challenged or infringed upon by third parties, including in countries where property rights are not highly developed or protected. In addition, the global nature of our business increases the risk that we may be unable to obtain or maintain our intellectual property rights on reasonable terms.
The granting of exclusivity impacts our ability to sell those products and brands to other customers and can increase the complexity of our product offerings and our costs. 12 Technology and Intellectual Property Risks We are subject to cybersecurity attacks, which could adversely impact our results of operations and financial position.
The granting of exclusivity impacts our ability to sell those products and brands to other customers and can increase the complexity of our product offerings and our costs. 11 Technology and Intellectual Property Risks We are subject to cybersecurity attacks, which could adversely impact our results of operations and financial position.
Refer to Note R to the consolidated financial statements included in Item 8 of this Report for additional information about litigation involving our businesses. 14 Our failure to comply with laws, government regulations and other requirements could adversely impact our results of operations and financial position.
Refer to Note R to the consolidated financial statements included in Item 8 of this Report for additional information about litigation involving our businesses. 13 Our failure to comply with laws, government regulations and other requirements could adversely impact our results of operations and financial position.
A number of factors impact consumers’ spending on home improvement projects as well as new home construction activity, including: • consumer confidence levels; • consumer income and debt levels; • unemployment and underemployment levels; • the availability of home equity loans and mortgages and the interest rates for and tax deductibility of such loans; • inflationary pressures; • changing government policies and programs; • existing home sales; • age of the housing stock; • fluctuations in home prices; • household formation; • trends in lifestyle and housing design; • the availability of skilled tradespeople for repair and remodeling work; and • natural disasters, terrorist acts, pandemics, social or civil unrest, wars or conflicts or other catastrophic events.
A number of factors impact consumers’ spending on home improvement projects as well as new home construction activity, including: • consumer confidence levels; • consumer income and debt levels; • consumer affordability; • unemployment and underemployment levels; • the availability of home equity loans and mortgages and the interest rates for and tax deductibility of such loans; • inflationary pressures, including from duties and tariffs; • changing government policies and programs; • existing home sales; • age of the housing stock; • fluctuations in home prices; • household formation; • trends in lifestyle and housing design; • the availability of skilled tradespeople for repair and remodeling work; and • natural disasters, terrorist acts, pandemics, social or civil unrest, wars or conflicts or other catastrophic events.
Our results of operations and financial position, as well as the effectiveness of our internal controls over financial reporting, could be adversely impacted if we do not appropriately select, implement, maintain or upgrade our critical systems in a timely manner or if we experience significant unanticipated expenses or disruptions in connection with the implementation, upgrade or update of such systems. 13 We may not be able to adequately protect or prevent the unauthorized use of our intellectual property.
Our results of operations and financial position, as well as the effectiveness of our internal controls over financial reporting, could be adversely impacted if we do not appropriately select, implement, maintain or upgrade our critical systems in a timely manner or if we experience significant unanticipated expenses or disruptions in connection with the implementation, integration, upgrade or update of such systems. 12 We may not be able to adequately protect or prevent the unauthorized use of our intellectual property.
If we were unable to borrow under our credit agreement, our financial flexibility could be restricted. 10 Competitive Risks We could lose market share if we do not maintain our strong brands, develop innovative products or respond to changing consumer purchasing practices and preferences.
If we were unable to borrow under our credit agreement, our financial flexibility could be restricted. 9 Competitive Risks We could lose market share if we do not maintain our strong brands, develop innovative products or respond to changing consumer purchasing practices and preferences.
We could also be adversely impacted if we have not appropriately prioritized and balanced our strategic initiatives or if we are unable to effectively manage change throughout our organization. 7 We may not be able to successfully execute our acquisition strategy or integrate businesses that we acquire.
We could also be adversely impacted if we have not appropriately prioritized and balanced our strategic initiatives or if we are unable to effectively manage change throughout our organization. 6 We may not be able to successfully execute our acquisition strategy or integrate businesses that we acquire.
In addition, we could be adversely impacted if any of our significant customers, suppliers or service providers experiences any similar events that disrupt their business operations or damage their reputation. Such events could adversely impact our results of operations and financial position.
In addition, we could be adversely impacted if any of our significant customers, suppliers or service providers experience any similar events that disrupt their business operations or damage their reputation. Such events could adversely impact our results of operations and financial position.
A failure or perceived failure by us in this regard may damage our reputation and adversely impact our results of operations and financial position. 11 We face significant competition and operate in an evolving competitive landscape. Our products face significant competition.
A failure or perceived failure by us in this regard may damage our reputation and adversely impact our results of operations and financial position. 10 We face significant competition and operate in an evolving competitive landscape. Our products face significant competition.
Sourcing these goods and services from alternate suppliers, including suppliers from new geographic regions, or re-engineering our products as a result of supplier disruptions, can be time-consuming and costly and could result in inefficiencies or delays in our business operations or could negatively impact the quality of our products.
Sourcing these goods and services from alternate suppliers, including suppliers from new geographic regions, or re-engineering our products as a result of supplier disruptions, is time-consuming and costly and could result in inefficiencies or delays in our business operations or could negatively impact the quality of our products.
In addition, we may not be able to achieve our aspirational goals related to our ESG initiatives, which are and may continue to be impacted by many complexities and variables, such as renewable energy infrastructure and availability, a challenging economic environment, changes to our operations and changes to our portfolio of businesses via acquisitions or divestitures.
In particular, we may not be able to achieve our aspirational goals related to our sustainability initiatives, which are and may continue to be impacted by many complexities and variables, such as renewable energy infrastructure and availability, a challenging economic environment, changes to our operations and changes to our portfolio of businesses via acquisitions or divestitures.
Increased selling prices for our products have led and may in the future lead to sales declines and loss of market share, particularly if those prices are not competitive. When our material costs decline, we have received and may in the future receive pressure from our customers to reduce our prices.
Increased selling prices for our products have led and may in the future lead to sales declines, a shift in the mix of products we sell and loss of market share, particularly if those prices are not competitive. When our material costs decline, we have received and may in the future receive pressure from our customers to reduce our prices.
System implementations and upgrades are complex and require significant management oversight, and we have experienced, and in the future may experience, unanticipated expenses and interruptions to our operations during these implementations and upgrades.
These system changes are complex and require significant management oversight, and we have experienced, and in the future may experience, unanticipated expenses and interruptions to our operations during these changes.
There are risks associated with our international operations and global strategies. In 2024, 20 percent of our sales were made outside of North America (particularly in Europe) and transacted in currencies other than the U.S. dollar.
There are risks associated with our international operations and global strategies. In 2025, 21 percent of our sales were made outside of North America (particularly in Europe) and transacted in currencies other than the U.S. dollar.
We may be adversely impacted if these information systems breakdown, fail, or if delays in system upgrades or replacements stretch those systems beyond support by third-party service providers, including cloud platform providers.
We have been and may in the the future be adversely impacted if these information systems breakdown, fail, or if delays in system upgrades or replacements stretch those systems beyond support by third-party service providers, including cloud platform providers.
These include laws and regulations related to anti-bribery/anti-corruption, competition, data privacy, environmental, social and governance (“ESG”) matters, sanctions, tax, trade, including duties and tariffs, and other business practices. Compliance with these laws, regulations and government policies is costly, and future changes to these laws may require significant management attention and disrupt our operations.
These include laws and regulations related to anti-bribery/anti-corruption, competition, data privacy, environmental, sustainability matters, sanctions, tax, trade, including duties and tariffs, and other business practices. Compliance with these laws, regulations and government policies is costly and has required significant management attention, and future changes to these laws may continue to require significant management attention and disrupt our operations.
Our sales are concentrated with three significant customers and this concentration may continue to increase. In 2024, our net sales to The Home Depot were $3.0 billion (approximately 38 percent of our consolidated net sales), and our net sales to Ferguson and Lowe’s were each less than 10 percent of our consolidated net sales.
Our sales are concentrated with three significant customers and this concentration may continue to increase. In 2025, our net sales to The Home Depot were $2.9 billion (approximately 38 percent of our consolidated net sales), and our net sales to Ferguson and Lowe’s were each less than 10 percent of our consolidated net sales.
Our results of operations and financial position could be adversely impacted by a negative perception regarding our products or company practices, positions or public statements, even if unfounded, negative claims and comments in social media or the press or a data breach.
Our results of operations and financial position could be adversely impacted by a negative perception regarding our products or company practices, positions or public statements, even if unfounded, negative claims and comments in social media or the press or a data breach. Furthermore, stakeholders’ expectations regarding company practices, positions or public statements are diverse and continually changing.
From time to time we enter into long-term agreements with certain significant suppliers to help ensure continued availability of the raw materials, components and finished products we require and to establish firm pricing, but these contractual commitments may result in our paying above market prices during the term of the contract and may limit our ability to adjust our sourcing partners in the future.
Such reductions have had and could in the future have an adverse impact on our results of operations and financial position. 7 From time to time we enter into long-term agreements with certain significant suppliers to help ensure continued availability of the raw materials, components and finished products we require and to establish firm pricing, but these contractual commitments may result in our paying above market prices during the term of the contract and may limit our ability to adjust our sourcing partners in the future.
Furthermore, stakeholders are increasingly scrutinizing companies' ESG practices, and stakeholders’ expectations regarding ESG practices are diverse and rapidly changing. We may not be able to align our ESG practices with such evolving expectations within the timeframes expected by stakeholders or without incurring significant costs.
We may not be able to align with such evolving expectations within the timeframes expected by stakeholders or without incurring significant costs.
Global cybersecurity vulnerabilities, threats and more frequent, sophisticated and targeted attacks pose a risk to our information technology systems and to critical third-party information technology platforms we utilize. We have implemented security policies, processes and layers of defense designed to help identify and protect against misappropriation or corruption of our systems and information and disruption of our operations.
We have implemented security policies, processes and layers of defense designed to help identify and protect against misappropriation or corruption of our systems and information and disruption of our operations.
Protecting and preventing the unauthorized use of our intellectual property is costly, time consuming and requires significant resources.
In addition, we may be harmed if our proprietary or confidential information regarding our business is exposed through the unauthorized use of artificial intelligence technologies. Protecting and preventing the unauthorized use of our intellectual property is costly, time-consuming and requires significant resources.
Such reductions have had and could in the future have an adverse impact on our results of operations and financial position.
Any such loss would have a material adverse impact on our business, results of operations and financial position.
Any such loss would have a material adverse impact on our business, results of operations and financial position. In addition, our Behr business grants Behr brand exclusivity in the retail sales channel in North America to The Home Depot, and from time to time, certain of our other businesses grant product and/or brand exclusivity to our customers.
From time to time, certain of our other businesses grant product and/or brand exclusivity to our customers.
Removed
Additional risks and uncertainties not presently known to us, or that we currently believe to be immaterial, also may adversely impact our business, results of operations and financial position.
Added
Our business performance relies on residential repair and remodeling activity and, to a lesser extent, on new home construction activity.
Added
In particular, we have experienced and may continue to experience significantly higher costs as a result of increased duties and tariffs, mainly in our Plumbing Products segment, due to duties and tariffs related to China and other international jurisdictions as well as related to materials.
Added
In addition, our Behr business grants to The Home Depot Behr brand exclusivity in the retail sales channel in North America and exclusivity with respect to Kilz branded primer products in the home improvement big box retail sales channel and across online only mass market retail marketplaces in the United States and in the retail sales channel in Canada.
Added
Global cybersecurity vulnerabilities, threats and more frequent, sophisticated and targeted attacks, which may be increasingly exacerbated by the proliferation of and advance in artificial intelligence, pose a risk to our information technology systems and to critical third-party information technology platforms we utilize.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeKey components of our cybersecurity program include: • an enterprise organizational framework that consists of enterprise leaders that oversee our cybersecurity governance, including policies and standards, and functional business unit leaders that implement our cybersecurity policies; • the identification of our cybersecurity risks and vulnerabilities and the implementation of protections against cybersecurity threats and incidents, including regular training to our employees; • continual global threat monitoring and detection, in partnership with third-party service providers; 15 • a process for assessing the severity of cybersecurity threats, identifying whether the cybersecurity threats are associated with a third-party service provider, and implementing an appropriate response and resolution to cybersecurity incidents, as necessary; and • risk-based cybersecurity audits led by our internal audit function, which include cybersecurity control maturity assessments (based on NIST CSF), as well as attack simulations and penetration testing performed by third-party service providers.
Biggest changeOur cybersecurity program is modeled on the National Institute of Standards and Technology's Cybersecurity Framework (NIST CSF) which provides the structure for the governance of, identification of, protection against, detection of, response to and recovery from cybersecurity threats and incidents, including those associated with our use of third-party applications and service providers. 14 Key components of our cybersecurity program include: • an enterprise organizational framework that consists of enterprise leaders that oversee our cybersecurity governance, including policies and standards, and functional business unit leaders that implement our cybersecurity policies; • the identification of our cybersecurity risks and vulnerabilities and the implementation of protections against cybersecurity threats and incidents, including regularly training and testing our employees; • continual global threat monitoring and detection, in partnership with third-party service providers; • a process for assessing the severity of cybersecurity threats, identifying whether the cybersecurity threats are associated with a third-party service provider, and implementing an appropriate response and resolution to cybersecurity incidents, as necessary; and • risk-based cybersecurity audits led by our internal audit function, which include cybersecurity control maturity assessments (based on NIST CSF), as well as attack simulations and penetration testing performed by third-party service providers.
Our Vice President, Information Technology has significant professional experience in leading the information technology function and our Director, Cybersecurity has held various roles in cybersecurity and is an ISC2 Certified Information Security Professional (CISSP ® ). Each periodically participates in various industry cyber forums and communicates industry best practices to the appropriate internal information security professionals.
Our Vice President, Information Technology has significant professional experience in leading the information technology function and our Director, Cybersecurity has held various roles in cybersecurity and is an ISC2 Certified Information Security Professional. Each periodically participates in various industry cyber forums and communicates industry best practices to the appropriate internal information security professionals.
In 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident.
In 2025, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident.
For more information about these risks, please see “Risk Factors – We are subject to cybersecurity attacks, which could adversely impact our results of operations and financial position” in this annual report on Form 10-K. 16
For more information about these risks, please see “Risk Factors – We are subject to cybersecurity attacks, which could adversely impact our results of operations and financial position” in this annual report on Form 10-K. 15
In 2024, as part of our enterprise risk management update to our Board, our Vice President, Information Technology discussed risks and trends associated with information technology, including cyber-attacks, and current and future planned actions to mitigate such risks.
In 2025, as part of our enterprise risk management update to our Board, our Vice President, Information Technology discussed risks and trends associated with information technology, including cyber-attacks, and current and future planned actions to mitigate such risks.
Removed
Our cybersecurity program is modeled on the National Institute of Security Technology Cybersecurity Framework (NIST CSF) which provides the governance structure for our identification of, protection against, detection of, response to and recovery from cybersecurity threats and incidents, including those associated with our use of third-party applications and service providers.
Removed
In addition, in 2024, our Vice President, Information Technology reviewed with our Board updates related to our operational and resource readiness with respect to cyber incidents, our incident response processes and emerging cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. The table below lists the number of principal North American properties as of December 31, 2024. Business Segment Manufacturing Warehouse and Distribution Plumbing Products 24 10 Decorative Architectural Products 9 14 Totals 33 24 Most of our North American facilities range from single warehouse buildings to complex manufacturing facilities.
Biggest changeItem 2. Properties. The table below lists the number of principal North American properties as of December 31, 2025. Business Segment Manufacturing Warehouse and Distribution Plumbing Products 23 9 Decorative Architectural Products 9 14 Totals 32 23 Most of our North American facilities range from single warehouse buildings to complex manufacturing facilities.
We own most of our North American manufacturing facilities, none of which is subject to significant encumbrances. A substantial number of our warehouse and distribution facilities are leased. The table below lists the number of principal properties outside of North America as of December 31, 2024.
We own most of our North American manufacturing facilities, none of which is subject to significant encumbrances. A substantial number of our warehouse and distribution facilities are leased. The table below lists the number of principal properties outside of North America as of December 31, 2025.
Business Segment Manufacturing Warehouse and Distribution Plumbing Products 12 15 Decorative Architectural Products — — Totals 12 15 Most of our international facilities are in Europe and China. We own most of our international manufacturing facilities, none of which is subject to significant encumbrances. A substantial number of our international warehouse and distribution facilities are leased.
Business Segment Manufacturing Warehouse and Distribution Plumbing Products 12 16 Decorative Architectural Products — — Totals 12 16 Most of our international facilities are in Europe and China. We own most of our international manufacturing facilities, none of which is subject to significant encumbrances. A substantial number of our international warehouse and distribution facilities are leased.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total Number Of Shares Purchased Average Price Paid Per Common Share Total Number Of Shares Purchased As Part Of Publicly Announced Plans or Programs Maximum Value Of Shares That May Yet Be Purchased Under The Plans Or Programs 10/1/24 - 10/31/24 1,069,651 $ 83.45 1,069,651 $ 1,075,395,662 11/1/24 - 11/30/24 1,090,788 $ 79.42 1,090,788 $ 988,760,389 12/1/24 - 12/31/24 1,179,967 $ 78.32 1,179,967 $ 896,349,195 Total for the quarter 3,340,406 $ 80.32 3,340,406 $ 896,349,195 18 Performance Graph The table below compares the cumulative total shareholder return on our common stock with the cumulative total return of (i) the Standard & Poor's 500 Composite Stock Index ("S&P 500 Index"), (ii) The Standard & Poor's Industrials Index ("S&P Industrials Index") and (iii) the Standard & Poor's Consumer Durables & Apparel Index ("S&P Consumer Durables & Apparel Index"), from December 31, 2019 through December 31, 2024, when the closing price of our common stock was $72.57.
Biggest changePeriod Total Number Of Shares Purchased Average Price Paid Per Common Share Total Number Of Shares Purchased As Part Of Publicly Announced Plans or Programs Maximum Value Of Shares That May Yet Be Purchased Under The Plans Or Programs 10/1/25 - 10/31/25 736,647 $ 67.88 736,647 $ 492,313,057 11/1/25 - 11/30/25 1,482,705 $ 61.97 1,482,705 $ 400,427,327 12/1/25 - 12/31/25 1,170,694 $ 64.07 1,170,694 $ 325,415,751 Total for the quarter 3,390,046 $ 63.98 3,390,046 $ 325,415,751 17 Performance Graph The table below compares the cumulative total shareholder return on our common stock with the cumulative total return of (i) the Standard & Poor's 500 Composite Stock Index ("S&P 500 Index"), (ii) The Standard & Poor's Industrials Index ("S&P Industrials Index") and (iii) the Standard & Poor's Consumer Durables & Apparel Index ("S&P Consumer Durables & Apparel Index"), from December 31, 2020 through December 31, 2025, when the closing price of our common stock was $63.46.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The New York Stock Exchange is the principal market on which our common stock is traded, under the ticker symbol MAS. On January 31, 2025, there were approximately 2,400 holders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The New York Stock Exchange is the principal market on which our common stock is traded, under the ticker symbol MAS. On January 31, 2026, there were approximately 2,200 holders of record of our common stock.
The graph assumes investments of $100 on December 31, 2019 in our common stock and in each of the three indices and the reinvestment of dividends.
The graph assumes investments of $100 on December 31, 2020 in our common stock and in each of the three indices and the reinvestment of dividends.
The following table provides information regarding the repurchase of our common stock for the three-month period ended December 31, 2024.
The following table provides information regarding the repurchase of our common stock for the three-month period ended December 31, 2025.
We repurchased and retired 10.0 million shares of our common stock for the year ended December 31, 2024 for approximately $757 million, inclusive of excise tax of $6 million. This included 0.5 million shares to offset the dilutive impact of restricted stock units granted in 2024. At December 31, 2024, we had $896 million remaining under the 2022 authorization.
We repurchased and retired 8.5 million shares of our common stock for the year ended December 31, 2025 for approximately $576 million, inclusive of excise tax of $5 million. This included 0.3 million shares to offset the dilutive impact of restricted stock units granted in 2025. At December 31, 2025, we had $325 million remaining under the 2022 authorization.
The Board of Directors declared a quarterly dividend of $0.31 per share in the first quarter of 2025 with the intention to increase the annual dividend 7 percent to $1.24 per share.
The Board of Directors declared a quarterly dividend of $0.32 per share in the first quarter of 2026 with the intention to increase the annual dividend three percent to $1.28 per share.
The table below sets forth the value, as of December 31 for each of the years indicated, of a $100 investment made on December 31, 2019 in each of our common stock, the S&P 500 Index, the S&P Industrials Index and the S&P Consumer Durables & Apparel Index and includes the reinvestment of dividends. 2020 2021 2022 2023 2024 Masco $ 114.46 $ 146.32 $ 97.25 $ 139.57 $ 151.22 S&P 500 Index $ 116.26 $ 147.52 $ 118.84 $ 147.64 $ 182.05 S&P Industrials Index $ 109.01 $ 130.16 $ 120.91 $ 140.30 $ 162.25 S&P Consumer Durables & Apparel Index $ 118.41 $ 143.20 $ 99.47 $ 116.21 $ 108.09
The table below sets forth the value, as of December 31 for each of the years indicated, of a $100 investment made on December 31, 2020 in each of our common stock, the S&P 500 Index, the S&P Industrials Index and the S&P Consumer Durables & Apparel Index and includes the reinvestment of dividends. 2021 2022 2023 2024 2025 Masco $ 127.84 $ 84.96 $ 121.94 $ 132.11 $ 115.53 S&P 500 Index $ 126.89 $ 102.22 $ 126.99 $ 156.59 $ 182.25 S&P Industrials Index $ 119.40 $ 110.92 $ 128.71 $ 148.84 $ 175.19 S&P Consumer Durables & Apparel Index $ 120.94 $ 84.01 $ 98.15 $ 91.28 $ 82.73
Added
Effective February 10, 2026, our Board of Directors authorized the repurchase, for retirement, of up to $2.0 billion of shares of our common stock, exclusive of excise tax, in open-market transactions or otherwise, replacing the previous Board of Directors authorization established in 2022.

Item 7. Management's Discussion & Analysis

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

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Biggest changeRESULTS OF OPERATIONS Below is a summary of our results of operations, dollars in millions, for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Change Net sales $ 7,828 $ 7,967 (2) % Cost of sales (4,997) (5,131) (3) % Gross profit $ 2,831 $ 2,836 — % Gross margin 36.2 % 35.6 % 60 bps Selling, general and administrative expenses $ (1,468) $ (1,473) — % Selling, general and administrative expenses of a percent of net sales (18.8) % (18.5) % (30) bps Impairment charge for other intangible assets $ — $ (15) (100) % Operating profit, as reported $ 1,363 $ 1,348 1 % Rationalization charges 9 13 (31) % Impairment charge for other intangible assets — 15 (100) % Insurance settlement — (40) (100) % Operating profit, excluding rationalization charges, impairment charge, and insurance settlement $ 1,372 $ 1,336 3 % Operating profit margin, as reported 17.4 % 16.9 % 50 bps Operating profit margin, excluding rationalization charges, impairment charge, and insurance settlement 17.5 % 16.8 % 70 bps 21 Our gross profit for 2024 was $2,831 million, which remained flat compared to 2023.
Biggest changeOur net sales for 2025 decreased primarily due to lower sales volume across the entire company which decreased sales by four percent, partially offset by higher net selling prices of plumbing products which increased sales by two percent. 20 RESULTS OF OPERATIONS Below is a summary of our results of operations, dollars in millions, for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Change Net sales $ 7,562 $ 7,828 (3) % Cost of sales (4,883) (4,997) (2) % Gross profit $ 2,679 $ 2,831 (5) % Gross margin 35.4 % 36.2 % (80) bps Selling, general and administrative expenses $ (1,426) $ (1,468) (3) % Selling, general and administrative expenses of a percent of net sales (18.9) % (18.8) % (10) bps Impairment charge for other intangible assets $ (5) $ — 100 % Operating profit, as reported $ 1,248 $ 1,363 (8) % Rationalization charges 19 9 111 % Impairment charge for other intangible assets 5 — 100 % Operating profit, excluding rationalization charges and impairment charge $ 1,272 $ 1,372 (7) % Operating profit margin, as reported 16.5 % 17.4 % (90) bps Operating profit margin, excluding rationalization charges and impairment charge 16.8 % 17.5 % (70) bps Our gross profit for 2025 was $2,679 million, which decreased five percent, and was negatively impacted by higher commodity and tariff costs, four percent due to lower sales volume, two percent due to the divestiture of our Kichler Lighting ("Kichler") business, as well as an increase in other expenses (including inventory-related reserves).
We do not believe such risk would have a material impact on our working capital or cash flows, as substantially all of our payments are made outside of the program. We utilize derivative and hedging instruments to manage our exposure to currency fluctuations, primarily related to the European euro, British pound sterling, Chinese renminbi, Mexican peso and the U.S. dollar.
We do not believe such risk would have a material impact on our working capital or cash flows, as substantially all of our payments are made outside of the program. 25 We utilize derivative and hedging instruments to manage our exposure to currency fluctuations, primarily related to the European euro, British pound sterling, Chinese renminbi, Mexican peso and the U.S. dollar.
Amounts include finance lease obligations. (B) Includes purchase commitments for vendor contracts and contracts for the purchase of renewable energy credits and transferable tax credits. Excludes contracts that do not require volume commitments and open or pending purchase orders.
Amounts include finance lease obligations. (B) Includes purchase commitments for vendor contracts and contracts for the purchase of renewable energy certificates and transferable tax credits. Excludes contracts that do not require volume commitments and open or pending purchase orders.
Consistent with past practice and as part of our long-term capital allocation strategy, outside of any potential acquisitions, we anticipate using approximately $600 million of cash for share repurchases (including shares which will be purchased to offset any dilution from restricted stock units granted as part of our compensation programs) in 2025.
Consistent with past practice and as part of our long-term capital allocation strategy, outside of any potential acquisitions, we anticipate using approximately $600 million of cash for share repurchases (including shares which will be purchased to offset any dilution from restricted stock units granted as part of our compensation programs) in 2026.
In the fourth quarter of 2024, we estimated that future discounted cash flows projected for all of our reporting units were greater than the carrying values. Accordingly, we did not recognize any impairment charges for goodwill. A 10 percent decrease in the estimated fair value of our reporting units would not have resulted in any goodwill impairment.
In the fourth quarter of 2025, we estimated that future discounted cash flows projected for all of our reporting units were greater than the carrying values. Accordingly, we did not recognize any impairment charges for goodwill. A 10 percent decrease in the estimated fair value of our reporting units would not have resulted in any goodwill impairment.
We believe that our strong financial position and cash flow generation, together with our investments in our industry-leading branded building products, our continued focus on innovation and disciplined capital allocation, will allow us to drive long-term growth and create value for our shareholders.
We believe that our strong financial position and cash flow generation, together with our investments in our industry-leading branded building products, our continued focus on innovation and customer service and disciplined capital allocation, will allow us to drive long-term growth and create value for our shareholders.
Refer to Note M to the consolidated financial statements for defined-benefit pension plan obligations. 28 Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP.
Refer to Note M to the consolidated financial statements for defined-benefit pension plan obligations. 27 Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP.
Our total debt as a percent of total capitalization was 102 percent and 97 percent at December 31, 2024 and 2023, respectively. Refer to Note K to the consolidated financial statements for additional information.
Our total debt as a percent of total capitalization was 97 percent and 102 percent at December 31, 2025 and 2024, respectively. Refer to Note K to the consolidated financial statements for additional information.
Refer to Note P for additional information. Recently Adopted and Issued Accounting Pronouncements Refer to Note A to the consolidated financial statements for discussion of recently adopted and issued accounting pronouncements, which is incorporated herein by reference. 30
Refer to Note P for additional information. Recently Adopted and Issued Accounting Pronouncements Refer to Note A to the consolidated financial statements for discussion of recently adopted and issued accounting pronouncements, which is incorporated herein by reference. 29
While we attempt to diversify these investments in a prudent manner to minimize risk, it is possible that future changes in the financial markets could affect the security or availability of these investments. Of the cash and cash investments we held at December 31, 2024 and 2023, $321 million and $323 million, respectively, was held in our foreign subsidiaries.
While we attempt to diversify these investments in a prudent manner to minimize risk, it is possible that future changes in the financial markets could affect the security or availability of these investments. Of the cash and cash investments we held at December 31, 2025 and 2024, $306 million and $321 million, respectively, was held in our foreign subsidiaries.
We also consider the profitability of the business, among other factors, to determine the royalty rate for use in the impairment assessment. We utilize our weighted average cost of capital of approximately 8.50 percent as the basis to determine the discount rate to apply to the estimated future cash flows.
We also consider the profitability of the business, among other factors, to determine the royalty rate for use in the impairment assessment. We utilize our weighted average cost of capital of approximately 7.75 percent as the basis to determine the discount rate to apply to the estimated future cash flows.
We had cash and cash investments of approximately $634 million at both December 31, 2024 and 2023. Our cash and cash investments consist of overnight interest bearing money market demand accounts, time deposit accounts, and money market mutual funds containing government securities and treasury obligations.
We had cash and cash investments of approximately $647 million and $634 million at December 31, 2025 and 2024, respectively. Our cash and cash investments consist of overnight interest bearing money market demand accounts, time deposit accounts, and money market mutual funds containing government securities and treasury obligations.
Our assumptions included U.S. and Eurozone Gross Domestic Product growing at approximately 1.8 percent and 1.4 percent, respectively, in 2025, and 2.0 percent and 1.4 percent, respectively, per annum over the remainder of the five-year forecast.
Our assumptions included U.S. and Eurozone Gross Domestic Product growing at approximately 1.5 percent and 1.2 percent, respectively, in 2026, and 1.8 percent and 1.2 percent, respectively, per annum over the remainder of the five-year forecast.
We utilize our weighted average cost of capital of approximately 8.50 percent as the basis to determine the discount rate to apply to the estimated future cash flows.
We utilize our weighted average cost of capital of approximately 7.75 percent as the basis to determine the discount rate to apply to the estimated future cash flows.
Share Repurchases Effective October 20, 2022, our Board of Directors authorized the repurchase, for retirement, of up to $2.0 billion of shares of our common stock, exclusive of excise tax, in open-market transactions or otherwise. We repurchased and retired 10.0 million shares of our common stock in 2024 for approximately $757 million, inclusive of excise tax of $6 million.
Share Repurchases Effective October 20, 2022, our Board of Directors authorized the repurchase, for retirement, of up to $2.0 billion of shares of our common stock, exclusive of excise tax, in open-market transactions or otherwise. We repurchased and retired 8.5 million shares of our common stock in 2025 for approximately $576 million, inclusive of excise tax of $5 million.
We discuss our consolidated results as well as our Business Segment results of operations for the year ended December 31, 2024 versus December 31, 2023. A detailed discussion of our consolidated and Business Segment results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under “Item 7.
A detailed discussion of our consolidated and Business Segment results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 can be found under “Item 7.
The amounts confirmed as valid under the program and included in accounts payable were $36 million and $53 million at December 31, 2024 and 2023, respectively. Of the amounts confirmed as valid under the program, the amounts owed to participating financial institutions were $23 million and $28 million at December 31, 2024 and 2023, respectively.
The amounts confirmed as valid under the program and included in accounts payable were $26 million and $36 million at December 31, 2025 and 2024, respectively. Of the amounts confirmed as valid under the program, the amounts owed to participating financial institutions were $17 million and $23 million at December 31, 2025 and 2024, respectively.
In 2024, based upon our assessment of the risks impacting each of our businesses, we applied a risk premium to increase the discount rate to a range of 10.50 percent to 12.50 percent for our reporting units. 29 If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized to the extent that a reporting unit's recorded carrying value exceeds its fair value, not to exceed the carrying amount of goodwill in that reporting unit.
In 2025, based upon our assessment of the risks impacting each of our businesses, we applied a risk premium to increase the discount rate to a range of 9.75 percent to 11.75 percent for our reporting units. 28 If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized to the extent that a reporting unit's recorded carrying value exceeds its fair value, not to exceed the carrying amount of goodwill in that reporting unit.
See Note K to the consolidated financial statements for additional information. 24 The 2022 Credit Agreement contains financial covenants requiring us to maintain (A) a net leverage ratio, as adjusted for certain items, not exceeding 4.0 to 1.0, and (B) an interest coverage ratio, as adjusted for certain items, not less than 2.5 to 1.0.
The 2022 Credit Agreement contains financial covenants requiring us to maintain (A) a net leverage ratio, as adjusted for certain items, not exceeding 4.0 to 1.0, and (B) an interest coverage ratio, as adjusted for certain items, not less than 2.5 to 1.0.
This included 0.5 million shares to offset the dilutive impact of restricted stock units granted in 2024. At December 31, 2024, we had $896 million remaining under the 2022 authorization.
This included 0.3 million shares to offset the dilutive impact of restricted stock units granted in 2025. At December 31, 2025, we had $325 million remaining under the 2022 authorization.
In 2024, based upon our assessment of the risks impacting each of our businesses and the nature of the other indefinite-lived intangible assets (i.e., trade name), we applied a risk premium to increase the discount rate to a range of 11.50 percent to 13.50 percent for our other indefinite-lived intangible assets.
In 2025, based upon our assessment of the risks impacting each of our businesses and the nature of the other indefinite-lived intangible assets (i.e., trade name), we applied a risk premium to increase the discount rate to a range of 10.75 percent to 12.00 percent for our other indefinite-lived intangible assets.
Under the 2022 Credit Agreement, at our request and subject to certain conditions, we can increase the aggregate commitment up to an additional $500 million with the current lenders or new lenders.
Under the 2022 Credit Agreement, at our request and subject to certain conditions, we can increase the aggregate commitment up to an additional $500 million with the current lenders or new lenders. See Note K to the consolidated financial statements for additional information.
NET INCOME AND INCOME PER COMMON SHARE - ATTRIBUTABLE TO MASCO CORPORATION Below is a summary of our net income, in millions, and diluted income per common share for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Favorable / (Unfavorable) Net income $ 822 $ 908 (9) % Diluted income per common share $ 3.76 $ 4.02 (6) % 22 Business Segment Results The following table sets forth our net sales and operating profit information by Business Segment, dollars in millions.
NET INCOME AND INCOME PER COMMON SHARE - ATTRIBUTABLE TO MASCO CORPORATION Below is a summary of our net income, in millions, and diluted income per common share for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Favorable / (Unfavorable) Net income $ 810 $ 822 (1) % Diluted income per common share $ 3.86 $ 3.76 3 % 22 Business Segment Results The following tables set forth our net sales and operating profit information by Business Segment, dollars in millions.
A 10 percent decrease in the estimated fair value of our other indefinite-lived intangible assets would have resulted in a $1 million impairment of one of our other indefinite-lived intangible assets. Refer to Note H for additional information.
A 10 percent decrease in the estimated fair value of our other indefinite-lived intangible assets would not have resulted in an additional impairment, except for the previously mentioned registered trademark. Refer to Note H for additional information.
Credit Agreement On April 26, 2022, we entered into a revolving credit agreement (the “2022 Credit Agreement”) with an aggregate commitment of $1.0 billion and a maturity date of April 26, 2027.
Amortization expense totaled $23 million in 2025, compared with $32 million in 2024. Credit Agreement On April 26, 2022, we entered into a revolving credit agreement (the “2022 Credit Agreement”) with an aggregate commitment of $1.0 billion and a maturity date of April 26, 2027.
Other Commitments We enter into contracts, which include reasonable and customary indemnifications that are standard for the industries in which we operate. Such indemnifications include claims made against builders by homeowners for issues relating to our products and workmanship. In conjunction with divestitures and other transactions, we occasionally provide reasonable and customary indemnifications.
Such indemnifications include claims made against builders by homeowners for issues relating to our products and workmanship. In conjunction with divestitures and other transactions, we occasionally provide reasonable and customary indemnifications.
Year Ended December 31, Percent Change 2024 2023 2024 vs. 2023 Net Sales: Plumbing Products $ 4,853 $ 4,842 — % Decorative Architectural Products 2,975 3,125 (5) % Total $ 7,828 $ 7,967 (2) % Year Ended December 31, Percent Change 2024 2023 2024 vs. 2023 Operating Profit: Plumbing Products $ 911 $ 861 6 % Decorative Architectural Products 549 578 (5) % Total $ 1,460 $ 1,439 1 % General corporate expense, net (97) (91) 7 % Total operating profit $ 1,363 $ 1,348 1 % BUSINESS SEGMENT RESULTS DISCUSSION Changes in operating profit in the following Business Segment Results discussion exclude general corporate expense, net, and compares each respective period to the same period of the immediately preceding year.
Year Ended December 31, Percent Change 2025 2024 2025 vs. 2024 Net Sales: Plumbing Products $ 4,992 $ 4,853 3 % Decorative Architectural Products 2,570 2,975 (14) % Total $ 7,562 $ 7,828 (3) % Year Ended December 31, Percent Change 2025 2024 2025 vs. 2024 Operating Profit: Plumbing Products $ 895 $ 911 (2) % Decorative Architectural Products 443 549 (19) % Total $ 1,338 $ 1,460 (8) % General corporate expense, net (89) (97) (8) % Total operating profit $ 1,248 $ 1,363 (8) % BUSINESS SEGMENT RESULTS DISCUSSION Changes in operating profit in the following Business Segment Results discussion exclude general corporate expense, net, and compares each respective period to the same period of the immediately preceding year.
For 2025, depreciation and amortization expense, excluding any potential future acquisitions, is expected to be approximately $150 million. Amortization expense totaled $32 million in 2024, compared with $34 million in 2023.
For 2026, capital expenditures, excluding any potential future acquisitions, are expected to be approximately $190 million. Depreciation and amortization expense for 2025 totaled $148 million, compared with $150 million for 2024. For 2026, depreciation and amortization expense, excluding any potential future acquisitions, is expected to be approximately $160 million.
Total cash dividends paid was $254 million in 2024. As part of our capital allocation strategy, the Board of Directors declared a quarterly dividend of $0.31 per share in the first quarter of 2025 with the intention to increase the annual dividend 7 percent to $1.24 per share.
As part of our capital allocation strategy, the Board of Directors declared a quarterly dividend of $0.32 per share in the first quarter of 2026 with the intention to increase the annual dividend three percent to $1.28 per share.
We currently do not have any derivative instruments for which we have designated hedge accounting. 26 Cash Flows Significant sources and (uses) of cash for the years ended December 31, 2024 and 2023 are summarized as follows, in millions: 2024 2023 Net cash from operating activities $ 1,075 $ 1,413 Purchase of Company common stock (751) (353) Excise tax paid on the purchase of Company common stock (3) — Cash dividends paid (254) (257) Purchase of redeemable noncontrolling interest (15) — Dividends paid to noncontrolling interest (37) (49) Proceeds from short-term borrowings — 77 Payment of short-term borrowings — (77) Payment of term loan — (200) Proceeds from the exercise of stock options 79 38 Employee withholding taxes paid on stock-based compensation (35) (29) Payment of debt (3) (5) Capital expenditures (168) (243) Acquisition of businesses, net of cash acquired (4) (136) Proceeds from disposition of business, net of cash disposed 126 — Effect of exchange rate changes on cash and cash investments (9) 6 Other, net (4) (4) Cash (decrease) increase $ (1) $ 182 Our working capital days were as follows: At December 31, 2024 2023 Receivable days 51 52 Inventory days 72 77 Accounts payable days 70 70 Working capital (receivables plus inventories, less accounts payable) as a percentage of net sales 15.1 % 16.0 % Operating Activities Net cash provided by operations was $1,075 million, primarily driven by operating profit, partially offset by changes in working capital.
Cash Flows Significant sources and (uses) of cash for the years ended December 31, 2025 and 2024 are summarized as follows, in millions: 2025 2024 Net cash from operating activities $ 1,022 $ 1,075 Purchase of Company common stock (571) (751) Excise tax paid on the purchase of Company common stock (6) (3) Cash dividends paid (261) (254) Purchase of redeemable noncontrolling interest — (15) Dividends paid to noncontrolling interest (45) (37) Proceeds from the exercise of stock options 6 79 Employee withholding taxes paid on stock-based compensation (10) (35) Payment of debt (2) (3) Capital expenditures (156) (168) Acquisition of business, net of cash acquired — (4) Proceeds from disposition of: Business, net of cash disposed — 126 Property and equipment 14 1 Effect of exchange rate changes on cash and cash investments 25 (9) Other, net (3) (5) Cash increase (decrease) $ 14 $ (1) Our working capital days were as follows: At December 31, 2025 2024 Receivable days 51 51 Inventory days 83 72 Accounts payable days 70 70 Working capital (receivables plus inventories, less accounts payable) as a percentage of net sales 16.7 % 15.1 % Operating Activities Net cash provided by operations was $1,022 million, primarily driven by operating profit and the change in deferred taxes as a result of the cash tax benefit associated with immediate expensing of qualified fixed assets and research and development expenditures from the enactment of the One Big Beautiful Bill Act, partially offset by changes in working capital.
Capital Expenditures We continue to invest in our manufacturing and distribution operations to increase our productivity, improve customer service and support product innovation. Capital expenditures for 2024 were $168 million, compared with $243 million for 2023.
Capital Expenditures We continue to invest in our manufacturing and distribution operations to increase our productivity, improve customer service and support product innovation. Capital expenditures for 2025 were $156 million, compared with $168 million for 2024. The decrease in capital expenditures in 2025 was primarily due to a capacity expansion investment in our Decorative Architectural Products segment in 2024.
Liquidity and Capital Resources Overview of Capital Structure Historically, we have largely funded our growth through cash provided by our operations, the issuance of notes in the financial markets, bank borrowings and, to a lesser extent, the issuance of our common stock, including issuances for certain mergers and acquisitions.
Operating Results Operating profit in the Decorative Architectural Products segment in 2025 was negatively impacted by lower sales volume and higher commodity and tariff costs, partially offset by cost savings initiatives and lower marketing costs. 23 Liquidity and Capital Resources Overview of Capital Structure Historically, we have largely funded our growth through cash provided by our operations, the issuance of notes in the financial markets, bank borrowings and, to a lesser extent, the issuance of our common stock, including issuances for certain mergers and acquisitions.
Consolidated Results of Operations We report our financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP"). However, we believe that certain non-GAAP performance measures and ratios, used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods.
However, we believe that certain non-GAAP performance measures and ratios, used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. These include the disclosure of net sales, operating profit and operating profit margins adjusted for certain items.
We review our hedging program, derivative positions and overall risk management on a regular basis.
We review our hedging program, derivative positions and overall risk management on a regular basis. We currently do not have any derivative instruments for which we have designated hedge accounting.
Plumbing Products Sales Net sales in the Plumbing Products segment were flat in 2024. In local currencies (including sales in currencies outside their respective functional currencies), net sales increased one percent in 2024. Higher net selling prices increased sales by two percent and the acquisition of Sauna360 Group Oy ("Sauna360") in 2023 increased sales by one percent.
Plumbing Products Sales Net sales in the Plumbing Products segment increased three percent in 2025. In local currencies (including sales in currencies outside their respective functional currencies), net sales increased two percent in 2025. Net sales increased three percent due to higher net selling prices, partially offset by one percent due to lower sales volume.
These amounts were partially offset by higher net selling prices of plumbing products which increased sales by one percent.
These amounts were partially offset by five percent due to higher net selling prices of plumbing products, as well as cost savings initiatives.
Contractual Obligations The following table provides payment obligations related to current contracts at December 31, 2024, in millions: Payments Due by Period 2025 2026-2027 2028-2029 Beyond 2029 Other Total Debt (A) $ 3 $ 304 $ 839 $ 1,806 $ — $ 2,952 Interest (A) 98 193 158 580 — 1,028 Operating leases 55 88 57 142 — 341 Currently payable income taxes 28 — — — — 28 Purchase commitments (B) 363 100 41 — — 505 Uncertain tax positions, including interest and penalties (C) — — — — 97 97 Total $ 546 $ 685 $ 1,095 $ 2,527 $ 97 $ 4,950 ______________________________ (A) We assume that all debt would be held to maturity.
Contractual Obligations The following table provides payment obligations related to current contracts at December 31, 2025, in millions: Payments Due by Period 2026 2027-2028 2029-2030 Beyond 2030 Other Total Debt (A) $ 2 $ 904 $ 539 $ 1,503 $ — $ 2,949 Interest (A) 98 178 135 521 — 932 Operating leases 60 90 62 124 — 336 Currently payable income taxes 17 — — — — 17 Purchase commitments (B) 369 125 79 85 — 658 Uncertain tax positions, including interest and penalties (C) — — — — 84 84 Total $ 545 $ 1,298 $ 815 $ 2,233 $ 84 $ 4,975 ______________________________ (A) We assume that all debt would be held to maturity.
Our selling, general and administrative expenses for 2024 were $1,468 million, which remained flat compared to 2023. Selling, general and administrative expenses were positively impacted by one percent each due to the divestiture of Kichler in the third quarter of 2024 and lower sales commissions, mostly offset by two percent due to higher employee-related costs.
Our selling, general and administrative expenses for 2025 were $1,426 million, which decreased three percent, and were positively impacted by three percent due to the divestiture of Kichler and one percent due to lower employee-related costs, partially offset by one percent due to unfavorable foreign currency translation.
From time to time, we may take actions to drive efficiency in the business focused on the strategic rationalization of our businesses, including business consolidations, plant closures, headcount reductions and other cost savings initiatives. Recent Trends Due to changing market conditions, we are experiencing, and may continue to experience, lower market demand for our products.
From time to time, we take actions to drive efficiency in the business focused on the strategic rationalization of our businesses, including business consolidations, plant closures, headcount reductions and other cost savings initiatives. In the fourth quarter of 2025, we began implementing various restructuring actions to further streamline our business, reduce headcount, and optimize operations.
We repaid $300 million during 2022 and the remaining $200 million upon the maturity of the term loan on April 26, 2023. Corporate Development Strategy We expect to maintain a balanced growth strategy pursuing organic growth by maximizing the full potential of our existing businesses and, as appropriate, complementing our existing business with strategic acquisitions.
We were in compliance with all covenants and no borrowings were outstanding under our 2022 Credit Agreement as of December 31, 2025. 24 Corporate Development Strategy We expect to maintain a balanced growth strategy pursuing organic growth by maximizing the full potential of our existing businesses and, as appropriate, complementing our existing business with strategic acquisitions.
OTHER INCOME (EXPENSE), NET Below is a summary of our other income (expense), net, in millions, for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Favorable / (Unfavorable) Interest expense $ (99) $ (106) 7 % Other, net (103) (4) (2,475) % Other income (expense), net $ (202) $ (110) (84) % Other, net included a loss on the sale of Kichler Lighting ("Kichler") of $88 million, inclusive of costs to sell, for the year ended December 31, 2024.
Our operating profit for 2025 was $1,248 million, which decreased eight percent, and was negatively impacted by decreased gross profit and an impairment charge for other intangible assets, partially offset by lower selling, general and administrative expenses. 21 OTHER INCOME (EXPENSE), NET Below is a summary of our other income (expense), net, in millions, for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Favorable / (Unfavorable) Interest expense $ (101) $ (99) (2) % Other, net (12) (103) 88 % Other income (expense), net $ (114) $ (202) 44 % Other, net included a loss on the sale of Kichler of $88 million, inclusive of costs to sell, for the year ended December 31, 2024.
During 2023, we repurchased and retired 6.2 million shares of our common stock (including 0.2 million shares to offset the dilutive impact of restricted stock units granted during the year), for approximately $356 million, inclusive of excise tax of $3 million. 25 Dividend to holders of our Common Shares In 2024, we paid a quarterly dividend of $0.29 per common share for an annual dividend of $1.16 per share.
Refer to Note N to the consolidated financial statements for additional information. During 2024, we repurchased and retired 10.0 million shares of our common stock (including 0.5 million shares to offset the dilutive impact of restricted stock units granted during the year), for approximately $757 million, inclusive of excise tax of $6 million.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II of our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 8, 2024. 20 NET SALES Below is a summary of our net sales, in millions, for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Change Net sales, as reported $ 7,828 $ 7,967 (2) % Acquisitions (58) — Divestitures — (72) Net sales, excluding acquisitions and divestitures 7,770 7,895 (2) % Currency translation 32 — Net sales, excluding acquisitions, divestitures and the effect of currency translation $ 7,802 $ 7,895 (1) % Our net sales for 2024 were $7,828 million, which decreased two percent compared to 2023.
NET SALES Below is a summary of our net sales, in millions, for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Change Net sales, as reported $ 7,562 $ 7,828 (3) % Divestitures — (178) Net sales, excluding divestitures 7,562 7,650 (1) % Currency translation (45) — Net sales, excluding divestitures and the effect of currency translation $ 7,517 $ 7,650 (2) % Our net sales for 2025 were $7,562 million, which decreased three percent compared to 2024.
These include the disclosure of net sales, operating profit and operating profit margins adjusted for certain items. Non-GAAP performance measures and ratios should be viewed in addition to, and not as an alternative for, our reported results under GAAP.
Non-GAAP performance measures and ratios should be viewed in addition to, and not as an alternative for, our reported results under GAAP. We discuss our consolidated results as well as our Business Segment results of operations for the year ended December 31, 2025 versus December 31, 2024.
These increases were mostly offset by lower sales volume and unfavorable sales mix which each decreased sales by one percent. Operating Results Operating profit in the Plumbing Products segment in 2024 was positively impacted by cost savings initiatives and higher net selling prices, partially offset by higher commodity costs, unfavorable sales mix, lower sales volume and higher employee-related costs.
Operating Results Operating profit in the Plumbing Products segment in 2025 was negatively impacted by higher commodity and tariff costs, an increase in other expenses (including inventory-related reserves), lower sales volume, unfavorable sales mix, an increase in strategic growth investments, and higher marketing costs, partially offset by higher net selling prices, cost savings initiatives, and the gain on the sale of a building.
We also have been experiencing, and may continue to experience, elevated commodity and other input costs, as well as employee-related cost inflation. We aim to offset the potential unfavorable impact of our elevated costs and lower demand for our products with productivity improvements, pricing, and other initiatives.
We have been experiencing, and may continue to experience, elevated commodity and other input costs, as well as employee-related cost inflation. Additionally, we have been experiencing, and may continue to experience, significantly higher costs to us, principally in our Plumbing Products segment, due to the recently enacted tariffs, particularly those related to China.
INCOME TAXES Below is a summary of our income tax expense, in millions, and our effective tax rate for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Favorable / (Unfavorable) Income tax expense $ (287) $ (278) (3) % Effective tax rate (25) % (22) % (300) bps Our 2023 income tax expense included a $29 million state income tax benefit, net of federal expense, from the recognition of certain state deferred tax assets due to a legal restructuring of certain U.S. businesses that occurred in early 2024.
INCOME TAXES Below is a summary of our income tax expense, in millions, and our effective tax rate for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Favorable / (Unfavorable) Income tax expense $ (277) $ (287) 3 % Effective tax rate (24.4) % (24.7) % 30 bps Refer to Note P to the consolidated financial statements for additional information.
Investing Activities Net cash used for investing activities was $50 million, primarily driven by $168 million of capital expenditures, partially offset by $126 million of proceeds from the sale of Kichler. 27 Commitments and Contingencies Litigation Information regarding our legal proceedings is set forth in Note R to the consolidated financial statements, which is incorporated herein by reference.
Commitments and Contingencies Litigation Information regarding our legal proceedings is set forth in Note R to the consolidated financial statements, which is incorporated herein by reference. Other Commitments We enter into contracts, which include reasonable and customary indemnifications that are standard for the industries in which we operate.
Financing Activities Net cash used for financing activities was $1,017 million, primarily due to $751 million for the repurchase and retirement of our common stock, $254 million for the payment of cash dividends, $37 million for dividends paid to noncontrolling interest, $35 million for employee withholding taxes paid on stock-based compensation, and $15 million for the purchase of the remaining equity interest in Easy Sanitary Solutions B.V.
Financing Activities Net cash used for financing activities was $888 million, primarily due to $571 million for the repurchase and retirement of our common stock, $261 million for the payment of cash dividends, and $45 million for dividends paid to noncontrolling interest. 26 Investing Activities Net cash used for investing activities was $144 million, primarily driven by $156 million of capital expenditures.
Excluding acquisitions, divestitures, and the effect of currency translation, net sales decreased one percent. Our net sales for 2024 decreased primarily due to lower sales volume of North America plumbing products, lower net selling prices of decorative architectural products, and unfavorable sales mix of plumbing products which each decreased sales by one percent.
Decorative Architectural Products Sales Net sales in the Decorative Architectural Products segment decreased 14 percent in 2025, primarily due to lower sales volume which decreased net sales by eight percent and the divestiture of Kichler which decreased net sales by six percent.
Removed
Gross profit was negatively impacted by one percent due to the non-recurrence of the receipt of an insurance settlement payment in 2023, as well as unfavorable sales mix, and one percent each due to lower sales volume and unfavorable foreign currency translation. These amounts were mostly offset by cost savings initiatives and one percent due to higher net selling prices.
Added
In connection with these actions, we incurred charges of approximately $18 million in the fourth quarter of 2025, and we expect to incur approximately $50 million in additional charges in 2026.
Removed
Our operating profit for 2024 was $1,363 million, which increased one percent, and was positively impacted by the non-recurrence of an impairment charge for other intangible assets in 2023.
Added
Additionally, subsequent to December 31, 2025, we announced that we will implement an internal reorganization resulting in the integration of our Liberty Hardware (“Liberty”) business, a distributor of cabinet and other hardware and shower doors, into our Delta Faucet business.
Removed
This state income tax benefit did not recur in 2024. Refer to Note P to the consolidated financial statements for additional information.
Added
As a result of the integration, beginning with our Quarterly Report on Form 10-Q for the period ending March 31, 2026, Liberty will be included in our Plumbing Products segment rather than our Decorative Architectural Products segment. Recent Trends Due to changing market conditions, we are experiencing, and may continue to experience, lower market demand for our products.
Removed
Decorative Architectural Products Sales Net sales in the Decorative Architectural Products segment decreased five percent in 2024, primarily due to the divestiture of Kichler in the third quarter of 2024, lower net selling prices across the segment and lower sales volume of builders' hardware products, partially offset by higher sales volume of paints and other coating products. 23 Operating Results Operating profit in the Decorative Architectural Products segment in 2024 was negatively impacted by lower net selling prices and the non-recurrence of the receipt of an insurance settlement payment in 2023, partially offset by cost savings initiatives, the non-recurrence of an other intangible asset impairment charge in 2023 and lower sales commissions.
Added
We seek to mitigate the impact of higher tariffs and other unfavorable impact to our costs over time with pricing, cost savings initiatives, sourcing changes, and other activities.
Removed
The decrease in capital expenditures in 2024 was primarily due to capacity expansion plans in our Plumbing Products and Decorative Architectural Products segments in 2023. For 2025, capital expenditures, excluding any potential future acquisitions, are expected to be approximately $175 million. Depreciation and amortization expense for 2024 totaled $150 million, compared with $149 million for 2023.
Added
Consumer demand for our products, however, could further diminish if consumer confidence erodes and the price of our products and other consumer goods increases. 19 Consolidated Results of Operations We report our financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP").
Removed
We were in compliance with all covenants and no borrowings were outstanding under our 2022 Credit Agreement as of December 31, 2024. Short-term Borrowings On May 9, 2023, our Hansgrohe SE subsidiary entered into €70 million ($77 million) of short-term borrowings to support working capital needs.
Added
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 11, 2025.
Removed
The loans contained no financial covenants and the entire balance was repaid as of December 31, 2023. 364-day Term Loan On April 26, 2022, we entered into a 364-day $500 million senior unsecured delayed draw term loan (the "term loan") due April 26, 2023 with a syndicate of lenders.
Added
Excluding divestitures and the effect of currency translation, net sales decreased two percent.
Removed
The term loan and commitments thereunder were subject to prepayment or termination at our option and the loans bore interest at SOFR plus a spread adjustment and 0.70%. The covenants, including the financial covenants, were substantially the same as those in the 2022 Credit Agreement.
Added
Effective February 10, 2026, our Board of Directors authorized the repurchase, for retirement, of up to $2.0 billion of shares of our common stock, exclusive of excise tax, in open-market transactions or otherwise, replacing the previous Board of Directors authorization established in 2022.
Removed
Acquisitions In the third quarter of 2023, we acquired all of the share capital of Sauna360 for approximately €124 million ($136 million), net of cash acquired. Sauna360 has a portfolio of products that includes traditional, infrared, and wood-burning saunas as well as steam showers.
Added
Dividend to Holders of our Common Shares In 2025, we paid a quarterly dividend of $0.31 per common share for an annual dividend of $1.24 per share. Total cash dividends paid was $261 million in 2025.
Removed
Refer to Note N to the consolidated financial statements for additional information.
Added
In the fourth quarter of 2025, we recognized a $5 million non-cash impairment charge related to a registered trademark within our Decorative Architectural Products segment due to the loss of a customer in our paint applicator business. As of December 31, 2025, the impaired other indefinite-lived intangible asset had a remaining net carrying value of $2 million.
Removed
These uses of cash were partially offset by $79 million of proceeds from the exercise of stock options.
Removed
In the fourth quarter of 2024, we estimated that the future discounted cash flows projected for all of our other indefinite-lived intangible assets were greater than the carrying values. Accordingly, we did not recognize any impairment charges for other indefinite-lived intangible assets.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed2 unchanged
Biggest changeAt December 31, 2024, we performed sensitivity analyses to assess the potential loss in the fair values of market risk sensitive instruments resulting from a hypothetical change of 10 percent in foreign currency exchange rates, a 10 percent decline in the market value of our long-term investments, or a 100 basis point change in interest rates.
Biggest changeAt December 31, 2025, we performed sensitivity analyses to assess the potential loss in the fair values of market risk sensitive instruments resulting from a hypothetical change of 10 percent in foreign currency exchange rates, a 10 percent decline in the market value of our long-term investments, or a 100 basis point change in interest rates.
Based upon the analyses performed, such changes would not be expected to materially affect our consolidated financial position, results of operations or cash flows. 31
Based upon the analyses performed, such changes would not be expected to materially affect our consolidated financial position, results of operations or cash flows. 30

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