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

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Paragraph-level year-over-year comparison of Sherwin-Williams'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.

+294 added−293 removedSource: 10-K (2026-02-19) vs 10-K (2025-02-20)

Top changes in Sherwin-Williams's 2025 10-K

294 paragraphs added · 293 removed · 251 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThese risks, uncertainties and other factors include such things as: • general business and economic conditions in the United States and worldwide; • inflation rates, interest rates, unemployment rates, labor costs, healthcare costs, recessionary conditions, geopolitical conditions, terrorist activity, armed conflicts and wars, public health crises, pandemics, outbreaks of disease and supply chain disruptions; • shifts in consumer behavior driven by economic downturns in cyclical segments of the economy; • shortages and increases in the cost of raw materials and energy; • catastrophic events, adverse weather conditions and natural disasters (including those that may be related to climate change); • the loss of any of our largest customers; • increased competition or failure to keep pace with developments in key competitive areas of our business; • disruptions to our information technology systems, including due to digitization efforts or cybersecurity incidents; • our ability to attract, retain, develop and progress a qualified global workforce; • our ability to successfully integrate past and future acquisitions into our existing operations; • risks and uncertainties associated with our expansion into and our operations in South America, Asia, Europe and other foreign markets; • policy changes affecting international trade, including import/export restrictions and tariffs; • our ability to achieve our strategies or expectations relating to sustainability considerations, including as a result of evolving legal, regulatory and other standards, processes and assumptions, the pace of scientific and technological developments, increased costs, the availability of requisite suppliers, energy sources, or financing and changes in carbon markets; • damage to our business, reputation, image or brands due to negative publicity; • the infringement or loss of our intellectual property rights or the theft or unauthorized use of our trade secrets or other confidential business information; • a weakening of global credit markets or changes to our credit ratings; • our ability to generate cash to service our indebtedness; • fluctuations in foreign currency exchange rates and changing monetary policies; • our ability to comply with a variety of complex U.S. and non-U.S. laws, rules and regulations; • increases in tax rates, or changes in tax laws or regulations; • our ability to comply with numerous, complex and increasingly stringent domestic and foreign health, safety and environmental laws, regulations and requirements; • our liability related to environmental investigation and remediation activities at some of our currently- and formerly-owned sites; • the nature, cost, quantity and outcome of pending and future litigation, including lead pigment and lead-based paint litigation; and • the other risk factors discussed in Item 1A of this Annual Report on Form 10-K and our other reports filed with the SEC. 5 Table of Contents Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results and that the above list should not be considered a complete list.
Biggest changeThese risks, uncertainties and other factors include such things as: • general business and economic conditions in the United States and worldwide; • inflation rates, interest rates, unemployment rates, labor costs, healthcare costs, recessionary conditions, geopolitical conditions, terrorist activity, armed conflicts and wars, public health crises, pandemics, outbreaks of disease and supply chain disruptions; • shifts in consumer behavior driven by economic downturns in cyclical segments of the economy; • shortages and increases in the cost of raw materials and energy; • catastrophic events, adverse weather conditions and natural disasters (including those that may be related to climate change); • disruptions to our information technology systems, including due to digitization efforts or cybersecurity incidents; • our ability to attract, retain, develop and progress a qualified global workforce; • the loss of any of our largest customers; • increased competition or failure to keep pace with developments in key competitive areas of our business; • our ability to successfully integrate past and future acquisitions into our existing operations; • risks and uncertainties associated with our expansion into and our operations in South America, Asia, Europe and other foreign markets; • policy changes affecting international trade, including import/export restrictions and tariffs; • our ability to achieve our strategies or expectations relating to sustainability considerations, including as a result of evolving legal, regulatory and other standards, processes and assumptions, the pace of scientific and technological developments, increased costs, the availability of requisite suppliers, energy sources, or financing and changes in carbon markets and carbon accounting rules; • damage to our business, reputation, image or brands due to negative publicity; • the infringement or loss of our intellectual property rights or the theft or unauthorized use of our trade secrets or other confidential business information; • a weakening of global credit markets or changes to our credit ratings; • our ability to generate cash to service our indebtedness; • fluctuations in foreign currency exchange rates and changing monetary policies; • our ability to comply with a variety of complex U.S. and non-U.S. laws, rules and regulations; • increases in tax rates, or changes in tax laws or regulations; • our ability to comply with numerous, complex and increasingly stringent domestic and foreign health, safety and environmental laws, regulations and requirements; • our liability related to environmental investigation and remediation activities at some of our currently- and formerly-owned sites; • the nature, cost, quantity and outcome of pending and future litigation, including lead pigment and lead-based paint litigation; and • the other risk factors discussed in Item 1A of this Annual Report on Form 10-K and our other reports filed with the SEC. 5 Table of Contents Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results and that the above list should not be considered a complete list.
The building blocks of our culture of belonging include: • Communicating impact : Sharing the Company story, goals and priorities at all levels and supporting our employees in life, career and connections. • Leading with intention : Creating a culture where we inspire employees to Create Your Possible and leverage the unique contributions of each employee to foster a positive employee experience for all and drive above-market growth. 3 Table of Contents • Empowering everyone : Investing in our people by providing collaboration, development and learning opportunities to drive retention, progression and engagement. • Committing to action : Empowering and engaging leaders at all levels to use tools and resources to take meaningful action to foster a culture of belonging for all employees.
The building blocks of our culture of belonging include: • Communicating impact : Sharing the Company story, goals and priorities at all levels and supporting our employees in life, career and connections. 3 Table of Contents • Leading with intention : Creating a culture where we inspire employees to Create Your Possible and leverage the unique contributions of each employee to foster a positive employee experience for all and drive above-market growth. • Empowering everyone : Investing in our people by providing collaboration, development and learning opportunities to drive retention, progression and engagement. • Committing to action : Empowering and engaging leaders at all levels to use tools and resources to take meaningful action to foster a culture of belonging for all employees.
The major trademarks and trade names used by each of the Reportable Segments are set forth below. • Paint Stores Group: Sherwin-Williams®, A-100®, Builders Solution®, Captivate®, Cashmere®, Duration®, Emerald®, Gallery Series™, Kem Tone®, Latitude®, Loxon®, Metalatex®, Novacor®, Painters Edge Plus®, ProClassic®, ProCraft®, Pro Industrial™, ProMar®, Scuff Tuff®, SuperDeck®, SuperPaint®, Woodscapes® • Consumer Brands Group: Cabot®, Colorgin®, Condor®, Dupli-Color®, Dutch Boy®, Geocel®, HGTV HOME® by Sherwin-Williams, Krylon®, Minwax®, Purdy®, Ronseal®, Thompson’s® WaterSeal®, Valspar®, White Lightning® • Performance Coatings Group: Sherwin-Williams®, Acrolon®, AcromaPro®, ATX®, DeBeer Refinish®, Duraspar®, EcoDex®, Envirolastic®, Excelo®, EzDex®, Fastline®, Firetex®, Fluropon®, Gross & Perthun™, Heat-Flex®, House of Kolor®, Huarun®, ICA®, Inver®, Kem Aqua®, Klumpp Coatings™, Lazzuril®, Macropoxy®, Martin 2 Table of Contents Senour®, Matrix Edge®, M.L.
The major trademarks and trade names used by each of the Reportable Segments are set forth below. • Paint Stores Group: Sherwin-Williams®, A-100®, Builders Solution®, Captivate®, Cashmere®, Duration®, Emerald®, Gallery Series™, Kem Tone®, Latitude®, Loxon®, Metalatex®, Novacor®, Painters Edge Plus®, ProClassic®, ProCraft®, Pro Industrial™, ProMar®, Scuff Tuff®, SuperDeck®, SuperPaint®, Woodscapes® • Consumer Brands Group: Cabot®, Colorgin®, Condor®, Dupli-Color®, Dutch Boy®, Geocel®, HGTV HOME® by Sherwin-Williams, Krylon®, Minwax®, Purdy®, Ronseal®, Suvinil®, Thompson’s® WaterSeal®, Valspar®, White Lightning® 2 Table of Contents • Performance Coatings Group: Sherwin-Williams®, Acrolon®, AcromaPro®, ATX®, DeBeer Refinish®, Duraspar®, EcoDex®, Envirolastic®, Excelo®, EzDex®, Fastline®, Firetex®, Fluropon®, Gross & Perthun™, Heat-Flex®, House of Kolor®, Huarun®, ICA®, Inver®, Kem Aqua®, Klumpp Coatings™, Lazzuril®, Macropoxy®, Martin Senour®, Matrix Edge®, M.L.
Campbell®, Octoral®, Oskar Nolte™, PermaClad®, Polane®, Powdura®, Sayerlack®, Sher-Wood®, Sumaré®, Ultra 9K®, Ultra 7000®, ValPure®, Valspar® Patents Although patents and licenses are not of material importance to our business as a whole or any segment, each segment derives a portion of its income from the licensing of technology, trademarks and trade names to foreign companies.
Campbell®, Octoral®, Oskar Nolte™, PermaClad®, Polane®, Powdura®, Sayerlack®, Sher-Wood®, Sumaré®, Ultra 9K®, Ultra 7000®, ValPure®, Valspar® Patent and Licensing Income Although patents and licenses are not of material importance to our business as a whole or any segment, each segment derives a portion of its income from the licensing of technology, trademarks and trade names to foreign companies.
Regulatory Compliance For additional information regarding environmental-related matters, see Notes 1, 10 and 19 to the consolidated financial statements in Item 8. 4 Table of Contents CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION Certain statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this report constitute “forward-looking statements” within the meaning of federal securities laws.
Regulatory Compliance For further information regarding environmental-related matters, see Notes 1, 10 and 19 to the consolidated financial statements in Item 8. 4 Table of Contents CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION Certain statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this report constitute “forward-looking statements” within the meaning of federal securities laws.
We have over 400 employee-led communities that bring together employees from various groups, divisions and functional teams to create greater synergy around business objectives and serve as a hub for innovation, professional development and mentorship opportunities that enable our employees to thrive and find long-term success at Sherwin-Williams. Talent Acquisition and Employee Engagement.
We have over 450 employee-led communities that bring together employees from various groups, divisions and functional teams to create greater synergy around business objectives and serve as a hub for innovation, professional development and mentorship opportunities that enable our employees to thrive and find long-term success at Sherwin-Williams. Talent Acquisition and Employee Engagement.
We measure our progress toward creating a culture of excellence that empowers employees to learn, grow and achieve their aspirations by conducting periodic pulse surveys and a global engagement survey, which we conducted in 2023 and expect to conduct every other year. We are focused on using these survey results to drive continued progress with our efforts.
We measure our progress toward creating a culture of excellence that empowers employees to learn, grow and achieve their aspirations by conducting periodic pulse surveys and a global engagement survey, which we conducted in 2025 and expect to conduct every other year. We are focused on using these survey results to drive continued progress with our efforts.
Backlog and Productive Capacity Backlog orders are not typically significant in the business of any Reportable Segment since there is normally a short period of time between the placing of an order and shipment. We believe that sufficient productive capacity currently exists to fulfill our needs for paint, coatings and related products during 2025.
Backlog and Productive Capacity Backlog orders are not typically significant in the business of any Reportable Segment since there is normally a short period of time between the placing of an order and shipment. We believe that sufficient productive capacity currently exists to fulfill our needs for paint, coatings and related products during 2026.
We invest in our people by providing learning and employee networking opportunities to drive retention, development and engagement and help employees excel in their current and future roles. During 2024, our employees collectively completed thousands of hours of online and instructor-led courses across a broad range of categories, including leadership, professional skills, technical skills and compliance.
We invest in our people by providing learning and employee networking opportunities to drive retention, development and engagement and help employees excel in their current and future roles. During 2025, our employees collectively completed thousands of hours of online and instructor-led courses across a broad range of categories, including leadership, professional skills, technical skills and compliance.
In addition, each store sells select purchased associated products. The Consumer Brands Group also supports the Company’s other businesses around the world with new product research and development, manufacturing, distribution and logistics. Approximately 63% of the total sales of the Consumer Brands Group in 2024 were intersegment transfers of products primarily sold through the Paint Stores Group.
In addition, each store sells select purchased associated products. The Consumer Brands Group also supports the Company’s other businesses around the world with new product research and development, manufacturing, distribution and logistics. Approximately 63% of the total sales of the Consumer Brands Group in 2025 were intersegment transfers of products primarily sold through the Paint Stores Group.
This segment licenses certain technology and trade names worldwide. Sherwin-Williams ® and other controlled brand products are distributed through the Paint Stores Group, this segment’s 324 company-operated branches, a direct sales staff and outside sales representatives to retailers, dealers, jobbers, licensees and other third-party distributors.
This segment licenses certain technology and trade names worldwide. Sherwin-Williams ® and other controlled brand products are distributed through the Paint Stores Group, this segment’s 317 company-operated branches, a direct sales staff and outside sales representatives to retailers, dealers, jobbers, licensees and other third-party distributors.
We strive to ensure our senior leaders have the resources they need to foster a positive employee experience for all and ultimately leverage our workforce to deliver customer-focused differentiated products, services and solutions. In 2024, we continued supporting employees in life, career and connection.
We strive to ensure our senior leaders have the resources they need to foster a positive employee experience for all and ultimately leverage our workforce to deliver customer-focused differentiated products, services and solutions. In 2025, we continued supporting employees in life, career and connection.
We strive to foster a strong workplace culture that drives belonging, employee engagement, performance and above market growth while attracting, retaining, developing and progressing a pipeline of talent ready to serve the communities in which we operate.
We strive to foster a strong workplace culture that drives belonging, employee experience, performance and above market growth while attracting, retaining, developing and progressing a pipeline of talent ready to serve the communities in which we operate.
In addition, it includes the operations of a real estate management unit that is responsible for the ownership, management and leasing of non-retail properties held primarily for use by the Company, including the Company’s current global headquarters and research and development center and disposal of idle facilities.
In addition, it includes the operations of a real estate management unit that is responsible for the ownership, management and leasing of non-retail properties held primarily for use by the Company, including the Company’s new and former global headquarters and former research and development center and disposal of idle facilities.
Sales and marketing of certain controlled brand and private-label products are performed by a direct sales staff. The products distributed through third-party customers are intended for resale to the ultimate end-user of the product. The Consumer Brands Group also consisted of 334 company-operated specialty paint stores in Latin America at December 31, 2024.
Sales and marketing of certain controlled brand and private-label products are performed by a direct sales staff. The products distributed through third-party customers are intended for resale to the ultimate end-user of the product. The Consumer Brands Group also consisted of 307 company-operated specialty paint stores in Latin America at December 31, 2025.
The Administrative function’s remaining assets consist primarily of cash and cash equivalents, investments and deferred pension assets. Also included in the Administrative function was interest expense, interest and investment income, certain expenses related to closed facilities and environmental-related matters and other expenses that were not directly associated with the Reportable Segments. Sales of this function represented external leasing revenue.
The Administrative function’s remaining assets consist primarily of cash and cash equivalents, investments and noncurrent pension assets. Also included in the Administrative function is interest expense, interest and investment income, certain expenses related to closed facilities and environmental-related matters and other expenses that were not directly associated with the Reportable Segments. Sales of this function represented external leasing revenue.
The Company’s early talent programs, including our management trainee program and similar programs across our global business, play a critical role in attracting, developing and advancing a pipeline of talent with a broad mix of skills, backgrounds and experiences. During 2024, we hired approximately 1,500 professionals through our management trainee program as part of our long-term growth initiatives.
The Company’s early talent programs, including our management trainee program and similar programs across our global business, play a critical role in attracting, developing and advancing a pipeline of talent with a broad mix of skills, backgrounds and experiences. During 2025, we hired approximately 1,700 professionals through our management trainee program as part of our long-term growth initiatives.
For more information about the Reportable Segments, see Note 22 to the consolidated financial statements in Item 8. Paint Stores Group Paint Stores Group consisted of 4,773 company-operated specialty paint stores in the United States, Canada and the Caribbean region at December 31, 2024.
For further information about the Reportable Segments, see Note 22 to the consolidated financial statements in Item 8. Paint Stores Group Paint Stores Group consisted of 4,853 company-operated specialty paint stores in the United States, Canada and the Caribbean region at December 31, 2025.
The Company’s seven guiding values — integrity, people, service, quality, performance, innovation and growth — drive how we fulfill our purpose, emphasize the importance of our global workforce and serve as the foundation of our culture of excellence. At December 31, 2024, we employed 63,890 people worldwide, of which approximately 75% were in the United States.
The Company’s seven guiding values — integrity, people, service, quality, performance, innovation and growth — drive how we fulfill our purpose, emphasize the importance of our global workforce and serve as the foundation of our culture of excellence. At December 31, 2025, we employed 64,249 people worldwide, of which approximately 73% were in the United States.
Administrative Function The Administrative function includes the administrative expenses and assets of the Company’s new global headquarters and research and development center, both currently under construction.
Administrative Function The Administrative function includes the administrative expenses and assets of the Company’s new global headquarters and research and development center.
Our principal executive offices are located at 101 West Prospect Avenue, Cleveland, Ohio 44115-1075, telephone (216) 566-2000. As used in this report, the terms “Sherwin-Williams,” “Company,” “we”, “us” and “our” mean The Sherwin-Williams Company and its consolidated subsidiaries.
Our principal executive offices are located at 1 Sherwin Way, Cleveland, Ohio 44113-2206, telephone (216) 566-2000. As used in this report, the terms “Sherwin-Williams,” “Company,” “we”, “us” and “our” mean The Sherwin-Williams Company and its consolidated subsidiaries.
Removed
In 2024, we introduced a new education benefit that offers bachelors’ degrees, associates’ degrees and certificates for in-demand fields, with tuition fully paid by our Company. More recently, in 2025 we added a new backup child and elder care benefit.
Added
In 2025, we introduced a new backup child and elder care benefit and increased the annual discount on medical plan contributions that employees can earn by participating in our well-being program.
Removed
We continue to permit remote, alternate and flexible work arrangements where possible to promote increased flexibility and support employee health and well-being, while maintaining our focus on collaboration and engagement.
Added
More recently, in 2026 we launched a new global well-being program and platform to give all employees access to engaging tools and resources that will help drive better health outcomes.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCompetition in any of these areas, or failure to keep pace with developments in any of these areas, may reduce our sales and adversely affect our earnings or cash flow by resulting in decreased sales volumes, reduced prices and increased costs of manufacturing, distributing and selling our products.
Biggest changeCompetition in any of these areas, or failure to keep pace with developments in any of these areas, may reduce our sales and adversely affect our earnings or cash flow by resulting in decreased sales volumes, reduced prices and increased costs of manufacturing, distributing and selling our products. 9 Table of Contents Our results of operations, cash flow or financial condition may be negatively impacted if we do not successfully integrate past and future acquisitions into our existing operations and if the performance of the businesses we acquire do not meet our expectations.
Historically, our reported net sales, earnings, cash flow and financial condition have been subjected to fluctuations in foreign exchange rates. Our primary exchange rate exposure is with the euro, the Mexican peso, the Brazilian real, the Canadian dollar, the British pound, the Chinese yuan, the Chilean peso and the Argentine peso, each against the U.S. dollar.
Historically, our reported Net sales, earnings, cash flow and financial condition have been subjected to fluctuations in foreign exchange rates. Our primary exchange rate exposure is with the euro, the Brazilian real, the Canadian dollar, the Mexican peso, the British pound, the Chinese yuan, the Chilean peso and the Argentine peso, each against the U.S. dollar.
The domestic and international regulatory environment related to information security, data collection and transfer, digital marketing or telemarketing, and privacy is increasingly rigorous and complex, with new and rapidly changing requirements applicable to our business, which often require changes to our business practices.
The domestic and international regulatory environment related to information security, data collection and transfer, digital marketing or telemarketing, and privacy is increasingly rigorous and complex, with new and rapidly changing requirements applicable to our business, which often require changes to our business practices.
Factors such as political instability, higher tariffs, import/export restrictions, supply chain disruptions, adverse weather conditions and natural disasters (including those that may be related to climate change or otherwise), armed conflicts and wars, or public health crises have impacted and may in the future adversely impact the availability and cost of raw materials and fuel supplies, our ability to meet customer demands for some of our products, adequately staff and maintain operations at affected facilities and our costs generally.
Factors such as political instability, higher tariffs, import/export restrictions, supply chain disruptions, adverse weather conditions and natural disasters (including those that may be related to climate change or otherwise), armed conflicts and wars, or public health crises have in the past adversely impacted, and may in the future adversely impact, the availability and cost of raw materials and fuel supplies, our ability to meet customer demands for some of our products, adequately staff and maintain operations at affected facilities and our costs generally.
Changes in inflation rates, interest rates, tax rates, unemployment rates, labor costs, healthcare costs, recessionary conditions, geopolitical conditions, governmental policies, laws and regulations (including import and export requirements such as new or increased tariffs, sanctions, quotas or trade barriers), business disruptions due to cybersecurity incidents, terrorist activity, armed conflicts and wars (including the ongoing conflict between Russia and Ukraine and Israel and Hamas), public health crises, pandemics, outbreaks of disease, catastrophic events, adverse weather conditions or natural disasters (including those that may be related to climate change or otherwise), supply chain disruptions (including those caused by industry capacity constraints, labor shortages, raw material availability and transportation and logistics delays and constraints) and other economic factors have in the past and could in the future adversely affect demand for some of our products, our ability to predict and meet any future changes in the demand for our products, the availability, delivery or cost of raw materials, our ability to adequately staff and maintain operations at affected facilities and our results of operations, cash flow, liquidity or financial condition and that of our customers, vendors and suppliers.
Changes in inflation rates, interest rates, tax rates, unemployment rates, labor costs, healthcare costs, recessionary conditions, geopolitical conditions, governmental policies, laws and regulations (including import and export requirements such as new or increased tariffs, sanctions, quotas or trade barriers), business disruptions due to cybersecurity incidents, terrorist activity, armed conflicts and wars (including the ongoing conflict between Russia and Ukraine), public health crises, pandemics, outbreaks of disease, catastrophic events, adverse weather conditions or natural disasters (including those that may be related to climate change or otherwise), supply chain disruptions (including those caused by industry capacity constraints, labor shortages, raw material availability and transportation and logistics delays and constraints) and other economic factors have in the past and could in the future adversely affect demand for some of our products, our ability to predict and meet any future changes in the demand for our products, the availability, delivery or cost of raw materials, our ability to adequately staff and maintain operations at affected facilities and our results of operations, cash flow, liquidity or financial condition and that of our customers, vendors and suppliers.
Our business may face scrutiny from such stakeholders and if our strategies relating to sustainability considerations do not meet stakeholder expectations and standards (including with respect to establishing science-based targets), which continue to evolve and may differ across jurisdictions in which we operate, our business, financial condition, results of operations and reputation could be adversely impacted.
Our business may face scrutiny from such stakeholders and if our strategies or expectations relating to sustainability considerations do not meet stakeholder expectations and standards (including with respect to establishing science-based targets), which continue to evolve and may differ across jurisdictions in which we operate, our business, financial condition, results of operations and reputation could be adversely impacted.
We have established strategies and expectations for our business relating to certain sustainability considerations, including regarding reducing greenhouse gas emissions, increasing energy efficiency, increasing use of electricity from renewable energy sources, reducing waste and improving safety performance. These strategies and expectations reflect our current business plans and aspirations, and there is no guarantee that they will be achieved.
We have established strategies and expectations for our business relating to certain sustainability considerations, including regarding reducing greenhouse gas emissions, increasing use of electricity from renewable energy sources, reducing waste and improving safety performance. These strategies and expectations reflect our current business plans and aspirations, and there is no guarantee that they will be achieved.
In accordance with the Contingencies Topic of the Accounting Standards Codification (ASC), we accrue for these contingencies by a charge to income when it is both probable that one or more future events will occur confirming the fact of a loss and the amount of the loss can be reasonably estimated.
In accordance with the Contingencies Topic of the Accounting Standards Codification (ASC), we accrue for contingencies by a charge to income when it is both probable that one or more future events will occur confirming the fact of a loss and the amount of the loss can be reasonably estimated.
Some of our competitors operate more extensively in certain regions around the world and have greater financial or operational resources to compete internationally. They may secure better terms from certain vendors, adopt more aggressive pricing and devote more resources to certain product lines or parts of their business.
Some of our competitors operate more extensively in certain regions around the world and have greater financial or operational resources to compete in certain regions. They may secure better terms from certain vendors, adopt more aggressive pricing and devote more resources to certain product lines or parts of their business.
Expanding export controls or limits on foreign investment, for example, has in the past and could in the future impact the global supply of raw materials. Government actions taken in connection with the United States-China trade conflict has in the past and could in the future impact business, including sales, imports and exports.
Expanding export controls or limits on foreign investment, for example, has in the past and could in the future impact the global supply of raw materials. Government actions taken in connection with the United States-China trade conflict have in the past and could in the future impact business, including sales, imports and exports.
In addition, environmental and social regulations, including regulations related to climate change or otherwise, have in the past and may in the future negatively impact us or our suppliers in terms of availability and cost of raw materials, as well as sources and supply of energy.
In addition, environmental regulations, including regulations related to climate change or otherwise, have in the past and may in the future negatively impact us or our suppliers in terms of availability and cost of raw materials, as well as sources and supply of energy.
Furthermore, many governments, regulators, investors, employees, customers, media outlets and other stakeholders are focused on sustainability considerations relating to businesses, including climate change and greenhouse gas emissions, natural capital circularity, human capital and belonging, culture and employee experience.
Furthermore, many governments, regulators, investors, employees, customers, media outlets and other stakeholders are focused on sustainability considerations relating to businesses, including climate change and greenhouse gas emissions, natural capital circularity, human capital and belonging, and employee experience.
For example, although we do not have significant operations in the region, the conflict between Israel and Hamas has caused disruption, instability and volatility in supply chains and logistics, including shipping disruptions in the Red Sea and surrounding waterways.
For example, although we do not have significant operations in the region, in the past the conflict between Israel and Hamas has caused disruption, instability and volatility in supply chains and logistics, including shipping disruptions in the Red Sea and surrounding waterways.
Our results of operations, cash flow, liquidity or financial condition have in the past and could in the future be adversely affected by a variety of domestic and international factors, including general economic conditions, political instability, inflation rates, recessions, sanctions, tariffs, foreign currency exchange rates, foreign currency exchange controls, interest rates, foreign investment and repatriation restrictions, legal and regulatory constraints, civil unrest, armed conflicts and wars (including the ongoing conflict between Russia and Ukraine and Israel and Hamas), difficulties in staffing and managing foreign operations and other economic and political factors.
Our results of operations, cash flow, liquidity or financial condition have in the past and could in the future be adversely affected by a variety of domestic and international factors, including general economic conditions, political instability, inflation rates, recessions, sanctions, tariffs, foreign currency exchange rates, foreign currency exchange controls, interest rates, foreign investment and repatriation restrictions, legal and regulatory constraints, civil unrest, armed conflicts and wars (including the ongoing conflict between Russia and Ukraine), difficulties in staffing and managing foreign operations and other economic and political factors.
We operate all over the world serving customers in more than 120 countries. Our business, operations and business plans and strategies are sensitive to global and regional business and economic conditions.
We operate all over the world serving customers in more than 120 countries. Our business, operations and strategies are sensitive to global and regional business and economic conditions.
Compliance with these requirements, including the European Union’s General Data Protection Regulation, China’s Personal Information Protection, Data Security and Cyber Security Laws, the California Consumer Privacy Act as amended by the California Privacy Rights Act, other U.S. state privacy laws and a growing number of other international and domestic regulations, are costly and will result in additional costs in our efforts to continue to comply.
Compliance with these requirements, including the European Union’s General Data Protection Regulation, China’s Personal Information Protection, Data Security and Cyber Security Laws, Brazil’s General Data Protection Law, the California Consumer Privacy Act as amended by the California Privacy Rights Act, other U.S. state privacy laws and a growing number of other international and domestic regulations, are costly and will result in additional costs in our efforts to continue to comply.
Compliance with these requirements, including the European Union’s General Data Protection Regulation, China’s Personal Information Protection, Data Security, and Cyber Security Laws, the California Consumer Privacy Act as amended by the California Privacy Rights Act, other U.S. state privacy laws, and a growing number of other international and domestic regulations, are costly and will result in additional costs in our efforts to continue to comply.
Compliance with these requirements, including the European Union’s General Data Protection Regulation, China’s Personal Information Protection, Data Security, and Cyber Security Laws, Brazil’s General Data Protection Law, the California Consumer Privacy Act as amended by the California Privacy Rights Act, other U.S. state privacy laws, and a growing number of other international and domestic regulations, are costly and will result in additional costs in our efforts to continue to comply.
In the event of catastrophic events, adverse weather conditions or a natural disaster causing significant damage to any one or more of our principal manufacturing or distribution facilities, we may not be able to manufacture the products needed to meet customer demand, which could have an adverse effect on our sales of certain paint, coatings and related products.
In the event of catastrophic events, adverse weather conditions or a natural disaster causing significant damage to any one or more of our principal manufacturing or distribution facilities, we may not be able to provide the products needed to meet customer demand, which could have an adverse effect on our sales of certain paint, coatings and related products.
These uncertainties will ultimately be resolved when one or more future events occur or fail to occur confirming the incurrence of a liability or the reduction of a liability.
These uncertainties will ultimately be resolved when one or more future events occur or fail to occur confirming the incurrence of a liability or the avoidance or reduction of a liability.
The outcome of new and emerging legislation or regulation in the U.S., European Union and other jurisdictions in which we operate may result in fees or restrictions on certain activities or materials (including changes to our products or product packaging) and new or additional requirements, including to fund energy efficiency activities or renewable energy use and to disclose information regarding our greenhouse gas emissions performance, renewable energy usage and efficiency, waste generation and recycling rates, climate-related risks, opportunities and oversight and related strategies and initiatives across our global operations.
The outcome of new and emerging legislation or regulation in the U.S., European Union and other jurisdictions in which we operate may result in fees or restrictions on certain activities or materials (including changes to our products or product packaging) and new or additional requirements, including to fund 14 Table of Contents energy efficiency activities or renewable energy use and to disclose information regarding our greenhouse gas emissions performance, renewable energy usage and efficiency, waste generation and recycling rates, climate-related risks, opportunities and oversight and related strategies and initiatives across our global operations.
Examples of such factors include, but are not limited to, evolving legal, regulatory and other standards, processes and assumptions; the pace of scientific and 10 Table of Contents technological developments; increased costs; the availability of requisite suppliers, energy sources, or financing; and changes in carbon markets.
Examples of such factors include, but are not limited to, evolving 10 Table of Contents legal, regulatory and other standards, processes and assumptions; the pace of scientific and technological developments; increased costs; the availability of requisite suppliers, energy sources, or financing; and changes in carbon markets and carbon accounting rules.
Wars, armed conflicts, political instability, civil disturbances and unrest, terrorist attacks and actions by governments in these areas (such as the ongoing conflict between Russia and Ukraine and Israel and Hamas and any expansion or increase in the severity and intensity of such) may decrease the supply and increase the price of raw materials that we use for our business, which could have a material adverse effect on our sales, earnings, cash flow or results of operations.
Wars, armed conflicts, political instability, civil disturbances and unrest, terrorist attacks and actions by governments in these areas (such as the ongoing conflict between Russia and Ukraine and any expansion or increase in the severity and intensity of the same) may decrease the supply and increase the price of raw materials that we use for our business, which could have a material adverse effect on our sales, earnings, cash flow or results of operations.
Due to the global scope of our operations, changes in government policies on foreign trade and investment may affect the demand for our products and services, impact the competitive position of our products or prevent us from being able to sell products in certain countries.
Due to the global scope of our operations, changes in government policies on foreign trade and investment have and may continue to affect the demand for our products and services, impact the competitive position of our products or prevent us from being able to sell products in certain countries.
Although changes in inflation, the interest rate environment and the mortgage market are difficult to predict, we expect the recent and continued combination of high interest rates and high inflation to continue to impact consumer and manufacturing customer behavior in 2025.
Although changes in inflation, the interest rate environment and the mortgage market are difficult to predict, we expect the recent and continued combination of high interest rates and inflation to continue to impact consumer and manufacturing customer behavior in 2026.
International, national and regional laws, regulations and policies that have the effect of restricting global trade and markets and restricting the import and export of products, services and technology, or those of our customers, or for the benefit of favored industries or sectors, could interfere with our operations, supply chain, manufacturing costs and customer relationships and harm our business.
International, national and regional laws, regulations and policies that have the effect of restricting global trade and markets and restricting the import and export of products, services and technology, or those of our customers, or for the benefit of favored industries or sectors, have in the past, and could in the future, interfere with our operations, supply chain, manufacturing costs and customer relationships and harm our business.
If any of the banks in these 11 Table of Contents credit and financing facilities are unable to perform on their commitments, such inability could adversely impact our cash flow, liquidity or financial condition, including our ability to obtain funding for working capital needs and other general corporate purposes.
If any of the banks in these credit and financing facilities are unable to perform on their commitments, such inability could adversely impact our cash flow, liquidity or financial condition, including our ability to obtain funding for working capital needs and other general corporate purposes.
The plaintiffs’ claims have been based upon various legal theories, including negligence, strict liability, breach of warranty, negligent misrepresentations and omissions, fraudulent misrepresentations and omissions, concert of action, civil conspiracy, violations of unfair trade practice and consumer protection laws, enterprise liability, market share liability, public nuisance, unjust enrichment and other theories.
The plaintiffs’ claims have been based upon various legal theories, including negligence, strict liability, breach of warranty, negligent misrepresentations and omissions, fraudulent misrepresentations and omissions, concert of action, civil conspiracy, violations of unfair trade practice and 15 Table of Contents consumer protection laws, enterprise liability, market share liability, public nuisance, unjust enrichment and other theories.
Additionally, any failure to comply with covenants in the instruments governing our debt could result in an event of default which, if not cured or waived, would have a material adverse effect on us. A significant portion of our operations are conducted through our subsidiaries.
Additionally, any failure to comply with covenants in the instruments governing our debt could result in an event of default which, if not cured or waived, would have a material adverse effect on us. 12 Table of Contents A significant portion of our operations are conducted through our subsidiaries.
OPERATIONAL RISKS Unexpected shortages and increases in the cost of raw materials and energy may adversely affect our earnings or cash flow. We purchase raw materials (including petrochemical-derived resins, latex and solvents, titanium dioxide and various additives) and energy for use in the manufacturing, distribution and sale of our products.
OPERATIONAL RISKS Unexpected shortages and increases in the cost of raw materials and energy have in the past and may in the future adversely affect our earnings or cash flow. We purchase raw materials (including petrochemical-derived resins, latex and solvents, titanium dioxide and various additives) and energy for use in the manufacturing, distribution and sale of our products.
These risks are expected to continue to be magnified due to the increased reliance on information technology systems to conduct our business, including those used in furtherance of supporting remote and 8 Table of Contents hybrid in-office work environments and managing our global operating and financial processes.
These risks are expected to continue to be magnified due to the increased reliance on information technology systems to conduct our business, including those used in furtherance of supporting remote and hybrid in-office work environments and managing our global operating and financial processes.
The success of past and future acquisitions depends in large part on our ability to integrate the operations and personnel of the acquired companies and manage challenges that may arise as a result of the acquisitions, particularly when the acquired businesses operate in new or foreign markets.
The success of the Suvinil acquisition, and other past and future acquisitions depends in large part on our ability to integrate the operations and personnel of the acquired companies and manage challenges that may arise as a result of the acquisitions, particularly when the acquired businesses operate in new or foreign markets.
We and third parties we rely on or do business with have experienced cybersecurity attacks and incidents in the past, some of which have resulted in unauthorized access to our information and systems and other disruptions to our business operations, and we could in the future experience similar incidents.
We and third parties we rely on or do business with have experienced cybersecurity attacks and incidents in the past, some of which have resulted in unauthorized access to our information and systems and other disruptions to our business operations, and 8 Table of Contents we could in the future experience similar incidents.
Payments to us by our 12 Table of Contents subsidiaries will also be contingent upon our subsidiaries’ earnings and business considerations. Our right to receive any assets of any of our subsidiaries upon their liquidation or reorganization will be effectively subordinated to the claims of that subsidiary’s creditors, including trade creditors.
Payments to us by our subsidiaries will also be contingent upon our subsidiaries’ earnings and business considerations. Our right to receive any assets of any of our subsidiaries upon their liquidation or reorganization will be effectively subordinated to the claims of that subsidiary’s creditors, including trade creditors.
Further, management cannot reasonably determine the scope or amount of the potential costs and liabilities related to such litigation, or resulting from any such legislation and regulations.
Further, management cannot reasonably determine the scope or amount of the potential costs and liabilities related to such matters, or resulting from any such legislation and regulations.
In addition, advances in artificial intelligence technology and increasingly widespread use of generative artificial intelligence tools may increase the risk of unauthorized access to intellectual property, may increase the risk that existing intellectual property law may not provide adequate protection and may introduce potential liability from the use of artificial intelligence tools.
In addition, advances in AI technology and increasingly widespread use of generative AI tools may increase the risk of unauthorized access to intellectual property, may increase the risk that existing intellectual property law may not provide adequate protection and may introduce potential liability from the use of AI tools.
The plaintiffs seek various damages and relief, including personal injury and property damage, costs relating to the detection and abatement of lead-based paint from buildings, costs associated with a public education campaign, medical monitoring costs and others.
The plaintiffs have sought various damages and relief, including personal injury and property damage, costs relating to the detection and abatement of lead-based paint from buildings, costs associated with a public education campaign, medical monitoring costs and others.
They may also require us to alter the contents our products and/or product packaging, which may 14 Table of Contents alter the performance and profitability of such products and packaging.
They may also require us to alter the contents of our products and/or product packaging, which may alter the performance and profitability of such products and packaging.
In the course of our business, we are subject to a variety of claims and lawsuits, including, but not limited to, litigation relating to product liability and warranty, raw materials used in our products, personal injury, environmental (including natural resource damages), intellectual property, commercial, contractual and antitrust claims that are inherently subject to many uncertainties regarding the possibility of a loss to us.
In the course of our business, we are subject to a variety of actual and potential claims, lawsuits, and other proceedings, including, but not limited to, litigation relating to product liability and warranty, raw materials used in our products, personal injury, environmental (including alleged natural resource damages), intellectual property, commercial, contractual and antitrust claims, that are inherently subject to many uncertainties regarding the possibility of a loss to us.
These shifts in consumer behavior have in the past adversely impacted and may in the future adversely 6 Table of Contents impact demand for some of our products, and our results of operations, cash flow, liquidity or financial condition.
These shifts in consumer behavior have in the past adversely impacted and may in the future adversely impact demand for some of our products, and our results of operations, cash flow, liquidity or financial condition.
Following two years of historic inflation, certain raw material and energy prices decreased in 2023 and 2024, particularly resins and solvents derived from petrochemical feedstock sources such as propylene and ethylene.
Following two years of historic inflation, certain raw material and energy prices decreased in 2023 and 2024, and remained flat in 2025, particularly resins and solvents derived from petrochemical feedstock sources such as propylene and ethylene.
For example, it could: • require us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other long-term growth initiatives and general corporate purposes; • increase our vulnerability to adverse business, economic or industry conditions; • limit our ability to obtain additional financing in the future to enable us to react to changes in our business or general business, economic or industry conditions; or • place us at a competitive disadvantage compared to businesses in our industry that have less debt.
For example, it could: • require us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other long-term growth initiatives and general corporate purposes; • limit cash flow available to return to shareholders in the form of dividends and share repurchases; • increase our vulnerability to adverse business, economic or industry conditions; • limit our ability to obtain additional financing in the future to enable us to react to changes in our business or general business, economic or industry conditions; or • place us at a competitive disadvantage compared to businesses in our industry that have less debt.
Protracted duration of economic downturns in cyclical segments of the economy may depress the demand for some of our products and adversely affect our sales, earnings, cash flow or financial condition.
Protracted duration of economic downturns in cyclical segments of the economy has in the past and may in the future depress the demand for some of our products and adversely affect our sales, earnings, cash flow or financial condition.
We have also been a defendant in legal proceedings arising from the manufacture and sale of non-lead-based paints that seek recovery based upon various legal theories, including the failure to adequately warn of potential exposure to lead during surface preparation when using non-lead-based paint on surfaces previously painted with lead-based paint. We are vigorously defending such litigation.
We have also been a defendant in legal proceedings arising from the manufacture and sale of non-lead-based paints that seek recovery based upon various legal theories, including the failure to adequately warn of potential exposure to lead during surface preparation when using non-lead-based paint on surfaces previously painted with lead-based paint.
Due to the uncertainties involved, management is unable to predict the outcome of the litigation against us, the number or nature of possible future claims and proceedings, or the effect of any legislation and/or administrative regulations.
Due to the uncertainties involved, management is unable to predict the outcome of the claims, lawsuits, and other proceedings against us, the number or nature of possible future claims, lawsuits, and proceedings, or the effect of any legislation and/or administrative regulations.
A continuation or worsening of these conditions could limit our ability to collect our accounts receivable, which could adversely affect our results of operations, cash flow, liquidity or financial condition.
A 11 Table of Contents continuation or worsening of these conditions could limit our ability to collect our accounts receivable, which could adversely affect our results of operations, cash flow, liquidity or financial condition.
While we would typically expect to see higher demand for our products as project backlogs are reduced in the future, inflation and other economic conditions may delay a recovery in demand, which may result in the labor shortage and such other conditions adversely impacting our sales, earnings, cash flow or financial condition.
While we would typically expect to see higher demand for our products as project backlogs are reduced, inflation, interest rates, and other economic conditions may delay a recovery in demand, which may result in any such labor shortage and other conditions adversely impacting our sales, earnings, cash flow or financial condition.
In those cases where no accrual is recorded because it is not probable that a liability has been incurred or the amount of any such loss cannot be reasonably estimated, any potential liability ultimately determined to be attributable to us may result in a material impact on our results of operations, liquidity or financial condition for the annual or interim period during which such liability is accrued.
In matters where no accrual is recorded because it is not probable that a liability will be incurred or the amount of any such loss cannot be reasonably estimated, any potential liability ultimately determined to be attributable to us may result in a material impact on our results of operations, liquidity or financial condition for the annual or interim period during which such liability is accrued.
Net sales of our consolidated foreign subsidiaries totaled approximately 19.2%, 19.2% and 19.4% of our total consolidated Net sales in 2024, 2023 and 2022, respectively. Sales outside of the United States make up a significant part of our current business and future strategic plans.
Net sales of our consolidated foreign subsidiaries totaled approximately 19.6%, 19.2% and 19.2% of our total consolidated Net sales in 2025, 2024 and 2023, respectively. Sales outside of the United States make up a significant part of our current business and future strategic plans.
Failures or delays (whether actual or perceived) in achieving our strategies or expectations related to these matters could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
The pursuit of our strategies or expectations, failures or delays (whether actual or perceived) in achieving our strategies or expectations or changes to our strategies or expectations related to these matters could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
Although the Federal Reserve cut interest rates in 2024, mortgage rates have remained high and we have not experienced meaningful positive impacts on demand for our products that serve these segments of the economy to date.
Although the 6 Table of Contents Federal Reserve cut interest rates in 2025, mortgage rates have remained high and we have not experienced meaningful positive impacts on demand for our products that serve these segments of the economy to date.
In particular, high levels of ongoing global inflation have impacted consumer and manufacturing behavior in recent years. We expect inflationary pressure to continue to impact consumer and manufacturing customer behavior during 2025, including in the United States housing market as a result of elevated mortgage rates and in global industrial markets as a result of softer demand.
In particular, ongoing global inflation has impacted consumer and manufacturing behavior in recent years. We expect inflationary pressure to continue to impact consumer and manufacturing customer behavior during 2026, including in the United States housing market as a result of elevated mortgage rates and in global industrial markets as a result of softer demand.
Although we have not experienced any material labor shortage to date, over the past few years, we have experienced an increasingly competitive labor market.
Although we have not experienced any material labor shortage to date, over the past few years, we have experienced an increasingly competitive labor market and higher labor-related costs.
In addition, market uncertainty and volatility in various geographies have been magnified as a result of potential shifts in U.S. and foreign trade, economic and other policies following the 2024 U.S. presidential and congressional elections, and any such actual shifts, including price increases on certain raw materials, or changes in the availability of, or tariffs on certain imported raw materials, could adversely impact our results of operations, cash flow, liquidity or financial condition.
In addition, market uncertainty and volatility in various geographies have been magnified as a result of shifts in U.S. and foreign trade, economic and other policies, and such shifts, including price increases on certain raw materials, and changes in the availability of, or tariffs on certain imported raw materials, could continue to adversely impact our results of operations, cash flow, liquidity or financial condition.
We continue to see project backlogs in these segments due to contractors experiencing a shortage of skilled workers, resulting in an adverse effect on the growth rate of demand for our products.
We have in the past and may in the future see project backlogs in these segments due to contractors experiencing a shortage of skilled workers, resulting in an adverse effect on the growth rate of demand for our products.
Despite the security measures we have in place, our facilities and systems and those of third parties we rely on or do business with, may be vulnerable to cybersecurity incidents, attacks, security breaches, malware (including ransomware and other programs that operate with malicious intent), power outages, system failures, acts of vandalism, human or technical errors, fraud (including through phishing or other social engineering attempts) or other similar events or disruptions.
Despite the security measures we have in place, our facilities and systems, and those of third parties we rely on or do business with, may be vulnerable to, or affected by damage or interruption resulting from, cybersecurity issues, including cyber attacks (including AI-powered cyberattacks), security breaches, fraud (including through phishing or social engineering attempts), malware (including ransomware and other programs that operate with malicious intent), power outages, system failures, acts of vandalism, human or technical errors, or other similar events or disruptions.
If we cannot generate the required cash, we may not be able to make the necessary payments required under our indebtedness. At December 31, 2024, we had total debt of approximately $9.888 billion, which is an increase of $37.5 million since December 31, 2023.
If we cannot generate the required cash, we may not be able to make the necessary payments required under our indebtedness. At December 31, 2025, we had total debt of approximately $10.871 billion, which is an increase of $982.9 million since December 31, 2024.
Policy changes affecting international trade could adversely impact the demand for our products and our competitive position.
Policy changes affecting international trade have in the past and could in the future adversely impact the demand for our products and our competitive position.
Our business benefits from free trade agreements, which may include the United States-Mexico-Canada Agreement and EU-UK Trade and Cooperation Agreement, and efforts to withdraw from, or substantially modify such agreements, in addition to trends such as protectionism or nationalism and the implementation of more restrictive trade policies, such as more detailed inspections, higher tariffs, import or export licensing requirements, exchange controls or new barriers to entry, could have a material adverse effect on our results of operations, financial condition or cash flow and that of our customers, vendors and suppliers.
Efforts to withdraw from, or substantially modify such agreements, in addition to trends such as protectionism or nationalism and the implementation of more restrictive trade policies, such as more detailed inspections, higher tariffs, import or export licensing requirements, exchange controls or new barriers to entry, could have a material adverse effect on our results of operations, financial condition or cash flow and that of our customers, vendors and suppliers.
The Company will 15 Table of Contents continue to vigorously defend against any additional lead pigment and lead-based paint litigation that may be filed, including utilizing all avenues of appeal, if necessary. Litigation is inherently subject to many uncertainties, and we ultimately may not prevail.
The Company will continue to vigorously defend against any such litigation that may be filed, including utilizing all avenues of appeal, if necessary. Litigation is inherently subject to many uncertainties, and we ultimately may not prevail.
Economic and political conditions in the countries where we are subject to taxes, including in the U.S., have in the past and may in the future result in significant changes to tax laws or regulations.
We are affected by changes in tax laws and regulations, as well as changes in related interpretations and other tax guidance. Economic and political conditions in the countries where we are subject to taxes, including in the U.S., have in the past and may in the future result in significant changes to tax laws or regulations.
Cybersecurity incidents, attacks and cybersecurity threats are increasingly sophisticated, constantly evolving and originate from many sources globally and often cannot be recognized or understood until the target has already been attacked.
Cybersecurity incidents, threats and attacks are increasingly sophisticated, including due to advances in artificial intelligence (AI) capabilities, constantly evolving, and originate from many sources globally. In addition, often these incidents cannot be recognized or understood until the target has already been attacked.
These investigations, examinations and other proceedings could subject us to significant liability and require us to take significant accruals or pay significant settlements, fines and penalties, which could have a material adverse effect on our results of operations, cash flow or financial condition. 13 Table of Contents Increases in tax rates, or changes in tax laws or regulations, could increase our costs and could adversely affect our results of operations, cash flow or financial condition.
These investigations, examinations and other proceedings could subject us to significant liability and require us to take significant accruals or pay significant settlements, fines and penalties, which could have a material adverse effect on our results of operations, cash flow or financial condition.
To the extent we are unable to remain competitive with our total rewards programs (which include compensation and benefits programs and practices), talent management strategy, workplace culture and strategies, initiatives, programs and practices that drive belonging and a positive employee experience, or if qualified candidates or employees become more difficult to attract or retain under reasonable terms, we may experience higher labor-related costs and may be unable to attract, retain, develop and progress a qualified global workforce, which could adversely affect our business and future success and impair our ability to meet our strategic objectives and the needs of our customers .
To the extent we are unable to remain competitive with our total rewards programs (which include compensation and benefits programs and practices), talent management strategy, workplace culture and strategies, initiatives, programs and practices that drive belonging and a positive employee experience, or if qualified candidates or employees become more difficult to attract or retain under reasonable terms, we have in the past and may in the future experience higher labor-related costs.
Our business, reputation, image and brands could be damaged by negative publicity. Our reputation, image and recognized brands significantly contribute to our business and success, as they are critical to retaining and growing our customer base and our relationships with other stakeholders. Specifically, our ability to maintain a positive perception of us and our business, including through our guiding values.
Our business, reputation, image and brands could be damaged by negative publicity. Our reputation, image and recognized brands significantly contribute to our business and success, as they are critical to retaining and growing our customer base and our relationships with other stakeholders.
Disruptions to our information technology systems could occur if we do not effectively design or implement these systems solutions, or otherwise fail to manage resulting changes in processes and controls.
Planned implementations will lead to changes in our operating and financial processes as well as our internal control over financial reporting. Disruptions to our information technology systems could occur if we do not effectively design or implement these systems solutions, or otherwise fail to manage resulting changes in processes and controls.
Except with respect to the California public nuisance litigation, we have not accrued any amounts for such litigation because we do not believe it is probable that a loss has occurred, and we believe it is not possible to estimate the range of potential losses as there is no substantive information upon which an estimate could be based.
We currently have not accrued any amounts for the pending lead pigment and lead-based paint litigation, because we do not believe it is probable that a loss will occur, or we believe it is not possible to estimate the range of potential losses as there is no substantive information upon which an estimate could be based.
In connection with our digitization initiative, we have begun a multi-year phased process to upgrade and harmonize certain components of our information technology systems, including our financial processing systems. We are making significant investments in this complex, enterprise-wide initiative. Planned implementations will lead to changes in our operating and financial processes as well as our internal control over financial reporting.
In connection with our digitization initiative, we are engaged in a multi-year phased process to upgrade and harmonize certain components of our information technology systems, including our financial processing systems. We are making significant investments in this complex, enterprise-wide initiative.
Disruptions to our information technology systems, including due to digitization efforts or cybersecurity incidents, may interfere with our operating and financial processes, result in the compromise or loss of critical and confidential information and severely harm our business. We rely on information technology systems to conduct our business.
In any of these instances, an adverse effect on sales may cause a reduction in our earnings or cash flow. Disruptions to our information technology systems, including due to digitization efforts or cybersecurity incidents, may interfere with our operating and financial processes, result in the compromise or loss of critical and confidential information and severely harm our business.
We expect additional lead pigment and lead-based paint litigation may be filed against us in the future asserting similar or different legal theories and seeking similar or different types of damages and relief.
We are vigorously defending any such litigation that remains ongoing. We expect additional litigation may be filed against us in the future asserting similar or different legal theories, and seeking similar or different types of damages and relief.
These laws and regulations can provide for significant penalties for non-compliance, which could result in additional costs of compliance, enforcement actions, regulatory investigations, and fines, individual or class action litigation, commercial litigation, or reputational harm. Ongoing efforts to comply with these laws also may divert management and employee attention from other business and growth initiatives.
These laws and regulations can provide for significant penalties for non-compliance, which could result in additional costs of compliance, enforcement actions, regulatory investigations, and fines, individual or class action litigation, commercial litigation, or reputational harm.
We have historically made strategic acquisitions of businesses in the paint and coatings industry and likely will acquire additional businesses in the future as part of our long-term growth strategy and initiatives.
We have historically made strategic acquisitions of businesses in the paint and coatings industry and likely will acquire additional businesses in the future as part of our long-term growth strategy and initiatives. In October 2025, we completed our acquisition of Suvinil, a leading provider of architectural paints in Brazil, with annual sales of approximately $525 million.
Investigations, examinations and other proceedings, the nature and outcome of which cannot be predicted, likely will arise from time to time.
We face liability and reputational risks even if we comply with all laws and regulations. Investigations, examinations and other proceedings, the nature and outcome of which cannot be predicted, likely will arise from time to time.
In any of these instances, an adverse effect on sales may cause a reduction in our earnings or cash flow. Although we have an extensive customer base, the loss of any of our largest customers could adversely affect our sales, earnings or cash flow. We have a large and varied customer base due to our extensive distribution platform.
Although we have an extensive customer base, the loss of any of our largest customers could adversely affect our sales, earnings or cash flow. We have a large and varied customer base due to our extensive distribution platform. During 2025, no individual customer accounted for sales totaling more than ten percent of our sales.
Although we believe we have adopted appropriate risk management and compliance programs to mitigate these risks, the global and diverse nature of our operations means compliance risks will continue to exist. We face liability and reputational risks even if we comply with all laws and regulations.
Ongoing efforts to comply with these laws also may divert management and employee attention from other business and growth initiatives. 13 Table of Contents Although we believe we have adopted appropriate risk management and compliance programs to mitigate these risks, the global and diverse nature of our operations means compliance risks will continue to exist.
A sustained labor shortage or increased turnover rates within our employee base (or within the employee base of key suppliers or third-party manufacturers), could negatively affect our supply chain or our ability to efficiently operate our manufacturing and distribution facilities and overall business. 9 Table of Contents Our results of operations, cash flow or financial condition may be negatively impacted if we do not successfully integrate past and future acquisitions into our existing operations and if the performance of the businesses we acquire do not meet our expectations.
A sustained labor shortage or increased turnover rates within our employee base (or within the employee base of key suppliers or third-party manufacturers), could negatively affect our supply chain or our ability to efficiently operate our manufacturing and distribution facilities and overall business.
During 2024, no individual customer accounted for sales totaling more than ten percent of our sales. However, we have some customers that, individually, purchase a large amount of products from us.
However, we have some customers that, individually, purchase a large amount of products from us.
We are subject to tax laws and regulations in the U.S. and multiple jurisdictions outside of the U.S. We are affected by changes in tax laws and regulations, as well as changes in related interpretations and other tax guidance.
Increases in tax rates, or changes in tax laws or regulations, could increase our costs and could adversely affect our results of operations, cash flow or financial condition. We are subject to tax laws and regulations in the U.S. and multiple jurisdictions outside of the U.S.
Removed
Despite our efforts to prevent these threats and disruptions to our information technology systems, these systems and those of our third-party providers may be affected by damage or interruption resulting from, among other causes, cybersecurity incidents, attacks, security breaches, power outages, system or operational failures or malware (including ransomware and other programs that operate with malicious intent).
Added
We rely on information technology systems to conduct our business.
Added
If we are unable to attract, retain, develop and progress a qualified global workforce, this could adversely affect our business and future success and impair our ability to meet our strategic objectives and the needs of our customers.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

4 edited+0 added−0 removed15 unchanged
Biggest changeDespite the security measures we have in place, our facilities and systems and those of third parties we rely on or do business with, may be vulnerable to cyber attacks, security breaches, malware (including ransomware and other programs that operate with malicious intent), power outages, system failures, acts of vandalism, human or technical errors, or other similar events or disruptions.
Biggest changeDespite the security measures we have in place, our facilities and systems and those of third parties we rely on or do business with, may be vulnerable to cybersecurity issues, including cyber attacks (including cyberattacks powered by AI), security breaches, fraud (including through phishing or social engineering attempts), malware (including ransomware and other programs that operate with malicious intent), power outages, system failures, acts of vandalism, human or technical errors, or other similar events or disruptions.
Our Chief Information Security Officer (CISO) leads our global cybersecurity program and is responsible for management of our cybersecurity risks. Our CISO reports to our CFO. Our CISO has served in that position since 2022 and has relevant 16 Table of Contents experience in cybersecurity leadership positions, including prior experience as CISO of a public company.
Our Chief Information Security Officer (CISO) leads our global cybersecurity program and is responsible for management of our cybersecurity risks. Our CISO reports to our CFO. Our CISO has served in that position since 2022 and has relevant experience in cybersecurity leadership positions, including prior experience as CISO of a public company.
The ERM program also facilitates the incorporation of risk assessment and evaluation into the strategic planning process and the provision of regular reports to senior management, including our CEO. The Audit Committee assists the Board with its oversight of both the ERM program and cybersecurity risk, providing regular reports to the Board.
The ERM program also facilitates the incorporation of risk assessment and evaluation into the strategic 16 Table of Contents planning process and the provision of regular reports to senior management, including our CEO. The Audit Committee assists the Board with its oversight of both the ERM program and cybersecurity risk, providing regular reports to the Board.
See Risk Factors in Item 1A for additional information on cybersecurity risks. 17 Table of Contents
See Risk Factors in Item 1A for further information on cybersecurity risks. 17 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

12 edited+0 added−1 removed1 unchanged
Biggest changeConstruction of the Company’s new global headquarters and research and development center is expected to be completed in 2025. Refer to Item 7 for further information on the construction of our new global headquarters and research and development center. Our principal manufacturing and distribution facilities are located as set forth below.
Biggest changeRefer to Item 7 for further information on our new global headquarters and research and development center. Our principal manufacturing and distribution facilities are located as set forth below. We believe our manufacturing and distribution facilities are well-maintained, suitable and adequate, with sufficient productive capacity, to meet our current needs.
The operations of the Paint Stores Group included 4,773 company-operated specialty paint stores, of which 206 were owned, in the United States, Canada, Puerto Rico, Virgin Islands, Grenada, Trinidad and Tobago, St. Maarten, Jamaica, Curaçao, Aruba, St. Lucia and Barbados at December 31, 2024.
The operations of the Paint Stores Group included 4,853 company-operated specialty paint stores, of which 206 were owned, in the United States, Canada, Puerto Rico, Virgin Islands, Grenada, Trinidad and Tobago, St. Maarten, Jamaica, Curaçao, Aruba, St. Lucia and Barbados at December 31, 2025.
The Consumer Brands Group operated 334 specialty paint stores in Latin America at December 31, 2024. These stores market and sell Sherwin-Williams ® and other controlled brand architectural paint and coatings, protective and marine products, OEM product finishes and related products which are branded for the Latin America market.
The Consumer Brands Group operated 307 specialty paint stores in Latin America at December 31, 2025. These stores market and sell Sherwin-Williams ® and other controlled brand architectural paint and coatings, protective and marine products, OEM product finishes and related products which are branded for the Latin America market.
For additional information regarding real property leases, see Note 9 to the consolidated financial statements in Item 8.
For further information regarding real property leases, see Note 9 to the consolidated financial statements in Item 8.
All real property within the Administrative function is owned with the exception of the current global headquarters, current research and development center and new global headquarters currently under construction. For additional information regarding real property within the Administrative function, refer to Item 1 and Item 7 of this report, which are incorporated herein by reference.
All real property within the Administrative function is owned with the exception of the former global headquarters, former research and development center and new global headquarters. For further information regarding real property within the Administrative function, refer to Item 1 and Item 7 of this report, which are incorporated herein by reference.
At the end of 2024: • the Mid Western Division operated 1,204 paint stores primarily located in the mid west and upper west coast states; • the Eastern Division operated 921 paint stores along the upper east coast and New England states; • the Canada Division operated 259 paint stores throughout Canada; • the Southeastern Division operated 1,210 paint stores principally covering the lower east and gulf coast states, Puerto Rico, Virgin Islands, Grenada, Trinidad and Tobago, St.
At the end of 2025: • the Mid Western Division operated 1,219 paint stores primarily located in the mid west and upper west coast states; • the Eastern Division operated 929 paint stores along the upper east coast and New England states; • the Canada Division operated 263 paint stores throughout Canada; • the Southeastern Division operated 1,232 paint stores principally covering the lower east and gulf coast states, Puerto Rico, Virgin Islands, Grenada, Trinidad and Tobago, St.
Maarten, Jamaica, Curaçao, Aruba, St. Lucia and Barbados; and • the Southwestern Division operated 1,179 paint stores in the central plains and lower west coast states. During 2024, the Paint Stores Group opened 79 net new stores, consisting of 84 new stores opened and 5 stores closed.
Maarten, Jamaica, Curaçao, Aruba, St. Lucia and Barbados; and • the Southwestern Division operated 1,210 paint stores in the central plains and lower west coast states. During 2025, the Paint Stores Group opened 80 net new stores, consisting of 83 new stores opened and 3 stores closed.
Manufacturing (1) Distribution (1) Leased Owned Total Leased Owned Total Consumer Brands Group Africa 1 1 1 1 Asia 3 6 9 3 4 7 Canada 3 3 1 1 Europe 2 16 18 3 13 16 Jamaica 1 1 1 1 Latin America 12 12 5 10 15 United States 6 42 48 14 12 26 Total 11 81 92 26 41 67 Performance Coatings Group Europe 1 8 9 4 4 8 Latin America 1 1 United States 1 1 2 2 Total 2 9 11 6 4 10 (1) Certain locations may contain both manufacturing and distribution facilities.
Manufacturing (1) Distribution (1) Leased Owned Total Leased Owned Total Consumer Brands Group Africa 1 1 1 1 Asia 3 6 9 3 5 8 Canada 3 3 2 2 Europe 2 17 19 3 13 16 Jamaica 1 1 1 1 Latin America 14 14 7 8 15 United States 6 42 48 13 12 25 Total 11 84 95 28 40 68 Performance Coatings Group Australia 1 1 Europe 1 8 9 2 4 6 Latin America 1 1 1 1 United States 1 1 Total 1 10 11 3 5 8 (1) Certain locations may contain both manufacturing and distribution facilities.
During 2024, the Consumer Brands Group opened 16 net new stores, consisting of 18 new stores opened and 2 stores closed. 18 Table of Contents The Performance Coatings Group operated 225 branches in the United States and 99 branches internationally at December 31, 2024.
During 2025, the Consumer Brands Group opened 13 new stores and closed 40 locations for a net decrease of 27 stores. 18 Table of Contents The Performance Coatings Group operated 218 branches in the United States and 99 branches internationally at December 31, 2025.
ITEM 2. PROPERTIES The Company’s global headquarters, which includes the global headquarters for the Paint Stores, Consumer Brands and Performance Coatings Groups and the Administrative function, is located in Cleveland, Ohio. During 2023, the Company closed on a transaction to sell and subsequently lease back its current global headquarters and research and development center.
ITEM 2. PROPERTIES The Company’s global headquarters, which includes the global headquarters for the Paint Stores, Consumer Brands and Performance Coatings Groups and the Administrative function, is located in Cleveland, Ohio. During 2025, the Company substantially completed the construction of its new global headquarters and research and development center.
These paint stores are located in Mexico (180), Chile (57), Brazil (49), Ecuador (37) and Uruguay (11).
These paint stores are located in Mexico (190), Chile (47), Ecuador (33), Brazil (26) and Uruguay (11).
International locations consisted of branches in Europe (47), Canada (22), Chile (11), Mexico (5), Peru (3), Ecuador (2), Brazil (2), Thailand (2), Indonesia (2), Vietnam (1), Singapore (1) and China (1). During 2024, this segment added 2 new branches.
International locations consisted of branches in Europe (46), Canada (23), Chile (11), Mexico (5), Peru (3), Ecuador (2), Brazil (2), Thailand (2), Indonesia (2), Vietnam (1), Singapore (1) and China (1). During 2025, the Performance Coatings Group opened 6 branches and closed 13 branches for a net decrease of 7 branches.
Removed
We believe our manufacturing and distribution facilities are well-maintained, suitable and adequate, with sufficient productive capacity, to meet our current needs.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeFor information regarding certain environmental matters and other legal proceedings, see the information included under the captions titled “Other Long-Term Liabilities” and “Litigation and Other Contingent Liabilities” of “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Notes 1, 10, 11 and 19 to the consolidated financial statements in Item 8.
Biggest changeFor information regarding certain other environmental matters and legal proceedings, see the information included under the captions titled “Other Long-Term Liabilities” and “Litigation and Other Contingent Liabilities” of “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Notes 1, 10, 11 and 19 to the consolidated financial statements in Item 8.
Added
On May 12, 2025, a subsidiary of the Company, The Sherwin-Williams Manufacturing Company (SWM), was served with a Petition and Application for Injunctive Relief from the State of Texas, through its Attorney General on behalf of the Texas Commission on Environmental Quality, filed in the District Court of Travis County, Texas, and on January 30, 2026, the State filed a First Amended Petition and Application for Injunctive Relief (together, the Petition).
Added
The Petition alleges that one of SWM’s Garland, Texas facility’s past operations violated Texas environmental regulations related to air and water emissions, and includes events related to the fire experienced at that facility on August 8, 2023. The Petition seeks injunctive relief, civil penalties, reimbursement of response costs, expenses, and attorney fees and costs.
Added
SWM denies the violations and claims for relief as alleged and intends to vigorously defend these claims if SWM is unable to resolve this matter to the mutual satisfaction of the parties.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeYoung has served as Senior Vice President – Corporate Strategy and Development since March 2021. Mr. Young served as Vice President – Corporate Strategy and Development from June 2017 to March 2021. Mr. Young joined the Company in June 2017 in connection with the Valspar acquisition. Mr. Binns has served as President, Global Architectural since January 2024. Mr.
Biggest changeYoung joined the Company in June 2017 in connection with the Valspar acquisition. Mr. Binns has served as President, Global Architectural since January 2024. Mr.
Young 49 Senior Vice President – Corporate Strategy and Development Justin T. Binns 49 President, Global Architectural Karl J. Jorgenrud 48 President, Global Industrial Todd D. Rea 50 President, Consumer Brands Group Colin M. Davie 56 President & General Manager, Global Supply Chain Division, Consumer Brands Group Ms.
Young 50 Senior Vice President – Corporate Strategy and Development Justin T. Binns 50 President, Global Architectural Karl J. Jorgenrud 49 President, Global Industrial Todd D. Rea 51 President, Consumer Brands Group Colin M. Davie 57 President & General Manager, Global Supply Chain Division, Consumer Brands Group Ms.
Binns served as President, Paint Stores Group from January 2023 to January 2024, President, The Americas Group from March 2022 to January 2023, President, Performance Coatings Group from November 2020 to March 2022 and President & General Manager, Automotive Finishes Division, 20 Table of Contents Performance Coatings Group from July 2018 to November 2020. Mr.
Binns served as President, Paint Stores Group from January 2023 to January 2024, President, The Americas Group from March 2022 to January 2023, President, Performance Coatings Group from November 2020 to March 2022 and President & General Manager, Automotive Finishes Division, Performance Coatings Group from July 2018 to November 2020. Mr.
Mr. Lang served as Vice President – Enterprise Finance, Reporting & Controls from May 2022 to January 2025. Mr. Lang served as Vice President – Assistant Corporate Controller from August 2019 to May 2022 and Director – External Financial Reporting from February 2018 until August 2019. Mr. Lang has been employed with the Company since February 2018. Mr.
Mr. Lang served as Vice President – Enterprise Finance, Reporting & Controls from May 2022 to January 2025. Mr. Lang served as Vice President – Assistant Corporate Controller from August 2019 to May 2022 and Director – External Financial Reporting from February 2018 until August 2019. Mr.
Executive officers are generally elected annually by the Board of Directors and hold office until their successors are elected and qualified or until their earlier death, resignation or removal. Name Age Position Heidi G. Petz 50 Chair, President and Chief Executive Officer Allen J. Mistysyn 56 Senior Vice President – Finance and Chief Financial Officer Marlena K.
Executive officers are generally elected annually by the Board of Directors and hold office until their successors are elected and qualified or until their earlier death, resignation or removal. Name Age Position Heidi G. Petz 51 Chair, President and Chief Executive Officer Benjamin E. Meisenzahl 44 Senior Vice President – Finance and Chief Financial Officer Marlena K.
Boyce 46 Senior Vice President – Human Resources Mary L. Garceau 52 Senior Vice President – Chief Legal Officer and Secretary James R. Jaye 58 Senior Vice President – Investor Relations and Corporate Communications J. Paul Lang 48 Senior Vice President – Enterprise Finance and Chief Accounting Officer Bryan J.
Boyce 47 Senior Vice President – Chief Human Resources Officer Mary L. Garceau 53 Senior Vice President – Chief Legal Officer and Secretary James R. Jaye 59 Senior Vice President – Investor Relations and Corporate Communications J. Paul Lang 49 Senior Vice President – Enterprise Finance and Chief Accounting Officer Bryan J.
Mistysyn has served as Senior Vice President – Finance and Chief Financial Officer since January 2017. Mr. Mistysyn has been employed with the Company since June 1990. Ms. Boyce has served as Senior Vice President – Human Resources since January 2025. Ms.
Boyce has served as Senior Vice President – Chief Human Resources Officer since October 2025. Ms. Boyce served as Senior Vice President – Human Resources from January 2025 to October 2025. Prior to that, Ms.
Added
Meisenzahl has served as Senior Vice President – Finance and Chief Financial Officer since January 2026. Mr. Meisenzahl served as Senior Vice President – Finance from May 2023 to January 2026, and as Senior Vice President – Finance Transformation from March 2021 to May 2023. Prior to that, Mr.
Added
Meisenzahl served within the Performance Coatings Group as Senior Vice President – Financial Excellence Initiatives from August 2020 to March 2021 and as Vice President – Finance, Industrial Wood Division from March 2018 to August 2020. Mr. Meisenzahl has been employed with the Company since January 2004. Ms.
Added
Lang has been employed with the Company since February 2018. 20 Table of Contents Mr. Young has served as Senior Vice President – Corporate Strategy and Development since March 2021. Mr. Young served as Vice President – Corporate Strategy and Development from June 2017 to March 2021. Mr.

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 Share Total Number of Shares Purchased as Part of a Publicly Announced Plan Maximum Number of Shares that May Yet Be Purchased Under the Plan October 1 – October 31 Share repurchase program (1) 850,000 $ 364.96 850,000 34,425,000 Employee transactions (2) 532 $ 389.91 N/A November 1 – November 30 Share repurchase program (1) 34,425,000 Employee transactions (2) 1,156 $ 384.70 N/A December 1 – December 31 Share repurchase program (1) 34,425,000 Employee transactions (2) 870 $ 358.75 N/A Total Share repurchase program (1) 850,000 $ 364.96 850,000 34,425,000 Employee transactions (2) 2,558 $ 376.96 — N/A (1) Shares were purchased through the Company’s publicly announced share repurchase program.
Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Plan Maximum Number of Shares that May Yet Be Purchased Under the Plan October 1 – October 31 Share repurchase program (1) — $ — — 29,975,000 Employee transactions (2) 1,921 $ 257.31 — N/A November 1 – November 30 Share repurchase program (1) 350,000 $ 337.27 350,000 29,625,000 Employee transactions (2) 586 $ 340.99 — N/A December 1 – December 31 Share repurchase program (1) — $ — — 29,625,000 Employee transactions (2) 1,913 $ 333.93 — N/A Total Share repurchase program (1) 350,000 $ 337.27 350,000 29,625,000 Employee transactions (2) 4,420 $ 301.57 — N/A (1) Shares were purchased through the Company’s publicly announced share repurchase program.
Peer group of companies is comprised of the following: Akzo Nobel N.V., Axalta Coating Systems Ltd., BASF SE, Genuine Parts Company, H.B. Fuller Company, The Home Depot, Inc., Lowe’s Companies, Inc., Masco Corporation, Newell Brands Inc., PPG Industries, Inc., RPM International Inc. and Stanley Black & Decker, Inc.
(1) Industry peer group of companies is comprised of the following: Akzo Nobel N.V., Axalta Coating Systems Ltd., BASF SE, Genuine Parts Company, H.B. Fuller Company, The Home Depot, Inc., Lowe’s Companies, Inc., Masco Corporation, Newell Brands Inc., PPG Industries, Inc., RPM International Inc. and Stanley Black & Decker, Inc.
(2) All shares were delivered to satisfy the exercise price and/or tax withholding obligations by employees who exercised stock options or had restricted stock units vest. 22 Table of Contents Comparison of Cumulative Total Return The following graph compares the cumulative total shareholder return on the Company’s common stock (NYSE: SHW) with the cumulative five-year total return of the companies listed on the Standard & Poor’s 500 Stock Index and the peer groups of companies selected on a line-of-business basis.
(2) All shares were delivered to satisfy the exercise price and/or tax withholding obligations by employees who exercised stock options or had restricted stock units vest. 22 Table of Contents Comparison of Cumulative Total Return The following graph compares the cumulative total shareholder return on the Company’s common stock (NYSE: SHW) with the cumulative five-year total return of the companies listed on the Standard & Poor’s 500 Stock Index and an industry peer group of companies selected on a line-of-business basis.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the New York Stock Exchange and traded under the symbol SHW. The number of shareholders of record at January 31, 2025 was 4,864.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the New York Stock Exchange and traded under the symbol SHW. The number of shareholders of record at January 31, 2026 was 4,662.
Issuer Purchases of Equity Securities The following table sets forth a summary of the Company’s purchases of common stock during the fourth quarter of 2024.
Issuer Purchases of Equity Securities The following table sets forth a summary of the Company’s purchases of common stock during the fourth quarter of 2025.
The cumulative five-year total return assumes $100 was invested on December 31, 2019 in Sherwin-Williams common stock, the S&P 500 and the peer group. The cumulative five-year total return, including reinvestment of dividends, represents the cumulative value through December 31, 2024.
The cumulative five-year total return assumes $100 was invested on December 31, 2020 in Sherwin-Williams common stock, the S&P 500 and the industry peer group. The cumulative five-year total return, including reinvestment of dividends, represents the cumulative value through December 31, 2025.
The Company had remaining authorization at December 31, 2024 to purchase 34,425,000 shares. There is no expiration date specified for the program.
The Company had remaining authorization at December 31, 2025 to purchase 29,625,000 shares. There is no expiration date specified for the program.

Item 7. Management's Discussion & Analysis

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

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Biggest changeYear Ended December 31, 2024 Paint Stores Group Consumer Brands Group Performance Coatings Group Administrative Total Net sales $ 13,188.0 $ 3,108.0 $ 6,797.3 $ 5.2 $ 23,098.5 Income before income taxes $ 2,902.6 $ 589.9 $ 1,027.9 $ (1,068.6) $ 3,451.8 as a percent of Net sales 22.0 % 19.0 % 15.1 % nm 14.9 % Acquisition-related amortization expense (1) 63.8 196.3 260.1 Adjusted segment profit $ 2,902.6 $ 653.7 $ 1,224.2 $ (1,068.6) $ 3,711.9 as a percent of Net sales 22.0 % 21.0 % 18.0 % nm 16.1 % Year Ended December 31, 2023 Paint Stores Group Consumer Brands Group Performance Coatings Group Administrative Total Net sales $ 12,839.5 $ 3,365.6 $ 6,843.1 $ 3.7 $ 23,051.9 Income before income taxes $ 2,860.8 $ 309.3 $ 991.6 $ (1,051.8) $ 3,109.9 as a percent of Net sales 22.3 % 9.2 % 14.5 % nm 13.5 % Items related to Restructuring Plan: Severance and other 14.2 (0.2) 1.3 15.3 Impairment of assets related to China divestiture 6.9 27.1 34.0 Gain on divestiture of domestic aerosol business (20.1) (20.1) Total — 21.1 (0.2) 8.3 29.2 Impairment related to trademarks 23.9 23.9 Devaluation of the Argentine peso 30.8 11.0 41.8 Acquisition-related amortization expense (1) 69.3 196.8 266.1 Adjusted segment profit $ 2,860.8 $ 454.4 $ 1,199.2 $ (1,043.5) $ 3,470.9 as a percent of Net sales 22.3 % 13.5 % 17.5 % nm 15.1 % nm -not meaningful (1) Acquisition-related amortization expense, which is included within Selling, general and administrative expenses, consists of the amortization of intangible assets related to the Valspar acquisition.
Biggest changeYear Ended December 31, 2025 Paint Stores Group Consumer Brands Group Performance Coatings Group Administrative Total Net sales $ 13,605.9 $ 3,166.4 $ 6,795.2 $ 6.8 $ 23,574.3 Income before income taxes $ 3,061.5 $ 509.6 $ 942.7 $ (1,175.6) $ 3,338.2 Percent to Net sales 22.5 % 16.1 % 13.9 % nm 14.2 % Acquisition-related amortization expense (1) 62.0 196.3 258.3 Severance and other restructuring expenses 39.1 17.9 54.0 111.0 Trademark impairment 17.8 17.8 Adjusted segment profit $ 3,061.5 $ 610.7 $ 1,174.7 $ (1,121.6) $ 3,725.3 Percent to Net sales 22.5 % 19.3 % 17.3 % nm 15.8 % Year Ended December 31, 2024 Paint Stores Group Consumer Brands Group Performance Coatings Group Administrative Total Net sales $ 13,188.0 $ 3,108.0 $ 6,797.3 $ 5.2 $ 23,098.5 Income before income taxes $ 2,902.6 $ 589.9 $ 1,027.9 $ (1,068.6) $ 3,451.8 Percent to Net sales 22.0 % 19.0 % 15.1 % nm 14.9 % Acquisition-related amortization expense (1) 63.8 196.3 260.1 Adjusted segment profit $ 2,902.6 $ 653.7 $ 1,224.2 $ (1,068.6) $ 3,711.9 Percent to Net sales 22.0 % 21.0 % 18.0 % nm 16.1 % nm - not meaningful (1) Acquisition-related amortization expense, which is included within Selling, general and administrative expenses, consists of the amortization of intangible assets related to the Valspar acquisition.
Based on facts and circumstances, the expense amounts recorded in AOCI can also have accelerated amortization due to certain plan changes, including those that result in a 38 Table of Contents curtailment. See Note 8 to the consolidated financial statements in Item 8 for information concerning the Company’s defined benefit pension plans and other postretirement benefit plans.
Based on facts and circumstances, the 38 Table of Contents expense amounts recorded in AOCI can also have accelerated amortization due to certain plan changes, including those that result in a curtailment. See Note 8 to the consolidated financial statements in Item 8 for further information concerning the Company’s defined benefit pension plans and other postretirement benefit plans.
Management, considering industry and Company-specific historical and projected data, develops growth rates and sales projections for each significant trademark. Terminal value rate determination follows common methodology of capturing the present value of perpetual sales estimates beyond the last projected period assuming a constant WACC and a low long-term growth rate.
Management, considering industry and Company-specific historical and projected data, develops growth rates and sales projections for each significant trademark. Terminal value rate determination follows common methodology of capturing the present value of perpetual sales estimates beyond the last projected period assuming a constant WACC and a long-term growth rate.
As an indicator that each reporting unit has been valued appropriately through the use of the discounted cash flow valuation model, the aggregate of all reporting units’ fair value is reconciled to the total market capitalization of the Company within a reasonable and supportable control premium. 37 Table of Contents The Company had seven components, some of which are aggregated due to similar economic characteristics, to form three reporting units (also the reportable operating segments) with goodwill as of October 1, 2024, the date of the annual impairment test.
As an indicator that each reporting unit has been valued appropriately through the use of the discounted cash flow valuation model, the aggregate of all reporting units’ fair value is reconciled to the total market capitalization of the Company within a reasonable and supportable control premium. 37 Table of Contents The Company had seven components, some of which are aggregated due to similar economic characteristics, to form three reporting units (also the reportable operating segments) with goodwill as of October 1, 2025, the date of the annual impairment test.
See Note 10 to the consolidated financial statements in Item 8 for information concerning the accrual for extended environmental-related activities and a discussion concerning unaccrued future loss contingencies.
See Note 10 to the consolidated financial statements in Item 8 for further information concerning the accrual for extended environmental-related activities and a discussion concerning unaccrued future loss contingencies.
See Note 13 to the consolidated financial statements in Item 8 for additional information concerning the Company’s defined contribution savings plan. 33 Table of Contents NON-GAAP FINANCIAL MEASURES Management utilizes certain financial measures that are not in accordance with US GAAP to analyze and manage the performance of the business. The required disclosures for these non-GAAP measures are shown below.
See Note 13 to the consolidated financial statements in Item 8 for further information concerning the Company’s defined contribution savings plan. 33 Table of Contents NON-GAAP FINANCIAL MEASURES Management utilizes certain financial measures that are not in accordance with US GAAP to analyze and manage the performance of the business. The required disclosures for these non-GAAP measures are shown below.
The Company performed the optional qualitative impairment test as of October 1, 2024, and determined that there was no indication of impairment on a more likely than not basis in the Company’s reporting units. Management tests indefinite-lived intangible assets for impairment at the asset level, as determined by appropriate asset valuations at acquisition.
The Company performed the optional qualitative impairment test as of October 1, 2025, and determined that there was no indication of impairment on a more likely than not basis in the Company’s reporting units. Management tests indefinite-lived intangible assets for impairment at the asset level, as determined by appropriate asset valuations at acquisition.
Management believes that the Company conducts its operations in compliance with applicable environmental laws and regulations and has implemented various programs designed to protect the environment and promote continued compliance. Depreciation of capital expenditures and other expenses related to ongoing environmental compliance measures were included in the normal operating expenses of conducting business.
Management believes that the Company conducts its operations in compliance with applicable environmental laws, regulations and requirements and has implemented various programs designed to help protect the environment and promote continued compliance. Depreciation of capital expenditures and other expenses related to ongoing environmental compliance measures were included in the normal operating expenses of conducting business.
The royalty savings valuation methodology and calculations used in 2024 impairment testing are consistent with prior years. The Company performed the optional qualitative impairment test as of October 1, 2024, and determined that there was indication of impairment on a more likely than not basis in certain of the Company’s trademarks.
The royalty savings valuation methodology and calculations used in 2025 impairment testing are consistent with prior years. The Company performed the optional qualitative impairment test as of October 1, 2025, and determined that there was indication of impairment on a more likely than not basis in certain of the Company’s trademarks.
Refer to the “Non-GAAP Financial Measures” section for a reconciliation of EBITDA to Net income. At December 31, 2024, the Company was in compliance with the covenant and expects to remain in compliance. The Company’s notes, debentures and revolving credit agreements contain various default and cross-default provisions.
Refer to the “Non-GAAP Financial Measures” section for a reconciliation of EBITDA to Net income. At December 31, 2025, the Company was in compliance with the covenant and expects to remain in compliance. The Company’s notes, debentures and revolving credit agreements contain various default and cross-default provisions.
The Company’s capital expenditures, depreciation and other expenses related to ongoing environmental compliance measures were not material to the Company’s financial condition, liquidity, cash flow or results of operations during 2024. Management does not expect that such capital expenditures, depreciation and other expenses will be material to the Company’s financial condition, liquidity, cash flow or results of operations in 2025.
The Company’s capital expenditures, depreciation and other expenses related to ongoing environmental compliance measures were not material to the Company’s financial condition, liquidity, cash flow or results of operations during 2025. Management does not expect that such capital expenditures, depreciation and other expenses will be material to the Company’s financial condition, liquidity, cash flow or results of operations in 2026.
As of October 1, 2024, the Company performed an analysis and determined that there were no events or changes in circumstances to suggest the carrying value of each long-lived asset group is not recoverable and therefore, no further impairment tests were performed.
As of October 1, 2025, the Company performed an analysis and determined that there were no events or changes in circumstances to suggest the carrying value of each long-lived asset group is not recoverable and therefore, no further impairment tests were performed.
For comparisons of the years ended December 31, 2023 and 2022, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed on February 20, 2024.
For comparisons of the years ended December 31, 2024 and 2023, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed on February 20, 2025.
In the event of default under any one of these arrangements, acceleration of the maturity of any one or more of these borrowings may result. See Note 7 to the consolidated financial statements in Item 8 for additional information.
In the event of default under any one of these arrangements, acceleration of the maturity of any one or more of these borrowings may result. See Note 7 to the consolidated financial statements in Item 8 for further information.
Short-term borrowings are primarily comprised of amounts outstanding under the Company’s domestic commercial paper program and various foreign credit facilities. The Company’s Long-term debt primarily consists of senior notes. The Company targets Net debt, which is total debt outstanding, net of Cash and cash equivalents, to be 2.0 to 2.5 times EBITDA.
Short-term borrowings are primarily comprised of amounts outstanding under the Company’s domestic commercial paper program, delayed draw term loans and various foreign credit facilities. The Company’s Long-term debt primarily consists of senior notes. The Company targets Net debt, which is total debt outstanding, net of Cash and cash equivalents, to be 2.0 to 2.5 times EBITDA.
Inventories Inventories are stated at the lower of cost or market with cost determined principally on the last-in, first-out (LIFO) method based on inventory quantities and costs determined during the fourth quarter and market representing current replacement cost, which is the cost to purchase or reproduce the inventory.
Inventories In accordance with the Inventory Topic of the ASC, inventories are stated at the lower of cost or market with cost determined principally on the last-in, first-out (LIFO) method based on inventory quantities and costs determined during the fourth quarter and market representing current replacement cost, which is the cost to purchase or reproduce the inventory.
See Note 4 to the consolidated financial statements in Item 8 for more information regarding the impact of the LIFO inventory valuation and the reserve for obsolescence.
See Note 4 to the consolidated financial statements in Item 8 for further information regarding the impact of the LIFO inventory valuation and the reserve for obsolescence.
In establishing the expected long-term rate of return on plan assets, management considered the historical rates of return, the nature of investments and an expectation for future investment strategies. The expected long-term rate of return on assets for the domestic defined benefit pension plan was 6.5% and 6.3% at December 31, 2024 and 2023, respectively.
In establishing the expected long-term rate of return on plan assets, management considered the historical rates of return, the nature of investments and an expectation for future investment strategies. The expected long-term rate of return on assets for the domestic defined benefit pension plan was 6.0% and 6.5% at December 31, 2025 and 2024, respectively.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in millions, except as noted and per share data) Company Background The Sherwin-Williams Company, founded in 1866, is engaged in the development, manufacture, distribution and sale of paint, coatings and related products to professional, industrial, commercial and retail customers primarily in North and South America with additional operations in the Caribbean region and throughout Europe, Asia and Australia.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in millions, except as noted and per share data) Company Background The Sherwin-Williams Company, founded in 1866, and its consolidated subsidiaries (collectively, the Company) are engaged in the development, manufacture, distribution and sale of paint, coatings and related products to professional, industrial, commercial and retail customers primarily in North and South America with additional operations in the Caribbean region and throughout Europe, Asia and Australia.
See Note 22 to the consolidated financial statements in Item 8 for additional information on the Company’s Reportable Segments.
See Note 22 to the consolidated financial statements in Item 8 for further information on the Company’s Reportable Segments.
See Note 7 to the consolidated financial statements in Item 8 for additional information on the Company’s outstanding debt.
See Note 7 to the consolidated financial statements in Item 8 for further information on the Company’s outstanding debt.
The expected long-term rate of return on assets for the foreign defined benefit pension plans was 4.8% at December 31, 2024 and 2023. In developing the assumed health care cost trend rates, management considered industry data, historical Company experience and expectations for future health care costs.
The expected long-term rate of return on assets for the foreign defined benefit pension plans was 5.1% and 4.8% at December 31, 2025 and 2024, respectively. In developing the assumed health care cost trend rates, management considered industry data, historical Company experience and expectations for future health care costs.
The Company is structured into three reportable segments – Paint Stores Group, Consumer Brands Group and Performance Coatings Group (collectively, the Reportable Segments) – and an Administrative function in the same way it is internally organized for assessing performance and making decisions regarding the allocation of resources.
The Company is structured into three reportable segments – Paint Stores Group, Consumer Brands Group and Performance Coatings Group (collectively, the Reportable Segments) – and an Administrative function, which is representative of the way it is internally organized for assessing performance and making decisions regarding the allocation of resources.
See Note 20 to the consolidated financial statements in Item 8 for information concerning income taxes. 39 Table of Contents
See Note 20 to the consolidated financial statements in Item 8 for further information concerning income taxes. 40 Table of Contents
The Paint Stores Group’s SG&A increased $194.1 million or 4.6% for the year primarily due to higher employee-related costs and investments in long-term growth initiatives, including increased spending from net new store openings and costs to support higher sales.
The Paint Stores Group’s SG&A increased $183.7 million, or 4.2% for the year primarily due to higher employee-related costs and investments in long-term growth initiatives, including increased spending from net new store openings and costs to support higher sales.
See Note 3 to the consolidated financial statements in Item 8 for additional information related to acquisitions. See Note 6 to the consolidated financial statements in Item 8 for a description of goodwill, intangible assets, historical impairments and summaries of the remaining carrying values of goodwill and intangible assets.
See Note 3 to the consolidated financial statements in Item 8 for further information related to acquisitions. See Note 6 to the consolidated financial statements in Item 8 for a description of goodwill, identifiable intangible assets, asset impairments and summaries of the remaining carrying values of goodwill and intangible assets.
As a percent of Net sales, SG&A increased 150 basis points compared to the same period in 2023 for these same reasons.
As a percent of Net sales, SG&A increased 50 basis points compared to the same period in 2024 for these same reasons.
The reader should refer to the determination of Net income and Net operating cash in accordance with US GAAP disclosed in the Statements of Consolidated Income and Statements of Consolidated Cash Flows in Item 8.
The reader should refer to the determination of Net income in accordance with US GAAP disclosed in the Statements of Consolidated Income in Item 8.
Net pension (credit) cost in 2025 for the domestic pension plan and foreign pension plans is expected to be approximately $(1.6) million and $5.3 million, respectively. Net periodic benefit credit for other postretirement benefits in 2025 is expected to be approximately $9.7 million.
Net pension (credit) cost in 2026 for the domestic pension plan and foreign pension plans is expected to be approximately $(3.2) million and $6.1 million, respectively. Net periodic benefit cost in 2026 for domestic other postretirement benefits is expected to be approximately $2.6 million.
The assumed health care cost trend rates for medical and prescription costs used to determine the projected benefit obligation for other postretirement benefit obligations at December 31, 2023 were 6.0% and 9.0%, respectively. The respective year-end assumptions described above for the Company’s defined benefit plans are also used to determine expense for the next year.
The assumed health care cost trend rates for medical and prescription costs used to determine the benefit obligation for domestic other postretirement benefit obligations at December 31, 2024 were 6.5% and 11.8%, respectively. The respective year-end assumptions described above for the Company’s defined benefit plans are also used to determine expense for the next year.
Net sales from stores in the Paint Stores Group open for more than twelve calendar months increased 1.7% in the year over the prior year comparable period. During 2024, the Paint Stores Group opened 84 new stores and closed 5 locations for a net increase of 79 stores.
Net sales from stores in the Paint Stores Group open for more than twelve calendar months increased 1.7% in the year over the prior year comparable period. During 2025, the Paint Stores Group opened 83 new stores and closed 3 locations for a net increase of 80 stores.
The Company believes that cash generated from operating activities and borrowings available under long-term and short-term debt, including its committed credit agreements and commercial paper program, will be sufficient for it to meet its contractual and other obligations and commercial commitments.
The Company believes that cash generated from operating activities and borrowings available under long-term and short-term debt, including its committed credit agreements and commercial paper program, will be sufficient for it to meet its contractual and other obligations and commercial commitments. The following tables summarize such obligations and commitments as of December 31, 2025.
The decrease in the effective rate was primarily due to a more favorable impact of tax benefits related to employee share-based payments. The other significant components of the Company’s effective tax rate were consistent year-over-year. See Note 20 to the consolidated financial statements in Item 8 for additional information.
The increase in the effective rate was primarily due to less favorable impacts of tax benefits related to employee share-based payments. The other significant components of the Company’s effective tax rate were consistent year-over-year. See Note 20 to the consolidated financial statements in Item 8 for further information.
The net working capital decrease is due to an increase in Short-term borrowings and a decrease in current assets, particularly Accounts receivable, net and Cash and cash equivalents, partially offset by an increase in Other current assets and a decrease in Accounts payable.
The net working capital increase is primarily due to an increase in current assets, particularly Accounts receivable, net and Other current assets and a decrease in the Current portion of long-term debt, partially offset by an increase in Short-term borrowings and Accounts payable.
The Company’s liability for other postretirement benefits decreased $12.1 million to $135.1 million at December 31, 2024 primarily due to benefits paid and changes in actuarial assumptions. The assumed discount rate used to determine the projected benefit obligation for the domestic defined benefit pension plan increased to 5.8% at December 31, 2024 from 5.1% at December 31, 2023.
The Company’s liability for domestic other postretirement benefits decreased $9.5 million to $125.6 million at December 31, 2025 primarily due to benefits paid and changes in actuarial assumptions. The assumed discount rate used to determine the projected benefit obligation for the domestic defined benefit pension plan decreased to 5.7% at December 31, 2025 from 5.8% at December 31, 2024.
The total number of stores in operation at December 31, 2024 was 4,773 in the United States, Canada and the Caribbean region. The Paint Stores Group’s objective is to expand its store base by an approximate average of 2% each year, primarily through organic growth. Sales of products other than paint increased 0.6% over last year.
The total number of stores in operation at December 31, 2025 was 4,853 in the United States, Canada and the Caribbean region. The Paint Stores Group’s objective is to grow sales through the expansion of its store base by an approximate average of 2% each year. Sales of products other than paint increased 0.5% over last year.
The assumed health care cost trend rates used to determine the projected benefit 30 Table of Contents obligation for other postretirement benefit obligations at December 31, 2024 were 6.5% and 11.8% for medical and prescription drug cost increases, respectively, both decreasing gradually to 4.5% in 2034.
The assumed health care cost trend rates used to determine the benefit obligation for domestic other postretirement benefit obligations at December 31, 2025 were 6.0% and 11.0% for medical and prescription drug cost increases, respectively, both decreasing gradually to 4.5% in 2034.
The Company will continue to recognize the related assets within Property, plant and equipment, net on the Consolidated Balance Sheets under US GAAP. These assets will be subject to depreciation over their useful lives in accordance with the Company’s accounting policies.
The Company will continue to recognize the related assets, including any capitalized interest, within Property, plant and equipment, net on the Consolidated Balance Sheets. These assets are subject to depreciation over their useful lives in accordance with the Company’s accounting policies.
Actuarial gains and losses and prior service costs are recognized and recorded in Accumulated other comprehensive income (AOCI). The amounts recorded in AOCI will continue to be modified as actuarial assumptions and service costs change, and all such amounts will be amortized to expense over a period of years through the net pension and net periodic benefit costs.
The amounts recorded in AOCI will continue to be modified as actuarial assumptions and service costs change, and all such amounts will be amortized to Net income over a period of years through the net pension and net periodic benefit costs.
The following table summarizes Free cash flow after dividends as calculated by management for the years indicated below: Year Ended December 31, 2024 2023 Net operating cash $ 3,153.2 $ 3,521.9 Capital expenditures (1,070.0) (888.4) Cash dividends (723.4) (623.7) Free cash flow after dividends $ 1,359.8 $ 2,009.8 34 Table of Contents Adjusted Diluted Net Income Per Share Management believes investors’ understanding of the Company’s operating performance is enhanced by the disclosure of diluted net income per share excluding Valspar acquisition-related amortization expense and certain other adjustments.
The following table summarizes Free cash flow after dividends as calculated by management for the years indicated below: 2025 2024 Net operating cash $ 3,451.6 $ 3,153.2 Capital expenditures (797.6) (1,070.0) Cash dividends (789.8) (723.4) Free cash flow after dividends $ 1,864.2 $ 1,359.8 34 Table of Contents Adjusted Diluted Net Income Per Share Management believes investors’ understanding of the Company’s operating performance is enhanced by the disclosure of diluted net income per share excluding Valspar acquisition-related amortization expense and certain other adjustments.
See Notes 3, 6 and 19 to the consolidated financial statements in Item 8 for additional information. 27 Table of Contents FINANCIAL CONDITION, LIQUIDITY AND CASH FLOW Overview The Company’s financial condition, liquidity and cash flow remained strong in 2024.
See Notes 1, 6 and 21 to the consolidated financial statements in Item 8 for further information. 27 Table of Contents FINANCIAL CONDITION, LIQUIDITY AND CASH FLOW Overview The Company’s financial condition, liquidity and cash flow remained strong in 2025.
Management considers EBITDA and Adjusted EBITDA useful in understanding the operating performance of the Company. The reader is cautioned that the Company’s EBITDA and Adjusted EBITDA should not be compared to other entities unknowingly.
Management considers EBITDA and Adjusted EBITDA useful in understanding the operating performance of the Company. The reader is cautioned that the Company’s EBITDA and Adjusted EBITDA should not be compared to other entities unknowingly. Further, EBITDA and Adjusted EBITDA should not be considered alternatives to Net income as an indicator of operating performance.
Changes in the Company’s accrual for product warranty claims during 2024 and 2023, including customer satisfaction settlements during the year, were as follows: 2024 2023 Balance at January 1 $ 40.4 $ 36.2 Charges to expense 34.2 37.0 Settlements (28.2) (32.8) Balance at December 31 $ 46.4 $ 40.4 Shareholders’ Equity Shareholders’ equity increased $335.4 million to $4.051 billion at December 31, 2024 from $3.716 billion last year.
Changes in the Company’s accrual for product warranty claims during 2025 and 2024, including customer satisfaction settlements during the year, were as follows: 2025 2024 Balance at January 1 $ 46.4 $ 40.4 Charges to expense 29.3 34.2 Settlements (18.4) (28.2) Balance at December 31 $ 57.3 $ 46.4 Shareholders’ Equity Shareholders’ equity increased $547.1 million to $4.598 billion at December 31, 2025 from $4.051 billion last year.
Defined Contribution Savings Plan Participants in the Company’s defined contribution savings plan are allowed to contribute up to the lesser of fifty percent of their annual compensation or the maximum dollar amount allowed under the Internal Revenue Code. The Company matches one hundred percent of all contributions up to six percent of eligible employee contributions.
Defined Contribution Savings Plan Participants in the Company’s defined contribution savings plan are allowed to contribute up to the lesser of fifty percent of their annual compensation or the maximum dollar amount allowed under the Internal Revenue Code.
This transaction did not meet the criteria for recognition as an asset sale under U.S. generally accepted accounting principles (US GAAP) and as such, was accounted for as a real estate financing transaction. The Company expects to receive total proceeds approximating $800 million to $850 million, with final proceeds expected in the first quarter of 2025.
This transaction did not meet the criteria for recognition as an asset sale under U.S. generally accepted accounting principles (US GAAP) and as such, was accounted for as a real estate financing transaction. The Company received the final proceeds for the new global headquarters in 2025 for a total of $800 million.
The following table summarizes the activity related to this transaction and the corresponding balances recognized in the Consolidated Balance Sheets. 2024 2023 2022 Activity: Proceeds received $ 244.2 $ 305.0 $ 210.0 Capitalized interest 45.2 23.8 Balances: Short-term liability $ 49.7 $ 39.9 $ 20.0 Long-term liability 715.9 475.9 187.0 Total liability $ 765.6 $ 515.8 $ 207.0 The net proceeds from this transaction and other real estate financing transactions are recognized as proceeds from real estate financing transactions within the Financing Activities section of the Statements of Consolidated Cash Flows.
The following table summarizes the activity related to this transaction and the corresponding balances recognized in the Consolidated Balance Sheets. 2025 2024 Activity: Proceeds received $ 40.9 $ 244.2 Capitalized interest 37.2 45.2 Balances: Short-term liability $ 51.0 $ 49.7 Long-term liability 762.0 715.9 Total liability $ 813.0 $ 765.6 The net proceeds from this transaction and other real estate financing transactions are recognized as Proceeds from real estate financing transactions within the Financing Activities section of the Statements of Consolidated Cash Flows.
Net sales of all operations other than consolidated foreign subsidiaries increased to $18.673 billion for 2024 compared to $18.624 billion for 2023. Net sales in the Paint Stores Group increased 2.7% primarily due to sales volume growth and selling price increases, which both impacted Net sales by a low-single digit percentage.
Net sales of all operations other than consolidated foreign subsidiaries increased to $18.959 billion for 2025 compared to $18.673 billion for 2024. Net sales in the Paint Stores Group increased 3.2% primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, partially offset by a low-single digit decrease in sales volume.
The following table presents Income before income taxes by segment and as a percent of Net sales by segment: Year Ended December 31, 2024 2023 $ Change % Change Income Before Income Taxes: Paint Stores Group $ 2,902.6 $ 2,860.8 $ 41.8 1.5 % Consumer Brands Group 589.9 309.3 280.6 90.7 % Performance Coatings Group 1,027.9 991.6 36.3 3.7 % Administrative (1,068.6) (1,051.8) (16.8) (1.6) % Total $ 3,451.8 $ 3,109.9 $ 341.9 11.0 % Income Before Income Taxes as a percent of Net sales: Paint Stores Group 22.0 % 22.3 % Consumer Brands Group 19.0 % 9.2 % Performance Coatings Group 15.1 % 14.5 % Administrative nm nm Total 14.9 % 13.5 % nm - not meaningful Income Tax Expense The effective income tax rate for 2024 was 22.3% compared to 23.2% in 2023.
The following table presents Income before income taxes by segment and as a percent of Net sales by segment: Year Ended December 31, 2025 2024 $ Change % Change Income Before Income Taxes: Paint Stores Group $ 3,061.5 $ 2,902.6 $ 158.9 5.5 % Consumer Brands Group 509.6 589.9 (80.3) (13.6) % Performance Coatings Group 942.7 1,027.9 (85.2) (8.3) % Administrative (1,175.6) (1,068.6) (107.0) (10.0) % Total $ 3,338.2 $ 3,451.8 $ (113.6) (3.3) % Income Before Income Taxes as a percent of Net sales: Paint Stores Group 22.5 % 22.0 % Consumer Brands Group 16.1 % 19.0 % Performance Coatings Group 13.9 % 15.1 % Administrative nm nm Total 14.2 % 14.9 % nm - not meaningful Income Tax Expense The effective income tax rate for 2025 was 23.1% compared to 22.3% in 2024.
See Note 3 to the consolidated financial statements in Item 8 for additional information on acquisitions and divestitures. Net financing cash usage decreased $407.5 million to a usage of $2.017 billion in 2024 from a usage of $2.425 billion in 2023.
See Note 3 to the consolidated financial statements in Item 8 for further information on acquisitions. Net financing cash usage decreased $638.5 million to a usage of $1.379 billion in 2025 from a usage of $2.017 billion in 2024.
The rate of compensation increases used to determine the projected benefit obligation at December 31, 2024 was 3.0% for the domestic pension plan and 3.3% for foreign pension plans, which was comparable to the rates used in the prior year.
In determining the rates of compensation increases, management considered historical Company increases as well as expectations for future increases. The rate of compensation increases used to determine the projected benefit obligation at December 31, 2025 was 3.0% for the domestic pension plan and 3.2% for foreign pension plans, which was comparable to the rates used in the prior year.
Defined Benefit Pension and Other Postretirement Benefit Plans In accordance with the accounting prescribed by the Retirement Benefits Topic of the ASC, the Company’s total liability for unfunded or underfunded defined benefit pension plans decreased $1.2 million to $67.8 million primarily due to changes in actuarial assumptions.
Defined Benefit Pension and Other Postretirement Benefit Plans In accordance with the accounting prescribed by the Retirement Benefits Topic of the ASC, the Company’s total liability for unfunded or underfunded defined benefit pension plans increased $15.5 million to $83.3 million primarily due to changes in actuarial assumptions and the acquisition of a Suvinil defined benefit pension plan.
Net sales in the Administrative function, which primarily consists of external leasing revenue, increased by an insignificant amount in 2024. 25 Table of Contents Income Before Income Taxes The following table presents the components of Income before income taxes as a percent of Net sales: Year Ended December 31, 2024 2023 % of Net Sales % of Net Sales Net sales $ 23,098.5 100.0 % $ 23,051.9 100.0 % Cost of goods sold 11,903.4 51.5 % 12,293.8 53.3 % Gross profit 11,195.1 48.5 % 10,758.1 46.7 % Selling, general and administrative expenses (SG&A) 7,422.1 32.1 % 7,065.4 30.6 % Other general (income) expense - net (38.8) (0.1) % 67.1 0.3 % Impairment — — % 57.9 0.3 % Interest expense 415.7 1.8 % 417.5 1.8 % Interest income (11.0) — % (25.2) (0.1) % Other (income) expense - net (44.7) (0.2) % 65.5 0.3 % Income before income taxes $ 3,451.8 14.9 % $ 3,109.9 13.5 % Consolidated Cost of goods sold decreased $390.4 million, or 3.2%, in 2024 compared to the same period in 2023 primarily due to lower sales volume in the Consumer Brands Group and moderating raw material costs, partially offset by higher sales volumes in the Paint Stores and Performance Coatings Groups.
Net sales in the Administrative function, which primarily consists of external leasing revenue, increased by an insignificant amount in 2025. 25 Table of Contents Income Before Income Taxes The following table presents the components of Income before income taxes as a percent of Net sales: Year Ended December 31, 2025 2024 % of Net Sales % of Net Sales Net sales $ 23,574.3 100.0 % $ 23,098.5 100.0 % Cost of goods sold 12,058.8 51.2 % 11,903.4 51.5 % Gross profit 11,515.5 48.8 % 11,195.1 48.5 % Selling, general and administrative expenses (SG&A) 7,695.0 32.6 % 7,422.1 32.1 % Other general (income) expense - net (10.2) — % (38.8) (0.1) % Impairment 17.8 0.1 % — — % Interest expense 465.0 1.9 % 415.7 1.8 % Interest income (11.2) (0.1) % (11.0) — % Other expense (income) - net 20.9 0.1 % (44.7) (0.2) % Income before income taxes $ 3,338.2 14.2 % $ 3,451.8 14.9 % Consolidated Cost of goods sold increased $155.4 million, or 1.3% in 2025 compared to the same period in 2024 primarily due to the impact of the October 2025 Suvinil acquisition, partially offset by moderating raw material costs and lower sales volume.
The assumed discount rate used to determine the projected benefit obligation for foreign defined benefit pension plans increased to 5.5% at December 31, 2024 from 4.8% at December 31, 2023. The assumed discount rate used to determine the projected benefit obligation for other postretirement benefit obligations increased to 5.6% at December 31, 2024 from 5.0% at December 31, 2023.
The assumed discount rate used to determine the projected benefit obligation for foreign defined benefit pension plans of 5.5% remained substantially the same at December 31, 2025 and December 31, 2024. The assumed discount rate used to determine the benefit obligation for domestic other postretirement benefit obligations decreased to 5.4% at December 31, 2025 from 5.6% at December 31, 2024.
The resulting quantitative impairment test performed as of October 1, 2024 did not result in any trademark impairment. The discounted cash flow and royalty savings valuation methodologies require management to make certain assumptions based upon information available at the time the valuations are performed from the perspective of a market participant.
The discounted cash flow and royalty savings valuation methodologies require management to make certain assumptions based upon information available at the time the valuations are performed from the perspective of a market participant.
Net Sales Year Ended December 31, 2024 2023 $ Change % Change Currency Impact Acquisition and Divestiture Impact Paint Stores Group $ 13,188.0 $ 12,839.5 $ 348.5 2.7 % — % — % Consumer Brands Group 3,108.0 3,365.6 (257.6) (7.7) % (2.9) % (1.4) % Performance Coatings Group 6,797.3 6,843.1 (45.8) (0.7) % (0.8) % 1.2 % Administrative 5.2 3.7 1.5 40.5 % 2.7 % — % Total $ 23,098.5 $ 23,051.9 $ 46.6 0.2 % (0.7) % 0.1 % Consolidated Net sales for 2024 increased 0.2% primarily due to higher sales in the Paint Stores Group.
Net Sales Year Ended December 31, 2025 2024 $ Change % Change Currency Impact Acquisition and Divestiture Impact Paint Stores Group $ 13,605.9 $ 13,188.0 $ 417.9 3.2 % (0.1) % 0.2 % Consumer Brands Group 3,166.4 3,108.0 58.4 1.9 % (1.1) % 5.3 % Performance Coatings Group 6,795.2 6,797.3 (2.1) — % 0.4 % 1.0 % Administrative 6.8 5.2 1.6 30.8 % 1.9 % — % Total $ 23,574.3 $ 23,098.5 $ 475.8 2.1 % (0.1) % 1.1 % Consolidated Net sales for 2025 increased 2.1% primarily due to higher Net sales in the Paint Stores and Consumer Brands Groups.
Also included in 2024 capital expenditures were expenditures related to manufacturing capacity expansion, operational efficiencies and maintenance projects in the Consumer Brands and Performance Coatings Groups and the opening of new paint stores and renovation and improvements in existing stores in the Paint Stores Group.
Additionally, the R&D center asset is depreciated over its useful life of 60 years. Also included in 2025 capital expenditures were expenditures related to manufacturing capacity expansion, operational efficiencies and maintenance projects in the Consumer Brands and Performance Coatings Groups and the opening of new paint stores and renovation and improvements in existing stores in the Paint Stores Group.
However, because litigation is inherently subject to many uncertainties and the ultimate result of any present or future litigation is unpredictable, the Company’s ultimate liability may result in costs that are significantly higher than currently accrued.
However, because litigation is inherently subject to many uncertainties and the ultimate result of any present or future litigation is unpredictable, the Company’s ultimate liability may result in costs that are significantly higher than currently accrued, and the recording of the additional liability may result in a material impact on Net income for the annual or interim period during which such additional liability is accrued.
In 2024, the allowance for current expected credit losses increased $0.8 million, or 1.3%. Inventories as a percent of Net sales decreased to 9.9% in 2024 from 10.1% in 2023. Inventory days outstanding was 93 days in 2024 compared to 94 days in 2023. The Company has sufficient total available borrowing capacity to fund its current operating needs.
Inventories as a percent of Net sales decreased to 9.8% in 2025 from 9.9% in 2024. Inventory days outstanding was 88 days in 2025 compared to 93 days in 2024. The Company has sufficient total available borrowing capacity to fund its current operating needs.
We will continue to support our growth strategy by executing initiatives within our enterprise priorities, including talent, simplification, digitization, supply chain responsiveness and sustainability. Within Paint Stores Group and Consumer Brands Group, we anticipate continued economic pressures to impact consumer behavior in both North America and Europe in 2025.
Significant opportunities exist for each business, and we will continue to support our growth strategy by executing initiatives within our enterprise priorities, including talent, simplification, digitization, supply chain responsiveness and sustainability. Within the Paint Stores and Consumer Brands groups, we anticipate continued economic pressures to impact customer buying behavior in 2026.
See Notes 1, 9, 10 and 20 to the consolidated financial statements in Item 8. Environmental Matters The operations of the Company, like those of other companies in the same industry, are subject to various federal, state and local environmental laws and regulations.
See Notes 1, 9, 10 and 16 to the consolidated financial statements in Item 8 for further information. Environmental-Related Liabilities The operations of the Company, like those of other companies in its industry, are subject to various domestic and foreign environmental laws and regulations.
See Notes 1, 16 and 19 to the consolidated financial statements in Item 8 for additional information related to the Company’s use of derivative instruments. The Company believes it may be exposed to continuing market risk from foreign currency exchange rate and commodity price fluctuations.
See Notes 1, 16 and 19 to the consolidated financial statements in Item 8 for further information on the use of derivative instruments. The Company believes it may experience losses from foreign currency translation and transactions, interest rate movement and commodity price fluctuations.
See Note 7 to the consolidated financial statements in Item 8 for a detailed description and summary of the Company’s outstanding debt, short-term borrowings and other available financing programs.
At December 31, 2025, the Company had unused capacity under its various credit agreements of $3.649 billion. See Note 7 to the consolidated financial statements in Item 8 for a detailed description and summary of the Company’s outstanding debt, short-term borrowings and other available financing programs.
Litigation and Other Contingent Liabilities In the course of its business, the Company is subject to a variety of claims and lawsuits, including, but not limited to, litigation relating to product liability and warranty, personal injury, environmental, intellectual property, commercial, contractual and antitrust claims.
Litigation and Other Contingent Liabilities In the course of its business, the Company is subject to a variety of actual and potential claims, lawsuits, and other proceedings, including, but not limited to, litigation relating to product liability and warranty, raw materials used in our products, personal injury, environmental (including alleged natural resource damages), intellectual property, commercial, contractual and antitrust claims, that are inherently subject to many uncertainties regarding the possibility of a loss to the Company.
As it relates to consolidated expenses, we expect raw material and employee-related costs to be up by a low-single digit percentage, offset by cost saving simplification efforts across our supply chain such as capacity and productivity improvements. Our capital deployment strategy remains balanced and consistent.
We will continue to monitor changes and impacts to our operations as we navigate this uncertain environment. We expect these costs and employee-related expenses to contribute to a low-single digit percentage increase, offset by cost saving simplification efforts across our supply chain such as capacity and productivity improvements. Our capital deployment strategy remains balanced and consistent.
On February 19, 2025, the Board of Directors increased the quarterly cash dividend to $0.79 per share. This quarterly dividend, if approved in each of the remaining quarters of 2025, would result in an annual dividend for 2025 of $3.16 per share, or a 30% payout of 2024 diluted net income per share.
This quarterly dividend, if approved in each of the remaining quarters of 2026, would result in an annual dividend for 2026 of $3.20 per share, or a 31% payout of 2025 diluted net income per share.
Consolidated Gross profit as a percent to consolidated Net sales increased to 48.5% in 2024 from 46.7% in 2023 for these same reasons. The Paint Stores Group’s Gross profit for 2024 increased $242.1 million compared to the same period in 2023 primarily due to higher Net sales driven by sales volume growth, selling price increases and moderating raw material costs.
The Paint Stores Group’s Gross profit for 2025 increased $364.2 million compared to the same period in 2024 primarily due to growth in Net sales from favorable selling prices and moderating raw material costs, partially offset by lower sales volume. The Paint Stores Group’s Gross profit as a percent of Net sales increased for these same reasons.
Income Taxes The Company estimates income taxes for each jurisdiction in which it conducts operations. This involves estimating taxable earnings, specific taxable and deductible items, the likelihood of generating sufficient future taxable income to utilize deferred tax assets and possible exposures related to future tax audits.
This involves estimating taxable earnings, specific taxable and deductible items, the likelihood of generating sufficient future taxable income to utilize deferred tax assets and possible exposures related to future tax audits. To the extent these estimates change, adjustments to deferred and accrued income taxes will be made in the period in which the changes occur.
Full year Net sales grew to a record level, gross margin expanded and Diluted net income per share increased by a double-digit percentage. We continued to generate strong cash flow from operations which was used for investment, an acquisition and returning cash to shareholders through dividends and repurchases of our common stock.
Full year Net sales grew to a record level, and gross profit and gross margin expanded. The Company continued to generate strong cash flow from operations, which was used for investment in capital expenditures, funding acquisitions and returning cash to shareholders through dividends and repurchases of common stock.
The following table summarizes EBITDA and Adjusted EBITDA as calculated by management for the years indicated below: Year Ended December 31, 2024 2023 Net income $ 2,681.4 $ 2,388.8 Interest expense 415.7 417.5 Income taxes 770.4 721.1 Depreciation 297.4 292.3 Amortization 326.6 330.2 EBITDA $ 4,491.5 $ 4,149.9 Restructuring expense — 9.6 Impairment related to Restructuring Plan — 34.0 Gain on divestiture of domestic aerosol business — (20.1) Impairment related to trademarks — 23.9 Devaluation of the Argentine peso — 41.8 Adjusted EBITDA $ 4,491.5 $ 4,239.1 Free Cash Flow After Dividends Free cash flow after dividends is a non-GAAP financial measure defined as Net operating cash, as shown in the Statements of Consolidated Cash Flows, less the amount reinvested in the business for capital expenditures and the return on investment to its shareholders by the payments of cash dividends.
The following table reconciles Net income computed in accordance with US GAAP to EBITDA and Adjusted EBITDA as calculated by management for the years indicated below: 2025 2024 Net income $ 2,568.5 $ 2,681.4 Interest expense 465.0 415.7 Income taxes 769.7 770.4 Depreciation 340.3 297.4 Amortization 336.6 326.6 EBITDA 4,480.1 4,491.5 Severance and other restructuring expenses 111.0 — Trademark impairment 17.8 — Adjusted EBITDA $ 4,608.9 $ 4,491.5 Free Cash Flow After Dividends Free cash flow after dividends is a non-GAAP financial measure defined as Net operating cash, as shown in the Statements of Consolidated Cash Flows, less the amount reinvested in the business for capital expenditures and the return on investment to its shareholders by the payments of cash dividends.
Year Ended December 31, 2024 Pre-Tax Tax Effect (1) After-Tax Diluted net income per share $ 10.55 Acquisition-related amortization expense (2) $ 1.02 $ .24 .78 Adjusted diluted net income per share $ 11.33 Year Ended December 31, 2023 Pre-Tax Tax Effect (1) After-Tax Diluted net income per share $ 9.25 Items related to Restructuring Plan: Severance and other $ .06 $ .02 .04 Impairment of assets related to China divestiture .13 .08 .05 Gain on divestiture of domestic aerosol business (.08) (.02) (.06) Discrete income tax expense related to China divestiture (1) — (.06) .06 Total .11 .02 .09 Impairment related to trademarks .09 .02 .07 Devaluation of the Argentine peso .16 — .16 Acquisition-related amortization expense (2) 1.03 .25 .78 Adjusted diluted net income per share $ 10.35 (1) The tax effect is calculated based on the statutory rate and the nature of the item, unless otherwise noted.
Year Ended December 31, 2025 Pre-Tax Tax Effect (1) After-Tax Diluted net income per share $ 10.26 Acquisition-related amortization expense (2) $ 1.03 $ .25 .78 Severance and other restructuring expenses .44 .10 .34 Trademark impairment .07 .02 .05 Adjusted diluted net income per share $ 11.43 Year Ended December 31, 2024 Pre-Tax Tax Effect (1) After-Tax Diluted net income per share $ 10.55 Acquisition-related amortization expense (2) $ 1.02 $ .24 .78 Adjusted diluted net income per share $ 11.33 (1) The tax effect is calculated based on the statutory rate and the nature of the item, unless otherwise noted.
Net Income Per Share Diluted net income per share for 2024 increased to $10.55 per share from $9.25 per share in 2023. Currency translation rate changes decreased diluted net income per share by $0.06 per share for 2024. Diluted net income per share in 2024 included acquisition-related amortization expense of $0.78 per share.
Net Income Per Share Diluted net income per share for 2025 decreased to $10.26 per share from $10.55 per share in 2024. Currency translation rate changes decreased diluted net income per share by $0.06 per share in 2025.
Property, Plant and Equipment Property, plant and equipment, net increased $696.4 million to $3.533 billion at December 31, 2024 primarily due to capital expenditures of $1.014 billion and assets acquired through a business combination of $32.9 million, partially offset by depreciation expense of $297.4 million and foreign currency translation and other adjustments of $52.6 million.
Property, Plant and Equipment Property, plant and equipment, net increased $604.2 million to $4.137 billion at December 31, 2025 primarily due to capital expenditures of $745.9 million, assets acquired through business combinations of $153.7 million and foreign currency translation and other adjustments of $44.9 million, offset by depreciation expense of $340.3 million.
Net sales of all consolidated foreign subsidiaries decreased to $4.426 billion in 2024 compared to $4.428 billion in 2023 primarily due to unfavorable currency translation impact in Latin America and lower Net sales in Asia as a result of the divestiture of the China architectural business, partially offset by higher Net sales in Europe as a result of acquisitions.
Net sales of all consolidated foreign subsidiaries increased to $4.615 billion in 2025 compared to $4.426 billion in 2024 primarily as a result of the higher Net sales in Latin America due to the October 2025 acquisition of Suvinil, partially offset by unfavorable foreign currency translation driven by Latin America.
Summary • Consolidated Net sales increased in the year to a record $23.099 billion ◦ Net sales from stores in the Paint Stores Group open more than twelve calendar months increased 1.7% in the year • Diluted net income per share increased 14.1% to $10.55 per share in the year compared to $9.25 per share in the full year 2023 ◦ Adjusted diluted net income per share increased 9.5% to $11.33 per share in the year compared to $10.35 per share in the full year 2023 • Generated Net operating cash of $3.153 billion, or 13.7% of Net sales, in the year • Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) increased 6.0% in the year to $4.492 billion or 19.4% of Net sales Outlook Sherwin-Williams delivered strong 2024 results despite continued choppy macroeconomic conditions.
Summary • Consolidated Net sales increased 2.1% in the year to $23.574 billion ◦ Net sales from stores in the Paint Stores Group open more than twelve calendar months increased 1.7% in the year • Diluted net income per share decreased 2.7% to $10.26 per share in the year compared to $10.55 per share in the full year 2024 ◦ Adjusted diluted net income per share increased 0.9% to $11.43 per share in the year compared to $11.33 per share in the full year 2024 • Generated Net operating cash of $3.452 billion, or 14.6% of Net sales in the year Outlook Sherwin-Williams delivered strong 2025 results driven by solid core performance and a focus on operational discipline despite continued demand choppiness.
However, the Company does not expect that foreign currency exchange rate and commodity price fluctuations or hedging contract losses will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. See Notes 1 and 19 to the consolidated financial statements in Item 8 for additional information related to foreign currency translation.
However, the Company does not expect foreign currency translation or transactions, interest rate movement, commodity price fluctuations or hedging contract losses to have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Financial Covenant Certain borrowings contain a consolidated leverage covenant.
Net investing cash usage increased $157.0 million to a usage of $1.196 billion in 2024 from a usage of $1.039 billion in 2023 primarily due to an increase in cash used for capital expenditures, proceeds from the divestiture of a business in 2023 and reduced proceeds from the sale of assets, partially offset by lower cash used for acquisitions.
Net investing cash usage increased $870.0 million to a usage of $2.066 billion in 2025 from a usage of $1.196 billion in 2024 primarily due to an increase in cash used for the Suvinil acquisition in the current year, partially offset by a decrease in capital expenditures.
Goodwill and Intangible Assets Goodwill, which represents the excess of cost over the fair value of net assets acquired in business combinations, decreased $45.9 million to $7.580 billion at December 31, 2024, due to foreign currency translation rate fluctuations of $94.1 million, partially offset by purchase accounting allocations of $48.2 million.
Goodwill and Intangible Assets Goodwill, which represents the excess of cost over the fair value of net assets acquired in business combinations, increased $456.5 million to $8.037 billion at December 31, 2025, due to purchase accounting allocations of $306.8 million, primarily related to the Suvinil acquisition, and foreign currency translation rate fluctuations and other adjustments of $149.7 million.
Consolidated Gross profit increased $437.0 million, or 4.1%, in 2024 compared to the same period in 2023 primarily due to higher sales volumes in the Paint Stores and Performance Coatings Groups and moderating raw material costs, partially offset by lower sales volume in the Consumer Brands Group.
Consolidated Gross profit increased $320.4 million, or 2.9% in 2025 compared to the same period in 2024 primarily due to favorable selling prices in the Paint Stores Group, the acquisition of Suvinil within the Consumer Brands Group and moderating raw material costs, partially offset by unfavorable product mix within the Performance Coatings Group.
The Company generated $3.153 billion in Net operating cash and invested $1.014 billion in capital expenditures and approximately $80 million in the acquisition of a metal packaging coatings business. The Company also returned cash of $2.462 billion to shareholders in the form of cash dividends and share repurchases during the year. The Company’s EBITDA increased 8.2% to $4.492 billion.
The Company generated $3.452 billion in Net operating cash and invested approximately $1.15 billion in the acquisition of Suvinil and $797.6 million in capital expenditures. Cash of $2.446 billion was returned to shareholders in the form of cash dividends and share repurchases during the year.
We have a strong liquidity position, with $210.4 million in cash and $3.274 billion of unused capacity under our credit facilities at December 31, 2024 and expect to end 2025 within our target debt-to-EBITDA leverage ratio of 2 to 2.5 times. We are, and expect to remain, in compliance with all financing covenants.
We have a strong liquidity position, with $207.2 million in cash and $3.649 billion of unused capacity under our credit facilities at December 31, 2025. We are, and expect to remain, in compliance with all financing covenants. Long-term debt maturities due in 2026 are $350.1 million, which were fully repaid in January 2026 with short-term borrowings.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe Company entered into forward foreign currency exchange contracts during 2024, 2023 and 2022 primarily to hedge against value changes in foreign currency. There were no material contracts outstanding at December 31, 2024. Forward foreign currency exchange contracts are described in Note 19 to the consolidated financial statements in Item 8.
Biggest changeIn addition, the Company entered into forward foreign currency exchange contracts during 2025, 2024 and 2023 primarily to hedge value changes in foreign currency. There were no material contracts outstanding at December 31, 2025.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to market risk associated with interest rates, foreign currency and commodity fluctuations. We occasionally utilize derivative instruments as part of our overall financial risk management policy, but do not use derivative instruments for speculative or trading purposes.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company is exposed to market risk associated with interest rates, foreign currency and commodity fluctuations. The Company occasionally utilizes derivative instruments as part of its overall financial risk management policy, but does not use derivative instruments for speculative or trading purposes.
In 2024, 2023 and 2022, the Company utilized U.S. dollar to euro cross currency swap contracts to hedge the Company’s net investment in its European operations. The contracts have been designated as net investment hedges and have various maturity dates. See Note 16 to the consolidated financial statements in Item 8.
In 2025, 2024 and 2023, the Company utilized U.S. dollar to euro cross currency swap contracts to hedge the Company’s net investment in its European operations. The contracts have been designated as net investment hedges and have various maturity dates.
We believe we may experience continuing losses from foreign currency fluctuations. However, we do not expect currency translation, transaction or hedging contract losses to have a material adverse effect on our financial condition, results of operations or cash flows. 40 Table of Contents
However, the Company does not expect foreign currency translation or transactions, interest rate movement, commodity price fluctuations or hedging contract losses to have a material adverse effect on the Company’s financial condition, results of operations or cash flows. 41 Table of Contents
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The Company entered into interest rate lock contracts in 2025 to hedge the variability in the benchmark interest rate for the 2025 issuance of long-term fixed rate debt. The contracts were designated as cash flow hedges and settled in 2025.
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See Notes 1, 16 and 19 to the consolidated financial statements in Item 8 for further information on the use of derivative instruments. The Company believes it may experience losses from foreign currency translation and transactions, interest rate movement and commodity price fluctuations.

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