Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

This Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") supplements the unaudited Interim Consolidated Financial Statements and the related notes thereto included elsewhere herein to help provide an understanding of our financial condition, changes in our financial condition, and the results of our operations for the periods presented. Unless the context otherwise requires, references herein to "The Chemours Company", "Chemours", "the Company", "our Company", "we", "us", and "our" refer to The Chemours Company and its consolidated subsidiaries. References herein to "EID" refer to EIDP, Inc., formerly known as E. I. du Pont de Nemours and Company, which is our former parent company and is now a subsidiary of Corteva, Inc. ("Corteva"), a Delaware corporation. References herein to "DuPont" refer to DuPont de Nemours, Inc., a Delaware Corporation.

This MD&A should be read in conjunction with the unaudited Interim Consolidated Financial Statements and the related notes thereto included in Item 1 of this Quarterly Report on Form 10-Q, as well as our audited Consolidated Financial Statements and the related notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025.

This section and other parts of this Quarterly Report on Form 10-Q contain forward-looking statements, within the meaning of the federal securities laws, that involve risks and uncertainties. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. The words "believe", "expect", "anticipate", "plan", "estimate", "target", "project", and similar expressions, among others, generally identify "forward-looking statements", which speak only as of the date the statements were made. The matters discussed in these forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those set forth in the forward-looking statements.

Our forward-looking statements are based on certain assumptions and expectations of future events that may not be accurate or realized. These statements, as well as our historical performance, are not guarantees of future performance. Forward-looking statements also involve risks and uncertainties that are beyond our control. Additionally, there may be other risks and uncertainties that we are unable to identify at this time or that we do not currently expect to have a material impact on our business. Factors that could cause or contribute to these differences include, but are not limited to, the risks, uncertainties, and other factors discussed in the Forward-looking Statements and the Risk Factors sections in our Annual Report on Form 10-K for the year ended December 31, 2025, and as otherwise discussed in this report. We assume no obligation to revise or update any forward-looking statement for any reason, except as required by law.

Overview

We are a leading, global provider of performance chemicals that are key inputs in end-products and processes in a variety of industries. We deliver customized solutions with a wide range of industrial and specialty chemical products for markets, including refrigeration and air conditioning, paints and coatings, plastics, transportation, semiconductor and consumer electronics, general industrial, and oil and gas. Our principal products include refrigerants, titanium dioxide ("TiO2") pigment and industrial fluoropolymer resins. We manage and report our operating results through three principal reportable segments: Thermal & Specialized Solutions, Titanium Technologies, and Advanced Performance Materials. Our Thermal & Specialized Solutions segment is a leading, global provider of refrigerants, thermal management solutions, propellants, blowing agents, and specialty solvents. Our Titanium Technologies segment is a leading, global provider of TiO2 pigment, a premium white pigment used to deliver whiteness, brightness, opacity, and protection in a variety of applications. Our Advanced Performance Materials segment is a leading, global provider of high-end polymers and advanced materials that deliver unique attributes, including low friction coefficients, extreme temperature resistance, weather resistance, ultraviolet and chemical resistance, and electrical insulation.

Our world-class product portfolio enables the performance and convenience of everyday products, processes, and technologies people rely on in their daily lives, making our products and the solutions they enable both vital and essential. We are committed to creating value for our customers and stakeholders by leveraging strengths that we use to create competitive advantage: our innovation and technical expertise, our ability to operate complex manufacturing sites safely, our deep customer relationships based on trust and reliability, and our talented workforce. Every day our people bring our chemistry to life, guided by five core values that form the bedrock foundation for how we operate: (i) Safety - we are committed to protecting people and the environment; (ii) Integrity - we do what's right; (iii) Partnership - we win through collaboration with the right internal and external partners; (iv) Ownership - we are each accountable for the Company's success; (v) Respect - we treat people well, include others, and value diverse perspectives.

Our core values, in unison with our company vision of Trusted Chemistry, helping people live better lives and communities thrive, underpin our commitment to our stakeholders. Our values and vision cannot be separated from our business strategy.

The Chemours Company

At Chemours, our approach to Sustainability begins with our vision to deliver Trusted Chemistry that helps people live better lives and communities to thrive. In 2018, we set forth ambitious Corporate Responsibility Commitment ("CRC") goals that we aim to achieve by 2030. These goals are designed to promote accountability and enable us to measure and transparently report the progress and impact of our sustainability commitment. Leveraging a robust governance framework, we are working to integrate sustainability across our organization and our business management processes. Our work in sustainability creates value for our shareholders by protecting our right to operate, meeting the needs of our customers, and advancing our corporate strategy, Pathway to Thrive. We understand that maintaining safe, sustainable operations has an impact on us, our communities, the environment, and our collective future. We deliver for our customers and society by designing sustainable offerings that perform at the highest level while minimizing impact on the environment. We are a leader in responsible manufacturing and we value partnership and collaboration to drive change. We are committed to continue working with policymakers, our value chain, and other organizations to find solutions that meet science-based regulations and address community needs.

Recent Developments

Tariffs

The chemicals sector has been and continues to be impacted by changes in U.S. and foreign trade policies, particularly the introduction and adjustment of tariffs by the United States as well as foreign retaliatory tariffs. We actively monitor changes and adjust our operations accordingly to enhance supply chain flexibility, including taking certain pricing actions and evaluating opportunities to source products not directly impacted by existing or potential tariffs. After the U.S. Supreme Court ruled in February 2026 that the International Emergency Economic Powers Act ("IEEPA") does not authorize the President of the United States (the "President") to impose tariffs, U.S. Customs and Border Protection established a process to return paid IEEPA tariffs to importers. The Company began receiving IEEPA refunds during the second quarter of 2026. In July 2026, the President imposed additional tariffs under Section 301 of the Trade Act of 1974 and Section 338 of the Tariff Act of 1930, which apply to the vast majority of U.S. imports. The President also has imposed additional tariffs on certain products under Section 232 of the Trade Expansion Act of 1962. The long-term impact of tariffs, including potential changes to existing tariffs or the imposition of further retaliatory trade measures, as well as possible tariff refunds, on our business, financial condition and results of operations remains uncertain.

The Chemours Company

Results of Operations and Business Highlights

Results of Operations

The following table sets forth our results of operations for the three and six months ended June 30, 2026 and 2025.

The Chemours Company

Net Sales

The following table sets forth the impacts of price, volume, currency, and portfolio changes on our net sales for the three and six months ended June 30, 2026.

Our net sales were relatively flat at $1.6 billion for the three months ended June 30, 2026 and 2025, as a decrease in volume of 4% was offset by an increase in price of 2% and favorable currency movements of 1%. The decrease in volume was primarily driven by lower volumes in Thermal & Specialized Solutions ("TSS") and Advanced Performance Materials ("APM") segments, while the increase in price was attributable to our TSS and Titanium Technologies ("TT") segments.

Our net sales were relatively flat at $3 billion for the six months ended June 30, 2026 and 2025, as a 4% decrease in volume was offset by a 2% increase in price and favorable currency movements adding a 2% tailwind to the segment's net sales as compared to the same period in the prior year. The decrease in volume was primarily driven by lower volumes in our APM and TT segment, while the increase in price was attributable to our TSS segment.

The key drivers of these changes for each of our reportable segments are discussed further under the "Segment Reviews" section within this MD&A.

Cost of Goods Sold

Our cost of goods sold ("COGS") was relatively flat at $1.3 billion and $2.5 billion for the three and six months ended June 30, 2026, respectively, compared with COGS of $1.3 billion and $2.5 billion for the same periods in 2025.

Selling, General, and Administrative Expense

Our selling, general, and administrative ("SG&A") expense increased by $45 million (or 11%) and $69 million (or 13%) to $469 million and $616 million for the three and six months ended June 30, 2026, respectively, compared with SG&A expense of $424 million and $547 million for the same periods in 2025. The increase in our SG&A expense for the three months ended June 30, 2026 was primarily attributable to an increase of approximately $120 million related to adjustments to environmental reserves, as well as a decrease of approximately $10 million in the MOU benefit related to litigation costs. This was partially offset by lower corporate litigation related charges and legacy legal fees in the period of approximately $90 million. The increase in our SG&A expense for the six months ended June 30, 2026 was primarily attributable to an increase of approximately $120 million related to adjustments to environmental reserves, and a decrease of approximately $20 million in the MOU benefit related to litigation costs. This was partially offset by lower corporate litigation related charges and legacy legal fees in the period of approximately $60 million.

Research and Development Expense

Our research and development ("R&D") expense was largely unchanged at $27 million and $53 million for the three and six months ended June 30, 2026, respectively, compared with R&D expense of $28 million and $55 million for the same periods in 2025.

Restructuring, Asset-Related, and Other Charges

Our restructuring, asset-related, and other charges decreased by $15 million (or 83%) and $35 million (or 69%) to $3 million and $16 million for the three and six months ended June 30, 2026, respectively, compared with restructuring, asset-related, and other charges of $18 million and $51 million for the same periods in 2025. Our restructuring, asset-related, and other charges for the three and six months ended June 30, 2026 were attributable to $2 million and $6 million, respectively, of charges related to our decision to exit our SPS CapstoneTM business, along with $1 million and $1 million, respectively, of decommissioning and other charges related to the Titanium Technologies Transformation Program. Additionally, for the six months ended June 30, 2026, our restructuring, asset-related, and other charges were attributable to employee separation charges of $9 million related to the 2026 Restructuring Program. Our restructuring, asset-related, and other charges for the three and six months ended June 30, 2025 were primarily attributable to $17 million and $45 million, respectively, of charges related to our decision to exit our SPS CapstoneTM business, along with $1 million and $5 million, respectively, of decommissioning and other charges related to the Titanium Technologies Transformation Program.

The Chemours Company

Equity in Earnings of Affiliates

Our equity in earnings of affiliates was flat at $9 million and $17 million for the three and six months ended June 30, 2026, respectively, compared with equity in earnings of affiliates of $9 million and $17 million for the same periods in 2025.

Interest Expense, Net

Our interest expense, net increased by $1 million (or 1%) and $4 million (or 3%) to $68 million and $137 million for the three and six months ended June 30, 2026, respectively, compared with interest expense, net of $67 million and $133 million for the same periods in 2025. The increase in our interest expense, net was primarily attributable to higher interest rates on our variable rate debt following the amendment to the Amended and Restated Credit Agreement related to the 2032 U.S. Dollar Term Loan in October 2025 and higher interest rates on the issuance of the 2034 Notes in March 2026.

Loss on Extinguishment of Debt

For the three and six months ended June 30, 2026, we recognized a loss on extinguishment of debt of $2 million and $11 million, respectively, related to the partial early redemption of the senior secured Euro term loan due August 2028, along with costs associated with early redemption of the senior unsecured notes due May 2027 and partial early redemption of the senior unsecured notes due November 2028, respectively. See "Note 15 - Debt" to the Interim Consolidated Financial Statements for further details.

Other Income, Net

Our other income, net increased by $271 million (or over 100%) and $290 million (or over 100%) to $273 million and $296 million for the three and six months ended June 30, 2026, respectively, compared with other income, net of $2 million and $6 million for the same periods in 2025. The increase in our other income, net was primarily attributable to the gain on sale of nine parcels of land sold in Kuan Yin, Taiwan in the second quarter of 2026. See "Note 10 - Property, Plant, and Equipment, Net" related to the to the Interim Consolidated Financial Statements for further details.

Provision for Income Taxes

We recognized a provision for income taxes of $273 million and $131 million for the three months ended June 30, 2026 and 2025, respectively.

There was a $142 million increase in our provision for income taxes for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. Our provision for income taxes for the three months ended June 30, 2026 was primarily attributable to the geographical mix of earnings and the recognition of a full valuation allowance against our U.S. federal and state deferred tax assets, inclusive of approximately $208 million related to prior year deferred tax assets, as a result of matters discussed in "Note 17 - Commitments and Contingent Liabilities". Additionally, our provision for income taxes was impacted by profit in inventory, withholding taxes on the repatriation of earnings, the non-taxable gain on the Company's sale of land for local Taiwanese tax purposes, and a foreign derived deduction eligible income tax benefit resulting from tax law changes pursuant to the 2025 Tax Act. Our provision for the three months ended June 30, 2025 was primarily attributable to $169 million tax expense to record a valuation allowance against our deferred tax asset for U.S. federal and state interest carryforwards, as well as $9 million tax expense to record valuation allowances against certain U.S. state and foreign net operating loss carryforwards. These were partially offset by a $66 million tax benefit related to environmental and litigation reserve, both recorded during the quarter.

We had a provision for income taxes of $281 and $135 million for the six months ended June 30, 2026 and 2025, respectively. There was a $146 million increase in our provision for income taxes for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Our provisions for the six months ended June 30, 2026 and for the six months ended June 30, 2025 were primarily attributable to the same factors discussed above.

The Chemours Company

Segment Reviews

We operate through three principal reportable segments, which were organized based on their similar economic characteristics, the nature of products and production processes, end-use markets, channels of distribution, and regulatory environments: Thermal & Specialized Solutions, Titanium Technologies, and Advanced Performance Materials. Other Non-Reportable Segment includes the Company's Performance Chemicals and Intermediates business.

Adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") is the primary measure of segment profitability used by our Chief Operating Decision Maker ("CODM") and is defined as income (loss) before income taxes, excluding the following:

A reconciliation of Segment Adjusted EBITDA to our consolidated income (loss) before income taxes for the three and six months ended June 30, 2026 and 2025 is included in "Note 23 - Segment Information" to the Interim Consolidated Financial Statements.

The Chemours Company

Thermal & Specialized Solutions

The following table sets forth the net sales, Adjusted EBITDA, and Adjusted EBITDA margin amounts for our Thermal & Specialized Solutions segment for the three and six months ended June 30, 2026 and 2025.

The following table sets forth the impacts of price, volume, currency, and portfolio changes on our Thermal & Specialized Solutions segment's net sales for the three and six months ended June 30, 2026.

Segment Net Sales

Our Thermal & Specialized Solutions segment's net sales decreased by $6 million (or 1%) to $591 million for the three months ended June 30, 2026, compared with segment net sales of $597 million for the same period in 2025. The decrease in segment net sales for the three months ended June 30, 2026 was primarily attributable to a 4% decrease in volume, partially offset by a 2% increase in price and favorable currency movements adding a 1% tailwind to the segment's net sales. The decrease in volumes was primarily attributable to lower stationary AC aftermarket refrigerant sales of TSS Opteon™ blends in North America, compared with elevated demand in the second quarter of 2025 driven by the stationary technology transition under the U.S. AIM Act, partially offset by higher Freon™ prices, primarily in the automotive segment.

Our Thermal & Specialized Solutions segment's net sales increased by $95 million (or 9%) to $1.2 billion for the six months ended June 30, 2026, compared with segment net sales of $1.1 billion for the same period in 2025. The increase in segment net sales for the six months ended June 30, 2026 was primarily attributable to an increase in prices of 6%, volumes of 1%, and favorable currency movements adding a 2% tailwind to the segment's net sales as compared to the same period in the prior year. The increase in volume and price was primarily attributable to the aforementioned higher Freon™ sales.

Adjusted EBITDA and Adjusted EBITDA Margin

For the three months ended June 30, 2026, segment Adjusted EBITDA increased by $6 million (or 3%) to $213 million and Adjusted EBITDA margin increased by approximately 100 basis points to 36%, compared with segment Adjusted EBITDA of $207 million and Adjusted EBITDA margin of 35% for the same period in 2025. The increase in segment Adjusted EBITDA and Adjusted EBITDA margin for the three months ended June 30, 2026 was primarily attributable to the aforementioned increase in refrigerant prices, as well as cost timing favorability.

For the six months ended June 30, 2026, segment Adjusted EBITDA increased by $55 million (or 16%) to $403 million and Adjusted EBITDA margin increased by approximately 200 basis points to 35%, compared with segment Adjusted EBITDA of $348 million and Adjusted EBITDA margin of 33% for the same period in 2025. The increases in segment Adjusted EBITDA and Adjusted EBITDA margin for the six months ended June 30, 2026 were primarily attributable to the aforementioned increase in refrigerant prices, as well as cost timing favorability.

The Chemours Company

Titanium Technologies

The following table sets forth the net sales, Adjusted EBITDA, and Adjusted EBITDA margin amounts for our Titanium Technologies segment for the three and six months ended June 30, 2026 and 2025.

The following table sets forth the impacts of price, volume, currency, and portfolio changes on our Titanium Technologies segment's net sales for the three and six months ended June 30, 2026.

Segment Net Sales

Our Titanium Technologies segment's net sales increased by $4 million (or 1%) to $661 million for the three months ended June 30, 2026 compared with segment net sales of $657 million for the same period in 2025. The increase in segment net sales for the three months ended June 30, 2026 was primarily attributable to an increase in price of 2% and favorable currency movements adding a 1% tailwind to the segment's net sales, partially offset by a decrease in volumes of 2% as compared to the same period in the prior year. Volume decreases were primarily driven by lower TiO2 sales across key end markets, with the exception of Asia, excluding China and Latin America.

Our Titanium Technologies segment's net sales decreased by $34 million (or 3%) to $1.2 million for the six months ended June 30, 2026 compared with segment net sales of $1.3 billion for the same period in 2025. The decrease in segment net sales for the six months ended June 30, 2026 was primarily attributable to a decrease in volume of 5%, partially offset by favorable currency movements adding a 2% tailwind to the segment's net sales.

Adjusted EBITDA and Adjusted EBITDA Margin

For the three months ended June 30, 2026 segment Adjusted EBITDA was relatively flat at $48 million and Adjusted EBITDA margin stayed flat at 7%, compared with segment Adjusted EBITDA of $47 million and Adjusted EBITDA margin of 7% for the same period in 2025.

For the six months ended June 30, 2026, segment Adjusted EBITDA decreased by $30 million (or 31%) to $67 million and Adjusted EBITDA margin decreased by approximately 300 basis points to 5%, compared with segment Adjusted EBITDA of $97 million and Adjusted EBITDA margin of 8% for the same period in 2025. The decreases in segment Adjusted EBITDA and Adjusted EBITDA margin for the six months ended June 30, 2026 were primarily attributable to lower costs absorption as a result of lower volumes and higher input costs, partially offset by favorable currency movements.

The Chemours Company

Advanced Performance Materials

The following table sets forth the net sales, Adjusted EBITDA, and Adjusted EBITDA margin amounts for our Advanced Performance Materials segment for the three and six months ended June 30, 2026 and 2025.

The following table sets forth the impacts of price, volume, currency, and portfolio changes on our Advanced Performance Materials segment's net sales for the three and six months ended June 30, 2026.

Segment Net Sales

Our Advanced Performance Materials segment's net sales decreased by $20 million (or 6%) to $326 million for the three months ended June 30, 2026, compared with segment net sales of $346 million for the same period in 2025. The decrease in segment net sales for the three months ended June 30, 2026 was primarily attributable to a decrease in volumes of 9%, partially offset by an increase in price of 2% and favorable currency movements adding a 1% tailwind to the segment's net sales as compared to the same period in the prior year. Volumes decreased primarily due to lower sales associated with the SPS CapstoneTM product line closure that was completed in the third quarter of 2025, partially offset by beginning signs of recovery in semiconductors and aerospace, as well as growth in electric vehicles and data centers.

Our Advanced Performance Materials segment's net sales decreased by $70 million (or 11%) to $569 million for the six months ended June 30, 2026, compared with segment net sales of $639 million for the same period in 2025. The decrease in segment net sales for the six months ended June 30, 2026 was primarily attributable to a 14% decrease in volume, partially offset by a 1% increase in price and favorable currency movements adding a 2% tailwind to the segment's net sales in the same period of the prior year. Volumes decreased primarily due to operational impacts in the first quarter of 2026 related to the previously disclosed and resolved outage at the Washington Works site, as well as operational impacts to the SPS CapstoneTM product line, partially offset by beginning signs of recovery in semiconductors and aerospace, as well as growth in electric vehicles and data centers.

Adjusted EBITDA and Adjusted EBITDA Margin

For the three months ended June 30, 2026, segment Adjusted EBITDA decreased by $24 million (or 48%) to $26 million and Adjusted EBITDA margin decreased by approximately 600 basis points to 8%, compared with segment Adjusted EBITDA of $50 million and Adjusted EBITDA margin of 14% for the same period in 2025. The decrease in segment Adjusted EBITDA and Adjusted EBITDA margin for the three months ended June 30, 2026 was primarily attributable to lower volumes due to the exit of the SPS CapstoneTM product line and operational impacts related to the previously disclosed and resolved outage at the Washington Works site.

For the six months ended June 30, 2026, segment Adjusted EBITDA decreased by $51 million (or 62%) to $31 million and Adjusted EBITDA margin decreased by approximately 800 basis points to 5%, compared with segment Adjusted EBITDA of $82 million and Adjusted EBITDA margin of 13% for the same period in 2025. The decreases in segment Adjusted EBITDA and Adjusted EBITDA margin for the six months ended June 30, 2026 were primarily attributable to lower volumes due to the exit of the SPS CapstoneTM product line and operational impacts related to the previously disclosed and resolved outage at the Washington Works site.

The Chemours Company

Corporate and Unallocated Items

In addition to our reportable segments, we assign certain costs to "Corporate expenses", which is presented separately in the segment reconciliation table below and in "Note 23 - Segment Information" to the Interim Consolidated Financial Statements. Corporate expenses include certain legacy-related legal and environmental expenses, stock-based compensation expenses and other corporate costs, but excludes segment unallocated items (described below).

Corporate and Other costs decreased by $4 million (or 9%) and $13 million (or 13%) to $42 million and $90 million for the three and six months ended June 30, 2026, compared with Corporate and Other costs of $46 million and $103 million for the same periods in 2025. The decrease in Corporate and Other costs for the three and six months ended June 30, 2026 was primarily attributable to lower environmental and PFOA reserve adjustments in the second quarter of 2026, lower legacy legal costs, decreased proxy costs and a decrease in other corporate expenses due to prior year adjustments, partially offset by a decrease in the MOU benefit and an increase in executive office spend.

Unallocated items are those items excluded from the determination of segment Adjusted EBITDA measure used by our CODM as described in the segment overview section of this MD&A and further described below as well as in "Note 23 - Segment Information" to the Interim Consolidated Financial Statements.

The following table sets forth our corporate and unallocated items for the three and six months ended June 30, 2026 and 2025.

The Chemours Company

Liquidity and Capital Resources

Our primary sources of liquidity are cash generated from operations and available cash. We also periodically utilize various financing facilities, including our receivables securitization facility, receivable factoring facilities and supply chain financing arrangements with third-party financial institutions to provide working capital flexibility. Additionally, we have access to incremental liquidity, if needed, through borrowings under our debt financing arrangements, which includes borrowing capacity under our Revolving Credit Facility. We expect the liquidity from these sources will provide adequate funds to support the cash needs of our businesses through at least the end of August 2027.

At June 30, 2026, we had total unrestricted cash and cash equivalents of $671 million, of which $516 million was held by our foreign subsidiaries. The availability under our Revolving Credit Facility as of June 30, 2026 was $953 million, net of $47 million in outstanding letters of credit, and is subject to compliance with certain covenants, including those related to the last twelve months of our consolidated earnings before interest, taxes, depreciation, and amortization ("EBITDA") and senior secured net debt, both of which are defined under the Credit Agreement. At June 30, 2026, we were in compliance with the applicable covenants under the Credit Agreement. Our revolving commitments are comprised of $780 million in revolving commitments that mature on May 2, 2030 and $220 million in revolving commitments that mature on October 7, 2026; in each case, subject to springing maturity provisions. Our debt financing arrangements are described in further detail in "Note 20 - Debt" to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025.

Subject to approval by our board of directors, we may raise additional capital or borrowings from time to time, or seek to refinance our existing debt. There can be no assurances that future capital or borrowings will be available to us, and the cost and availability of new capital or borrowings could be materially impacted by market conditions. Our borrowing costs can be impacted by short- and long-term debt ratings assigned by nationally recognized ratings agencies. On July 17, 2026, Moody's downgraded our rating to B1 from Ba3. This action is in line with the negative outlook that Moody's put on the global chemicals sector in March 2026. Our outlook has been changed from negative to stable, reflecting expectations for continued earnings improvement and free cash flow generation, along with net proceeds from asset sales to be applied toward debt reduction. On April 16, 2025, S&P Global affirmed our BB- credit rating with negative outlook. Our debt ratings could constrain the capital available to us and could limit our access to and/or increase the cost of funding our operation. Further, the decision to refinance our existing debt is based on a number of factors, many of which are beyond our control, including general market conditions and our ability to refinance on attractive terms at any given point in time. Any attempts to raise additional capital or borrowings or refinance our existing debt could cause us to incur significant charges, including an increase in interest expense as a result of higher interest rates on any new or refinanced borrowings.

In the ordinary course of business, we engage in normal and customary working capital management actions. Ordinary course working capital management actions may include managing the timing of payables or receivables where permitted in accordance with the payment terms, utilizing supply chain financing arrangements, and utilizing the accounts receivable securitization facility described in "Note 15 - Debt" to the Interim Consolidated Financial Statements, among other actions, where appropriate and deemed to be in our commercial interest. Additionally, in the normal course of business, from time to time, we agree with our customers and, or, our suppliers, to a swap of terms, which can result in collecting from customers or paying suppliers earlier in one period in exchange for later in another period.

While we have historically generated operating cash flows through various past industry and economic cycles, we do have a historical pattern of seasonality with a working capital use of cash in the first half of the year, primarily driven by seasonal accounts receivable timing and, to a lesser extent, inventory builds, and a working capital source of cash in the second half of the year, as we sell product from inventory and collect receivables from customers. We currently anticipate that we will remain in compliance with applicable covenants under the Credit Agreement through at least August 2027.

Throughout the year, we utilize supply chain financing arrangements with several third-party financial institutions to manage our working capital needs and enhance liquidity. We also participate in certain customers' supply chain financing and other early pay programs as a routine source of working capital. During the three months ended June 30, 2026 and 2025, we utilized various customer facilitated supply chain financing facilities to accelerate the collection of $89 million and $133 million, respectively, of our accounts receivable, incurring an immaterial discount amount for both periods. For the six months ended June 30, 2026 and 2025, we accelerated the collection of approximately $156 million and $226 million, respectively, of our accounts receivable, incurring an immaterial discount amount of both periods. See "Note 8 - Accounts and Notes Receivable, Net" to the Interim Consolidated Financial Statements for further details regarding our supplier financing programs.

The Chemours Company

In March 2026, we issued $700 million aggregate principal amount of 2034 Notes. We received proceeds of $690 million, net of underwriting fees and other expenses of $10 million, which are deferred and amortized to interest expense over the term of the 2034 Notes. The net proceeds from the 2034 Notes together with cash on hand were used in part to redeem $188 million aggregate principal amount of the Company's 5.750% senior notes due 2028 for an aggregate redemption price of approximately $190 million, which includes payments related to extinguishments of debt. The remaining net proceeds from the Offering were used to fund the redemption of the Company's outstanding 5.375% senior notes due 2027 of $495 million aggregate principal amount, for an aggregate redemption price of $499 million, which includes payments related to extinguishments of debt.

In the second quarter of 2026, the Company used €230 million of cash to pay down a portion of the outstanding tranche B-3 euro term loan due August 2028.

For the three and six months ended June 30, 2026, we recognized a loss on extinguishments of debt of $2 million and $11 million, respectively, related to the partial early redemption of the senior secured Euro term loan due August 2028, along with costs associated with early redemption of the senior unsecured notes due May 2027 and partial early redemption of the senior unsecured notes due November 2028.

As a result of the Company's 2026 debt-related activity, anticipated annual interest expense is expected to decrease approximately $1 million. This expected annual interest expense reduction reflects the positive impact of repayments of the senior unsecured notes due May 2027, partial repayment of the senior unsecured notes due November 2028, pay down of a portion of the outstanding tranche B-3 euro term loan due August 2028, and the cross-currency swap of the senior unsecured notes, partially offset by the issuance of the 2034 Notes in March 2026. For further details, see "Note 15 - Debt" and "Note 20 - Financial Instruments" to the Interim Consolidated Financial Statements.

A substantial majority of the $516 million of unrestricted cash and cash equivalents held by our foreign subsidiaries at June 30, 2026, is available for local operations or is readily convertible into currencies used in our worldwide operations, including the U.S. dollar. We are subject to restrictions imposed by the local governments in certain jurisdictions where we operate, which impose certain limitations on our ability to exchange currencies, repatriate earnings or capital, or create cross-border cash pooling arrangements. During the six months ended June 30, 2026, we received approximately $578 million of net cash in the U.S. through intercompany loans and dividends. We believe we have the ability to fund U.S. operations cash requirements for working capital, dividends, investments, and other financing requirements through a mixture of repatriations, intercompany loans, and other actions. For further information related to our income tax positions, refer to "Note 9 - Income Taxes" to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025.

In addition, we monitor the third-party depository institutions that hold our cash and cash equivalents. We diversify our cash and cash equivalents among counterparties to minimize exposure to any one of these entities.

Over the course of the next 12 months and beyond, we anticipate making significant cash payments for known contractual and other obligations, which we expect to fund through cash generated from operations, available cash (including restricted cash), receivables securitization, and our existing debt financing arrangements. Such obligations include principal and interest obligations on long-term debt, contractual obligations for operating and finance leases, purchase obligations, legal settlement agreements, and our expectations for capital expenditures, which except as noted below, did not significantly change from what was previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. Our contractual and other obligations also include:

The Chemours Company

We continue to believe our sources of liquidity are sufficient to fund our planned operations and to meet our principal, interest, dividend, income taxes, and contractual obligations through at least the end of August 2027. Our capital allocation strategy is aligned with our strategic priorities under Pathway to Thrive and commitment to balance sheet flexibility. Our capital allocation strategy seeks to (i) focus investments in growth initiatives to enhance our portfolio; (ii) improve our leverage profile; (iii) responsibly resolve contingent legal and/or accrued environmental liabilities on terms and bases deemed to be in the best interest of the Company and its stakeholders; and (iv) return cash to shareholders through regular quarterly dividends. Since its inception, the Company has consistently maintained a long practice of returning capital to its shareholders, which will remain a strategic priority going forward. On August 4, 2026, the Board of Directors of Chemours declared a quarterly cash dividend of $0.0875 per share on the Company's common stock for the second quarter of 2026. The dividend will be paid on September 15, 2026, to stockholders of record as of August 14, 2026.

The Chemours Company

Cash Flows

The following table sets forth a summary of the net cash provided by (used for) our operating, investing, and financing activities for the six months ended June 30, 2026 and 2025.

Operating Activities

We generated $114 million in cash flows for our operating activities during the six months ended June 30, 2026. Comparatively, we used $19 million in cash flows for our operating activities during the six months ended June 30, 2025. The increase in our operating cash inflows was primarily attributable to changes in net working capital as a result of fewer inventory purchases made in 2026, in addition to higher earnings in the second quarter of 2026.

Investing Activities

We generated $195 million in cash flows for our investing activities during the six months ended June 30, 2026. Comparatively, we used $128 million in cash flows for our investing activities during the six months ended June 30, 2025. The increase in our investing cash inflows was primarily attributable to $294 million in proceeds from sales of assets and business, primarily due to the net proceeds of the Kuan Yin land sale. This cash generation was partially offset by purchases of property, plant, and equipment of $93 million during the six months ended June 30, 2026, compared to $127 million for the six months ended June 30, 2025. The decrease in cash spending related to property, plant, and equipment is due to timing of payments, as there were more payments in 2025, partially offset by increased capital project spend incurred year-over-year.

Financing Activities

We used $308 million in cash flows for our financing activities during the six months ended June 30, 2026 which was primarily attributable to our capital allocation activities, resulting in $963 million of debt repayments, $26 million of cash dividends, $5 million of payments on finance leases, $10 million of payments of debt issuance cost, $6 million of debt extinguishment payments and $2 million of payments related to tax withholdings on vested stock awards, partially offset by $700 million of proceeds from issuance of debt, $3 million of net proceeds from exercised stock options and $1 million of net proceeds in connection with one of our supplier financing programs.

We used $84 million in cash flows for our financing activities during the six months ended June 30, 2025 which was primarily attributable to our capital allocation activities, resulting in $50 million of cash dividends, along with $16 million of net debt repayments.

The Chemours Company

Current Assets

The following table sets forth the components of our current assets at June 30, 2026 and December 31, 2025.

Our accounts and notes receivable, net increased by $228 million (or 34%) to $907 million at June 30, 2026, compared with accounts and notes receivable, net of $679 million at December 31, 2025. This increase in our accounts and notes receivable, net at June 30, 2026 was primarily attributable to higher net sales in the second quarter of 2026, compared to the fourth quarter of 2025, as well as a higher value-added tax receivable and a larger receivable derivative balance, partially offset by collections through our Accounts Receivable Securitization facility and a lower MOU balance.

Our inventories decreased by $117 million (or 7%) to $1.5 billion at June 30, 2026, compared with inventories of $1.6 billion at December 31, 2025. The decrease in our inventories at June 30, 2026 was primarily attributable to a decrease in raw materials and finished goods inventories, partially offset by an increase in semi-finished inventories. Raw materials decreased because we consumed a portion of our high grade ore inventory. Additionally, the decrease in finished goods is a result of seasonally higher sales and lowered purchases through the first half of 2026 within our Thermal & Specialized Solutions segment, in addition to our Titanium Technologies segment right sizing finished product inventory.

Our prepaid expenses and other decreased by $17 million (or 21%) to $63 million at June 30, 2026, compared with prepaid expenses and other of $80 million at December 31, 2025. The decrease in our prepaid expenses and other was primarily due to decreases in prepaid tax and prepaid insurance amortization, partially offset by an increase in prepaid other and income tax receivable.

Current Liabilities

The following table sets forth the components of our current liabilities at June 30, 2026 and December 31, 2025.

Our accounts payable decreased by $17 million (or 2%) to $937 million at June 30, 2026 compared with accounts payable of $954 million at December 31, 2025. The decrease in our accounts payable at June 30, 2026 was primarily attributable to lower spend in the second quarter of 2026, compared to the fourth quarter of 2025.

Our compensation and other employee-related costs decreased by $13 million (or 14%) to $83 million at June 30, 2026 compared with compensation and other employee-related costs of $96 million at December 31, 2025. The decrease in our compensation and other employee-related costs at June 30, 2026 was primarily attributable to lower annual incentive plan accruals, partially offset by an increase in accruals for employee benefits.

Our short-term and current maturities of long-term debt decreased by $8 million (or 19%) to $34 million at June 30, 2026 compared with short-term and current maturities of long-term debt of $42 million at December 31, 2025. The decrease in our short-term and current maturities of long-term debt was primarily attributable to the timing of payments, as the balance related to insurance premium financing was paid down in the first half of 2026.

The Chemours Company

Our current environmental remediation increased by $36 million (or 41%) to $124 million at June 30, 2026 compared with current environmental remediation of $88 million at December 31, 2025. The increase in our current environmental remediation was primarily attributable to higher environmental remediation accruals in the second quarter of 2026. Refer to "Note 17 - Commitments and Contingent Liabilities" for further details on environmental remediation.

Our other accrued liabilities increased by $177 million (or 35%) to $683 million at June 30, 2026 compared with other accrued liabilities of $506 million at December 31, 2025. The increase in our other accrued liabilities was primarily attributable to an increase in accrued litigation, an increase in our interest accrued as driven by the timing of payments, as well as increases to accrued other expense, deferred credits, accrued severance and asset retirement obligations. This was partially offset by payments of customer discounts and rebates in the second quarter of 2026, a decrease in derivative instruments related to a cross currency swap, and a decrease to income tax payable.

Credit Facilities and Notes

Refer to "Note 15 - Debt" to the Interim Consolidated Financial Statements in this Quarterly Report on Form 10-Q and "Note 20 - Debt" to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025 for a discussion of our credit facilities and notes.

Supplier Financing

We maintain supply chain finance programs with several financial institutions. The available capacity under these programs can vary based on the number of investors and/or financial institutions participating in these programs at any point in time. See "Note 13 - Accounts Payable" to the Interim Consolidated Financial Statements for further details regarding supplier financing programs.

Off-Balance Sheet Arrangements

There have been no material changes to the off-balance sheet arrangement described in our MD&A and "Note 20 - Debt" to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025. Historically, we have not made any payments to satisfy guarantee obligations; however, we believe we have the financial resources to satisfy these guarantees in the event required.

Critical Accounting Policies and Estimates

Our significant accounting policies are described in our MD&A and "Note 3 - Summary of Significant Accounting Policies" to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to the critical accounting policies and estimates previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, except as described in "Note 2 - Recent Accounting Pronouncements" to the Interim Consolidated Financial Statements.

Recent Accounting Pronouncements

See "Note 2 - Recent Accounting Pronouncements" to the Interim Consolidated Financial Statements for a discussion about recent accounting pronouncements.

The Chemours Company

Environmental Matters

Consistent with our values and our Environment, Health, Safety, and Corporate Responsibility policy, we are committed to preventing releases to the environment at our manufacturing sites to keep our people and communities safe, and to be good stewards of the environment. We are also subject to environmental laws and regulations relating to the protection of the environment. We believe that, as a general matter, our policies, standards, and procedures are properly designed to prevent unreasonable risk of harm to people and the environment, and that our handling, manufacture, use, and disposal of hazardous substances are in accordance with applicable environmental laws and regulations.

Environmental Remediation

In large part, because of past operations, operations of predecessor companies, or past disposal practices, we, like many other similar companies, have clean-up responsibilities and associated remediation costs, and are subject to claims by other parties, including claims for matters that are liabilities of EID and its subsidiaries that we may be required to indemnify pursuant to the Separation-related agreements executed prior to our separation from EID on July 1, 2015 (the "Separation").

Our environmental liabilities include estimated costs, including certain accruable costs associated with on-site capital projects. The accruable costs relate to a number of sites for which it is probable that environmental remediation will be required, whether or not subject to enforcement activities, as well as those obligations that result from environmental laws such as CERCLA, RCRA, and similar federal, state, local, and foreign laws. These laws may require certain investigative, remediation, and restoration activities at sites where we conduct or EID once conducted operations or at sites where our generated waste was disposed. At June 30, 2026 and December 31, 2025, our consolidated balance sheets include environmental remediation liabilities of $795 million and $618 million, respectively, relating to these matters, which, as discussed in further detail below, include $311 million and $320 million, respectively, for Fayetteville.

As remediation efforts progress, sites move from the investigation phase ("Investigation") to the active clean-up phase ("Active Remediation"), and as construction is completed at Active Remediation sites, those sites move to the operation, maintenance, and monitoring ("OM&M"), or closure phase. As final clean-up activities for some significant sites are completed over the next several years, we expect our annual expenses related to these active sites to decline over time. The time frame for a site to go through all phases of remediation (Investigation and Active Remediation) may take about 15 to 20 years, followed by several years of OM&M activities. Remediation activities, including OM&M activities, vary substantially in duration and cost from site to site. These activities, and their associated costs, depend on the mix of unique site characteristics, evolving remediation technologies, and diverse regulatory requirements, as well as the presence or absence of other Potentially Responsible Parties ("PRPs"). In addition, for claims that we may be required to indemnify EID pursuant to the Separation-related agreements, we and EID may have limited available information for certain sites or are in the early stages of discussions with regulators. For these sites, there may be considerable variability between the clean-up activities that are currently being undertaken or planned and the ultimate actions that could be required. Therefore, considerable uncertainty exists with respect to environmental remediation costs, and, under adverse changes in circumstances, we currently estimate the potential liabilities may range up to approximately $700 million above the amount accrued at June 30, 2026. This estimate is not intended to reflect an assessment of our maximum potential liability. The estimated liabilities are determined based on existing remediation laws and technologies and our planned remedial responses, which are derived from environmental studies, sampling, testing, and analyses. Inherent uncertainties exist in such evaluations, primarily due to unknown environmental conditions, changing governmental regulations regarding liability, and emerging remediation technologies. We will continue to evaluate as new or additional information becomes available in the determination of our environmental remediation liability.

In general, uncertainty is greatest and the range of potential liability is widest in the Investigation phase, narrowing over time as regulatory agencies approve site remedial plans. As a result, uncertainty is reduced, and sites ultimately move into OM&M, as needed. As more sites advance from Investigation to Active Remediation to OM&M or closure, the upper end of the range of potential liability is expected to decrease over time. Some remediation sites will achieve site closure and will require no further action to protect people and the environment and comply with laws and regulations. At certain sites, we expect that there will continue to be some level of remediation activity due to ongoing OM&M of remedial systems. In addition, portfolio changes, such as an acquisition or divestiture, or notification as a PRP for a multi-party Superfund site, could result in additional remediation activity and potentially additional accrual.

Management does not believe that any loss, in excess of amounts accrued, related to remediation activities at any individual site will have a material impact on our financial position or cash flows for any given year, as such obligation can be satisfied or settled over many years.

The Chemours Company

Significant Environmental Remediation Sites

While there are many remediation sites that contribute to our total accrued environmental remediation liabilities at June 30, 2026 and December 31, 2025, the following table sets forth the liabilities of the five sites that are deemed the most significant, together with the aggregate liabilities for all other sites.

The five sites listed above represent 84% and 81% of our total accrued environmental remediation liabilities at June 30, 2026 and December 31, 2025, respectively. For these five sites, we expect to spend, in the aggregate, $228 million over the next three years. For all other sites, we expect to spend $68 million over the next three years.

Chambers Works, Deepwater, New Jersey ("Chambers Works")

The Chambers Works complex is located on the eastern shore of the Delaware River in Deepwater, Salem County, New Jersey. The site comprises the former Carneys Point Works in the northern area and the Chambers Works manufacturing area in the southern area. Site operations began in 1892 when the former Carneys Point smokeless gunpowder plant was constructed at the northern end of Carneys Point. Site operations began in the manufacturing area around 1914 and included the manufacture of dyes, aromatics, elastomers, chlorofluorocarbons, and tetraethyl lead. We continue to manufacture a variety of fluoropolymers and finished products at Chambers Works. In addition, two tenants operate processes at Chambers Works. As a result of over 100 years of continuous industrial activity, site soils and groundwater have been impacted by chemical releases.

In response to identified groundwater contamination, a groundwater interceptor well system ("IWS") was installed in 1970, which was designed to contain contaminated groundwater and restrict off-site migration. Additional remediation is being completed under a federal RCRA Corrective Action permit. The site has been studied extensively over the years, and more than 25 remedial actions have been completed to date and engineering and institutional controls put in place to ensure protection of people and the environment. In 2017, a site perimeter sheet pile barrier intended to more efficiently contain groundwater was completed.

Remaining work beyond continued operation of the IWS and groundwater monitoring includes completion of various targeted studies on site and in adjacent water bodies to close investigation data gaps, as well as selection and implementation of final remedies under RCRA Corrective Action for various solid waste management units and areas of concern not yet addressed through interim measures. Discussions are ongoing with the U.S. Environmental Protection Agency (the "EPA") and the New Jersey Department of Environmental Protection (the "NJ DEP") relating to such remaining work as well as the scope of remedial programs and investigation relating to the Chambers Works site historic industrial activity as well as ongoing remedial programs, which could have a material adverse impact on our results of operations, financial position or cash flows for any given year.

Further, as a result of the expanded off-site drinking water program requirements at Washington Works and Chambers Works as referenced in Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements, pursuant to the 2026 Consent Decree, we recognized additional environmental remediation reserves of $29 million in the second quarter of 2026 for Chamber Works, inclusive of $22 million that were included in Accrued Litigation liabilities as of December 31, 2025 that were reclassified to Accrued Environmental Remediation as of June 30, 2026.

Dordrecht Works, Dordrecht, Netherlands

The Dordrecht Works complex is located on the southern shore of River Beneden Merwede about 3 kilometers northeast of the city Dordrecht, Netherlands. The facility encompasses 136 acres purchased by EID in 1959. The site is located in a mixed commercial and industrial area with residential communities to the south and north across the river. Site operations began in the early 1960's and included nylon, filaments, and engineering polymers. Fluoropolymer manufacturing began in 1967. In July 2015, upon separation from EID, we became owner of the Dordrecht Works complex.

The Chemours Company

The site has implemented a number of environmental investigations at the request of local (Netherlands) regulatory agencies. In the early 1980's, the first major environmental assessment of soil and groundwater at the site was conducted. In 1984, a sitewide groundwater containment system was installed to prevent off-site migration and establish hydraulic protection to the deeper groundwater aquifer. Collected groundwater containing chlorinated organics, PFOA and other PFAS compounds is treated using vapor and solid phase granular activated carbon. The pump and treat system is monitored regularly to maintain effective containment and treatment operation with documentation of results submitted annually to the regulatory agency.

As further discussed in "Note 17 - Commitments and Contingent Liabilities" to the Consolidated Financial Statements, the Company and the municipalities of Dordrecht, Papendrecht, Sliedrecht and Molenlanden signed a Letter of Intent ("LOI") that includes the implementation of a specific remediation plan for the restoration of restricted vegetables in certain areas of those municipalities to be funded by Chemours, sampling and developing a program to address the Merwelanden recreational lake, and further settlement discussions. An estimate of this liability was included in Accrued Litigation at December 31, 2023 and was reclassified to Accrued Environmental Remediation as of December 31, 2024 based on the remediation plan to be implemented as part of the LOI.

In the fourth quarter of 2024, we received comments from the Municipality of Dordrecht and the Province of South Holland on a Plan of Action for Vegetable Gardens ("Plan of Action") in the municipalities and approval for the pilot stage of the plan. The Plan of Action provides for replacement of soil impacted with PFOA above certain levels to remove RIVM documented consumption restrictions as well as providing for alternative irrigation water, if necessary, as determined by PFOA levels. Accruals related to the Plan of Action of $24 million and $26 million are included in the environmental remediation balance as of June 30, 2026 and December 31, 2025, respectively. Further, we are in continued legal discussion with the four municipalities (Dordrecht, Papendrecht, Sliedrecht and Molenlanden) related to a fund to cover certain other expenditures aimed at environmental-related activities. While we do not consider these ongoing settlement discussions, including any amounts with respect to a potential fund that the municipalities put forward as part of such negotiations, to be indicative of the merits or potential outcome of any court proceeding with respect to the underlying claims, prior to the fourth quarter of 2025, we had not accrued for any amounts related to the fund. Although we believed a loss was probable and could be material, an amount of loss was not deemed estimable. In the fourth quarter of 2025, we, along with DuPont and Corteva pursuant to the MOU, proposed a settlement framework and based on the proposed framework, we considers a loss probable and reassessed the low end of the range of probable outcomes for this matter with respect to the potential fund. As such, in the fourth quarter of 2025, we accrued an amount that did not materially affect results of operations for that period related to the potential fund which represented its 50% share of the total funding included in the settlement framework. In the second quarter of 2026, a revised settlement framework was proposed, and we updated its reserve for this matter, accruing an amount that did not materially affect results of operations for the period. The aggregate amount recorded in both the fourth quarter of 2025 and second quarter of 2026 remains accrued as of June 30, 2026.

The Dordrecht Works facility discharges, through outfalls at the site, wastewater and stormwater pursuant to permits issued by the applicable local authorities, including the DCMR Environmental Protection Agency ("DCMR"). As the regulatory landscape has evolved in the Netherlands over the last years, there is increased focus on PFAS compounds discharged under the site's existing permits, including compounds that were previously discharged at undetected levels, and the site has been ordered to meet certain limits for these discharges or be subject to conditional fines. We regularly carry out analyses of its wastewater to assess compliance with current emission limits as well as detect other contaminants as analysis methods develop. We identified the presence of certain compounds based upon new analysis methods and reported these to DCMR and in December 2023 submitted an application under normal permitting practice for a discharge requirement based on limited information for these compounds. We have continued to engage with regulatory authorities on the application, including providing additional data and information in November 2024. In February 2025, we submitted a revised permit application. We will continue to engage with the regulatory authorities on this matter.

In December 2024, DCMR indicated an intention to impose a conditional fine of up to €3.7 million for one of the compounds for which we have objected. In January 2025, we responded to this intention, including that such intention is not consistent with normal permitting practice. In February 2025, DCMR responded to us indicating it will impose the conditional fine, after a grace period. In March 2025, DCMR adjusted the conditional fine to allow a grace period until July 2025 subject to certain conditions. Objections have been submitted against the adjustment. We filed a pro forma objection to the conditional fine. This procedure is on hold upon our request because of the pending permit application. We have piloted abatement technology and continues to implement such technology to reduce discharges below the conditional fine level. We have not recorded a liability for this matter at June 30, 2026 as the conditional fine is not effective at this time and will only be imposed after the grace period, if at that time, we fail to comply with the discharge limits for the compound. We do not believe the above matter will have a material impact on our financial position, results of operation or cash flows.

The Chemours Company

In addition, in March 2022, the public prosecutor in The Netherlands has raised a matter related to an alleged infraction of Regulation (EU) 517/2014. Due to a reporting error, our Dordrecht Works facility exceeded its allocated or transferred quota of hydrofluorocarbons within the European market over several years. We implemented improvements to our reporting procedures and operated within the allocated quota. We paid a fine in the fourth quarter of 2022. On October 31, 2024, we received a request from the Dutch ILT agency to amend our F-gas reporting for certain years to reflect HFCs produced and consumed or destroyed at the Dordrecht Works facility. In November 2024, we made minor amendments to its F-gas reporting for the above years and consulted with the Dutch ILT agency and EU Commission to address the Dutch ILT's assertion that certain compounds are subject to the F-gas quota system. In February 2025, the Company received an intention for the ILT to collect a penalty of €1 million based on the consideration that HFC-23 imported or acquired on the market and added to the production process rather than directly sent for destruction is quota consuming. The Company is reviewing the ILT intention and met with the agency in April 2025 to review the matter and Dordrecht Works' HFC-23 related operations. In May 2025, ILT noticed the collection of the penalty of €1 million (Euro), which was paid by us in June 2025. We have submitted an objection to the collection of the penalty. In June 2025, the European Commission sent a compliance letter related to the Dordrecht Works operations alleging infringement of Article 16(1) of the F-gas regulation by exceeding its annual quota between 2016 to 2019 and 2021 to 2024, asserting a total reduction of 1,114,016 tons of carbon dioxide equivalent. In June 2025 the European Commission also sent a compliance letter asserting that, based upon its 2024 reporting year submission, a quota exceedance occurred making it subject to a reduced quota allocation in the future and penalties. We responded to the compliance letter and on August 1, 2025 the European Commission sent a letter-decision imposing a 200% quota reduction penalty applicable in 2026. On October 9, 2025, we filed an application for annulment of such decision in the General Court of the European Union based upon the decision violating EU law and its principle of proportionality. We also filed for an interim action to suspend the August 1, 2025 decision and the court issued an order granting temporary relief whereby the quota reduction decision was suspended during the interim proceedings. In January 2026, the court issued an order dismissing the interim action and temporary suspension. The annulment matter is proceeding. Based on available information, we do not believe the above matter will have a material impact on our financial position, results of operation or cash flows.

Fayetteville Works, Fayetteville, North Carolina

Fayetteville is located southeast of the City of Fayetteville in Cumberland and Bladen counties, North Carolina. The facility encompasses approximately 2,200 acres, which were purchased by EID in 1970, and are bounded to the east by the Cape Fear River and to the west by North Carolina Highway 87. Currently, we manufacture fluorinated monomers, fluorinated vinyl ethers, NafionTM membranes and dispersions, and polymerization aids at the site. A former manufacturing area, which was sold in 1992, produced nylon strapping and elastomeric tape. EID sold its Butacite® and SentryGlas® manufacturing units to Kuraray America, Inc. in September 2014. In July 2015, upon our Separation from EID, we became the owner of the Fayetteville land assets along with fluoromonomers, NafionTM membranes, and the related polymerization aid manufacturing units. A polyvinyl fluoride resin manufacturing unit remained with EID.

Beginning in 1996, several stages of site investigation were conducted under oversight by NC DEQ, as required by the facility's hazardous waste permit. In addition, the site has voluntarily agreed to agency requests for additional investigations of the potential release of PFAS beginning with "PFOA" (collectively, perfluorooctanoic acids and its salts, including the ammonium salt) in 2006. As a result of detection of GenX in on-site groundwater wells during our investigations in 2017, NC DEQ issued a Notice of Violation ("NOV") in September 2017 alleging violations of North Carolina water quality statutes and requiring further response. Since that time, and in response to three additional NOVs issued by NC DEQ and pursuant to the Consent Order (as discussed below), we have worked cooperatively with the agency to investigate and address releases of PFAS to on-site and off-site groundwater and surface water.

As discussed in "Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements, we, along with NC DEQ and Cape Fear River Watch ("CFRW"), a non-profit organization, have filed a final Consent Order ("CO") that comprehensively addressed various issues, NOVs, and court filings made by NC DEQ regarding Fayetteville and resolved litigations filed by NC DEQ and CFRW. In connection with the CO, a thermal oxidizer ("TO") became fully operational at the site in December 2019 to reduce aerial PFAS emissions from Fayetteville. The CO requires us to provide permanent replacement drinking water supplies, via connection to public water supply, whole building filtration units and/or reverse osmosis units, to qualifying surrounding residents, businesses, schools, and public buildings with private drinking water wells.

In 2020, we, along with NC DEQ and CFRW, reached agreement on the terms of an addendum to the CO (the "Addendum"). The Addendum establishes the procedure to implement specified remedial measures for reducing PFAS loadings from Fayetteville to the Cape Fear River, including construction of a barrier wall with groundwater extraction system to be completed by March 15, 2023, or an extended date in accordance with the Addendum. In June 2023, we completed the construction of the barrier wall with a groundwater extraction and treatment system in accordance with the requirements under the CO. In October 2023, we submitted the engineer's certification confirming that the barrier wall was constructed and documented to be in conformance with the accepted design.

Further discussion related to Fayetteville is included under the heading "Fayetteville Works, Fayetteville, North Carolina" in "Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements.

The Chemours Company

Pompton Lakes, New Jersey

During the 20th century, blasting caps, fuses, and related materials were manufactured at Pompton Lakes, Passaic County, New Jersey. Operating activities at the site were ceased in the mid-1990s. The primary contaminants in the soil and sediments are lead and mercury. Groundwater contaminants include volatile organic compounds. Under the authority of EPA and NJ DEP, remedial actions at the site are focused on investigating and cleaning-up the area. Groundwater monitoring at the site is ongoing, and we have installed and continue to install vapor mitigation systems at residences within the groundwater plume. In addition, we are further assessing groundwater conditions. In September 2015, EPA issued a modification to the site's RCRA permit that requires us to dredge mercury contamination from a 36-acre area of the lake and remove sediment from two other areas of the lake near the shoreline. The remediation activities commenced when permits and implementation plans were approved in May 2016, and work on the lake dredging project is now complete. In April 2019, we submitted a revised Corrective Measures Study ("CMS") proposing actions to address on-site soils impacted from past operations that exceed applicable clean-up criteria. We received comments on the CMS from EPA and NJ DEP in March 2020, and we responded to their comments in June 2020 and continue to seek resolution with EPA.

Washington Works, Parkersburg, West Virginia ("Washington Works")

The Washington Works complex is located on the eastern shore of the Ohio River south of Parkersburg, West Virginia. The facility encompasses approximately 400 acres, which were purchased by EID in the late 1940's. Other nearby land parcels purchased by EID included Blennerhassett Island, and three separate properties where WVDEP permitted landfills were operated. Site operations began in 1948 and included the manufacture of nylon, filaments, and acrylics. In 1949, fluoropolymer manufacturing began, and in 1959, polyoxymethylene production was started. Landfill operations occurred from the 1960's through the early 2000's when all three were closed according to WVDEP approved closure plans. Beginning in 2014, EID no longer used PFOA as a polymerization aid to manufacture some fluoropolymer resins at Washington Works.

In July 2015, upon our separation from EID, we became the owner of the Washington Works complex. The site has implemented environmental investigations, including Verification Investigation in 1992 and RCRA Facility Investigation ("RFI") in 1999 pursuant to corrective action requirements of its RCRA Part B and HSWA Permit under EPA and the West Virginia Department of Natural Resources oversight. The RFI was approved in 2012 and a CMS was completed in 2015 that recommended certain remedial actions, including capping of the former on-site landfill and ponds, which had already been completed, sitewide groundwater hydraulic control, drinking water supply well treatment via granular activated carbon, and long-term groundwater monitoring. These actions were memorialized in a RCRA final remedy implementation plan approved by the agencies in 2018 and integrated into the updated RCRA permit in August 2020.

The remedial actions required by the RCRA final remedy implementation plan have been completed or are part of routine operations, maintenance and monitoring. Landfill post closure care includes systems to treat surface water, leachate or groundwater, landfill cover or cap maintenance, monitoring and reporting. Additionally, upgrades to the Local landfill cover are being developed. In December 2023, we entered into a voluntary Administrative Order on Consent with EPA under RCRA 3012(a) requiring monitoring, testing, analysis and reporting to complete a more comprehensive environmental assessment and site conceptual model of compounds found in soil and water at and around our manufacturing facility. This agreement is not based on any allegations of non-compliance and it builds on the significant research Chemours and its predecessor have already done to advance knowledge of older legacy compounds around the site. Accruals related to these remedial actions were $43 million and $24 million as of June 30, 2026 and December 31, 2025, respectively. The accrual increase was primarily driven by a change in estimate related to the Company's long-term operation, maintenance and monitoring ("OM&M") programs at Washington Works.

The Chemours Company

Chemours Washington Works discharges, through outfalls at the site, wastewater and stormwater pursuant to a National Pollutant Discharge Elimination System ("NPDES") permit issued by the WVDEP. In connection with actions being taken by us to comply with certain NPDES effluent limits, including for PFOA and hexafluoropropylene oxide dimer acid, we submitted a permit modification to WVDEP relating to groundwater abatement for certain process water used at the facility, a temperature reduction project and realigning discharge flows to certain outfalls. In July 2021, EPA provided a specific objection to the draft modification based on Clean Water Act ("CWA") regulations and requirements. In August 2021, WVDEP issued an NPDES permit modification to provide for the start-up of an abatement unit at the facility and to extend compliance dates for certain limits to December 2021 due to delays from the COVID-19 pandemic. In September 2021, WVDEP issued a further NPDES modification, including for the operation of an abatement unit from the site's Ranney Well, and the site is taking additional actions to reduce PFAS discharges associated with wet weather flows and continuing to assess future stormwater discharges and permitting. In April 2023, we agreed to an Administrative Order on Consent ("AOC") with EPA that includes additional sampling as well as a compliance analysis and implementation of actions to address PFOA and hexafluoropropylene oxide dimer acid ("HFPO Dimer Acid") discharge exceedances that occurred following the outfall limits for these compounds that came into effect in January 2022. In August, 2023 we submitted an Alternatives Analysis and Implementation Plan ("AA&IP") consistent with the Administrative Order on Consent. In December 2024, EPA issued comments on the AA&IP, accepting certain provisions and rejecting other provisions of the plan. In December 2024, we submitted a revised NPDES permit application which includes abatement and other practices to substantially address the discharge exceedances subject to the AOC. In April 2025, we submitted a revised AA&IP in response to EPA to comments and to conform with the revised NPDES permit application. The provisions of the AOC have been incorporated into the 2026 Consent Order between the company, EPA and West Virginia (see additional discussions under "Litigation and Other matters related to Fayetteville and other U.S. Advanced Performance Materials sites" in Note 17 - Commitments and Contingent Liabilities to the Interim Consolidated Financial Statements). We expect to make future capital and other operating-related expenditures at Washington Works in connection with the 2026 Consent Order and permit application. In addition, we discharge treated wastewater and non-contact cooling water from a second perfluoroalkoxy ("PFA") processing line pursuant to a separate NPDES permit. In April 2026, we submitted a modification to allow extension of the second PFA processing line NPDES permit while the site-wide NPDES permit renewal application continues to be evaluated. WVDEP granted the extension through December 2026. In December 2024, the West Virginia Rivers Coalition filed a complaint under the Clean Water Act in West Virginia federal court alleging past and ongoing exceedances of certain effluent discharge limits, including those for PFOA and HFPO-DA, under the NPDES permit held by the Chemours Washington Works facility, in which, Little Hocking intervened. West Virginia Rivers Coalition has moved to dismiss its claims.

Further, pursuant to an Order on Consent ("OC"), entered into by EID with EPA since 2006, we provide alternate drinking water supplies, via granular activated carbon ("GAC") treatment or other approved supply, to residential well owners and local public drinking water systems near the Washington Works complex whose PFOA concentration exceeds 70 parts per trillion. We also provide regular sampling and GAC change outs activities as per OC requirements. Accruals that were related to this matter were included in Accrued Litigation and were $16 million as of December 31, 2025. These accruals were reclassified to Accrued Environmental Remediation as of June 30, 2026. The 2026 Consent Decree between the company, EPA and WVDEP incorporates and supersedes the requirements of the 2006 OC including lowering the allowed concentration level and expanding the parameter list by which alternative water supply will be offered (see additional discussions under "Leach Settlement" in Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements.) As a result of these changes and pursuant to requirements of the 2026 Consent Decree, in addition to the amount noted above that was reclassified to Accrued Environmental Remediation, the Company recognized an increase to its environmental remediation reserve for the off-site drinking water program at Washington Works of $113 million in the second quarter of 2026. Inclusive of the off-site drinking water program reserves, environmental accruals related to Washington Works were $174 million and $24 million as of June 30, 2026 and December 31, 2025, respectively.

New Jersey Department of Environmental Protection Directives and Litigation

In March 2019, NJ DEP issued two Directives, one being a state-wide PFAS Directive, and filed four lawsuits against us and other defendants, including allegations relating to clean-up and removal costs at four sites including Chambers Works. In December 2021, a consolidated order was entered in the lawsuits granting, in part, and denying, in part a motion to dismiss or strike parts of the Second Amended Complaints. In January 2022, NJ DEP filed a motion for a preliminary injunction requiring EID and us to establish a remediation funding source ("RFS") in the amount of $943 million for Chambers Works, the majority of which is for non-PFAS remediation items. Further discussion related to these matters is included in "Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements.

Climate Change

Sustainability is a foundational element of Chemours' growth strategy and long-term success. Our sustainability approach, risks and opportunities are integrated into our Pathway to Thrive strategy, which is designed to maintain alignment with the evolving external environment and the expectations of our stakeholders.

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Chemours' 2030 CRC goals articulate a strategic vision for managing climate-related impacts. By embedding climate considerations into business strategy, teams are empowered to proactively address climate disruptions and drive innovation in next-generation solutions that support resilience in a changing climate. Chemours' Pathway to Thrive corporate strategy is directly linked to climate action. The strategy is designed to support efforts to ensure products are manufactured, distributed, and used with a focus on minimizing environmental impact and safeguarding the communities in which we operate. Through this approach, we seek to protect our license to operate, meet customer needs, sharpen our innovation and differentiate our portfolio, which we believe supports the creation of enduring value for our shareholders.

As part of delivering trusted chemistry, we focus on the responsible stewardship of climate and water. Our 2030 goals include:

In 2021, we updated our climate goals to better align our climate commitment with the Paris Accord and set us on a path to achieve net zero greenhouse gas emissions from our operations by 2050. In 2022, we signed a commitment with the Science Based Targets initiative ("SBTi") to establish science-based targets for scopes 1, 2, and 3 GHG emissions. In May 2024, the SBTi approved Chemours' near-term science-based emissions reduction targets which includes our 2030 goal of a 60% absolute reduction of Scope 1 and 2 emissions and 25% per ton of product reduction in our Scope 3 emissions intensity. Beyond the progress we have made reducing our operational footprint through Scope 1 and 2 reductions, the reduction of our Scope 3 emissions will enable us to partner with our suppliers to further improve our product carbon footprint by reducing upstream emissions, as well as reduce downstream emissions through the ongoing adoption of low carbon solutions enable by Chemours innovation like our Opteon™ portfolio of low global warming potential refrigerants.

Making people's lives better centers on the essentiality of our products and the critical end markets they serve. From life-saving medical applications and low global warming potential refrigerants, to durable paints and coatings, semiconductor chips and clean energy technologies such as EV batteries, Chemours chemistries power products that the world needs. We believe that climate change is an important global issue that presents both opportunities and challenges for our company, our partners, our customers, and our communities. Climate change-related matters for our company are likely to be driven by changes in physical and transition risk, such as regulations and/or public policy, and changes in technology and product demand. Our operations and business results are increasingly subject to evolving climate-related legislation and regulations, inclusive of
restrictions on GHG emissions, cap and trade emissions trading systems, and taxes on GHG emissions, fuel, and energy, among other provisions. Such regulatory matters have led, and are expected to continue to lead, to subsequent developments in product technology and demand. This helps guide our investment decisions and drive growth in demand for low-carbon and energy efficient products, manufacturing technologies, and services that facilitate adaptation to a changing climate. Our business segments conduct market trend impact assessments, continuously evaluate opportunities for existing and new products and are well-positioned to take advantage of opportunities that may arise from increased market demand for and/or legislation mandating or incentivizing the use of products and technologies necessary to achieve a low-carbon economy.

In our Thermal & Specialized Solutions segment, global regulations driving the phase-down of HFCs, including the EU's F-Gas Directive, the EU's Mobile Air Conditioning Directive, and the AIM Act in the US, promote the adoption and sale of our high performing Opteon™ products, which have lower GWP and near-zero ozone-depletion footprint. Our Opteon™ portfolio has been developed to meet global regulations while maintaining or improving performance compared to the products they replace in refrigeration and cooling applications, such as food transportation, food and pharmaceutical/medical storage, food manufacturing and retail, automotive air conditioning, and residential and commercial building air conditioning.

We are pleased to have achieved our 2025 goal with our low GWP products delivering more than 350 million tons of avoided global CO2-equivalent emissions. We are a proponent of the AIM Act, which went into effect in 2022 and has begun the national phase-down of hydrofluorocarbons. We successfully completed an improvement project to significantly reduce emissions of HFC-23 at our Louisville, Kentucky manufacturing site. The project includes the design, custom-build and installation of proprietary technology to capture HFC-23 process emissions from the site. This project was operational as of October 2022 and validation of performance was completed prior to an extension period granted by EPA in the first quarter of 2023.

In our Titanium Technologies business, our Ti-Pure™ Sustainability product series, is designed to advance our customers' sustainability goals. The product series includes enhanced product sustainability designations-including climate impact and resource efficiency. Going forward, our product portfolio will continue to be centered on the evolving needs of our customers.

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In our Advanced Performance Materials segment, we see continued increasing demand for some of our key growth markets, offset by the more mature markets that are impacted by cyclical demand. Further, our fluoropolymers are critical to delivering durable, high performance over a wide range of harsh operating conditions, enhancing passenger safety, improving vehicle emission controls and fuel economy, enabling vehicle electrification by improving performance of batteries while enabling cost reductions, and improving the sustainability footprint and performance of hybrid and electric car batteries. Our fluoropolymer technology also supports market demand for clean hydrogen generation using water electrolyzers, energy storage in flow batteries, and hydrogen conversion to power fuel cell vehicles.

As an energy and emissions intensive company, our costs of complying with complex environmental laws and regulations, as well as internal and external voluntary programs, are significant and will continue to be significant for the foreseeable future. These laws and regulations may change and could become more stringent over time, which could result in significant additional compliance costs, increased costs of purchased energy or other raw materials, increased transportation costs, investments in, or restrictions on, our operations, installation or modification of GHG-emitting equipment, or additional costs associated with GHG emissions. Additionally, significant regional or national differences in approaches to the imposition of such regulations and restrictions could present competitive challenges or opportunities in a global marketplace. Currently, most of our global operating facilities are required to monitor and report their GHG emissions but may or may not be subject to programs requiring trading or
emission controls. The EU Emission Trading System applies to our operating sites in that region. By tracking and taking action to reduce our GHG emissions footprint through energy efficiency programs, increased use of renewable energy and focused GHG emissions reduction programs, we can decrease the potential future impact of these regulatory matters.

PFOA

See our discussion under the heading "PFOA" in "Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements.

GenX

In June 2019, the Member States Committee of the European Chemicals Agency ("ECHA") voted to list HFPO Dimer Acid as a Substance of Very High Concern. The vote was based on Article 57(f) - equivalent level of concern having probable serious effects to the environment. This identification does not impose immediate regulatory restriction or obligations, but may lead to a future authorization or restriction of the substance. On September 24, 2019, we filed an application with the EU Court of Justice for the annulment of the decision of ECHA to list HFPO Dimer Acid as a Substance of Very High Concern. In February 2022, the General Court dismissed the annulment action and we have appealed such decision. In November 2023, the EU Court of Justice dismissed our appeal.

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PFAS

Refer to our discussion under the heading "PFAS" in "Note 17 - Commitments and Contingent Liabilities" to the Interim Consolidated Financial Statements.

In May 2020, ECHA announced that five Member States (Germany, the Netherlands, Norway, Sweden, and Denmark) launched a call for evidence to inform a PFAS restriction proposal to restrict the manufacture, placing on the market and use of PFAS in the EU. In this regulatory process, more than 4,000 substances, including fluorinated-gases ("F-gases") and fluoropolymers are being considered as part of this broad regulatory action. Companies producing or using PFAS, as well as selling mixture or products containing PFAS, were invited to provide input. This call for evidence closed July 31, 2020. Thousands of substances meet the definition of PFAS as outlined in the call for evidence. This very broad definition covers substances with a variety of physical and chemical properties, health and environmental profiles, uses, and benefits. We submitted information on the substances covered by the call for evidence to the Member State competent authority for Germany, which is the Federal Institute for Occupational Safety and Health. On July 15, 2021, the countries submitted their restriction proposal, which informs ECHA of the intent to prepare a PFAS restriction dossier for fluorinated substances within a defined structural formula scope, including branched fluoroalkyl groups and substances containing ether linkages, fluoropolymers and side chain fluorinated polymers. The restriction dossier was submitted to ECHA in January 2023, and in February 2023 ECHA published a report and supporting annexes on the restriction proposal, which includes identified concerns for in-scope PFAS and their degradation products and the proposed restriction of a full ban with certain use-specific time-limited derogation periods. Comments were submitted from individuals and organizations during the consultation period in 2023 and the restriction dossier will be reviewed by the ECHA Risk Assessment Committee ("RAC") and Socio-economic Analysis Committees ("SEAC"). RAC and SEAC will focus on the different sectors that may be affected and elements of the proposal, and further meetings will be held in 2025. In August 2025, the five national authorities reviewed over 5,600 comments from the 2023 consultation and updated their original restriction proposal. This revised version, called the Background Document, is now the basis for ECHA's committee opinions and includes alternative restriction options instead of a full ban or a ban with time-limited derogations for certain applications. In March 2026, RAC adopted its final opinion and SEAC issued its draft opinion. A 60-day consultation period on the SEAC opinion was completed on May 25, 2026. ECHA final opinions are expected later in 2026, concluding the regulatory process. The European Commission will determine the scope and implementation of the REACH restriction. The estimated earliest entry into force of restrictions is 2027, contingent upon timely completion of the remaining steps in the EU Registration, Evaluation, Authorization, and Restriction of Chemicals ("REACH") restriction process.

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