Weyerhaeuser WY · USD

NOTE 2: BUSINESS SEGMENTSOur business segments and how we account for those segments are discussed in Note 1: Summary of Significant Accounting Policies. This note provides key financial data by business segment and information about our chief operating decision maker.KEY FINANCIAL DATA BY BUSINESS SEGMENTSales, Significant Segment Expenses and Net Contribution (Charge) to Earnings DOLLAR AMOUNTS IN MILLIONS UNALLOCATED REAL ITEMS AND ESTATE WOOD INTERSEGMENT TIMBERLANDS & ENR PRODUCTS ELIMINATIONS CONSOLIDATED 2025 Net sales to unaffiliated customers $ 1,494 $ 454 $ 4,957 $ — $ 6,905 Intersegment sales 592 — — (592 ) — Total 2,086 454 4,957 (592 ) 6,905 Costs of sales 1,664 117 4,674 (575 ) 5,880 Gross margin 422 337 283 (17 ) 1,025 Selling expenses 1 — 88 3 92 General and administrative expenses 97 27 156 173 453 Other segment items(1) (262 ) (5 ) (16 ) 230 (53 ) Net contribution (charge) to earnings $ 586 $ 315 $ 55 $ (423 ) $ 533 2024 Net sales to unaffiliated customers $ 1,512 $ 391 $ 5,221 $ — $ 7,124 Intersegment sales 554 — — (554 ) — Total 2,066 391 5,221 (554 ) 7,124 Costs of sales 1,686 152 4,516 (543 ) 5,811 Gross margin 380 239 705 (11 ) 1,313 Selling expenses 1 — 85 2 88 General and administrative expenses 100 26 155 199 480 Other segment items(1) (1 ) (3 ) 8 45 49 Net contribution (charge) to earnings $ 280 $ 216 $ 457 $ (257 ) $ 696 2023 Net sales to unaffiliated customers $ 1,654 $ 363 $ 5,657 $ — $ 7,674 Intersegment sales 572 — — (572 ) — Total 2,226 363 5,657 (572 ) 7,674 Costs of sales 1,746 126 4,699 (579 ) 5,992 Gross margin 480 237 958 7 1,682 Selling expenses 1 — 84 2 87 General and administrative expenses 100 26 149 156 431 Other segment items(1) (109 ) — 16 40 (53 ) Net contribution (charge) to earnings $ 488 $ 211 $ 709 $ (191 ) $ 1,217 (1)Other segment items for each reportable segment includes recurring and non-recurring income and expense items. For our Timberlands segment, this includes a legal benefit in 2023 and gains on the sale of timberlands in 2023 and 2025. For our Wood Products segment, this includes insurance recoveries in 2023, product remediation recoveries and an impairment charge related to the indefinite curtailment of our New Bern lumber mill in 2024, and a gain on the sale of our Princeton lumber mill in 2025.

NOTE 3: REVENUE RECOGNITIONA majority of our revenue is derived from sales of delivered logs and manufactured wood products. We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers.PERFORMANCE OBLIGATIONSA performance obligation, as defined in ASC Topic 606, is a promise in a contract to transfer a distinct good or service to a customer. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue at the point in time, or over the period, in which the performance obligation is satisfied.Performance obligations associated with delivered log sales are typically satisfied when the logs are delivered to our customers’ mills or delivered to an ocean vessel in the case of export sales. Performance obligations associated with the sale of wood products are typically satisfied when the products are shipped. We have elected, as an accounting policy, to treat shipping and handling that is performed after a customer obtains control of the product as an activity required to fulfill the promise to transfer the good; therefore we will not evaluate this requirement as a separate performance obligation.Customers are generally invoiced shortly after logs are delivered or after wood products are shipped, with payment generally due within a month or less of the invoice date. ASC Topic 606 requires entities to consider significant financing components of contracts with customers, though allows for the use of a practical expedient when the period between satisfaction of a performance obligation and payment receipt is one year or less. Given the nature of our revenue transactions, we have elected to utilize this practical expedient.Performance obligations associated with real estate sales are generally met when placed into escrow and all conditions of closing have been satisfied.CONTRACT ESTIMATESSubstantially all of our performance obligations are satisfied as of a point in time. Therefore, there is little judgment in determining when control transfers for our business segments as described above.The transaction price for log sales generally equals the amount billed to our customer for logs delivered during the accounting period. For the limited number of log sales subject to a long-term supply agreement, the transaction price is variable but is known at the time of billing.

NOTE 13: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIESThis note provides details about our:  legal proceedings,  environmental matters and  commitments and other contingencies. LEGAL PROCEEDINGSWe are party to various legal proceedings arising in the ordinary course of business. We are not currently a party to any legal proceeding that management believes could have a material adverse effect on our Consolidated Balance Sheet, Consolidated Statement of Operations or Consolidated Statement of Cash Flows.ENVIRONMENTAL MATTERSUnder the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) – commonly known as the “Superfund” – and similar state laws, we are a party to various proceedings related to the cleanup of hazardous waste sites and have been notified that we may be a potentially responsible party related to the cleanup of other hazardous waste sites for which proceedings have not yet been initiated.Kalamazoo River Site RemediationWe have received notification from the Environmental Protection Agency (EPA) and have acknowledged that we are a potentially responsible party in a portion of the Kalamazoo River Superfund site in southwest Michigan. Our involvement in the remediation site is based on our operation of the Plainwell, Michigan mill, located within the remediation site, from 1954 to 1970. Several other companies also have been deemed potentially responsible parties as past or present owners or operators of facilities within the site, or as arrangers under CERCLA.We cooperated with other parties to jointly implement an administrative order issued by the EPA on April 14, 2016, with respect to a portion of the site comprising a stretch of the river approximately 1.7 miles long referred to as the Otsego Township Dam Area. During third quarter 2018, implementation of this administrative order was completed.In 2010, the company, along with others, was named as a defendant by Georgia-Pacific Consumer Products LP, Fort James Corporation and Georgia-Pacific LLC in an action seeking contribution under CERCLA for remediation costs relating to a certain area within the site. On March 29, 2018, the U.S. District Court issued an opinion and order assigning the company responsibility for 5 percent of approximately $50 million in past costs incurred by the plaintiffs. The remaining 95 percent of this pool of past costs incurred was allocated to the plaintiffs and other defendants.

NOTE 11: LONG-TERM DEBT, NETThis note provides details about:  debt issued and extinguished and  long-term debt and related maturities. Our long-term debt includes notes, debentures and other borrowings.DEBT ISSUED AND EXTINGUISHEDIn November 2025, the Arkansas Development Finance Authority issued resource recovery revenue bonds for our benefit in the aggregate principal amount of $102 million. The net proceeds after deducting the discount, underwriting fees and issuance costs were $101 million. The proceeds from the issuance of these bonds were deposited directly into a restricted trust account to be used for the specific purpose for which the money was raised, which is generally to finance capital expenditures for the construction of our TimberStrand® facility in Monticello, Arkansas. We will pay a term interest rate of 3.875 percent until October 2032, at which point the interest rate will reset. We are obligated to repay the principal amount in October 2065. Refer to Note 21: Restricted Cash for details on the portion of the proceeds which remained in the account as of December 31, 2025.In August 2025, we entered into an $800 million senior unsecured term loan agreement that will mature in August 2028. Net proceeds after fees were $799 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread. Additionally, we utilized approximately $500 million of the net proceeds of the term loan to partially redeem our $750 million 4.75 percent senior unsecured notes due in May 2026.In March 2025, we repaid our $71 million 7.95 percent debentures at maturity. We also entered into a $300 million senior unsecured term loan that will mature in April 2030. Net proceeds after fees were $299 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed-upon base rate plus a spread.In January 2025, we repaid our $139 million 8.50 percent debentures at maturity.Over the course of 2023, we refinanced approximately $1 billion of debt.In December 2023, we entered into a $250 million senior unsecured term loan that will mature in December 2028. Net proceeds after fees were $249 million. Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed upon base rate plus a spread.

NOTE 18: INCOME TAXESThis note provides details about income taxes applicable to our operations, including the following:  earnings before income taxes,  provision for income taxes,  effective income tax rate,  deferred tax assets and liabilities and  unrecognized tax benefits. The Income Taxes section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our income taxes.EARNINGS BEFORE INCOME TAXESDomestic and Foreign Earnings Before Income Taxes DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 Domestic earnings $ 80 $ 192 $ 737 Foreign earnings 180 235 200 Total earnings before income taxes $ 260 $ 427 $ 937 PROVISION FOR INCOME TAXES DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 Current: Federal $ — $ 1 $ 37 State (1 ) 2 8 Foreign 51 68 57 Total current 50 71 102 Deferred: Federal (110 ) (32 ) 1 State (5 ) (5 ) (3 ) Foreign 1 (3 ) (2 ) Total deferred (114 ) (40 ) (4 ) Total income tax (benefit) provision $ (64 ) $ 31 $ 98 EFFECTIVE INCOME TAX RATE DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 Dollars Percent Dollars Percent Dollars Percent U.S. federal statutory income tax $ 55 21.0 % $ 90 21.0 % $ 197 21.0 % Domestic, Federal REIT income not subject to federal income tax (136 ) (52.1 ) (60 ) (14.1 ) (114 ) (12.1 ) Nontaxable and nondeductible items Intra-entity transfers 9 3.6 (13 ) (3.0 ) (2 ) (0.2 ) Return to provision adjustment (3 ) (1.1 ) — — (1 ) (0.1 ) Other 3 1.1 1 0.3 1 0.1 Domestic state and local income taxes, net of federal effect(1) (6 ) (2.4 ) (3 ) (0.7 ) 3 0.3 Foreign tax effects Canada Income tax rate differential (10 ) (3.9 ) (16 ) (3.7 ) (11 ) (1.2 ) Provincial income taxes 19 7.2 24 5.6 23 2.5 Withholding taxes 6 2.2 7 1.7 5 0.6 Other (1 ) (0.2 ) 1 0.3 (3 ) (0.4 ) Total income tax (benefit) provision $ (64 ) (24.6 )% $ 31 7.4 % $ 98 10.5 % (1)In 2025, state and local income taxes in Mississippi and Louisiana contributed to the majority of domestic state income taxes, net of federal effect. In 2024 and 2023, state and local income taxes in Oregon contributed to the majority of domestic state income taxes, net of federal effect.INCOME TAXES PAID DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 U.S. Federal $ — $ — $ 21 U.S.

NOTE 15: SHARE-BASED COMPENSATIONThis note provides details about:  our Long-Term Incentive Compensation Plan (2022 Plan),  how we account for share-based awards,  tax benefits of share-based awards,  types of share-based compensation,  unrecognized share-based compensation and  deferred compensation stock equivalent units. Share-based compensation expense was:  $43 million in 2025,  $43 million in 2024 and  $36 million in 2023. OUR LONG-TERM INCENTIVE COMPENSATION PLANOur long-term incentive plan provides for share-based awards that include:  restricted stock,  restricted stock units (RSUs),  performance shares and  performance share units (PSUs). We may issue future grants of up to 20 million shares under the 2022 Plan. We also have the right to reissue forfeited and expired grants. The Compensation Committee of our board of directors annually establishes an overall pool of stock awards available for grants based on performance. For stock-settled awards, we issue new stock into the marketplace and generally do not repurchase shares in connection with issuance of new awards.Our common shares would increase by approximately 24 million shares if all share-based awards were exercised or vested. These include:  all outstanding share-based awards at December 31, 2025 and  all remaining RSUs and PSUs that could be granted under the 2022 Plan. HOW WE ACCOUNT FOR SHARE-BASED AWARDSWe recognize the cost of share-based awards using a fair-value-based measurement in our Consolidated Statement of Operations over the required service period — generally the period from the date of the grant to the date when it is fully vested. Special situations include:  Awards that vest upon retirement — the required service period ends on the date an employee is eligible for retirement, including early retirement.  Awards that continue to vest following job elimination or the sale of a business — the required service period ends on the date the employment from the company is terminated. In these special situations, compensation expense from share-based awards is recognized over a period that is shorter than the stated vesting period. Forfeitures are recognized in compensation expense as they occur.TAX BENEFITS OF SHARE-BASED AWARDSOur total income tax benefit from share-based awards recognized in our Consolidated Statement of Operations for the last three years was:  $5 million in 2025,  $6 million in 2024 and  $5 million in 2023.

NOTE 16: LEASESThe majority of our operating leases are related to our office and warehouse space, and our financing leases are related to vehicles and warehouse space. Our leases have remaining lease terms of approximately 1 year to 25 years. Options to renew, extend or terminate a lease are reflected in our lease terms when we believe it is reasonably certain we will exercise that option. When our leases do not provide an implicit or an explicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments.Lease Expense DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 Operating lease costs $ 25 $ 24 $ 22 Financing lease costs 6 4 5 Total lease costs $ 31 $ 28 $ 27 Supplemental Cash Flow Information DOLLAR AMOUNTS IN MILLIONS 2025 2024 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 31 $ 22 $ 22 Financing cash flows for financing leases(1) $ 6 $ 5 $ 6 ROU assets obtained in exchange for new (modified) lease liabilities: Operating leases $ 4 $ 53 $ 14 Financing leases $ 16 $ 6 $ 6 (1)Interest expense related to financing leases was immaterial during 2025, 2024 and 2023.Supplemental Balance Sheet Information Related to Leases DOLLAR AMOUNTS IN MILLIONS DECEMBER 31, 2025 DECEMBER 31,2024 LEASES BALANCE SHEET CLASSIFICATION Assets Operating lease ROU assets Other assets $ 125 $ 138 Financing lease ROU assets Property and equipment, net 22 12 Total leased assets $ 147 $ 150 Liabilities Current: Operating lease liabilities Accrued liabilities $ 19 $ 25 Financing lease liabilities Accrued liabilities 6 4 Noncurrent: Operating lease liabilities Other liabilities 108 121 Financing lease liabilities Other liabilities 14 8 Total lease liabilities $ 147 $ 158 Weighted Average Remaining Lease Term DECEMBER 31, 2025 DECEMBER 31,2024 Operating leases 9 years 10 years Financing leases 4 years 3 years Weighted Average Discount Rate DECEMBER 31, 2025 DECEMBER 31,2024 Operating leases 4.9 % 4.8 % Financing leases 5.4 % 5.

NOTE 4: TIMBERLAND ACQUISITIONS AND DIVESTITURESVIRGINIA DIVESTITUREIn February 2026, we completed the sale of 108 thousand acres of Virginia timberlands for approximately $193 million. This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations. However, the related assets did meet the relevant criteria to be classified as held for sale on our current period Consolidated Balance Sheet. As of December 31, 2025, assets held for sale of $128 million within our Timberlands segment were included in "Assets held for sale" on our Consolidated Balance Sheet.GEORGIA AND ALABAMA DIVESTITUREIn December 2025, we completed the sale of 86 thousand acres of Georgia and Alabama timberlands for $216 million, which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $117 million gain in the Timberlands segment in our Consolidated Statement of Operations. This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.OREGON DIVESTITUREIn October 2025, we completed the sale of 28 thousand acres of Oregon timberlands for $190 million, which is net of purchase price adjustments and closing costs. As a result of the sale, we recorded a $149 million gain in the Timberlands segment in our Consolidated Statement of Operations. This sale was not considered a strategic shift that had, or will have, a major effect on our operations or financial results and therefore did not meet the requirements for presentation as discontinued operations.NORTH CAROLINA AND VIRGINIA ACQUISITIONIn August 2025, we completed the purchase of 117 thousand acres of North Carolina and Virginia timberlands for $364 million. We recorded $361 million of timberland assets in "Timber and timberlands at cost, less depletion" and $3 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet.WASHINGTON ACQUISITIONIn August 2025, we completed the purchase of approximately 10 thousand acres of Washington timberlands for $95 million. We recorded $94 million of timberland assets in "Timber and timberlands at cost, less depletion" and $1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet.