Critical accounting estimates (MD&A): disclosure examples

Financial:	Page
Three-Year Summary of Consolidated Financial Highlights	44
Five-Year Stock Performance	45
Management’s discussion and analysis:
Introduction	46
Executive Overview	47
Consolidated Results of Operations	51
Consolidated Balance Sheets and Cash Flows Analysis	55
Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures	59
Business Segment & Corpo ra te Results	62
Firmwide Risk Management	83
Strategic Risk Management	88
Capital Risk Management	89
Liquidity Risk Management	100
Reputation Risk Management	108
Credit and Investment Risk Management	109
Credit Portfolio	111
Consumer Credit Portfolio	112
Wholesale Credit Portfolio	118
Allowance for Credit Losses	129
Investment Portfolio Risk Management	132
Market Risk Management	133
Country Risk Management	143
C li mate Risk Manag ement	145
Operational Risk Management	146

Page
Forward-Looking Statements	1
Availability of Company Information	2
Overview	3
Our Strategy	3
Our Business	6
Management's Discussion and Analysis
Operating Segment Results	21
Consolidated Results of Operations	25
Liquidity and Capital Resources	29
Properties	32
Quantitative and Qualitative Disclosures About Market Risk	33
Critical Accounting Estimates	34
Risk Factors	37
Other Key Information
Information About Our Executive Officers	52
Market for Our Common Stock	53
Stock Performance Graph	53
Issuer Purchases of Equity Securities	53
Rule 10b5-1 Trading Arrangements	54
Cybersecurity	54
Disclosure Pursuant to Section 13(r) of the Securities Exchange Act of 1934	54
Financial Statements and Supplemental Details
Auditor's Reports	57
Consolidated Financial Statements	60

Forward-Looking Statements

This Form 10-K contains forward-looking statements that involve a number of risks and uncertainties. Words such as "accelerate", "achieve", "aim", "ambitions", "anticipate", "believe", "committed", "continue", "could", "designed", "estimate", "expect", "forecast", "future", "goals", "grow", "guidance", "intend", "likely", "may", "might", "milestones", "next generation", "objective", "on track", "opportunity", "outlook", "pending", "plan", "position", "possible", "potential", "predict", "progress", "ramp", "roadmap", "seek", "should", "strive", "targets", "to be", "upcoming", "will", "would" and variations of such words and similar expressions are intended to identify such forward-looking statements, which may include statements regarding:

▪ our business plans and strategy and anticipated benefits therefrom;

▪ projections of our future financial performance, including future revenue, gross profits, capital expenditures and cash flows;

▪ projected costs and yield trends;

▪ future cash requirements, the availability, uses, sufficiency and cost of capital resources, and sources of funding, including for future capital and R&D investments and for returns to stockholders, and credit ratings expectations;

▪ future products, services and technologies, and the expected goals, timeline, ramps, progress, availability, production, regulation and benefits of such products, services and technologies, including future process nodes and packaging technology, product roadmaps, schedules, future product architectures, expectations regarding process performance, per-watt parity and metrics, and expectations regarding product and process competitiveness;

▪ internal and external manufacturing plans, including future internal manufacturing volumes, manufacturing expansion plans and the financing therefor, and external foundry usage;

▪ future production capacity and product supply;

▪ supply expectations, including regarding constraints, limitations, pricing, and industry shortages;

▪ plans and goals related to Intel's foundry business, including with respect to anticipated customers, future manufacturing capacity and service, technology and IP offerings;

If our accounting estimates and judgments turn out to be inaccurate, our future financial results could fall short of expectations, which could have a material adverse effect on our stock price. The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make certain estimates, judgments and assumptions that can affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. We base our estimates, judgments and assumptions on information available to us at the time that they are made, as discussed in “Critical Accounting Estimates” under Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations and in “Significant Accounting Policies” discussed in Note 1 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report. For example, we make certain judgments related to revenue recognition and remaining performance obligations. While we believe these judgments and assumptions are reasonable under the circumstances, they are subject to uncertainties and actual results may differ.

Risks Related to Our Common and Preferred Stock

Our stock price could become more volatile and your investment could lose value. All of the factors discussed within this Risk Factors section have affected and could in the future affect our stock price. The timing of announcements in the public market by us or by our competitors regarding new cloud services, AI advancements, products, product enhancements, technological advances, data center capacity, acquisitions, joint ventures and strategic alliances or major transactions could also affect our stock price. Changes in the amounts and frequency of stock repurchases or dividends could affect our stock price. Our stock price could also be affected by factors, some

The Company’s Use of Accounting Estimates Involves Judgment and Could Impact the Company’s Financial Results: The application of accounting principles generally accepted in the U.S. (GAAP) requires the company to make estimates and assumptions about certain items and future events that directly affect its reported financial condition. The company’s most critical accounting estimates are described in the Management Discussion in IBM’s 2025 Annual Report to Stockholders, under “Critical Accounting Estimates.” In addition, as discussed in note Q, “Commitments & Contingencies,” in IBM’s 2025 Annual Report to Stockholders, the company makes certain estimates including decisions related to legal proceedings and reserves. These estimates and assumptions involve the use of judgment. As a result, actual financial results may differ.

The Company’s Goodwill or Amortizable Intangible Assets May Become Impaired: The company acquires other companies, including the intangible assets of those companies. The company may not realize all the economic benefit from those acquisitions, which could cause an impairment of goodwill or intangible assets. If our goodwill or net intangible assets become impaired, we may be required to record a charge to the Consolidated Income Statement.

The Company Depends on Skilled Employees and Could Be Impacted by a Shortage of Critical Skills: Much of the future success of the company depends on the continued service, availability and integrity of skilled employees, including technical, marketing and staff resources. Skilled and experienced personnel in the areas where the company competes are in high demand, and competition for their talents is intense. Changing demographics and labor work force trends may result in a shortage of or insufficient knowledge and skills. In addition, as global opportunities and industry demand shifts, realignment, training and scaling of skilled resources may not be sufficiently rapid or successful. Further, many of IBM’s

key employees receive a total compensation package that includes equity awards. Any new regulations, volatility in the stock market and other factors could diminish the company’s use or the value of the company’s equity awards, putting the company at a competitive disadvantage.

Our proved reserve information included in this annual report represents management’s best estimates based on assumptions, as of a specified date, of the volumes to be recovered from underground accumulations of crude oil, bitumen, natural gas and NGLs. Such volumes cannot be directly measured, and the estimates and underlying assumptions used by management are subject to substantial risk and uncertainty. Any material changes in the factors and assumptions underlying our estimates of these items could result in a material negative impact to the volume of reserves reported or could cause us to incur impairment expenses on property associated with the production of those reserves. Future reserve revisions could also result from changes in, among other things, governmental regulation and commodity prices. For more information on estimates used, see the "Critical Accounting Estimates" section of Management's Discussion and Analysis of Financial Condition and Results of Operations .

19	ConocoPhillips 2025 10-K

CEO’s Letter	3
Directors and Senior Management	4
PART I
Item 1.	Business	5
Item 1A.	Risk Factors	10
Item 1B.	Unresolved Staff Comments	20
Item 1C.	Cybersecurity	20
Item 2.	Properties	22
Item 3.	Legal Proceedings	24
Item 4.	Mine Safety Disclosures	25
Executive Officers of the Registrant and Principal Executive Officers of Subsidiaries	26
PART II
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	27
Item 6.	[Reserved]	28
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Critical Accounting Estimates	40
Cautionary Information	42
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 8.	Financial Statements and Supplementary Data	43
Report of Independent Registered Public Accounting Firm	44
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	75
Item 9A.	Controls and Procedures	75
Management’s Annual Report on Internal Control Over Financial Reporting	76
Report of Independent Registered Public Accounting Firm	77
Item 9B.	Other Information	78

February 6, 2026

Fellow Shareholders:

The Union Pacific team continued to build on ‘what’s possible’ in 2025, and we delivered best-ever full year results across safety, service, and operating performance while growing our volumes. These results demonstrate that we are committed to our strategy – Safety, Service, and Operational Excellence leads to Growth – and understand what we need to do to set the Company up for future success. We know success can be measured in many ways, but to us it’s about serving our customers, communities, and employees while driving value to our owners.

Critical accounting estimates are those that NEE believes are both most important to the portrayal of its financial condition and results of operations, and require complex, subjective judgments, often as a result of the need to make assumptions about the effect of matters that are inherently uncertain. Judgments and uncertainties affecting the critical accounting estimates may result in materially different amounts being reported under different conditions or using different assumptions. NEE’s significant accounting policies, including those requiring critical accounting estimates, are described in Note 1 to the consolidated financial statements, which were prepared under GAAP. Further details regarding NEE's critical accounting estimates are as follows:

Accounting for Derivatives and Hedging Activities

NEE uses derivative instruments (primarily swaps, options, futures and forwards) to manage the physical and financial risks inherent in the purchase and sale of fuel and electricity, as well as interest rate and foreign currency exchange rate risk associated primarily with outstanding and expected future debt issuances and borrowings. In addition, NEE, through NEER, uses derivatives to optimize the value of its power generation and natural gas and oil production assets and engages in power and fuel marketing and trading activities to take advantage of expected future favorable price movements.

Nature of Accounting Estimates

Accounting pronouncements require the use of fair value accounting if certain conditions are met, which may require significant judgment to measure the fair value of assets and liabilities. This applies not only to traditional financial derivative instruments, but to any contract having the accounting characteristics of a derivative. As a result, significant judgment must be used in applying derivatives accounting guidance to contracts. In the event changes in interpretation occur, it is possible that contracts that currently are excluded from derivatives accounting rules would have to be recorded on the balance sheet at fair value, with changes in the fair value recorded in the statement of income.

Assumptions and Accounting Approach

This Annual Report and the documents incorporated by reference in this Annual Report contain statements that are not historical in nature, are predictive, or that depend upon or refer to future events or conditions or contain other forward-looking statements. Statements including, but not limited to, statements regarding artificial intelligence (“AI"), other technological and market advancements and their impacts on our business; the extent, timing and mix of future revenues and customer demand; the deployment of our products and services; the impact of the macroeconomic and geopolitical environment, including but not limited to, expanded trade controls, tariffs, conflicts around the world, volatility in foreign currency exchange rates, inflation and changes in interest rates; the impact of government actions; future costs, expenses, tax rates and uses of cash; pending legal, administrative and tax proceedings; restructuring actions and associated charges and benefits; pending acquisitions, accounting for acquisitions and integration of acquired businesses; and other statements using words such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “intends,” “may,” “plans,” “projects,” “should,” “targets,” “will” and “would,” and words of similar import and the negatives thereof, constitute forward-looking statements. These statements are predictions based upon our current expectations about future events. Actual results could vary materially as a result of certain factors, including but not limited to those expressed in these statements. Important risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements include, but are not limited to, those identified in the “Proprietary Technology,” “Governmental Regulations,” “Competition,” “Risk Factors,” “Critical Accounting Estimates,” “Results of Operations,” “Quantitative and Qualitative Disclosures About Market Risk” and “Liquidity and Capital Resources” sections contained in this Annual Report and the risks discussed in our other Securities and Exchange Commission (“SEC”) filings.

We urge you to consider these factors carefully in evaluating the forward-looking statements contained in this Annual Report. All subsequent written or oral forward-looking statements attributable to our company or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. The forward-looking statements included in this Annual Report are made only as of the date of this Annual Report. We do not intend, and undertake no obligation, to update these forward-looking statements.

Overview

CSX CORPORATION
FORM 10-K
TABLE OF CONTENTS
Item No.	Page
PART I
1.	Business	3
1A. Risk Factors	7
1B. Unresolved Staff Comments	13
1C. Cybersecurity	14
2.	Properties	16
3.	Legal Proceedings	20
4.	Mine Safety Disclosures	20
Executive Officers of the Registrant	21
PART II
5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	23
6.	Reserved	25
7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	26
· Terms Used by CSX	26
· 202 5 Highlights	28
· Results of Operations	28
· Liquidity and Capital Resources	38
· Contractual Obligations, Other Commitments and Off-Balance Sheet Arrangements	42
· Labor Agreements	42
· Critical Accounting Estimates	43
· Forward-Looking Statements	47

CSX 2025 Form 10-K p.2

CSX CORPORATION

PART I

Item 1. Business

CSX Corporation, together with its subsidiaries ("CSX" or the “Company”), based in Jacksonville, Florida, is one of the nation's leading transportation companies. The Company provides rail-based freight transportation services including traditional rail service, the transport of intermodal containers and trailers, as well as other transportation services such as rail-to-truck transfers and bulk commodity operations. CSX and the rail industry provide customers with access to an expansive and interconnected transportation network that plays a key role in North American commerce and is critical to the long-term economic success and improved global competitiveness of the United States. In addition, freight railroads provide the most economical and environmentally efficient means to transport goods over land.

CSX Transportation, Inc.

TABLE OF CONTENTS	PAGE
PART I	4
Item 1. Business	4
Item 1A. Risk Factors	10
Item 1B. Unresolved Staff Comments	18
Item 1C. Cybersecurity	18
Item 2. Properties	19
Item 3. Legal Proceedings	19
Item 4. Mine Safety Disclosures	20
PART II	20
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
Item 6. [Reserved]	20
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Overview	21
Results of Operations	22
Performance by Business Segment	25
Performance by Geographic Area	27
Critical Accounting Estimates	31
New Accounting Pronouncements	33
Financial Condition and Liquidity	33
Financial Instruments	36
Item 7A. Quantitative and Qualitative Disclosures About Market Risk	36
Item 8. Financial Statements and Supplementary Data	36
Index to Financial Statements	36
Management’s Responsibility for Financial Reporting	37

• Executive Overview : High-level discussion of our operating results and some of the trends that affect our business. • Critical Accounting Estimates : Policies and estimates that we believe are important to understanding the assumptions and judgments underlying our financial statements. • Results of Operations : A more detailed discussion of our revenue and expenses. • Liquidity and Capital Resources : Discussion of key aspects of our consolidated statements of cash flows, changes in our consolidated balance sheets, and our financial commitments.

You should note that this MD&A contains forward-looking statements that involve risks and uncertainties. Please see the section entitled “Forward-Looking Statements” immediately preceding Part I of this Annual Report for important information to consider when evaluating such statements.

You should read this MD&A in conjunction with the consolidated financial statements and related notes in Item 8 of this Annual Report.

In the Results of Operations sections of this MD&A, where we describe two or more factors that contributed to changes in revenue and operating income, we have, where possible, quantified the impact of those factors. Where a change is the result of multiple factors that are interrelated and cannot be separately quantified, we have identified the interrelated factors without quantifying them.

PART I
Item 1.	Business	1
Overview	1
Strategy	1
Competitive Strengths	2
Products and Services; Reporting Segments	3
Human Capital	4
Customers	5
Competition	5
Government Regulation	6
Where You Can Find More Information	8
Item 1A.	Risk Factors	9
Item 1B.	Unresolved Staff Comments	16
Item 1C.	Cybersecurity	17
Item 2.	Properties	18
Operating Facilities	18
Fleet	18
Item 3.	Legal Proceedings	18
Item 4.	Mine Safety Disclosures	19
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
Shareowner Return Performance Graph	21
Item 6.	[Reserved]	22
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Overview	23

PART I

Introductory Note

In this Annual Report on Form 10-K ("Annual Report" and "this report"), the "Company," "we," "us" and "our" refer to United Parcel Service, Inc. ("UPS"). With regard to the Company’s segments, "we," "us" and "our" may also refer to the segment being discussed.

Unless the context indicates otherwise, whenever we refer in this Annual Report to a particular year, we mean our calendar year ended or ending December 31.

Cautionary Statement About Forward-Looking Statements