Exhibit 2.1 AGREEMENT AND PLAN OF MERGER among BIOCRYST PHARMACEUTICALS, INC., AXEL MERGER SUB, INC. and ASTRIA THERAPEUTICS, INC. Dated as of October 14, 2025 TABLE OF CONTENTS | | | Page | | --- | --- | --- | | ARTICLE 1 DEFINITIONS | | 1 | | Section 1.01. | Definitions. | 1 | | Section 1.02. | Other Definitional and Interpretative Provisions | 20 | | ARTICLE 2 THE MERGER | | 20 | | Section 2.01. | The Merger. | 20 | | Section 2.02. | Certificate of Incorporation and Bylaws. | 21 | | Section 2.03. | Direc ...

[Form 8-K Filing Details](index=1&type=section&id=Form%208-K%20Filing%20Details) This section outlines the essential administrative and identification details of the Form 8-K filing for REKOR SYSTEMS, INC [General Information](index=1&type=section&id=General%20Information) This section provides the foundational details of the Form 8-K filing, including the registrant's identification, jurisdiction, and securities information | Detail | Value | | :--- | :--- | | Registrant Name | REKOR SYSTEMS, INC. | | Filing Type | FORM 8-K | | Date of Report | October 14, 2025 | | State of Incorporation | Delaware | | Commission File Number | 001-38338 | | Trading Symbol | REKR | | Exchange | The Nasdaq Stock Market | - The registrant is not an emerging growth company[2](index=2&type=chunk) [Financial and Regulatory Disclosures](index=3&type=section&id=Financial%20and%20Regulatory%20Disclosures) This section details the preliminary financial results for Q3 2025 and confirms their dissemination under Regulation FD [Item 2.02. Results of Operations and Financial Condition](index=3&type=section&id=Item%202.02.%20Results%20of%20Operations%20and%20Financial%20Condition) Rekor Systems, Inc. announced preliminary, unaudited financial results for the quarter ended September 30, 2025, including expected ranges for revenue, gross margin, and Adjusted EBITDA, ahead of its full Q3 2025 results release and investor call scheduled for November 13, 2025 - **Rekor Systems, Inc.** issued a press release on **October 14, 2025**, announcing preliminary, unaudited financial results for the quarter ended **September 30, 2025**[3](index=3&type=chunk) - The preliminary results include expected ranges for revenue, gross margin, and Adjusted EBITDA[3](index=3&type=chunk) - The company's full third-quarter **2025** results and related investor conference call are scheduled for **November 13, 2025**[3](index=3&type=chunk) [Item 7.01. Regulation FD Disclosure](index=3&type=section&id=Item%207.01.%20Regulation%20FD%20Disclosure) This section confirms that the financial information disclosed under Item 2.02 is being furnished pursuant to Regulation FD to ensure broad and non-selective dissemination of material information - The information from Item 2.02 is furnished pursuant to **Regulation FD**[5](index=5&type=chunk) - The purpose of this disclosure is to ensure broad and non-selective dissemination of material information[5](index=5&type=chunk) [Exhibits and Signatures](index=3&type=section&id=Exhibits%20and%20Signatures) This section details the exhibits included in the filing and confirms the official signature by the Chief Financial Officer [Item 9.01. Financial Statements and Exhibits](index=3&type=section&id=Item%209.01.%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits accompanying the Form 8-K filing, primarily the press release detailing the preliminary financial results | Exhibit Number | Title | | :--- | :--- | | 99.1 | Press Release dated October 14, 2025 | | 104 | Cover Page Interactive Data File (embedded with the Inline XBRL document) | [Signature](index=4&type=section&id=Signature) The report is officially signed by Rekor Systems, Inc. through its Chief Financial Officer, Eyal Hen, on October 14, 2025 - The report was signed on behalf of **Rekor Systems, Inc.** by **Eyal Hen**, Chief Financial Officer[9](index=9&type=chunk)[10](index=10&type=chunk)[11](index=11&type=chunk) - The signature date is **October 14, 2025**[11](index=11&type=chunk)

[Filing Information](index=1&type=section&id=Filing%20Information) This section provides details on Eversource Energy's Form 8-K filing and its common share listing [Registrant Details](index=1&type=section&id=Registrant%20Details) Eversource Energy (ES) filed a Form 8-K on October 14, 2025, detailing current events. The company's common shares are listed on the New York Stock Exchange - Eversource Energy (ES) filed a **Form 8-K** on **October 14, 2025**[2](index=2&type=chunk) Securities Registered | Title of each class | Trading Symbol | Name of each exchange on which registered | | :--- | :--- | :--- | | Common Shares, $5.00 par value per share | ES | New York Stock Exchange | [Section 2 - Financial Information](index=2&type=section&id=Section%202%20-%20Financial%20Information) This section details Eversource Energy's Q3 2025 financial results and offshore wind liability update [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) Eversource Energy issued a news release on October 14, 2025, providing an update on offshore wind liability, including unaudited financial information for the three months ended September 30, 2025. This information is attached as Exhibit 99.1 - Eversource Energy issued a news release on **October 14, 2025**, updating on offshore wind liability and unaudited **Q3 2025** financial information[5](index=5&type=chunk) - The news release is attached as Exhibit 99.1 and incorporated by reference, but the information is not deemed 'filed' with the SEC unless specified[5](index=5&type=chunk)[6](index=6&type=chunk) [Section 8 - Other Events](index=2&type=section&id=Section%208%20-%20Other%20Events) This section outlines post-closing adjustments and increased contingent liability for offshore wind projects [Item 8.01 Other Events](index=2&type=section&id=Item%208.01%20Other%20Events) This section details the post-closing adjustments and increased contingent liability related to the sale of Eversource's interests in the South Fork Wind and Revolution Wind projects to Global Infrastructure Partners (GIP). Revised cost projections for Revolution Wind led to an expected $285 million increase in liability and a net after-tax charge of $75 million in Q3 2025 - Eversource sold its interests in the South Fork Wind and Revolution Wind projects to affiliates of Global Infrastructure Partners (GIP) on **September 30, 2024**[7](index=7&type=chunk) Offshore Wind Contingent Liability Evolution | Date | Liability Amount | | :--- | :--- | | September 30, 2024 (initial) | $365 million | | June 30, 2025 | $296 million | | Q3 2025 (expected increase) | +$285 million | | Q3 2025 (expected net after-tax charge) | $75 million | | Q3 2025 (expected EPS impact) | $0.20 per share | - The **$285 million** increase in liability is due to revised construction cost projections for Revolution Wind, reflecting damage to the installation vessel, insurance costs, and a stop-work order from BOEM[9](index=9&type=chunk) - The expected **$285 million** increase in liability will result in a net after-tax non-recurring charge of approximately **$75 million**, or **$0.20 per share**, in **Q3 2025**, partially offset by a **$210 million** federal tax benefit[11](index=11&type=chunk) - Revolution Wind project completion is still expected in the **second half of 2026**[10](index=10&type=chunk) [Non-GAAP Measures and Forward-Looking Statements](index=3&type=section&id=Non-GAAP%20Measures%20and%20Forward-Looking%20Statements) This section discusses the use of non-GAAP financial measures and outlines key forward-looking statement risks [Non-GAAP Financial Measures Disclosure](index=3&type=section&id=Non-GAAP%20Financial%20Measures%20Disclosure) Eversource uses non-GAAP financial measures to evaluate and present earnings results, excluding non-recurring items such as losses on offshore wind investments, the Aquarion water business sale, land disposition, and certain transaction costs. Management believes these exclusions provide a more meaningful representation of ongoing operating performance - Eversource uses non-GAAP financial measures to evaluate and provide details of earnings results by business, excluding specific non-recurring items[12](index=12&type=chunk) - Excluded items include losses on offshore wind equity method investments, the pending sale of the Aquarion water distribution business, disposition of land for the Northern Pass Transmission project, and certain transaction/transition costs[12](index=12&type=chunk) - Management believes these non-GAAP measures offer a more meaningful representation of financial performance by excluding items not indicative of ongoing costs and performance[12](index=12&type=chunk) [Forward-Looking Statements and Risk Factors](index=4&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) The report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially. Key risks include cyberattacks, ability to qualify for tax credits, variability in offshore wind project costs, capital market disruptions, economic conditions, regulatory actions, and extreme weather - The report includes forward-looking statements, which are subject to risks and uncertainties that may cause actual results to differ materially[13](index=13&type=chunk) - Key risk factors include cyberattacks, ability to qualify for investment tax credits, variability in offshore wind project costs (Revolution Wind and South Fork Wind), disruptions in capital markets, changes in economic conditions, and regulatory actions[13](index=13&type=chunk) - Eversource encourages readers to consult its SEC filings and website for detailed risk factor disclosures[14](index=14&type=chunk) [Section 9 - Financial Statements and Exhibits](index=5&type=section&id=Section%209%20-%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits filed with the Form 8-K, including the interactive data file [Item 9.01 Financial Statements and Exhibits](index=5&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits filed with the Form 8-K, specifically Exhibit 104, which is the Cover Page Interactive Data File embedded within the Inline XBRL document Exhibits Filed | Exhibit Number | Description | | :--- | :--- | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | [Signature](index=6&type=section&id=Signature) This section confirms the official signing of the report by Eversource Energy's authorized officer [Registrant Signature](index=6&type=section&id=Registrant%20Signature) The report was duly signed on October 14, 2025, by Jay S. Buth, Vice President, Controller, and Chief Accounting Officer of Eversource Energy - The report was signed on **October 14, 2025**, by Jay S. Buth, Vice President, Controller and Chief Accounting Officer of Eversource Energy[19](index=19&type=chunk)[20](index=20&type=chunk)[21](index=21&type=chunk)

Consolidated Results [Consolidated Financial Highlights](index=2&type=section&id=Consolidated%20Financial%20Highlights) JPMorgan Chase & Co. reported **strong** 3Q25 financial performance, with net revenue **up 9% YoY** and net income **up 12% YoY** Consolidated Financial Highlights (Reported Basis) | Metric (Reported Basis) | 3Q25 (millions) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :---------------------- | :-------------- | :---------------- | :----------------------- | :-------------------------- | | Total net revenue | $46,427 | 9% | $136,649 | 1% | | Total noninterest expense | $24,281 | 8% | $71,657 | 4% | | NET INCOME | $14,393 | 12% | $44,023 | (1)% | Consolidated Financial Highlights (Managed Basis) | Metric (Managed Basis) | 3Q25 (millions) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :--------------------- | :-------------- | :---------------- | :----------------------- | :-------------------------- | | Total net revenue | $47,120 | 9% | $138,814 | 1% | | NET INCOME | $14,393 | 12% | $44,023 | (1)% | Per Share Metrics | Metric | 3Q25 | 3Q25 Change (YoY) | 9 Months 2025 | 9 Months 2025 Change (YoY) | | :---------------------- | :-------- | :---------------- | :------------ | :------------------------- | | Diluted EPS | $5.07 | 16% | $15.38 | 3% | | Book value per share | $124.96 | 9% | $124.96 | 9% | | Tangible book value per share | $105.70 | 10% | $105.70 | 10% | | Cash dividends declared per share | $1.50 | 20% | $4.30 | 21% | Estimated Capital Ratios | Capital Ratio (Estimated) | 3Q25 | 3Q24 | | :------------------------ | :------ | :------ | | Common equity Tier 1 (CET1) | 14.8 % | 15.3 % | | Tier 1 capital ratio | 15.8 % | 16.4 % | | Total capital ratio | 17.7 % | 18.2 % | | Tier 1 leverage ratio | 6.9 % | 7.1 % | | Supplementary leverage ratio (SLR) | 5.8 % | 6.0 % | Period-End Balance Sheet Metrics | Metric (Period-End) | 3Q25 (millions) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :------------------ | :-------------- | :---------------- | :----------------------- | :-------------------------- | | Total assets | $4,560,205 | 8% | $4,560,205 | 8% | | Total loans | $1,435,246 | 7% | $1,435,246 | 7% | | Total deposits | $2,548,476 | 5% | $2,548,476 | 5% | | Common stockholders' equity | $340,167 | 5% | $340,167 | 5% | Managed Net Revenue by Line of Business | Line of Business (Managed Net Revenue) | 3Q25 (millions) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :------------------------------------- | :-------------- | :---------------- | :----------------------- | :-------------------------- | | Consumer & Community Banking | $19,473 | 9% | $56,633 | 7% | | Commercial & Investment Bank | $19,878 | 17% | $59,079 | 12% | | Asset & Wealth Management | $6,066 | 12% | $17,557 | 11% |\ | Corporate | $1,703 | (45)% | $5,545 | (64)% | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Total net revenue **increased 3% QoQ**, but net income **decreased 4% QoQ** due to higher tax expense Consolidated Revenue Breakdown | Revenue Category (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :-------------------------- | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Noninterest revenue | $22,461 | $21,703 | $22,037 | $19,249 | 3% | 17% | | Interest income | $49,439 | $48,241 | $46,853 | $50,416 | 2% | (2)% |\ | Interest expense | $25,473 | $25,032 | $23,580 | $27,011 | 2% | (6)% | | Net interest income | $23,966 | $23,209 | $23,273 | $23,405 | 3% | 2% | | TOTAL NET REVENUE | $46,427 | $44,912 | $45,310 | $42,654 | 3% | 9% | Consolidated Expenses and Profit | Expense/Profit (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Provision for credit losses | $3,403 | $2,849 | $3,305 | $3,111 | 19% | 9% | | TOTAL NONINTEREST EXPENSE | $24,281 | $23,779 | $23,597 | $22,565 | 2% | 8% | | Income before income tax expense | $18,743 | $18,284 | $18,408 | $16,978 | 3% | 10% | | Income tax expense | $4,350 | $3,297 | $3,765 | $4,080 | 32% | 7% | | NET INCOME | $14,393 | $14,987 | $14,643 | $12,898 | (4)% | 12% | - The effective income tax rate **increased to 23.2%** in 3Q25 from **18.0%** in 2Q25, primarily due to a **$774 million income tax benefit** recorded in Corporate in 2Q25 related to tax audit resolutions and foreign currency translation regulations[15](index=15&type=chunk)[16](index=16&type=chunk) [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Total assets **increased QoQ** to **$4.56 trillion**, with loans **up 2% QoQ** and deposits **down 1% QoQ** Consolidated Assets | Asset Category (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :------------------------ | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Total assets | $4,560,205 | $4,552,482 | $4,357,856 | $4,002,814 | $4,210,048 | —% | 8% | | Loans, net of allowance for loan losses | $1,409,511 | $1,387,039 | $1,330,487 | $1,323,643 | $1,316,062 | 2% | 7% | | Investment securities, net of allowance for credit losses | $783,945 | $745,939 | $664,447 | $681,320 | $634,502 | 5% | 24% | | Trading assets: Debt and equity instruments | $892,928 | $829,510 | $814,664 | $576,817 | $734,928 | 8% | 21% | Consolidated Liabilities and Equity | Liability/Equity Category (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :----------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Deposits | $2,548,476 | $2,562,380 | $2,495,877 | $2,406,032 | $2,430,772 | (1)% | 5% | | Long-term debt | $427,203 | $419,802 | $407,224 | $401,418 | $410,157 | 2% | 4% | | TOTAL LIABILITIES | $4,199,993 | $4,195,558 | $4,006,436 | $3,658,056 | $3,864,212 | —% | 9% | | TOTAL STOCKHOLDERS' EQUITY | $360,212 | $356,924 | $351,420 | $344,758 | $345,836 | 1% | 4% | - During the third quarter of 2025, the Firm transferred **$44.1 billion** of investment securities from Available-for-Sale (AFS) to Held-to-Maturity (HTM) for asset-liability management purposes[20](index=20&type=chunk) [Condensed Average Balance Sheets and Annualized Yields](index=7&type=section&id=Condensed%20Average%20Balance%20Sheets%20and%20Annualized%20Yields) Average interest-earning assets **increased 1% QoQ** to **$3.9 trillion**, with net yield at **2.45%** and spread at **1.92%** Condensed Average Balances | Average Balance (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------- | :---------- | :---------- | :---------- | :---------- | :---------------- | :---------------- | | Total interest-earning assets | $3,895,764 | $3,845,982 | $3,668,384 | $3,621,766 | 1% | 8% | | Loans | $1,417,466 | $1,380,726 | $1,339,391 | $1,325,440 | 3% | 7% | | Investment securities | $768,599 | $727,651 | $664,970 | $681,320 | 6% | 23% | | Total interest-bearing liabilities | $3,229,476 | $3,190,122 | $3,016,242 | $2,919,698 | 1% | 11% | | Noninterest-bearing deposits | $610,601 | $602,777 | $587,417 | $633,957 | 1% | (4)% | Annualized Yields and Rates | Average Rate (%) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :---------------- | :--- | :--- | :--- | :--- | :---------------- | :---------------- | | Total interest-earning assets | 5.05 | 5.04 | 5.19 | 5.55 | 0.01 pp | (0.50) pp | | Total interest-bearing liabilities | 3.13 | 3.15 | 3.17 | 3.68 | (0.02) pp | (0.55) pp | | INTEREST RATE SPREAD | 1.92 | 1.89 | 2.02 | 1.87 | 0.03 pp | 0.05 pp | | NET YIELD ON INTEREST EARNING ASSETS | 2.45 | 2.43 | 2.58 | 2.58 | 0.02 pp | (0.13) pp | [Reconciliation from Reported to Managed Basis](index=8&type=section&id=Reconciliation%20from%20Reported%20to%20Managed%20Basis) Managed basis total net revenue was **$47.1 billion**, **up 3% QoQ** and **9% YoY**, with overhead ratio stable at **52%** Non-GAAP Revenue Reconciliation | Metric (millions) | Reported 3Q25 | Managed 3Q25 | Managed 3Q25 Change (QoQ) | Managed 3Q25 Change (YoY) | | :---------------- | :------------ | :----------- | :------------------------ | :------------------------ | | Other income | $1,439 | $2,027 | 12% | 35% | | Total noninterest revenue | $22,461 | $23,049 | 3% | 16% | | Net interest income | $23,966 | $24,071 | 3% | 2% | | Total net revenue | $46,427 | $47,120 | 3% | 9% | | Pre-provision profit | $22,146 | $22,839 | 4% | 10% | | Income before income tax expense | $18,743 | $19,436 | 2% | 10% | | Income tax expense | $4,350 | $5,043 | 24% | 6% | Overhead Ratio Reconciliation | Ratio | Reported 3Q25 | Managed 3Q25 | | :------------ | :------------ | :----------- | | Overhead ratio | 52% | 52% | - Managed basis results include fully taxable-equivalent adjustments to revenue, which allow for comparability of revenue from both taxable and tax-exempt sources; these adjustments do not impact net income[26](index=26&type=chunk)[107](index=107&type=chunk) [Segment & Corporate Results - Managed Basis](index=9&type=section&id=Segment%20%26%20Corporate%20Results%20-%20Managed%20Basis) Most segments reported **YoY growth** in revenue and net income, but Corporate **declined significantly** due to a prior-year Visa share gain Managed Net Revenue by Segment | Segment (Managed Net Revenue) | 3Q25 (millions) | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :---------------------------- | :-------------- | :---------------- | :---------------- | :----------------------- | :-------------------------- | | Consumer & Community Banking | $19,473 | 3% | 9% | $56,633 | 7% | | Commercial & Investment Bank | $19,878 | 2% | 17% | $59,079 | 12% | | Asset & Wealth Management | $6,066 | 5% | 12% | $17,557 | 11% | | Corporate | $1,703 | 11% | (45)% | $5,545 | (64)% | | TOTAL NET REVENUE | $47,120 | 3% | 9% | $138,814 | 1% | Managed Net Income by Segment | Segment (Managed Net Income) | 3Q25 (millions) | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | 9 Months 2025 (millions) | 9 Months 2025 Change (YoY) | | :--------------------------- | :-------------- | :---------------- | :---------------- | :----------------------- | :-------------------------- | | Consumer & Community Banking | $5,009 | (3)% | 24% | $14,603 | 12% | | Commercial & Investment Bank | $6,901 | 4% | 21% | $20,493 | 13% | | Asset & Wealth Management | $1,658 | 13% | 23% | $4,714 | 21% | | Corporate | $825 | (51)% | (54)% | $4,213 | (55)% | | TOTAL NET INCOME | $14,393 | (4)% | 12% | $44,023 | (1)% | - Corporate's **significant YoY decline** in net revenue and net income for both 3Q25 and the nine months ended September 30, 2025, is largely attributable to a **$7.9 billion net gain** related to Visa shares recorded in 2Q24[30](index=30&type=chunk) [Capital and Other Selected Balance Sheet Items](index=10&type=section&id=Capital%20and%20Other%20Selected%20Balance%20Sheet%20Items) The firm maintained **strong** capital, with estimated CET1 ratio at **14.8%** and TCE **increasing 6% YoY** to **$287.7 billion** Estimated Capital Ratios | Capital Metric (Estimated) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Standardized CET1 capital ratio | 14.8 % | 15.1 % | 15.4 % | 15.7 % | 15.3 % | | Advanced CET1 capital ratio | 14.9 % | 15.2 % | 15.6 % | 15.8 % | 15.5 % | | Tier 1 leverage ratio | 6.9 % | 6.9 % | 7.2 % | 7.2 % | 7.1 % | | Supplementary leverage ratio (SLR) | 5.8 % | 5.9 % | 6.0 % | 6.1 % | 6.0 % | Tangible Common Equity | Tangible Common Equity (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Total tangible common equity (period-end) | $287,741 | $284,333 | $278,905 | $272,212 | $271,446 | 1% | 6% | | Total tangible common equity (average) | $283,843 | $277,290 | $271,872 | $265,790 | $269,192 | 2% | 5% | - CET1 capital, beginning balance (9 Months 2025): **$275,513 million**[32](index=32&type=chunk) - Net income applicable to common equity (9 Months 2025): **$43,204 million**[32](index=32&type=chunk) - Dividends declared on common stock (9 Months 2025): **$(11,969) million**[32](index=32&type=chunk) - Net purchase of treasury stock (9 Months 2025): **$(22,308) million**[32](index=32&type=chunk) - Standardized/Advanced CET1 capital, ending balance (9 Months 2025): **$287,297 million**[32](index=32&type=chunk) [Earnings Per Share and Related Information](index=12&type=section&id=Earnings%20Per%20Share%20and%20Related%20Information) Diluted EPS **decreased 3% QoQ** but **increased 16% YoY** to **$5.07**, with cash dividends **up 20% YoY** to **$1.50** Earnings Per Share | EPS Metric (per share) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :--------------------- | :---- | :---- | :---- | :---- | :---------------- | :---------------- | | Basic earnings per share | $5.08 | $5.25 | $5.08 | $4.38 | (3)% | 16% | | Diluted earnings per share | $5.07 | $5.24 | $5.07 | $4.37 | (3)% | 16% | Common Dividends and Payout Ratio | Common Dividends (per share) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :--------------------------- | :---- | :---- | :---- | :---- | :---------------- | :---------------- | | Cash dividends declared per share | $1.50 | $1.40 | $1.40 | $1.25 | 7% | 20% | | Dividend payout ratio | 29% | 27% | 27% | 28% | | | - Total shares of common stock repurchased in 3Q25: **28.0 million**[38](index=38&type=chunk) - Aggregate repurchases of common stock in 3Q25: **$8,315 million**[38](index=38&type=chunk) - A new common share repurchase program of **up to $50 billion** was authorized, effective July 1, 2025, replacing the previous **$30 billion** program[39](index=39&type=chunk) Business Segment & Corporate Results [Consumer & Community Banking ("CCB")](index=13&type=section&id=Consumer%20%26%20Community%20Banking%20%28%22CCB%22%29) CCB reported **strong** 3Q25 results, with net revenue **up 9% YoY** and net income **up 24% YoY** CCB Income Statement | CCB Income Statement (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | TOTAL NET REVENUE | $19,473 | $18,847 | $18,313 | $17,791 | 3% | 9% | | Provision for credit losses | $2,538 | $2,082 | $2,629 | $2,795 | 22% | (9)% | | TOTAL NONINTEREST EXPENSE | $10,296 | $9,858 | $9,857 | $9,586 | 4% | 7% | | NET INCOME | $5,009 | $5,169 | $4,425 | $4,046 | (3)% | 24% | CCB Revenue by Business | CCB Revenue by Business (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :--------------------------------- | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Banking & Wealth Management | $11,040 | $10,698 | $10,254 | $10,090 | 3% | 9% | | Home Lending | $1,260 | $1,250 | $1,207 | $1,295 | 1% | (3)% | | Card Services & Auto | $7,173 | $6,899 | $6,852 | $6,406 | 4% | 12% | - Active digital customers **increased by 1% QoQ** and **6% YoY** to **74.0 million**[50](index=50&type=chunk) - Active mobile customers **increased by 2% QoQ** and **7% YoY** to **60.9 million**[50](index=50&type=chunk) - Client investment assets **grew by 7% QoQ** and **15% YoY** to **$1,232.4 billion**[50](index=50&type=chunk) - Total net charge-offs **increased by 6% QoQ** and **2% YoY** to **$1,963 million**, primarily driven by Card Services[48](index=48&type=chunk) - Total allowance for loan losses **increased by 3% QoQ** and **10% YoY** to **$17,557 million**[48](index=48&type=chunk) [Commercial & Investment Bank ("CIB")](index=17&type=section&id=Commercial%20%26%20Investment%20Bank%20%28%22CIB%22%29) CIB delivered **strong** 3Q25 results, with net revenue **up 17% YoY** and net income **up 21% YoY** CIB Income Statement | CIB Income Statement (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | TOTAL NET REVENUE | $19,878 | $19,535 | $19,666 | $17,015 | 2% | 17% | | Provision for credit losses | $809 | $696 | $705 | $316 | 16% | 156% | | TOTAL NONINTEREST EXPENSE | $9,722 | $9,641 | $9,842 | $8,751 | 1% | 11% | | NET INCOME | $6,901 | $6,650 | $6,942 | $5,691 | 4% | 21% | CIB Revenue by Business | CIB Revenue by Business (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :--------------------------------- | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Investment Banking | $2,694 | $2,684 | $2,268 | $2,354 | —% | 14% | | Fixed Income Markets | $5,613 | $5,690 | $5,849 | $4,651 | (1)% | 21% | | Equity Markets | $3,331 | $3,246 | $3,814 | $2,501 | 3% | 33% | | Securities Services | $1,423 | $1,418 | $1,269 | $1,326 | —% | 7% | - Net charge-offs **increased by 74% QoQ** and **263% YoY** to **$567 million**[68](index=68&type=chunk) - Total nonaccrual loans **increased by 10% QoQ** and **33% YoY** to **$5,371 million**[68](index=68&type=chunk) - Assets under custody (period-end) **grew by 6% QoQ** and **12% YoY** to **$40,128 billion**[73](index=73&type=chunk) - Total investment banking fees **increased by 5% QoQ** and **16% YoY** to **$2,627 million**, with **strong growth** in Equity underwriting (**53% YoY**) and Debt underwriting (**9% YoY**)[73](index=73&type=chunk) [Asset & Wealth Management ("AWM")](index=21&type=section&id=Asset%20%26%20Wealth%20Management%20%28%22AWM%22%29) AWM reported **robust** 3Q25 performance, with net revenue **up 12% YoY** and net income **up 23% YoY** AWM Income Statement | AWM Income Statement (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | TOTAL NET REVENUE | $6,066 | $5,760 | $5,731 | $5,439 | 5% | 12% | | Provision for credit losses | $59 | $46 | $(10) | $4 | 28% | **NM** | | TOTAL NONINTEREST EXPENSE | $3,818 | $3,733 | $3,713 | $3,639 | 2% | 5% | | NET INCOME | $1,658 | $1,473 | $1,583 | $1,351 | 13% | 23% | AWM Revenue by Business | AWM Revenue by Business (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :--------------------------------- | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Asset Management | $2,916 | $2,705 | $2,671 | $2,525 | 8% | 15% | | Global Private Bank | $3,150 | $3,055 | $3,060 | $2,914 | 3% | 8% | AWM Client Assets | Client Assets (billions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :----------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | TOTAL ASSETS UNDER MANAGEMENT | $4,599 | $4,343 | $4,113 | $4,045 | $3,904 | 6% | 18% | | TOTAL CLIENT ASSETS | $6,838 | $6,421 | $6,002 | $5,932 | $5,721 | 6% | 20% | - Net asset flows into AUM for 3Q25 were **positive** across all asset classes: Liquidity (**$37B**), Fixed income (**$31B**), Equity (**$31B**), Multi-asset (**$4B**), and Alternatives (**$6B**)[84](index=84&type=chunk) - Firmwide Wealth Management Client assets **increased by 7% QoQ** and **20% YoY** to **$4,373 billion**[84](index=84&type=chunk) - Number of Global Private Bank client advisors **increased by 8% YoY** to **4,050**[79](index=79&type=chunk) [Corporate](index=24&type=section&id=Corporate) Corporate net income **decreased 51% QoQ** and **54% YoY**, with total net revenue **down 45% YoY** due to a prior-year Visa gain Corporate Income Statement | Corporate Income Statement (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | TOTAL NET REVENUE | $1,703 | $1,538 | $2,304 | $3,070 | 11% | (45)% | | Provision for credit losses | $(3) | $25 | $(19) | $(4) | **NM** | 25% | | NONINTEREST EXPENSE | $445 | $547 | $185 | $589 | (19)% | (24)% | | NET INCOME | $825 | $1,695 | $1,693 | $1,810 | (51)% | (54)% | Corporate Segment Memo Items | Corporate Memo (millions) | 3Q25 | 2Q25 | 1Q25 | 3Q24 | 3Q25 Change (QoQ) | 3Q25 Change (YoY) | | :------------------------ | :------ | :------ | :------ | :------ | :---------------- | :---------------- | | Treasury and CIO Net Revenue | $1,687 | $1,649 | $1,564 | $3,154 | 2% | (47)% | | Other Corporate Net Revenue | $16 | $(111) | $740 | $(84) | **NM** | **NM** | | Treasury and CIO Net Income | $1,166 | $1,121 | $1,158 | $2,291 | 4% | (49)% | | Other Corporate Net Income | $(341) | $574 | $535 | $(481) | **NM** | 29% | - The **significant YoY decline** in total net revenue and net income is largely due to a **$7.9 billion net gain** related to Visa shares recorded in 2Q24[91](index=91&type=chunk) - Investment securities gains/(losses) for 3Q25 were **$105 million**, a **significant improvement** from losses in previous quarters[87](index=87&type=chunk) - Average Available-for-Sale (AFS) securities **increased by 7% QoQ** and **62% YoY** to **$495.8 billion**[87](index=87&type=chunk) - During 3Q25, **$44.1 billion** of investment securities were transferred from AFS to HTM for asset-liability management purposes[89](index=89&type=chunk) Credit-Related Information [Credit Exposure](index=25&type=section&id=Credit%20Exposure) Total credit exposure **increased 3% QoQ** and **8% YoY** to **$3.28 trillion**, driven by loan growth Total Credit Exposure | Credit Exposure (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Total consumer loans | $628,559 | $626,983 | $614,522 | $625,670 | $614,487 | —% | 2% | | Total wholesale loans | $806,687 | $785,009 | $741,173 | $722,318 | $725,524 | 3% | 11% | | Total loans | $1,435,246 | $1,411,992 | $1,355,695 | $1,347,988 | $1,340,011 | 2% | 7% | | Lending-related commitments | $1,714,006 | $1,656,993 | $1,626,483 | $1,577,622 | $1,576,476 | 3% | 9% | | Total credit exposure | $3,277,594 | $3,182,430 | $3,092,120 | $3,038,506 | $3,022,318 | 3% | 8% | Credit Exposure by Category | Credit Exposure by Category (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :------------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Consumer exposure | $1,746,537 | $1,724,322 | $1,692,152 | $1,671,825 | $1,649,403 | 1% | 6% | | Wholesale exposure | $1,531,057 | $1,458,108 | $1,399,968 | $1,366,681 | $1,372,915 | 5% | 12% | [Nonperforming Assets](index=26&type=section&id=Nonperforming%20Assets) Total nonperforming assets **increased 1% QoQ** and **23% YoY** to **$10.6 billion**, driven by nonaccrual loans Nonperforming Assets and Exposure | Nonperforming Assets (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :------------------------------ | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Total consumer nonaccrual loans | $4,600 | $4,669 | $3,759 | $3,926 | $3,713 | (1)% | 24% | | Total wholesale nonaccrual loans | $5,506 | $5,152 | $4,859 | $4,911 | $4,362 | 7% | 26% | | Total nonaccrual loans | $10,106 | $9,821 | $8,618 | $8,837 | $8,075 | 3% | 25% | | Total nonperforming assets | $10,635 | $10,480 | $9,105 | $9,300 | $8,628 | 1% | 23% | | Total nonperforming exposure | $11,660 | $11,402 | $9,898 | $10,037 | $9,247 | 2% | 26% | Nonaccrual Loan Ratios | Nonaccrual Loan-Related Ratios | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :----------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Total nonaccrual loans to total loans | 0.70 % | 0.70 % | 0.64 % | 0.66 % | 0.60 % | | Total consumer, excluding credit card nonaccrual loans to total consumer, excluding credit card loans | 1.17 % | 1.18 % | 0.96 % | 1.00 % | 0.94 % | | Total wholesale nonaccrual loans to total wholesale loans | 0.68 % | 0.66 % | 0.66 % | 0.68 % | 0.60 % | [Summary of Changes in the Allowances](index=27&type=section&id=Summary%20of%20Changes%20in%20the%20Allowances) Total allowance for credit losses **increased 3% QoQ** and **10% YoY** to **$28.8 billion**, driven by higher loan loss provisions Allowance for Credit Losses | Allowance (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | QoQ Change | YoY Change | | :------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | :--------- | :--------- | | Allowance for Loan Losses | $25,735 | $24,953 | $25,208 | $24,345 | $23,949 | 3% | 7% | | Allowance for Lending-Related Commitments | $2,964 | $2,932 | $2,226 | $2,101 | $2,142 | 1% | 38% | | Allowance for Investment Securities | $105 | $108 | $118 | $152 | $175 | (3)% | (40)% | | Total allowance for credit losses | $28,804 | $27,993 | $27,552 | $26,598 | $26,266 | 3% | 10% | Net Charge-Off Rates | Net Charge-Off/(Recovery) Rates | 3Q25 | 2Q25 | 1Q25 | 3Q24 | | :------------------------------ | :----- | :----- | :----- | :----- | | Consumer retained, excluding credit card loans | 0.12 % | 0.14 % | 0.18 % | 0.17 % | | Credit card retained loans | 3.15 % | 3.40 % | 3.58 % | 3.23 % | | Wholesale retained loans | 0.33 % | 0.19 % | 0.11 % | 0.09 % | | Total retained loans | 0.76 % | 0.73 % | 0.74 % | 0.65 % | Allowance for Loan Losses Components | Allowance Components (millions) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :------------------------------ | :----------- | :----------- | :----------- | :----------- | :----------- | | Total consumer allowance for loan losses | $17,457 | $16,850 | $16,858 | $16,407 | $15,835 | | Total wholesale allowance for loan losses | $8,278 | $8,103 | $8,350 | $7,938 | $8,114 | Non-GAAP Financial Measures This section reconciles non-GAAP financial measures like managed basis results, TCE, and metrics excluding Markets, for clearer performance assessment Non-GAAP Revenue Reconciliation | Metric (millions) | Reported 3Q25 | Managed 3Q25 | Managed 3Q25 Excl. Markets | | :---------------- | :------------ | :----------- | :------------------------- | | Net interest income | $23,966 | $24,071 | $23,391 | | Noninterest revenue | $22,461 | $23,049 | $14,785 | | Total net revenue (Memo) | N/A | N/A | $8,944 (Markets) | Non-GAAP Yields and Rates | Yield/Rate (%) | Managed 3Q25 | Managed 3Q25 Excl. Markets | | :------------- | :----------- | :------------------------- | | Net yield on average interest-earning assets | 2.45 | 3.73 | - Managed basis results include fully taxable-equivalent adjustments to revenue for comparability, with no impact on net income[107](index=107&type=chunk) - Pre-provision profit is used to assess a lending institution's ability to generate income in excess of credit losses[107](index=107&type=chunk) - TCE, ROTCE, and TBVPS are used by the Firm, investors, and analysts to assess the Firm's use of equity[107](index=107&type=chunk) - Metrics excluding Markets (Fixed Income Markets and Equity Markets) are reviewed to assess performance apart from volatility associated with Markets activities[107](index=107&type=chunk) [Glossary of Terms and Acronyms (a)](index=2&type=section&id=Glossary%20of%20Terms%20and%20Acronyms%20%28a%29) This section refers to the Glossary of Terms and Acronyms in the 2024 Annual Report on Form 10-K for definitions

[Consolidated Results](index=3&type=section&id=Consolidated%20Results) [Summary Financial Data](index=3&type=section&id=Summary%20Financial%20Data) Wells Fargo & Company reported strong financial performance for Q3 2025, with total revenue increasing by 3% QoQ and 5% YoY, and net income applicable to common stock growing by 2% QoQ and 10% YoY. Diluted EPS rose by 4% QoQ and 17% YoY. The company also saw increases in average loans and assets, while maintaining stable capital ratios **Selected Income Statement Data (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Total revenue | $21,436M | $20,822M | $20,366M | 3% | 5% | | Noninterest expense | $13,846M | $13,379M | $13,067M | 3% | 6% | | Pre-tax pre-provision profit (PTPP) | $7,590M | $7,443M | $7,299M | 2% | 4% | | Provision for credit losses | $681M | $1,005M | $1,065M | (32)% | (36)% | | Wells Fargo net income | $5,589M | $5,494M | $5,114M | 2% | 9% | | Wells Fargo net income applicable to common stock | $5,341M | $5,214M | $4,852M | 2% | 10% | | Diluted earnings per common share | $1.66 | $1.60 | $1.42 | 4% | 17% | | Dividends declared per common share | $0.45 | $0.40 | $0.40 | 13% | 13% | | Book value per common share | $52.30 | $51.13 | $49.26 | 2% | 6% | | Tangible book value per common share | $44.18 | $43.18 | $41.76 | 2% | 6% | **Selected Balance Sheet Data (Period-End Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Loans | $943,102M | $924,418M | $909,711M | 2% | 4% | | Assets | $2,062,926M | $1,981,269M | $1,922,125M | 4% | 7% | | Deposits | $1,367,361M | $1,340,703M | $1,349,646M | 2% | 1% | | Headcount | 210,821 | 212,804 | 220,167 | (1)% | (4)% | | Common Equity Tier 1 (CET1) - Standardized | 11.0% | 11.1% | 11.3% | - | - | | Tier 1 leverage ratio | 7.7% | 8.0% | 8.3% | - | - | | Supplementary Leverage Ratio (SLR) | 6.4% | 6.7% | 6.9% | - | - | - Provision for credit losses decreased significantly by **32% QoQ** and **36% YoY**, indicating improved credit quality or a more favorable economic outlook[4](index=4&type=chunk) [Consolidated Statement of Income](index=5&type=section&id=Consolidated%20Statement%20of%20Income) The consolidated statement of income shows a 3% QoQ increase in total revenue, driven by a 5% increase in interest income and a 4% increase in total noninterest income. Net interest income also grew by 2% QoQ. Noninterest expense increased by 3% QoQ, primarily due to personnel expenses **Consolidated Statement of Income (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Interest income | $22,419M | $21,320M | $22,998M | 5% | (3)% | | Interest expense | $10,469M | $9,612M | $11,308M | 9% | (7)% | | Net interest income | $11,950M | $11,708M | $11,690M | 2% | 2% | | Total noninterest income | $9,486M | $9,114M | $8,676M | 4% | 9% | | Total revenue | $21,436M | $20,822M | $20,366M | 3% | 5% | | Provision for credit losses | $681M | $1,005M | $1,065M | (32)% | (36)% | | Total noninterest expense | $13,846M | $13,379M | $13,067M | 3% | 6% | | Income before income tax expense | $6,909M | $6,438M | $6,234M | 7% | 11% | | Wells Fargo net income | $5,589M | $5,494M | $5,114M | 2% | 9% | - Investment banking fees showed significant growth, increasing by **21% QoQ** and **25% YoY**, contributing to the overall noninterest income growth[12](index=12&type=chunk) - Card fees increased by **4% QoQ** and **12% YoY**, partly due to the acquisition of the remaining interest in the merchant services joint venture in April 2025, which now includes its revenue in card fees[12](index=12&type=chunk) [Consolidated Balance Sheet](index=6&type=section&id=Consolidated%20Balance%20Sheet) The consolidated balance sheet at September 30, 2025, shows a 4% QoQ increase in total assets, primarily driven by increases in federal funds sold and securities purchased under resale agreements, and debt securities. Total liabilities also increased by 5% QoQ, mainly due to a 23% rise in short-term borrowings. Total equity remained stable QoQ **Consolidated Balance Sheet (Period-End Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Total assets | $2,062,926M | $1,981,269M | $1,922,125M | 4% | 7% | | Loans | $943,102M | $924,418M | $909,711M | 2% | 4% | | Debt securities (Trading, AFS, HTM) | $578,143M | $533,916M | $529,832M | 8% | 9% | | Total deposits | $1,367,361M | $1,340,703M | $1,349,646M | 2% | 1% | | Short-term borrowings | $230,649M | $187,995M | $111,894M | 23% | 106% | | Total liabilities | $1,879,914M | $1,798,315M | $1,737,114M | 5% | 8% | | Total equity | $183,012M | $182,954M | $185,011M | 0% | (1)% | | Treasury stock | $(123,148)M | $(117,244)M | $(107,479)M | (5)% | (15)% | - Federal funds sold and securities purchased under resale agreements increased by **47% QoQ** and **47% YoY**, indicating increased liquidity management activities[15](index=15&type=chunk) [Average Balances and Interest Rates (Taxable-Equivalent Basis)](index=7&type=section&id=Average%20Balances%20and%20Interest%20Rates%20%28Taxable-Equivalent%20Basis%29) Average interest-earning assets increased by 4% QoQ, primarily driven by federal funds sold and securities purchased under resale agreements. Total interest-bearing liabilities also increased by 6% QoQ, mainly due to a 43% rise in short-term borrowings. The net interest margin on a taxable-equivalent basis slightly decreased to 2.61% from 2.68% QoQ **Average Balances (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Total interest-earning assets | $1,832,510M | $1,762,160M | $1,754,068M | 4% | 4% | | Loans | $928,677M | $916,719M | $910,255M | 1% | 2% | | Total interest-bearing liabilities | $1,414,181M | $1,334,659M | $1,314,429M | 6% | 8% | | Interest-bearing deposits | $984,197M | $970,684M | $986,206M | 1% | 0% | | Short-term borrowings | $211,959M | $147,917M | $109,902M | 43% | 93% | **Average Interest Rates (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Total interest-earning assets | 4.88% | 4.87% | 5.24% | | Loans | 5.97% | 5.95% | 6.41% | | Total interest-bearing liabilities | 2.94% | 2.89% | 3.43% | | Interest-bearing deposits | 2.09% | 2.09% | 2.60% | | Net interest margin on a taxable-equivalent basis | 2.61% | 2.68% | 2.67% | - The average interest rate on total interest-earning assets remained stable QoQ at **4.88%**, while the rate on total interest-bearing liabilities increased to **2.94%** from **2.89% QoQ**[17](index=17&type=chunk) [Reportable Operating Segment Results](index=8&type=section&id=Reportable%20Operating%20Segment%20Results) [Combined Segment Results](index=8&type=section&id=Combined%20Segment%20Results) In Q3 2025, all reportable operating segments except Corporate reported positive net income. Consumer Banking and Lending, Commercial Banking, and Corporate and Investment Banking were the largest contributors to net income. Total revenue increased across most segments QoQ, with Corporate and Investment Banking showing the highest growth **Combined Segment Net Income (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Segment | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Consumer Banking and Lending | $2,185M | $1,863M | $1,924M | | Commercial Banking | $1,162M | $1,086M | $1,318M | | Corporate and Investment Banking | $1,966M | $1,737M | $1,992M | | Wealth and Investment Management | $591M | $480M | $529M | | Corporate | $(315)M | $328M | $(649)M | | Consolidated Company | $5,589M | $5,494M | $5,114M | **Combined Segment Total Revenue (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Segment | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Consumer Banking and Lending | $9,650M | $9,228M | $9,124M | | Commercial Banking | $3,041M | $2,933M | $3,333M | | Corporate and Investment Banking | $4,879M | $4,673M | $4,911M | | Wealth and Investment Management | $4,196M | $3,898M | $3,878M | | Corporate | $176M | $559M | $(337)M | | Consolidated Company | $21,436M | $20,822M | $20,366M | - The Corporate segment reported a net loss of **$315 million** in Q3 2025, a significant decrease from a net income of **$328 million** in Q2 2025, but an improvement from a loss of **$649 million** in Q3 2024[18](index=18&type=chunk) [Consumer Banking and Lending Segment](index=10&type=section&id=Consumer%20Banking%20and%20Lending) The Consumer Banking and Lending segment reported a 14% QoQ increase in net income to $2,185 million, driven by higher total revenue and a decrease in provision for credit losses. Total revenue grew by 5% QoQ, with significant increases in card fees and mortgage banking. Average total loans increased by 3% YoY, while average total deposits remained stable **Consumer Banking and Lending Income Statement (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $7,505M | $7,199M | $7,149M | 4% | 5% | | Total noninterest income | $2,145M | $2,029M | $1,975M | 6% | 9% | | Total revenue | $9,650M | $9,228M | $9,124M | 5% | 6% | | Provision for credit losses | $767M | $945M | $930M | (19)% | (18)% | | Net income | $2,185M | $1,863M | $1,924M | 17% | 14% | **Consumer Banking and Lending Selected Metrics (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Return on allocated capital | 18.5% | 15.9% | 16.3% | | Efficiency ratio | 62% | 63% | 62% | | Digital active customers ( in millions) | 37.0 | 36.6 | 35.8 | | Mobile active customers ( in millions) | 32.5 | 32.1 | 31.2 | | Credit card purchase volume ($ in billions) | $47.4 | $46.4 | $43.4 | | Auto loan originations ($ in billions) | $8.8 | $6.9 | $4.1 | - In Q3 2025, approximately **$8 billion** of loans and **$6 billion** of deposits were prospectively transferred from Commercial Banking to Consumer, Small and Business Banking within this segment[27](index=27&type=chunk) [Commercial Banking Segment](index=12&type=section&id=Commercial%20Banking) The Commercial Banking segment's net income increased by 7% QoQ to $1,162 million, despite a 2% QoQ decrease in net interest income and a 9% YoY decrease in total revenue. The segment saw a significant 191% QoQ increase in provision for credit losses, though it remained lower YoY. Average total loans decreased by 3% QoQ, partly due to a transfer of certain business customers **Commercial Banking Income Statement (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $1,949M | $1,983M | $2,289M | (2)% | (15)% | | Total noninterest income | $1,092M | $950M | $1,044M | 15% | 5% | | Total revenue | $3,041M | $2,933M | $3,333M | 4% | (9)% | | Provision for credit losses | $39M | $(43)M | $85M | 191% | (54)% | | Net income | $1,162M | $1,086M | $1,318M | 7% | (12)% | **Commercial Banking Selected Balance Sheet Data (Average, Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Commercial and industrial loans | $166,946M | $167,134M | $161,967M | 0% | 3% | | Commercial real estate loans | $37,605M | $44,373M | $44,756M | (15)% | (16)% | | Total loans | $219,356M | $226,461M | $222,116M | (3)% | (1)% | | Total deposits | $171,976M | $177,994M | $173,158M | (3)% | (1)% | - The decrease in Commercial Real Estate loans by **15% QoQ** and **16% YoY** significantly impacted the total loan portfolio for the segment[34](index=34&type=chunk) [Corporate and Investment Banking Segment](index=14&type=section&id=Corporate%20and%20Investment%20Banking) The Corporate and Investment Banking segment reported a 13% QoQ increase in net income to $1,966 million, driven by a 4% QoQ increase in total revenue. Investment banking fees saw a substantial 18% QoQ and 24% YoY growth. Average total loans increased by 4% QoQ and 8% YoY, with significant growth in Markets loans **Corporate and Investment Banking Income Statement (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $1,870M | $1,815M | $1,909M | 3% | (2)% | | Total noninterest income | $3,009M | $2,858M | $3,002M | 5% | 0% | | Total revenue | $4,879M | $4,673M | $4,911M | 4% | (1)% | | Provision for credit losses | $(107)M | $103M | $26M | NM | NM | | Net income | $1,966M | $1,737M | $1,992M | 13% | (1)% | **Corporate and Investment Banking Selected Balance Sheet Data (Average, Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Commercial and industrial loans | $214,774M | $202,473M | $183,255M | 6% | 17% | | Commercial real estate loans | $81,121M | $83,413M | $91,963M | (3)% | (12)% | | Total loans | $295,895M | $285,886M | $275,218M | 4% | 8% | | Total trading-related assets | $306,440M | $274,599M | $234,210M | 12% | 31% | | Total deposits | $204,056M | $202,420M | $194,315M | 1% | 5% | - Net gains from trading activities increased by **16% QoQ** and **4% YoY**, contributing to the segment's noninterest income[36](index=36&type=chunk) [Wealth and Investment Management Segment](index=16&type=section&id=Wealth%20and%20Investment%20Management) The Wealth and Investment Management segment's net income increased by 23% QoQ and 12% YoY to $591 million, driven by an 8% QoQ and 8% YoY increase in total revenue. Investment advisory and other asset-based fees grew by 7% QoQ and 8% YoY. Total client assets increased by 5% QoQ and 8% YoY, reaching $2,473 billion **Wealth and Investment Management Income Statement (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $974M | $891M | $842M | 9% | 16% | | Total noninterest income | $3,222M | $3,007M | $3,036M | 7% | 6% | | Total revenue | $4,196M | $3,898M | $3,878M | 8% | 8% | | Provision for credit losses | $(14)M | $12M | $16M | NM | NM | | Net income | $591M | $480M | $529M | 23% | 12% | **Wealth and Investment Management Selected Metrics (Period-End Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Return on allocated capital | 35.1% | 28.7% | 31.5% | | Efficiency ratio | 82% | 83% | 81% | | Total client assets ($ in billions) | $2,473 | $2,346 | $2,294 | | Total loans (average) | $86,150M | $84,871M | $82,797M | | Total deposits (average) | $127,377M | $123,611M | $107,991M | - Advisory assets increased by **6% QoQ** and **11% YoY**, reaching **$1,104 billion**, contributing to the growth in investment advisory fees[40](index=40&type=chunk) [Corporate Segment](index=17&type=section&id=Corporate) The Corporate segment reported a net loss of $315 million in Q3 2025, a significant decline from a net income of $328 million in Q2 2025, primarily due to a 69% QoQ decrease in total revenue and a 41% YoY increase in income tax benefit. Noninterest expense increased by 15% QoQ. Average total deposits decreased significantly by 40% YoY **Corporate Segment Income Statement (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $(273)M | $(103)M | $(415)M | NM | 34% | | Total noninterest income | $449M | $662M | $78M | (32)% | 476% | | Total revenue | $176M | $559M | $(337)M | (69)% | 152% | | Provision for credit losses | $(4)M | $(12)M | $8M | 67% | NM | | Noninterest expense | $650M | $565M | $580M | 15% | 12% | | Net income (loss) | $(315)M | $328M | $(649)M | NM | 51% | **Corporate Segment Selected Balance Sheet Data (Average, Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Available-for-sale debt securities | $188,103M | $172,879M | $147,093M | 9% | 28% | | Held-to-maturity debt securities | $214,409M | $220,364M | $242,621M | (3)% | (12)% | | Total assets | $636,359M | $601,010M | $648,930M | 6% | (2)% | | Total deposits | $55,201M | $46,242M | $92,662M | 19% | (40)% | - The Corporate segment includes corporate treasury and enterprise functions, investment portfolio, and venture capital/private equity investments, as well as results for previously divested businesses[41](index=41&type=chunk) [Credit-Related Information](index=18&type=section&id=Credit-Related%20Information) [Consolidated Loans Outstanding – Period-End Balances, Average Balances, and Average Interest Rates](index=18&type=section&id=Consolidated%20Loans%20Outstanding%20%E2%80%93%20Period-End%20Balances%2C%20Average%20Balances%2C%20and%20Average%20Interest%20Rates) Consolidated period-end loans increased by 2% QoQ and 4% YoY to $943,102 million, driven by growth in commercial and industrial loans and consumer loans (credit card, auto, other consumer). Commercial real estate loans continued to decline. Average interest rates on total loans remained stable QoQ at 5.97% **Period-End Loans (Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Loan Type | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | $ Change QoQ | $ Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Commercial and industrial | $417,904M | $402,150M | $372,750M | $15,754M | $45,154M | | Commercial real estate | $130,250M | $132,560M | $141,410M | $(2,310)M | $(11,160)M | | Total commercial | $563,465M | $549,770M | $530,642M | $13,695M | $32,823M | | Residential mortgage | $243,910M | $245,755M | $252,676M | $(1,845)M | $(8,766)M | | Credit card | $56,996M | $55,318M | $55,046M | $1,678M | $1,950M | | Auto | $46,041M | $42,878M | $42,815M | $3,163M | $3,226M | | Other consumer | $32,690M | $30,697M | $28,532M | $1,993M | $4,158M | | Total consumer | $379,637M | $374,648M | $379,069M | $4,989M | $568M | | Total loans | $943,102M | $924,418M | $909,711M | $18,684M | $33,391M | **Average Interest Rates on Loans (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Loan Type | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Commercial and industrial | 6.26% | 6.29% | 7.16% | | Commercial real estate | 6.15% | 6.17% | 6.90% | | Credit card | 12.70% | 12.65% | 12.73% | | Auto | 5.59% | 5.48% | 5.22% | | Total loans | 5.97% | 5.95% | 6.41% | [Net Loan Charge-offs](index=19&type=section&id=Net%20Loan%20Charge-offs) Total net loan charge-offs decreased by 5% QoQ and 15% YoY to $942 million in Q3 2025. This reduction was primarily driven by lower charge-offs in credit card and other consumer loans. Commercial real estate charge-offs increased QoQ but decreased significantly YoY **Net Loan Charge-offs by Product (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Product | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | $ Change QoQ | $ Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Commercial and industrial | $131M | $179M | $129M | $(48)M | $2M | | Commercial real estate | $107M | $61M | $184M | $46M | $(77)M | | Total commercial | $250M | $247M | $323M | $3M | $(73)M | | Credit card | $571M | $622M | $601M | $(51)M | $(30)M | | Auto | $50M | $30M | $83M | $20M | $(33)M | | Other consumer | $93M | $101M | $127M | $(8)M | $(34)M | | Total consumer | $692M | $750M | $788M | $(58)M | $(96)M | | Total net loan charge-offs | $942M | $997M | $1,111M | $(55)M | $(169)M | **Net Loan Charge-offs by Segment (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Segment | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Consumer Banking and Lending | $766M | $818M | $871M | | Commercial Banking | $83M | $98M | $50M | | Corporate and Investing Banking | $94M | $75M | $196M | | Wealth and Investment Management | $(1)M | $6M | $(5)M | | Total net loan charge-offs | $942M | $997M | $1,111M | [Changes in Allowance for Credit Losses for Loans](index=20&type=section&id=Changes%20in%20Allowance%20for%20Credit%20Losses%20for%20Loans) The allowance for credit losses for loans decreased by 2% QoQ and 3% YoY to $14,311 million at period-end September 30, 2025. This was primarily due to a decrease in the provision for credit losses and lower net loan charge-offs. The allowance for loan losses as a percentage of total loans was 1.46% **Changes in Allowance for Credit Losses for Loans (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | $ Change QoQ | $ Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Balance, beginning of period | $14,568M | $14,552M | $14,789M | $16M | $(221)M | | Provision for credit losses for loans | $687M | $1,007M | $1,059M | $(320)M | $(372)M | | Net loan charge-offs | $(942)M | $(997)M | $(1,111)M | $55M | $169M | | Balance, end of period | $14,311M | $14,568M | $14,739M | $(257)M | $(428)M | | Allowance for loan losses to total net loan charge-offs (annualized) | 3.68x | 3.49x | 3.24x | - | - | | Allowance for loan losses as a percentage of total loans | 1.46% | 1.51% | 1.58% | - | - | - The ratio of allowance for loan losses to total net loan charge-offs improved to **3.68x**, indicating a stronger coverage of potential losses[46](index=46&type=chunk) [Allocation of the Allowance for Credit Losses for Loans](index=21&type=section&id=Allocation%20of%20the%20Allowance%20for%20Credit%20Losses%20for%20Loans) The allocation of allowance for credit losses (ACL) for loans shows that commercial loans account for 52.8% of the total ACL, while consumer loans account for 47.2%. Commercial real estate loans have the highest ACL as a percentage of loan class at 2.28%, followed by credit card loans at 8.61% **Allocation of Allowance for Credit Losses for Loans by Product (Sep 30, 2025):** | Product | ACL ($ in millions) | ACL as % of loan class | | :-------------------------------- | :------------------ | :--------------------- | | Commercial and industrial | $4,376 | 1.05% | | Commercial real estate | $2,965 | 2.28% | | Lease financing | $211 | 1.38% | | Total commercial | $7,552 | 1.34% | | Residential mortgage | $569 | 0.23% | | Credit card | $4,907 | 8.61% | | Auto | $717 | 1.56% | | Other consumer | $566 | 1.73% | | Total consumer | $6,759 | 1.78% | | Total allowance for credit losses for loans | $14,311 | 1.52% | **Allocation of Allowance for Credit Losses for Loans by Segment (Sep 30, 2025):** | Segment | ACL ($ in millions) | ACL as % of loan class | | :-------------------------------- | :------------------ | :--------------------- | | Consumer Banking and Lending | $7,599 | 2.32% | | Commercial Banking | $2,184 | 0.98% | | Corporate and Investing Banking | $4,275 | 1.41% | | Wealth and Investment Management | $251 | 0.29% | | Corporate | $2 | 0.22% | | Total allowance for credit losses for loans | $14,311 | 1.52% | [Nonperforming Assets (Nonaccrual Loans and Foreclosed Assets)](index=22&type=section&id=Nonperforming%20Assets%20%28Nonaccrual%20Loans%20and%20Foreclosed%20Assets%29) Total nonperforming assets decreased by 2% QoQ and 7% YoY to $7,832 million at September 30, 2025. This reduction was primarily driven by a decrease in commercial real estate nonaccrual loans. Nonaccrual loans as a percentage of total loans stood at 0.81% **Nonaccrual Loans by Product (Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Product | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | $ Change QoQ | $ Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Commercial and industrial | $1,050M | $925M | $743M | $125M | $307M | | Commercial real estate | $3,334M | $3,556M | $4,115M | $(222)M | $(781)M | | Total commercial | $4,459M | $4,563M | $4,952M | $(104)M | $(493)M | | Residential mortgage | $3,057M | $3,090M | $3,086M | $(33)M | $(29)M | | Total consumer | $3,155M | $3,194M | $3,220M | $(39)M | $(65)M | | Total nonaccrual loans | $7,614M | $7,757M | $8,172M | $(143)M | $(558)M | | Foreclosed assets | $218M | $207M | $212M | $11M | $6M | | Total nonperforming assets | $7,832M | $7,964M | $8,384M | $(132)M | $(552)M | - Nonaccrual loans in the Corporate and Investment Banking segment decreased by **$636 million YoY**, contributing significantly to the overall reduction in nonperforming assets[49](index=49&type=chunk) [Commercial Loan Portfolio – Commercial and Industrial Loans and Lease Financing by Industry and Commercial Real Estate Loans by Property Type](index=23&type=section&id=Commercial%20Loan%20Portfolio%20%E2%80%93%20Commercial%20and%20Industrial%20Loans%20and%20Lease%20Financing%20by%20Industry%20and%20Commercial%20Real%20Estate%20Loans%20by%20Property%20Type) The commercial loan portfolio shows that 'Financials except banks' is the largest industry for commercial and industrial loans and lease financing, with $183,637 million outstanding. For commercial real estate loans, 'Apartments' represent the largest property type with $37,677 million outstanding. Nonaccrual loans for 'Office' property type remain the highest at $2,450 million **Commercial and Industrial Loans and Lease Financing by Industry (Sep 30, 2025):** | Industry | Nonaccrual loans | Loans outstanding balance | Total commitments | | :-------------------------------- | :--------------- | :------------------------ | :---------------- | | Financials except banks | $165M | $183,637M | $293,425M | | Technology, telecom and media | $117M | $25,353M | $65,988M | | Real estate and construction | $70M | $29,329M | $60,547M | | Retail | $85M | $20,454M | $43,224M | | Materials and commodities | $104M | $14,217M | $34,747M | | Total commercial and industrial loans and lease financing | $1,125M | $433,215M | $850,945M | **Commercial Real Estate Loans by Property Type (Sep 30, 2025):** | Property Type | Nonaccrual loans | Loans outstanding balance | Total commitments | | :-------------------------------- | :--------------- | :------------------------ | :---------------- | | Apartments | $287M | $37,677M | $41,732M | | Industrial/warehouse | $46M | $23,854M | $30,020M | | Office | $2,450M | $23,670M | $24,613M | | Hotel/motel | $289M | $11,882M | $12,262M | | Retail (excluding shopping center) | $96M | $10,714M | $11,687M | | Total commercial real estate loans | $3,334M | $130,250M | $145,354M | - Nonaccrual loans for the 'Office' property type within Commercial Real Estate decreased by **$800 million YoY**, but still represent the largest portion of nonaccrual CRE loans[51](index=51&type=chunk) [Equity](index=24&type=section&id=Equity) [Tangible Common Equity](index=24&type=section&id=Tangible%20Common%20Equity) Tangible common equity (TCE), a non-GAAP measure, remained stable QoQ at $139,119 million at September 30, 2025. Tangible book value per common share increased by 2% QoQ to $44.18. Return on average tangible common equity (ROTCE) was 15.2% for Q3 2025, consistent with the prior quarter and up from 13.9% YoY **Tangible Book Value per Common Share Reconciliation (Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | % Change QoQ | % Change YoY | | :-------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Total equity | $183,012M | $182,954M | $185,011M | 0% | (1)% | | Total common stockholders' equity | $164,687M | $164,644M | $164,801M | 0% | 0% | | Tangible common equity | $139,119M | $139,057M | $139,711M | 0% | 0% | | Common shares outstanding (in millions) | 3,148.9 | 3,220.4 | 3,345.5 | (2)% | (6)% | | Book value per common share | $52.30 | $51.13 | $49.26 | 2% | 6% | | Tangible book value per common share | $44.18 | $43.18 | $41.76 | 2% | 6% | **Return on Average Tangible Common Equity (ROTCE) Reconciliation (Quarter ended Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Net income applicable to common stock | $5,341M | $5,214M | $4,852M | | Average tangible common equity | $139,539M | $137,697M | $139,346M | | Return on average common stockholders' equity (ROE) | 12.8% | 12.8% | 11.7% | | Return on average tangible common equity (ROTCE) | 15.2% | 15.2% | 13.9% | [Risk-Based Capital Ratios Under Basel III](index=26&type=section&id=Risk-Based%20Capital%20Ratios%20Under%20Basel%20III) Wells Fargo maintained strong capital adequacy under Basel III in Q3 2025. The Common Equity Tier 1 (CET1) ratio under the Standardized Approach was 11.0%, slightly down from 11.1% QoQ, and 12.7% under the Advanced Approach, stable QoQ. Total risk-weighted assets (RWAs) increased by 1% QoQ under the Standardized Approach **Risk-Based Capital Ratios Under Basel III (Sep 30, 2025 vs. Jun 30, 2025 vs. Sep 30, 2024):** | Metric | Sep 30, 2025 | Jun 30, 2025 | Sep 30, 2024 | | :-------------------------------- | :----------- | :----------- | :----------- | | Common Equity Tier 1 (CET1) - Standardized Approach | 11.0% | 11.1% | 11.3% | | Tier 1 capital - Standardized Approach | 12.3% | 12.5% | 12.8% | | Total capital - Standardized Approach | 14.8% | 15.0% | 15.5% | | Risk-weighted assets (RWAs) - Standardized Approach ($ in billions) | $1,243.8 | $1,225.9 | $1,219.9 | | Common Equity Tier 1 (CET1) - Advanced Approach | 12.7% | 12.7% | 12.7% | | Tier 1 capital - Advanced Approach | 14.2% | 14.3% | 14.4% | | Total capital - Advanced Approach | 16.2% | 16.2% | 16.4% | | Risk-weighted assets (RWAs) - Advanced Approach ($ in billions) | $1,072.8 | $1,070.4 | $1,089.3 | - The company must calculate its CET1, Tier 1, and total capital ratios under both the Standardized and Advanced Approaches, as per Basel III capital rules[57](index=57&type=chunk)

[Use of non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20non-GAAP%20Financial%20Measures) This section explains the company's use of non-GAAP financial measures to provide a clearer view of operational performance and financial condition [Non-GAAP Financial Measures Overview](index=3&type=section&id=Non-GAAP%20Financial%20Measures%20Overview) The company uses non-GAAP financial measures to clarify operating performance and financial condition, advising against their isolated use - Non-GAAP financial measures, including **adjusted net income**, **adjusted diluted EPS**, **adjusted pre-tax pre-provision net revenue**, **core revenue**, **core noninterest expense**, **core efficiency ratio**, **adjusted return on average assets and equity**, and **tangible assets/equity**, are used to exclude non-core/adjusted income and expense items or the impact of goodwill and other intangibles[3](index=3&type=chunk) - Management uses these non-GAAP measures to analyze performance, financial condition, and operational efficiency, believing they facilitate period-to-period comparisons and provide meaningful indications of operating performance by eliminating non-recurring or non-indicative gains and charges[4](index=4&type=chunk) - Investors are advised that non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP measures, and their calculation methods may differ from those of other companies[4](index=4&type=chunk) [Financial Summary and Key Metrics](index=4&type=section&id=Financial%20Summary%20and%20Key%20Metrics) This section provides a concise overview of the company's financial performance and key metrics for the reported periods [Selected Financial Highlights](index=4&type=section&id=Selected%20Financial%20Highlights) The company's Q3 2025 financial summary highlights significant growth in assets, loans, and deposits, with improved net interest income and NIM, despite an elevated efficiency ratio Selected Balance Sheet Data (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :---------------------------------- | :--------- | :--------- | :--------- | | Cash and cash equivalents | $1,280,033 | $1,165,729 | $951,750 | | Loans HFI | $12,297,600 | $9,874,282 | $9,478,129 | | Total assets | $16,236,459 | $13,354,238 | $12,920,222 | | Total deposits | $13,812,955 | $11,403,470 | $10,976,211 | | Total common shareholders' equity | $1,978,043 | $1,611,130 | $1,562,329 | Selected Statement of Income Data (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :---------------------------------- | :--------- | :--------- | :--------- | | Total interest income | $236,898 | $182,084 | $185,628 | | Total interest expense | $89,658 | $70,669 | $79,611 | | Net interest income | $147,240 | $111,415 | $106,017 | | Total noninterest income (loss) | $26,635 | $(34,552) | $(16,497) | | Total noninterest expense | $109,856 | $81,261 | $76,212 | | Net income applicable to FB Financial Corporation | $23,375 | $2,909 | $10,220 | Selected Ratios | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Net interest margin (NIM) (tax-equivalent basis) | 3.95 % | 3.68 % | 3.55 % | | Efficiency ratio | 63.2 % | 105.7 % | 85.1 % | | Nonperforming assets as a percentage of total assets | 0.89 % | 0.92 % | 0.99 % | | Tangible common equity to tangible assets* | 10.1 % | 10.4 % | 10.4 % | [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) This section details the company's consolidated income statement performance for three and nine-month periods, highlighting key revenue and expense trends [Three Months Ended](index=6&type=section&id=Three%20Months%20Ended) Q3 2025 saw significant growth in interest and net interest income, a recovery in noninterest income, and a substantial rise in noninterest expense due to merger costs Consolidated Statements of Income (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | Sep 2025 vs. Jun 2025 (Percent variance) | Sep 2025 vs. Sep 2024 (Percent variance) | | :------------------------------------------ | :--------- | :--------- | :--------- | :--------------------------------------- | :--------------------------------------- | | Total interest income | $236,898 | $182,084 | $185,628 | 30.1 % | 27.6 % | | Net interest income | $147,240 | $111,415 | $106,017 | 32.2 % | 38.9 % | | Total noninterest income (loss) | $26,635 | $(34,552) | $(16,497) | (177.1)% | (261.5)% | | Total noninterest expense | $109,856 | $81,261 | $76,212 | 35.2 % | 44.1 % | | Net income applicable to FB Financial Corporation | $23,375 | $2,909 | $10,220 | 703.5 % | 128.7 % | - Merger and integration costs increased significantly to **$16.06 million** in Sep 2025, up from **$2.73 million** in Jun 2025 and zero in Sep 2024[9](index=9&type=chunk) - Diluted net income per common share rose to **$0.43** in Sep 2025, compared to **$0.06** in Jun 2025 and **$0.22** in Sep 2024[9](index=9&type=chunk) [Nine Months Ended](index=7&type=section&id=Nine%20Months%20Ended) Nine months ended September 2025 saw increased interest and net interest income, but decreased net income due to higher credit loss provisions and noninterest expenses Consolidated Statements of Income (Nine Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Sep 2024 | Sep 2025 vs. Sep 2024 (Percent variance) | | :------------------------------------------ | :--------- | :--------- | :--------------------------------------- | | Total interest income | $598,688 | $539,169 | 11.0 % | | Net interest income | $366,296 | $308,122 | 18.9 % | | Provision for credit losses on loans HFI | $30,761 | $7,648 | 302.2 % | | Total noninterest income | $15,115 | $17,073 | (11.5)% | | Total noninterest expense | $270,666 | $223,725 | 21.0 % | | Net income applicable to FB Financial Corporation | $65,645 | $78,149 | (16.0)% | - Provision for credit losses on loans HFI increased by **302.2%** to **$30.76 million** for the nine months ended Sep 2025 compared to Sep 2024[11](index=11&type=chunk) - Merger and integration costs, which were zero in Sep 2024, amounted to **$19.19 million** for the nine months ended Sep 2025[11](index=11&type=chunk) [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) This section presents the company's consolidated balance sheet, detailing asset, liability, and equity changes [Balance Sheet Overview](index=8&type=section&id=Balance%20Sheet%20Overview) September 2025 balance sheet shows substantial growth in total assets, loans, and deposits, with increased goodwill from acquisitions Consolidated Balance Sheets (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | Sep 2025 vs. Jun 2025 (Percent variance) | Sep 2025 vs. Sep 2024 (Percent variance) | | :------------------------------------------ | :--------- | :--------- | :--------- | :--------------------------------------- | :--------------------------------------- | | Total assets | $16,236,459 | $13,354,238 | $12,920,222 | 85.6 % | 25.7 % | | Loans held for investment | $12,297,600 | $9,874,282 | $9,478,129 | 97.4 % | 29.7 % | | Total deposits | $13,812,955 | $11,403,470 | $10,976,211 | 83.8 % | 25.8 % | | Total common shareholders' equity | $1,978,043 | $1,611,130 | $1,562,329 | 90.4 % | 26.6 % | - Goodwill increased from **$242.56 million** in Jun 2025 to **$350.35 million** in Sep 2025, reflecting recent acquisition activities[13](index=13&type=chunk) - Money market and savings deposits showed strong annualized growth of **112.9%** from Jun 2025 to Sep 2025, and **45.6%** from Sep 2024 to Sep 2025[13](index=13&type=chunk) [Average Balance and Interest Yield/Rate Analysis](index=9&type=section&id=Average%20Balance%20and%20Interest%20Yield%2FRate%20Analysis) This section analyzes average balances, interest yields, and rates, providing insights into net interest margin performance [Three Months Ended](index=9&type=section&id=Three%20Months%20Ended) Q3 2025 saw net interest margin improve to **3.95%** due to higher asset yields, a slight increase in deposit costs, and significant loan growth Key Yield/Rate Metrics (Three Months Ended) | Metric | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :------------------------------------------ | :----------- | :----------- | :----------- | :----------- | :----------- | | Loans HFI average yield | 6.75 % | 6.44 % | 6.41 % | 6.51 % | 6.70 % | | Total interest-earning assets average yield | 6.35 % | 5.99 % | 5.91 % | 6.01 % | 6.20 % | | Total interest-bearing deposits average rate | 3.16 % | 3.10 % | 3.13 % | 3.37 % | 3.58 % | | Net interest margin (NIM) (tax-equivalent basis) | 3.95 % | 3.68 % | 3.55 % | 3.50 % | 3.55 % | | Cost of total deposits | 2.53 % | 2.48 % | 2.54 % | 2.70 % | 2.83 % | - Average balances for Loans HFI increased from **$9.84 billion** in June 2025 to **$12.19 billion** in September 2025[16](index=16&type=chunk) - The interest rate spread improved to **3.14%** in Sep 2025 from **2.86%** in Jun 2025[16](index=16&type=chunk) [Nine Months Ended](index=13&type=section&id=Nine%20Months%20Ended) Nine months ended September 2025 showed improved net interest income and margin, decreased deposit costs, and increased average loans HFI balances Key Yield/Rate Metrics (Nine Months Ended) | Metric | Sep 30, 2025 | Sep 30, 2024 | | :------------------------------------------ | :----------- | :----------- | | Loans HFI average yield | 6.55 % | 6.68 % | | Total interest-earning assets average yield | 6.10 % | 6.13 % | | Total interest-bearing deposits average rate | 3.13 % | 3.53 % | | Net interest income (tax-equivalent basis) | $368,751 | $310,087 | | Net interest margin (NIM) (tax-equivalent basis) | 3.74 % | 3.51 % | | Cost of total deposits | 2.52 % | 2.79 % | - Average balances for Loans HFI increased to **$10.56 billion** for the nine months ended Sep 2025 from **$9.34 billion** in Sep 2024[28](index=28&type=chunk) - The interest rate spread improved to **2.93%** for the nine months ended Sep 2025, up from **2.55%** in the same period last year[28](index=28&type=chunk) [Southern States Bancshares Inc. Opening Balance Sheet (Preliminary)](index=15&type=section&id=Southern%20States%20Bancshares%20Inc.%20Opening%20Balance%20Sheet%20%28Preliminary%29) This section presents the preliminary opening balance sheet for Southern States Bancshares Inc. post-acquisition [Acquisition Balance Sheet](index=15&type=section&id=Acquisition%20Balance%20Sheet) Southern States Bancshares, Inc.'s preliminary acquisition balance sheet shows significant additions to assets, loans, and deposits, with substantial goodwill Southern States Bancshares, Inc. Opening Balance Sheet (Preliminary, In Thousands) | Metric | Amount | | :------------------------------------------ | :------- | | Total assets | $2,938,166 | | Loans, net of fair value adjustments | $2,266,549 | | Deposits | $2,468,530 | | Total liabilities | $2,569,811 | | Goodwill | $107,793 | | Core deposit intangible | $30,820 | | Total consideration | $368,355 | - The acquisition resulted in the recognition of **$107.79 million** in goodwill and **$30.82 million** in core deposit intangible[33](index=33&type=chunk) - The estimated fair values of assets acquired and liabilities assumed are preliminary and subject to change during the measurement period as allowed under ASC 805 - Business Combinations[33](index=33&type=chunk) [Investments and Other Sources of Liquidity](index=16&type=section&id=Investments%20and%20Other%20Sources%20of%20Liquidity) This section details the company's investment securities portfolio and various sources of liquidity [Investment Securities](index=16&type=section&id=Investment%20Securities) September 2025 investment securities totaled **$1.43 billion**, primarily debt securities, showing an improved unrealized loss position Investment Securities, at Fair Value (Dollars in Thousands) | Security Type | Sep 2025 | % | Jun 2025 | % | Sep 2024 | % | | :------------------------------------------ | :--------- | :-- | :--------- | :-- | :--------- | :-- | | U.S. government agency securities | $653,197 | 46 % | $642,264 | 48 % | $516,833 | 33 % | | Mortgage-backed securities - residential | $587,587 | 41 % | $541,343 | 40 % | $879,589 | 56 % | | Total investment securities, at fair value | $1,428,401 | 100 % | $1,337,565 | 100 % | $1,567,922 | 100 % | - Investment securities as a percentage of total assets decreased to **8.80%** in Sep 2025 from **10.0%** in Jun 2025 and **12.1%** in Sep 2024[36](index=36&type=chunk) - Unrealized loss on available-for-sale debt securities improved to **$(55.89) million** in Sep 2025 from **$(63.26) million** in Jun 2025[36](index=36&type=chunk) [Sources of Liquidity](index=16&type=section&id=Sources%20of%20Liquidity) Total on-balance sheet liquidity rose to **$1.89 billion** in September 2025, increasing total available sources of liquidity Sources of Liquidity (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Cash and cash equivalents | $1,280,033 | $1,165,729 | $951,750 | | Unpledged available-for-sale debt securities | $608,716 | $547,354 | $510,538 | | Total on-balance sheet liquidity | $1,890,199 | $1,713,083 | $1,462,288 | | Unsecured borrowing capacity | $4,018,822 | $3,325,751 | $3,199,575 | | Total available sources of liquidity | $7,766,890 | $6,926,145 | $6,689,410 | - On-balance sheet liquidity as a percentage of total assets was **11.6%** in Sep 2025, a decrease from **12.8%** in Jun 2025 but an increase from **11.3%** in Sep 2024[36](index=36&type=chunk) - Total available sources of liquidity increased by **12.1%** from Jun 2025 to Sep 2025 and by **16.1%** from Sep 2024 to Sep 2025[36](index=36&type=chunk) [Loan Portfolio](index=17&type=section&id=Loan%20Portfolio) This section provides an overview of the company's loan portfolio composition and unfunded commitments [Loan Portfolio Composition](index=17&type=section&id=Loan%20Portfolio%20Composition) Total loans HFI grew to **$12.30 billion** in September 2025, with more floating-rate loans and a shift towards Community markets Loan Portfolio (Loans HFI, Dollars in Thousands) | Loan Type | Sep 2025 | % of Total | Jun 2025 | % of Total | Sep 2024 | % of Total | | :------------------------------------------ | :--------- | :--------- | :--------- | :--------- | :--------- | :--------- | | Commercial and industrial | $2,155,105 | 17 % | $1,788,911 | 18 % | $1,688,815 | 18 % | | Construction | $1,195,392 | 10 % | $1,022,678 | 10 % | $1,079,726 | 11 % | | Residential real estate: 1-to-4 family mortgage | $1,852,626 | 15 % | $1,660,696 | 17 % | $1,612,031 | 17 % | | Commercial real estate: Non-owner occupied | $2,890,233 | 24 % | $2,198,689 | 22 % | $2,048,036 | 22 % | | Total loans HFI | $12,297,600 | 100 % | $9,874,282 | 100 % | $9,478,129 | 100 % | - The percentage of loans HFI portfolio with floating interest rates increased to **51.5%** in Sep 2025 from **49.6%** in Jun 2025 and **49.2%** in Sep 2024[39](index=39&type=chunk) - Loans by market showed a shift, with Metropolitan loans decreasing as a percentage of total from **82%** in Jun 2025 to **69%** in Sep 2025, while Community loans increased from **5%** to **21%**[39](index=39&type=chunk) [Unfunded Loan Commitments](index=17&type=section&id=Unfunded%20Loan%20Commitments) Unfunded loan commitments rose to **$3.19 billion** in September 2025, with commercial and industrial loans as the largest category Unfunded Loan Commitments (Dollars in Thousands) | Commitment Type | Sep 2025 | % of Total | Jun 2025 | % of Total | Sep 2024 | % of Total | | :------------------------------------------ | :--------- | :--------- | :--------- | :--------- | :--------- | :--------- | | Commercial and industrial | $1,451,366 | 46 % | $1,396,533 | 49 % | $1,314,683 | 48 % | | Construction | $731,742 | 23 % | $535,669 | 19 % | $510,157 | 19 % | | Residential line of credit | $808,961 | 25 % | $745,570 | 26 % | $735,928 | 27 % | | Total unfunded loans HFI | $3,190,375 | 100 % | $2,861,685 | 100 % | $2,713,360 | 100 % | - Total unfunded loan commitments increased by **11.5%** from Jun 2025 to Sep 2025 and by **17.6%** from Sep 2024 to Sep 2025[39](index=39&type=chunk) [Asset Quality](index=18&type=section&id=Asset%20Quality) This section assesses the company's asset quality, focusing on credit loss allowance, net charge-offs, and nonperforming assets [Allowance for Credit Losses (ACL) on Loans HFI](index=18&type=section&id=Allowance%20for%20Credit%20Losses%20%28ACL%29%20on%20Loans%20HFI) ACL on loans HFI rose to **$185.0 million** in September 2025, driven by provisions and acquired loan allowance, with the ACL ratio slightly decreasing Allowance for Credit Losses on Loans HFI Roll Forward Summary (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | ACL on loans HFI at the beginning of the period | $148,948 | $150,531 | $155,055 | | Provision for credit losses on loans HFI | $29,957 | $5,746 | $1,856 | | Initial allowance on acquired loans with credit deterioration | $7,518 | — | — | | ACL on loans HFI at the end of the period | $184,993 | $148,948 | $156,260 | | ACL on loans HFI as a percentage of loans HFI | 1.50 % | 1.51 % | 1.65 % | - The provision for credit losses on loans HFI increased significantly to **$29.96 million** in Sep 2025 from **$5.75 million** in Jun 2025[41](index=41&type=chunk) - The initial allowance on acquired loans with credit deterioration contributed **$7.52 million** to the ACL in Sep 2025[41](index=41&type=chunk) [Net Charge-offs](index=18&type=section&id=Net%20Charge-offs) Net charge-offs increased to **$(1.43) million** in September 2025, primarily from consumer and commercial loans, raising the annualized ratio to **0.05%** Net Charge-offs (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Total charge-offs | $(1,709) | $(1,454) | $(915) | | Total recoveries | $279 | $973 | $264 | | Net charge-offs | $(1,430) | $(481) | $(651) | | Annualized net charge-offs as a percentage of average loans HFI | 0.05 % | 0.02 % | 0.03 % | - Annualized net charge-offs as a percentage of average loans HFI increased to **0.05%** in Sep 2025 from **0.02%** in Jun 2025[41](index=41&type=chunk) [Nonperforming Assets](index=18&type=section&id=Nonperforming%20Assets) Total nonperforming assets rose to **$145.20 million** in September 2025, but the ratio to total assets slightly decreased to **0.89%** Nonperforming Assets (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Loans past due 90 days or more and accruing interest | $26,311 | $21,962 | $26,250 | | Nonaccrual loans | $89,448 | $73,950 | $64,585 | | Total nonperforming loans HFI | $115,759 | $95,912 | $90,835 | | Total nonperforming assets | $145,199 | $123,038 | $127,333 | | Total nonperforming assets as a percentage of total assets | 0.89 % | 0.92 % | 0.99 % | - Total nonperforming loans HFI as a percentage of loans HFI was **0.94%** in Sep 2025, a slight decrease from **0.97%** in Jun 2025[41](index=41&type=chunk) - Nonaccrual loans as a percentage of loans HFI increased to **0.73%** in Sep 2025 from **0.75%** in Jun 2025 and **0.68%** in Sep 2024[41](index=41&type=chunk) [Selected Deposit Data](index=19&type=section&id=Selected%20Deposit%20Data) This section details the company's deposit base by market, customer segment, and estimated insurance status [Deposits by Market and Customer Segment](index=19&type=section&id=Deposits%20by%20Market%20and%20Customer%20Segment) Total deposits grew to **$13.81 billion** in September 2025, with a notable shift to Community deposits and Consumer/Commercial segments remaining dominant Deposits by Market (Dollars in Thousands) | Market | Sep 2025 | % | Jun 2025 | % | Sep 2024 | % | | :------------------------------------------ | :--------- | :-- | :--------- | :-- | :--------- | :-- | | Metropolitan | $8,549,817 | 62 % | $8,275,006 | 73 % | $7,794,790 | 71 % | | Community | $4,579,933 | 33 % | $2,436,243 | 21 % | $2,459,641 | 22 % | | Brokered/wholesale | $487,765 | 4 % | $518,719 | 4 % | $519,200 | 5 % | | Total | $13,812,955 | 100 % | $11,403,470 | 100 % | $10,976,211 | 100 % | Deposits by Customer Segment (Dollars in Thousands) | Segment | Sep 2025 | % | Jun 2025 | % | Sep 2024 | % | | :------------------------------------------ | :--------- | :-- | :--------- | :-- | :--------- | :-- | | Consumer | $5,966,458 | 43 % | $4,772,582 | 42 % | $4,676,492 | 43 % | | Commercial | $6,045,418 | 44 % | $4,835,968 | 42 % | $4,886,660 | 45 % | | Public | $1,801,079 | 13 % | $1,794,920 | 16 % | $1,413,059 | 12 % | - Community deposits increased by **88.0%** from Jun 2025 to Sep 2025, reflecting a significant shift in deposit sourcing[44](index=44&type=chunk) [Estimated Insured and Uninsured Deposits](index=19&type=section&id=Estimated%20Insured%20and%20Uninsured%20Deposits) Uninsured and uncollateralized deposits rose to **$3.94 billion** in September 2025, but their percentage of total deposits decreased to **28.5%** Estimated Insured and Uninsured Deposits (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Estimated insured or collateralized deposits | $9,871,337 | $8,418,783 | $7,654,786 | | Estimated uninsured and uncollateralized deposits | $3,941,618 | $2,984,687 | $3,321,425 | | Estimated uninsured and uncollateralized deposits as a % of total deposits | 28.5 % | 26.2 % | 30.3 % | - The percentage of uninsured and uncollateralized deposits to total deposits decreased to **28.5%** in Sep 2025 from **30.3%** in Sep 2024[44](index=44&type=chunk) [Preliminary Capital Ratios](index=20&type=section&id=Preliminary%20Capital%20Ratios) This section outlines the company's preliminary capital ratios, including tangible common equity and regulatory metrics [Computation of Tangible Common Equity to Tangible Assets](index=20&type=section&id=Computation%20of%20Tangible%20Common%20Equity%20to%20Tangible%20Assets) Tangible common equity rose to **$1.59 billion** in September 2025, with the tangible common equity to tangible assets ratio stable at **10.1%** Computation of Tangible Common Equity to Tangible Assets (Dollars in Thousands) | Metric | Sep 30, 2025 | Dec 31, 2024 | | :------------------------------------------ | :----------- | :----------- | | Total Common Shareholders' Equity | $1,978,043 | $1,567,538 | | Goodwill | $350,353 | $242,561 | | Other intangibles | $33,216 | $5,762 | | Tangible Common Equity | $1,594,474 | $1,319,215 | | Total Assets | $16,236,459 | $13,157,482 | | Tangible Assets | $15,852,890 | $12,909,159 | | Tangible Common Equity to Tangible Assets* | 10.1 % | 10.2 % | - The increase in goodwill and other intangibles reflects recent acquisition activities[48](index=48&type=chunk) [Preliminary Regulatory Capital Ratios](index=20&type=section&id=Preliminary%20Regulatory%20Capital%20Ratios) Preliminary regulatory capital ratios, including Common Equity Tier 1 and Total Risk-Based Capital, generally decreased in September 2025, indicating reduced capital buffers Preliminary Regulatory Capital Ratios (Dollars in Thousands) | Metric | Sep 30, 2025 | Dec 31, 2024 | | :------------------------------------------ | :----------- | :----------- | | Common Equity Tier 1 Capital | $1,662,376 | $1,450,722 | | Tier 1 Capital | $1,662,376 | $1,480,722 | | Total Capital | $1,923,686 | $1,721,941 | | Common Equity Tier 1 | 11.7 % | 12.8 % | | Tier 1 Risk-Based | 11.7 % | 13.1 % | | Total Risk-Based | 13.5 % | 15.2 % | | Tier 1 Leverage | 10.7 % | 11.3 % | - Preliminary Total Risk-Weighted Assets increased significantly to **$14.22 billion** in Sep 2025 from **$11.31 billion** in Dec 2024[48](index=48&type=chunk) [Segment Data](index=21&type=section&id=Segment%20Data) This section details the financial performance for the Banking and Mortgage segments [Banking Segment](index=21&type=section&id=Banking%20Segment) The Banking segment saw increased net interest income and pre-tax net contribution recovery, with an improved efficiency ratio despite higher merger costs Banking Segment Performance (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Net interest income | $144,859 | $108,909 | $104,335 | | Provisions for credit losses | $34,070 | $582 | $1,861 | | Merger and integration costs | $16,057 | $2,734 | — | | Pre-tax net contribution (loss) after allocations | $26,898 | $(6,723) | $10,990 | | Efficiency ratio | 61.4 % | 110.0 % | 83.1 % | | Core efficiency ratio* | 50.6 % | 52.8 % | 53.9 % | - Total assets for the Banking segment increased to **$15.60 billion** in Sep 2025 from **$12.74 billion** in Jun 2025[51](index=51&type=chunk) - Merger and integration costs for the Banking segment increased substantially to **$16.06 million** in Sep 2025 from **$2.73 million** in Jun 2025[51](index=51&type=chunk) [Mortgage Segment](index=21&type=section&id=Mortgage%20Segment) The Mortgage segment recovered to a **$2.70 million** pre-tax net contribution in September 2025, driven by increased mortgage banking income and improved efficiency Mortgage Segment Performance (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Net interest income | $2,381 | $2,506 | $1,682 | | Mortgage banking income | $13,484 | $13,029 | $11,553 | | Pre-tax net contribution (loss) after allocations | $2,704 | $(3,012) | $404 | | Efficiency ratio | 80.9 % | 88.9 % | 96.6 % | | Mortgage loan sales | $343,450 | $391,061 | $327,269 | | Mortgage sale margin | 2.69 % | 2.86 % | 2.84 % | - Mortgage banking income increased to **$13.48 million** in Sep 2025 from **$13.03 million** in Jun 2025 and **$11.55 million** in Sep 2024[51](index=51&type=chunk) - The change in fair value of mortgage servicing rights, net of hedging, was a loss of **$(3.39) million** in Sep 2025, an improvement from **$(4.23) million** in Jun 2025[51](index=51&type=chunk) [Non-GAAP Reconciliations](index=22&type=section&id=Non-GAAP%20Reconciliations) This section reconciles GAAP to non-GAAP financial measures, offering adjusted views of income, revenue, and capital ratios [Adjusted Net Income](index=22&type=section&id=Adjusted%20Net%20Income) Q3 2025 adjusted net income significantly increased to **$57.61 million**, excluding non-recurring items like merger costs and initial credit loss provisions Adjusted Net Income (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Income (loss) before income taxes (GAAP) | $29,602 | $(9,735) | $11,394 | | Plus initial provision for credit losses on acquired loans and unfunded commitments | $28,366 | — | — | | Plus merger and integration costs | $16,057 | $2,734 | — | | Adjusted net income (Non-GAAP) | $57,606 | $40,821 | $40,132 | | Adjusted diluted earnings per common share | $1.07 | $0.88 | $0.86 | - For the nine months ended Sep 2025, adjusted net income was **$138.54 million**, compared to **$119.45 million** in Sep 2024[55](index=55&type=chunk) - A non-recurring tax benefit of **$(8.71) million** was recorded during the three months ended June 30, 2025, due to the expiration of the statute of limitations[56](index=56&type=chunk) [Adjusted Pre-Tax Pre-Provision Net Revenue](index=23&type=section&id=Adjusted%20Pre-Tax%20Pre-Provision%20Net%20Revenue) Q3 2025 adjusted pre-tax pre-provision net revenue rose substantially to **$80.98 million**, reflecting improved operational performance before taxes and credit losses Adjusted Pre-Tax Pre-Provision Net Revenue (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Pre-tax pre-provision net revenue (GAAP) | $64,019 | $(4,398) | $13,308 | | Plus merger and integration costs | $16,057 | $2,734 | — | | Adjusted pre-tax pre-provision net revenue (Non-GAAP) | $80,980 | $58,649 | $53,762 | - For the nine months ended Sep 2025, adjusted pre-tax pre-provision net revenue was **$191.76 million**, an increase from **$157.31 million** in Sep 2024[58](index=58&type=chunk) [Adjusted Tangible Net Income](index=23&type=section&id=Adjusted%20Tangible%20Net%20Income) Q3 2025 adjusted tangible net income reached **$59.14 million**, clarifying earnings by adjusting for amortization, non-core gains/losses, and merger costs Adjusted Tangible Net Income (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Income (loss) before income taxes (GAAP) | $29,602 | $(9,735) | $11,394 | | Plus amortization of core deposit and other intangibles | $2,079 | $631 | $719 | | Plus initial provision for credit losses on acquired loans and unfunded commitments | $28,366 | — | — | | Plus merger and integration costs | $16,057 | $2,734 | — | | Adjusted tangible net income (Non-GAAP) | $59,144 | $41,288 | $40,663 | - For the nine months ended Sep 2025, adjusted tangible net income was **$141.03 million**, up from **$121.12 million** in Sep 2024[58](index=58&type=chunk) [Core Efficiency Ratio (Consolidated)](index=24&type=section&id=Core%20Efficiency%20Ratio%20%28Consolidated%29) Consolidated core efficiency ratio improved to **53.3%** in September 2025, indicating enhanced operational efficiency after adjusting for non-core expenses and income Core Efficiency Ratio (Consolidated, Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Total noninterest expense (GAAP) | $109,856 | $81,261 | $76,212 | | Core noninterest expense (Non-GAAP) | $93,529 | $78,527 | $76,212 | | Total revenue (GAAP) | $173,875 | $76,863 | $89,520 | | Core revenue (tax-equivalent basis) (Non-GAAP) | $175,357 | $137,997 | $130,591 | | Efficiency ratio (GAAP) | 63.2% | 105.7% | 85.1% | | Core efficiency ratio (tax equivalent basis) (Non-GAAP) | 53.3% | 56.9% | 58.4% | - The core efficiency ratio for the nine months ended Sep 2025 was **56.4%**, an improvement from **58.2%** in Sep 2024[61](index=61&type=chunk) [Banking Segment Core Efficiency Ratio](index=25&type=section&id=Banking%20Segment%20Core%20Efficiency%20Ratio) Banking segment core efficiency ratio improved to **50.6%** in September 2025, reflecting better cost management relative to core revenue despite increased merger costs Banking Segment Core Efficiency Ratio (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Banking segment noninterest expense (GAAP) | $96,969 | $67,330 | $63,114 | | Banking segment core noninterest expense (Non-GAAP) | $80,642 | $64,596 | $63,114 | | Banking segment total revenue (GAAP) | $157,937 | $61,189 | $75,965 | | Banking segment total core revenue (tax-equivalent basis) (Non-GAAP) | $159,419 | $122,356 | $117,046 | | Banking segment efficiency ratio (GAAP) | 61.4% | 110.0% | 83.1% | | Banking segment core efficiency ratio (tax-equivalent basis) (Non-GAAP) | 50.6% | 52.8% | 53.9% | - The Banking segment's core efficiency ratio for the nine months ended Sep 2025 was **53.0%**, an improvement from **54.0%** in Sep 2024[63](index=63&type=chunk) [Mortgage Segment Core Efficiency Ratio](index=25&type=section&id=Mortgage%20Segment%20Core%20Efficiency%20Ratio) Mortgage segment core efficiency ratio improved to **80.9%** in September 2025, indicating enhanced operational efficiency Mortgage Segment Core Efficiency Ratio (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Mortgage segment noninterest expense (GAAP) | $12,887 | $13,931 | $13,098 | | Mortgage segment core noninterest expense (Non-GAAP) | $12,887 | $13,931 | $13,098 | | Mortgage segment total revenue (GAAP) | $15,938 | $15,674 | $13,555 | | Mortgage segment core total revenue (Non-GAAP) | $15,938 | $15,641 | $13,545 | | Mortgage segment efficiency ratio (GAAP) | 80.9% | 88.9% | 96.6% | | Mortgage segment core efficiency ratio (tax-equivalent basis) (Non-GAAP) | 80.9% | 89.1% | 96.7% | - The Mortgage segment's core efficiency ratio for the nine months ended Sep 2025 was **85.9%**, an improvement from **93.9%** in Sep 2024[64](index=64&type=chunk) [Tangible Assets, Common Equity and Related Measures](index=27&type=section&id=Tangible%20Assets%2C%20Common%20Equity%20and%20Related%20Measures) Tangible assets rose to **$15.85 billion** and tangible common equity to **$1.59 billion** in September 2025, with tangible book value per share at **$29.83** Tangible Assets, Common Equity and Related Measures (Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Total assets (GAAP) | $16,236,459 | $13,354,238 | $12,920,222 | | Tangible assets (Non-GAAP) | $15,852,890 | $13,107,202 | $12,671,212 | | Total common shareholders' equity (GAAP) | $1,978,043 | $1,611,130 | $1,562,329 | | Tangible common equity (Non-GAAP) | $1,594,474 | $1,364,094 | $1,313,319 | | Tangible book value per common share | $29.83 | $29.78 | $28.15 | | Tangible common equity to tangible assets | 10.1% | 10.4% | 10.4% | - Tangible book value per common share increased to **$29.83** in Sep 2025 from **$29.78** in Jun 2025 and **$28.15** in Sep 2024[66](index=66&type=chunk) - Goodwill and other intangibles increased significantly in Sep 2025, reflecting recent acquisition activity[66](index=66&type=chunk) [Adjusted Return on Average Tangible Common Equity and Related Measures](index=28&type=section&id=Adjusted%20Return%20on%20Average%20Tangible%20Common%20Equity%20and%20Related%20Measures) Q3 2025 adjusted return on average tangible common equity increased to **14.7%**, reflecting enhanced profitability relative to tangible equity after non-core adjustments Adjusted Return on Average Tangible Common Equity (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Net income (GAAP) | $23,375 | $2,909 | $10,220 | | Average tangible common equity (Non-GAAP) | $1,592,447 | $1,335,747 | $1,274,241 | | Return on average tangible common equity (GAAP) | 5.82% | 0.87% | 3.19% | | Adjusted tangible net income (Non-GAAP) | $59,144 | $41,288 | $40,663 | | Adjusted return on average tangible common equity (Non-GAAP) | 14.7% | 12.4% | 12.7% | - Adjusted return on average tangible common equity for the nine months ended Sep 2025 was **13.3%**, slightly up from **13.1%** in Sep 2024[69](index=69&type=chunk) [Adjusted Return on Average Assets and Related Measures](index=28&type=section&id=Adjusted%20Return%20on%20Average%20Assets%20and%20Related%20Measures) Q3 2025 adjusted return on average assets increased to **1.43%**, indicating improved asset utilization and profitability after adjusting for non-core items Adjusted Return on Average Assets (Three Months Ended, Dollars in Thousands) | Metric | Sep 2025 | Jun 2025 | Sep 2024 | | :------------------------------------------ | :--------- | :--------- | :--------- | | Net income (GAAP) | $23,375 | $2,909 | $10,220 | | Average assets (GAAP) | $16,007,788 | $13,032,490 | $12,741,950 | | Return on average assets (GAAP) | 0.58% | 0.09% | 0.32% | | Adjusted net income (Non-GAAP) | $57,606 | $40,821 | $40,132 | | Adjusted return on average assets (Non-GAAP) | 1.43% | 1.26% | 1.25% | - Adjusted pre-tax pre-provision return on average assets for the three months ended Sep 2025 was **2.01%**, an increase from **1.81%** in Jun 2025[69](index=69&type=chunk)

"Business Day" means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business. "Common Shares" means the common shares, par value CHF 0.08 per share, of the Company. "Control" (including the terms "controlling," "controlled by" or "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by c ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis for the reported periods [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements and notes, covering financial position, performance, and cash flows [Condensed Consolidated Balance Sheets (Unaudited)](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Provides a snapshot of the company's financial position, detailing assets, liabilities, and stockholders' deficit Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 7, 2025 | Dec 29, 2024 | Change | Change (%) | | :-------------------------------- | :---------- | :----------- | :------- | :--------- | | Total Assets | $1,660,277 | $1,737,013 | $(76,736) | -4.4% | | Current portion of long-term debt | $5,521 | $1,149,679 | $(1,144,158) | -99.5% | | Long-term debt, less current portion | $4,810,274 | $3,825,659 | $984,615 | +25.7% | | Total Liabilities | $5,622,236 | $5,699,304 | $(77,068) | -1.4% | | Total Stockholders' Deficit | $(3,961,959) | $(3,962,291) | $332 | +0.0% | [Condensed Consolidated Statements of Income (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(Unaudited)) Details the company's revenues, expenses, and net income over specific fiscal periods Condensed Consolidated Statements of Income Highlights (in thousands, except per share data) | Metric | Fiscal Quarter Ended Sep 7, 2025 | Fiscal Quarter Ended Sep 8, 2024 | Change (%) | Three Fiscal Quarters Ended Sep 7, 2025 | Three Fiscal Quarters Ended Sep 8, 2024 | Change (%) | | :-------------------------------- | :------------------------------- | :------------------------------- | :--------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Total Revenues | $1,147,054 | $1,080,119 | +6.2% | $3,404,254 | $3,262,502 | +4.3% | | Income from operations | $223,168 | $198,831 | +12.2% | $658,307 | $605,347 | +8.7% | | Net income | $139,319 | $146,924 | -5.2% | $420,061 | $414,726 | +1.3% | | Earnings per share - diluted | $4.08 | $4.19 | -2.6% | $12.22 | $11.80 | +3.6% | [Condensed Consolidated Statements of Comprehensive Income (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) Presents net income and other comprehensive income components, reflecting total non-owner changes in equity Condensed Consolidated Statements of Comprehensive Income Highlights (in thousands) | Metric | Fiscal Quarter Ended Sep 7, 2025 | Fiscal Quarter Ended Sep 8, 2024 | Change (%) | Three Fiscal Quarters Ended Sep 7, 2025 | Three Fiscal Quarters Ended Sep 8, 2024 | Change (%) | | :-------------------- | :------------------------------- | :------------------------------- | :--------- | :-------------------------------------- | :-------------------------------------- | :--------- | | Net income | $139,319 | $146,924 | -5.2% | $420,061 | $414,726 | +1.3% | | Currency translation adjustment | $(618) | $598 | -203.7% | $2,187 | $(1,010) | +316.5% | | Comprehensive income | $138,701 | $147,522 | -6.0% | $422,248 | $413,716 | +2.1% | [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Summarizes cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows Highlights (Three Fiscal Quarters Ended, in thousands) | Metric | Sep 7, 2025 | Sep 8, 2024 | Change | Change (%) | | :--------------------------------------- | :---------- | :---------- | :------- | :--------- | | Net cash provided by operating activities | $552,256 | $446,879 | $105,377 | +23.6% | | Net cash used in investing activities | $(6,063) | $(71,895) | $65,832 | -91.6% | | Net cash used in financing activities | $(558,241) | $(312,998) | $(245,243) | +78.3% | | Change in cash and cash equivalents, restricted cash and cash equivalents | $(10,561) | $61,397 | $(71,958) | -117.2% | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) Provides detailed explanations and additional information supporting the condensed consolidated financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with GAAP for interim financial information, not including all footnotes required for complete statements[17](index=17&type=chunk) - The company operates in three reportable segments: U.S. stores, supply chain, and international franchise, with performance evaluated based on Segment Income[19](index=19&type=chunk)[20](index=20&type=chunk) - Domino's completed a **$1.00 billion** asset-backed securitization on September 5, 2025, issuing new 2025 Five-Year and Seven-Year Notes to repay existing debt[45](index=45&type=chunk)[46](index=46&type=chunk) - The company adopted ASU 2023-07 (Segment Reporting) retrospectively in Q4 2024 and is evaluating ASU 2023-09 (Income Taxes) and ASU 2024-03 (Expense Disaggregation) for future impact[64](index=64&type=chunk)[66](index=66&type=chunk)[68](index=68&type=chunk) [1. Basis of Presentation](index=8&type=section&id=1.%20Basis%20of%20Presentation) Outlines the accounting principles and periods covered for the unaudited condensed consolidated financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States for interim financial information[17](index=17&type=chunk) - The 2025 and 2024 third quarters represent the twelve-week periods ended September 7, 2025, and September 8, 2024, respectively[18](index=18&type=chunk) - The 2025 and 2024 three fiscal quarters represent the thirty-six-week periods ended September 7, 2025, and September 8, 2024, respectively[18](index=18&type=chunk) [2. Segment Information](index=8&type=section&id=2.%20Segment%20Information) Details the company's reportable segments, performance evaluation metrics, and recent accounting standard adoption - The Company has three reportable segments: (i) U.S. stores; (ii) supply chain; and (iii) international franchise[19](index=19&type=chunk) - The Company's chief operating decision maker evaluates segment performance and allocates resources based on Segment Income (EBITDA and other)[20](index=20&type=chunk) - The Company adopted ASU 2023-07, Segment Reporting, in the fourth quarter of 2024, including relevant interim disclosures retrospectively[22](index=22&type=chunk) Segment Income (Three Fiscal Quarters Ended, in thousands) | Segment | Sep 7, 2025 | Sep 8, 2024 | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | | U.S. Stores | $402,112 | $394,167 | +2.0% | | Supply Chain | $217,193 | $190,736 | +13.9% | | International Franchise | $196,640 | $180,796 | +8.7% | | Total Segment Income | $815,945 | $765,699 | +6.6% | [3. Earnings Per Share](index=12&type=section&id=3.%20Earnings%20Per%20Share) Presents basic and diluted earnings per share, along with the weighted average number of shares outstanding Earnings Per Share (Three Fiscal Quarters Ended) | Metric | Sep 7, 2025 | Sep 8, 2024 | Change (%) | | :-------------------------- | :---------- | :---------- | :--------- | | Earnings per share – basic | $12.31 | $11.91 | +3.4% | | Earnings per share – diluted | $12.22 | $11.80 | +3.6% | | Basic weighted average number of shares | 34,122,385 | 34,835,394 | -2.1% | | Diluted weighted average number of shares | 34,366,396 | 35,145,732 | -2.2% | [4. Stockholders' Deficit](index=12&type=section&id=4.%20Stockholders'%20Deficit) Details changes in stockholders' deficit, including common stock, net income, dividends, and share repurchases Stockholders' Deficit Highlights (Three Fiscal Quarters Ended Sep 7, 2025) | Metric | Dec 29, 2024 | Sep 7, 2025 | | :-------------------------------- | :----------- | :---------- | | Common Stock Shares | 34,281,927 | 33,785,145 | | Net income | — | $420,061 | | Dividends declared on common stock and equivalents | — | $(178,441) | | Purchases of common stock | — | $(242,817) | | Balance at September 7, 2025 | $(3,962,291) | $(3,957,671) | - Subsequent to the end of Q3 2025, on October 7, 2025, the Board declared a **$1.74 per share** quarterly dividend[34](index=34&type=chunk) [5. Fair Value Measurements](index=14&type=section&id=5.%20Fair%20Value%20Measurements) Explains the classification of fair value measurements and details the valuation of investments and fixed rate notes - Fair value measurements are classified into Level 1 (quoted market prices), Level 2 (observable market-based inputs), and Level 3 (unobservable inputs)[37](index=37&type=chunk)[38](index=38&type=chunk) - The Company's investment in DPC Dash is accounted for as a trading security at fair value (Level 1)[40](index=40&type=chunk) - The Company sold **4,200,000** ordinary shares of DPC Dash in Q2 2025 for net proceeds of **$44.1 million**[40](index=40&type=chunk) - The fair values of the Company's fixed rate notes are classified as Level 2 measurements[43](index=43&type=chunk) [6. Refinancing](index=15&type=section&id=6.%20Refinancing) Details the $1.00 billion asset-backed securitization completed in September 2025, covering new debt issuance and repayment - On September 5, 2025, the Company completed a **$1.00 billion** refinancing transaction through an asset-backed securitization[45](index=45&type=chunk) - Issued **$500.0 million** Series 2025-1 **4.930%** Fixed Rate Senior Secured Notes (Five-Year) and **$500.0 million** Series 2025-1 **5.217%** Fixed Rate Senior Secured Notes (Seven-Year)[45](index=45&type=chunk) - Proceeds, along with **$160.0 million** cash, were used to repay **$742.0 million** of 2015 Ten-Year Notes and **$402.7 million** of 2018 7.5-Year Notes[46](index=46&type=chunk) - Established a new **$320.0 million** variable funding note facility (2025 Variable Funding Notes), replacing previous facilities, with **$263.6 million** available borrowing capacity as of September 7, 2025[49](index=49&type=chunk) [7. Revenue Disclosures](index=17&type=section&id=7.%20Revenue%20Disclosures) Provides details on deferred franchise and development fees, and advertising fund assets Deferred Franchise Fees and Development Fees (Three Fiscal Quarters Ended, in thousands) | Metric | Sep 7, 2025 | Sep 8, 2024 | | :------------------------------------------------ | :---------- | :---------- | | Beginning of period | $20,946 | $25,195 | | Revenue recognized during the period | $(4,316) | $(4,292) | | New deferrals due to cash received and other | $3,297 | $2,281 | | End of period | $19,927 | $23,184 | Advertising Fund Assets, Restricted (in thousands) | Metric | Sep 7, 2025 | Dec 29, 2024 | | :-------------------------------- | :---------- | :----------- | | Advertising fund assets, restricted | $135,826 | $103,396 | | Cash and cash equivalents | $109,634 | $80,928 | | Accounts receivable | $17,900 | $14,300 | | Prepaid expenses | $8,300 | $8,200 | [8. Leases](index=18&type=section&id=8.%20Leases) Details lease costs, uncommenced lease commitments, and maximum potential future payments under franchisee lease guarantees Lease Costs (Three Fiscal Quarters Ended, in thousands) | Metric | Sep 7, 2025 | Sep 8, 2024 | Change (%) | | :-------------------------- | :---------- | :---------- | :--------- | | Rent expense | $65,900 | $63,200 | +4.3% | | Operating lease cost | $36,213 | $34,260 | +5.7% | | Total finance lease cost | $6,308 | $6,849 | -7.8% | - The Company had additional uncommenced leases with estimated future minimum rental commitments of **$161.9 million**, expected to commence in 2025 and 2026[57](index=57&type=chunk) - Maximum potential future payments under franchisee lease guarantees were **$14.1 million** as of September 7, 2025[58](index=58&type=chunk) [9. Supplemental Disclosures of Cash Flow Information](index=18&type=section&id=9.%20Supplemental%20Disclosures%20of%20Cash%20Flow%20Information) Provides additional details on non-cash investing and financing activities - Non-cash investing activities related to accruals for capital expenditures were **$4.8 million** at September 7, 2025[59](index=59&type=chunk) - Non-cash financing activity related to accruals for excise taxes on share repurchases was **$2.5 million** as of September 7, 2025[59](index=59&type=chunk) [10. Company-owned Store Transactions](index=19&type=section&id=10.%20Company-owned%20Store%20Transactions) Details refranchising and purchasing activities of company-owned and franchised stores - During Q2 2025, the Company refranchised **36** U.S. Company-owned stores in Maryland for **$8.5 million**, resulting in a **$3.9 million** pre-tax refranchising gain[60](index=60&type=chunk) - During Q1 2025, the Company purchased **two** U.S. franchised stores for **$0.9 million**[61](index=61&type=chunk) - In Q1 and Q2 2024, the Company refranchised one U.S. Company-owned store each, resulting in approximately **$0.1 million** pre-tax refranchising losses each[62](index=62&type=chunk) [11. New Accounting Pronouncements](index=19&type=section&id=11.%20New%20Accounting%20Pronouncements) Discusses the adoption of new accounting standards and the evaluation of upcoming pronouncements - The Company adopted ASU 2023-07, Segment Reporting, in Q4 2024, applying it retrospectively[64](index=64&type=chunk)[65](index=65&type=chunk) - The Company is evaluating ASU 2023-09 (Income Taxes), effective for fiscal years beginning after December 15, 2024[66](index=66&type=chunk)[67](index=67&type=chunk) - The Company is evaluating ASU 2024-03 (Expense Disaggregation), effective for annual fiscal years beginning after December 15, 2026[68](index=68&type=chunk)[69](index=69&type=chunk) - The Company is evaluating ASU 2025-06 (Internal-Use Software), issued September 2025, effective for annual periods beginning after December 15, 2027[70](index=70&type=chunk)[71](index=71&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Provides management's perspective on financial condition and results of operations, including business overview, performance highlights, and financial analysis [Overview](index=21&type=section&id=Overview) Introduces Domino's as the largest global pizza company, highlighting its franchise model and 'Hungry for MORE' strategy - Domino's is the largest pizza company globally, with over **21,700** locations in more than **90** markets[73](index=73&type=chunk) - Approximately **99%** of Domino's global stores are owned and operated by independent franchisees[74](index=74&type=chunk) - The 'Hungry for MORE' strategy aims to generate MORE sales, MORE stores, and MORE profits through delicious food, operational excellence, renowned value, and best-in-class franchisees[78](index=78&type=chunk)[79](index=79&type=chunk) [Third Quarter of 2025 Highlights](index=22&type=section&id=Third%20Quarter%20of%202025%20Highlights) Summarizes key financial and operational achievements for the third fiscal quarter of 2025 - Global retail sales, excluding foreign currency impact, increased **6.3%** in Q3 2025 compared to Q3 2024[85](index=85&type=chunk) - U.S. retail sales increased **7.0%** and international retail sales (excluding foreign currency impact) increased **5.7%** in Q3 2025[85](index=85&type=chunk) - Income from operations increased **12.2%** in Q3 2025[85](index=85&type=chunk) [Three Fiscal Quarters of 2025 Highlights](index=22&type=section&id=Three%20Fiscal%20Quarters%20of%202025%20Highlights) Summarizes key financial and operational achievements for the first three fiscal quarters of 2025 - Global retail sales, excluding foreign currency impact, increased **5.5%** for the three fiscal quarters of 2025 compared to 2024[85](index=85&type=chunk) - U.S. retail sales increased **4.5%** and international retail sales (excluding foreign currency impact) increased **6.6%** for the three fiscal quarters of 2025[85](index=85&type=chunk) - Income from operations increased **8.7%** for the three fiscal quarters of 2025[85](index=85&type=chunk) [Statistical Measures](index=22&type=section&id=Statistical%20Measures) Presents key performance indicators including global retail sales, same store sales growth, and store growth activity - Global retail sales, same store sales growth, and net store growth are key statistical measures used to analyze performance[83](index=83&type=chunk)[88](index=88&type=chunk)[91](index=91&type=chunk) [Global Retail Sales](index=22&type=section&id=Global%20Retail%20Sales) Details retail sales performance across U.S. and international stores for the reported periods Global Retail Sales (in millions of U.S. dollars) | Segment | Third Quarter of 2025 | Third Quarter of 2024 | Change (%) | Three Fiscal Quarters of 2025 | Three Fiscal Quarters of 2024 | Change (%) | | :---------------- | :-------------------- | :-------------------- | :--------- | :---------------------------- | :---------------------------- | :--------- | | U.S. stores | $2,320.4 | $2,168.4 | +7.0% | $6,896.8 | $6,602.5 | +4.5% | | International stores | $2,375.8 | $2,223.6 | +6.8% | $6,933.5 | $6,581.9 | +5.3% | | Total | $4,696.2 | $4,392.0 | +6.9% | $13,830.3 | $13,184.4 | +4.9% | [Global Retail Sales Growth, Excluding Foreign Currency Impact](index=23&type=section&id=Global%20Retail%20Sales%20Growth,%20Excluding%20Foreign%20Currency%20Impact) Shows retail sales growth adjusted for foreign currency fluctuations across U.S. and international segments Global Retail Sales Growth, Excluding Foreign Currency Impact | Segment | Third Quarter of 2025 | Third Quarter of 2024 | Three Fiscal Quarters of 2025 | Three Fiscal Quarters of 2024 | | :------------------------------------------ | :-------------------- | :-------------------- | :---------------------------- | :---------------------------- | | U.S. stores | +7.0% | +5.1% | +4.5% | +6.6% | | International stores (excluding foreign currency impact) | +5.7% | +5.1% | +6.6% | +6.5% | | Total (excluding foreign currency impact) | +6.3% | +5.1% | +5.5% | +6.5% | [Same Store Sales Growth](index=23&type=section&id=Same%20Store%20Sales%20Growth) Reports comparable store sales growth for U.S. company-owned, U.S. franchise, and international stores Same Store Sales Growth | Segment | Third Quarter of 2025 | Third Quarter of 2024 | Three Fiscal Quarters of 2025 | Three Fiscal Quarters of 2024 | | :------------------------------------------ | :-------------------- | :-------------------- | :---------------------------- | :---------------------------- | | U.S. Company-owned stores | +3.4% | +3.1% | +1.0% | +5.4% | | U.S. franchise stores | +5.3% | +3.0% | +2.7% | +4.4% | | U.S. stores | +5.2% | +3.0% | +2.7% | +4.5% | | International stores (excluding foreign currency impact) | +1.7% | +0.8% | +2.5% | +1.1% | - Increase in U.S. same store sales in Q3 2025 was primarily due to higher customer transaction counts, driven in part by the 'Best Deal Ever' promotion[89](index=89&type=chunk) - Increases in international same store sales in both Q3 and three fiscal quarters of 2025 were driven by higher customer transaction counts[90](index=90&type=chunk) [Store Growth Activity](index=23&type=section&id=Store%20Growth%20Activity) Provides store count, openings, closings, and net store growth for U.S. and international segments Store Count and Net Store Growth | Metric | U.S. Company-owned Stores | U.S. Franchise Stores | Total U.S. Stores | International Stores | Total | | :-------------------------- | :------------------------ | :-------------------- | :------------------ | :------------------- | :---- | | Store count at June 15, 2025 | 258 | 6,803 | 7,061 | 14,475 | 21,536 | | Openings (Q3 2025) | 2 | 28 | 30 | 220 | 250 | | Closings (Q3 2025) | — | (1) | (1) | (35) | (36) | | Store count at Sep 7, 2025 | 260 | 6,830 | 7,090 | 14,660 | 21,750 | | Third quarter 2025 net store growth | 2 | 27 | 29 | 185 | 214 | | Trailing four quarters net store growth | 3 | 157 | 160 | 588 | 748 | [Income Statement Data](index=25&type=section&id=Income%20Statement%20Data) Analyzes key components of the income statement, including revenues, cost of sales, and operating expenses Income Statement Data Highlights (in millions) | Metric | Q3 2025 | Q3 2024 | Change (%) | 3FQ 2025 | 3FQ 2024 | Change (%) | | :-------------------------------- | :------ | :------ | :--------- | :------- | :------- | :--------- | | Total revenues | $1,147.1 | $1,080.1 | +6.2% | $3,404.3 | $3,262.5 | +4.3% | | Gross margin | $459.9 | $423.7 | +8.5% | $1,364.0 | $1,282.6 | +6.3% | | Income from operations | $223.2 | $198.8 | +12.3% | $658.3 | $605.3 | +8.7% | | Net income | $139.3 | $146.9 | -5.2% | $420.1 | $414.7 | +1.3% | - Consolidated gross margin as a percentage of revenues increased to **40.1%** in Q3 2025 (from 39.2% in Q3 2024) and to **40.1%** in the three fiscal quarters of 2025 (from 39.3% in 3FQ 2024)[106](index=106&type=chunk) [Revenues](index=25&type=section&id=Revenues) Examines revenue performance across U.S. company-owned stores, franchise royalties, advertising, supply chain, and international segments - Consolidated revenues increased **$66.9 million (6.2%)** in Q3 2025 and **$141.8 million (4.3%)** in the three fiscal quarters of 2025[95](index=95&type=chunk) - Primary drivers were higher supply chain revenues and increased U.S. franchise royalties and fees and advertising revenues[95](index=95&type=chunk) [U.S. Company-owned Stores](index=26&type=section&id=U.S.%20Company-owned%20Stores) Analyzes revenue changes for U.S. company-owned stores, considering refranchising and same store sales impacts - Revenues decreased **$6.5 million (7.2%)** in Q3 2025 and **$7.3 million (2.7%)** in the three fiscal quarters of 2025, primarily due to the refranchising of **36** stores[97](index=97&type=chunk) - Decreases were partially offset by higher same store sales (**+3.4%** in Q3 2025, **+1.0%** in three fiscal quarters 2025)[97](index=97&type=chunk)[98](index=98&type=chunk) [U.S. Franchise Royalties and Fees](index=26&type=section&id=U.S.%20Franchise%20Royalties%20and%20Fees) Examines revenue growth from U.S. franchise royalties and fees, driven by same store sales and store count increases - Revenues increased **$13.1 million (9.1%)** in Q3 2025 and **$22.2 million (5.0%)** in the three fiscal quarters of 2025[99](index=99&type=chunk) - Driven by higher same store sales (**+5.3%** in Q3 2025, **+2.7%** in three fiscal quarters 2025) and an increase in the average number of U.S. franchised stores[99](index=99&type=chunk)[100](index=100&type=chunk) [U.S. Franchise Advertising](index=26&type=section&id=U.S.%20Franchise%20Advertising) Details revenue growth in U.S. franchise advertising, influenced by sales, store growth, and contribution rates - Revenues increased **$10.7 million (8.9%)** in Q3 2025 and **$31.6 million (8.9%)** in the three fiscal quarters of 2025[101](index=101&type=chunk) - Growth was due to higher same store sales, net store growth, decreased advertising incentives, and the return to the standard **6.0%** advertising contribution rate[101](index=101&type=chunk) [Supply Chain](index=26&type=section&id=Supply%20Chain) Analyzes revenue changes in the supply chain segment, driven by order volumes, pricing, and product mix shifts - Revenues increased **$45.6 million (7.0%)** in Q3 2025 and **$84.2 million (4.3%)** in the three fiscal quarters of 2025[102](index=102&type=chunk) - Driven by higher order volumes and a **3.3%** (Q3) / **4.3%** (3FQ) increase in food basket pricing to stores[102](index=102&type=chunk) - Partially offset by a shift in product mix and the transition of the equipment and supplies business to a third-party supplier[102](index=102&type=chunk) [International Franchise Royalties and Fee Revenues](index=27&type=section&id=International%20Franchise%20Royalties%20and%20Fee%20Revenues) Examines revenue growth from international franchise royalties and fees, influenced by store growth and currency impacts - Revenues increased **$3.9 million (5.2%)** in Q3 2025 and **$11.0 million (5.0%)** in the three fiscal quarters of 2025[103](index=103&type=chunk) - Driven by net store growth and same store sales growth (excluding foreign currency impact)[103](index=103&type=chunk) - Foreign currency exchange rates had a positive impact of **$0.8 million** in Q3 2025 but a negative impact of **$2.6 million** in the three fiscal quarters of 2025[103](index=103&type=chunk) [Cost of Sales / Gross Margin](index=27&type=section&id=Cost%20of%20Sales%20/%20Gross%20Margin) Analyzes changes in cost of sales and gross margin for U.S. company-owned stores and the supply chain segment - Consolidated gross margin increased **$36.2 million (8.5%)** in Q3 2025 and **$81.4 million (6.3%)** in the three fiscal quarters of 2025[105](index=105&type=chunk) - Gross margin as a percentage of revenues increased **0.9 percentage points** to **40.1%** in Q3 2025 and **0.8 percentage points** to **40.1%** in the three fiscal quarters of 2025[106](index=106&type=chunk) [U.S. Company-Owned Store Gross Margin](index=28&type=section&id=U.S.%20Company-Owned%20Store%20Gross%20Margin) Examines the decrease in U.S. company-owned store gross margin, influenced by food and labor costs - U.S. Company-owned store gross margin decreased **$1.5 million (9.9%)** in Q3 2025 and **$4.8 million (10.1%)** in the three fiscal quarters of 2025[108](index=108&type=chunk) - As a percentage of store revenues, it decreased **0.5 percentage points** in Q3 2025 and **1.3 percentage points** in the three fiscal quarters of 2025[108](index=108&type=chunk) - Food costs increased **0.7-0.8 percentage points**, driven by food basket pricing, while labor costs decreased **0.2-0.4 percentage points** due to sales leverage[112](index=112&type=chunk) [Supply Chain Gross Margin](index=28&type=section&id=Supply%20Chain%20Gross%20Margin) Analyzes the increase in supply chain gross margin, driven by procurement productivity and sales leverage - Supply chain gross margin increased **$10.0 million (14.3%)** in Q3 2025 and **$21.4 million (9.8%)** in the three fiscal quarters of 2025[109](index=109&type=chunk) - As a percentage of supply chain revenues, it increased **0.7 percentage points** in Q3 2025 and **0.6 percentage points** in the three fiscal quarters of 2025[109](index=109&type=chunk) - Food costs decreased **0.3-0.5 percentage points** due to procurement productivity, and labor costs decreased **0.3-0.4 percentage points** due to sales leverage and efficiency[113](index=113&type=chunk) [General and Administrative Expenses](index=28&type=section&id=General%20and%20Administrative%20Expenses) Details the changes in general and administrative expenses, including severance and non-recurring event costs - General and administrative expenses increased **$1.1 million (1.1%)** in Q3 2025 and **$0.8 million (0.3%)** in the three fiscal quarters of 2025[110](index=110&type=chunk) - The increase for the three fiscal quarters was primarily due to **$5 million** in severance expenses, offset by the non-recurrence of Worldwide Rally expenses from 2024[110](index=110&type=chunk) [U.S. Franchise Advertising Expenses](index=28&type=section&id=U.S.%20Franchise%20Advertising%20Expenses) Explains the increase in U.S. franchise advertising expenses, consistent with revenue growth and brand promotion obligations - U.S. franchise advertising expenses increased **$10.7 million (8.9%)** in Q3 2025 and **$31.6 million (8.9%)** in the three fiscal quarters of 2025, consistent with revenue increases[111](index=111&type=chunk) - These costs are expensed when related revenues are recognized, as the not-for-profit advertising fund is obligated to expend them on brand promotion[111](index=111&type=chunk) [Refranchising (Gain) Loss](index=30&type=section&id=Refranchising%20(Gain)%20Loss) Reports gains and losses from the refranchising of company-owned stores - A **$3.9 million** pre-tax refranchising gain was recorded in Q2 2025 from selling **36** U.S. Company-owned stores for **$8.5 million**[114](index=114&type=chunk) - In Q1 and Q2 2024, pre-tax refranchising losses of approximately **$0.1 million** each were recorded from selling single stores[115](index=115&type=chunk) [Other (Expense) Income](index=30&type=section&id=Other%20(Expense)%20Income) Details unrealized gains and losses on the DPC Dash investment - A net **$3.0 million** pre-tax unrealized loss on DPC Dash investment was recorded in Q3 2025, compared to a net **$5.0 million** pre-tax realized and unrealized gain for the three fiscal quarters of 2025[116](index=116&type=chunk) - In 2024, significant pre-tax unrealized gains of **$26.2 million** (Q3) and **$18.9 million** (3FQ) were recorded on the DPC Dash investment[116](index=116&type=chunk) [Interest Expense, Net](index=30&type=section&id=Interest%20Expense,%20Net) Analyzes changes in net interest expense and the weighted average borrowing rate - Interest expense, net increased **$0.6 million (1.4%)** in Q3 2025 and **$0.4 million (0.3%)** in the three fiscal quarters of 2025[117](index=117&type=chunk) - The weighted average borrowing rate remained stable at **3.8%** for both periods[117](index=117&type=chunk) [Provision for Income Taxes](index=30&type=section&id=Provision%20for%20Income%20Taxes) Details changes in income tax provision and effective tax rates, including impacts from equity-based compensation - Provision for income taxes increased **$2.2 million (5.8%)** in Q3 2025 due to a higher effective tax rate of **22.3%** (vs. 20.4% in Q3 2024)[118](index=118&type=chunk) - For the three fiscal quarters of 2025, it increased **$33.4 million (38.6%)** due to a higher effective tax rate of **22.2%** (vs. 17.3% in 3FQ 2024) and higher income before taxes[119](index=119&type=chunk) - The effective tax rate increase for the three fiscal quarters was primarily driven by a **3.8 percentage point** unfavorable change from excess tax benefits from equity-based compensation[119](index=119&type=chunk) [Segment Income](index=31&type=section&id=Segment%20Income) Analyzes the income performance of the U.S. stores, supply chain, and international franchise segments Segment Income (in millions) | Segment | Q3 2025 | Q3 2024 | Change (%) | 3FQ 2025 | 3FQ 2024 | Change (%) | | :-------------------- | :------ | :------ | :--------- | :------- | :------- | :--------- | | U.S. stores | $136.3 | $128.6 | +6.0% | $402.1 | $394.2 | +2.0% | | Supply chain | $70.2 | $61.2 | +14.7% | $217.2 | $190.7 | +13.9% | | International franchise | $67.3 | $62.4 | +7.9% | $196.6 | $180.8 | +8.7% | [U.S. Stores](index=31&type=section&id=U.S.%20Stores) Details the increase in U.S. stores Segment Income, driven by franchise royalties and fees - U.S. stores Segment Income increased **$7.7 million (6.0%)** in Q3 2025 and **$7.9 million (2.0%)** in the three fiscal quarters of 2025[124](index=124&type=chunk) - Primarily driven by higher U.S. franchise royalties and fees revenues, partially offset by a decrease in U.S. Company-owned store gross margin[124](index=124&type=chunk) [Supply Chain](index=31&type=section&id=Supply%20Chain) Analyzes the increase in supply chain Segment Income, primarily due to gross margin improvements - Supply chain Segment Income increased **$9.0 million (14.7%)** in Q3 2025 and **$26.5 million (13.9%)** in the three fiscal quarters of 2025[126](index=126&type=chunk) - Primarily due to the **$10.0 million** increase in supply chain gross margin in Q3 and **$21.4 million** increase in the three fiscal quarters[126](index=126&type=chunk) [International Franchise](index=31&type=section&id=International%20Franchise) Details the increase in international franchise Segment Income, driven by royalties and lower G&A expenses - International franchise Segment Income increased **$4.9 million (7.9%)** in Q3 2025 and **$15.8 million (8.7%)** in the three fiscal quarters of 2025[127](index=127&type=chunk) - Mainly due to higher international franchise royalties and fees revenues and lower general and administrative expenses (due to non-recurrence of Worldwide Rally)[127](index=127&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) Discusses the company's working capital, sources and uses of cash, debt, share repurchases, and dividends - As of September 7, 2025, working capital was **$123.0 million** (excluding restricted cash and advertising fund items)[129](index=129&type=chunk) - Primary sources of liquidity are cash flows from operations and availability of borrowings under the **$320.0 million** variable funding notes facility, with **$263.6 million** available capacity[130](index=130&type=chunk) - Expected uses of cash include funding working capital, investing in the core business, repaying debt, paying dividends, and repurchasing shares[131](index=131&type=chunk) [Restricted Cash](index=32&type=section&id=Restricted%20Cash) Details the composition of restricted cash and cash equivalents, including amounts for debt payments and advertising - Total restricted cash and cash equivalents were **$202.5 million** as of September 7, 2025, including **$151.9 million** for debt payments and working capital, and **$50.4 million** in an interest reserve[133](index=133&type=chunk) - An additional **$109.6 million** of advertising fund restricted cash and cash equivalents is held for brand promotion activities[133](index=133&type=chunk) [Long-Term Debt](index=33&type=section&id=Long-Term%20Debt) Reports the company's long-term debt, its classification, and debt covenant requirements - As of September 7, 2025, the Company had approximately **$4.82 billion** of long-term debt[135](index=135&type=chunk) - The Company satisfied non-amortization tests for its fixed rate notes, classifying outstanding principal as long-term debt[135](index=135&type=chunk) - Debt covenants require a minimum debt service coverage ratio of **1.75x**[136](index=136&type=chunk) [Share Repurchase Programs](index=33&type=section&id=Share%20Repurchase%20Programs) Details share repurchases during the quarter and fiscal quarters, and remaining authorization - During Q3 2025, the Company repurchased and retired **165,778** shares for **$74.7 million**[138](index=138&type=chunk) - For the three fiscal quarters of 2025, **596,754** shares were repurchased for approximately **$274.7 million**[138](index=138&type=chunk) - As of September 7, 2025, approximately **$539.7 million** remained authorized for future share repurchases[138](index=138&type=chunk) [Dividends](index=33&type=section&id=Dividends) Reports quarterly dividends declared by the Board of Directors - On July 15, 2025, the Board declared a **$1.74 per share** quarterly dividend, paid on September 30, 2025[139](index=139&type=chunk) - A subsequent **$1.74 per share** quarterly dividend was declared on October 7, 2025, payable on December 26, 2025[139](index=139&type=chunk) [Sources and Uses of Cash](index=34&type=section&id=Sources%20and%20Uses%20of%20Cash) Summarizes cash flow activities from operations, investing, and financing, and their primary drivers Sources and Uses of Cash (Three Fiscal Quarters, in millions) | Cash Flow Activity | 2025 | 2024 | Change | | :--------------------------------------- | :--- | :--- | :----- | | Net cash provided by operating activities | $552.3 | $446.9 | +$105.4 | | Net cash used in investing activities | $(6.1) | $(71.9) | +$65.8 | | Net cash used in financing activities | $(558.2) | $(313.0) | $(245.2) | | Change in cash and cash equivalents, restricted cash and cash equivalents | $(10.6) | $61.4 | $(72.0) | - Operating cash flow increase driven by changes in operating assets/liabilities, higher net income (excluding non-cash), and positive change in restricted advertising fund assets/liabilities[142](index=142&type=chunk) - Investing cash flow decrease due to **$44.1 million** from DPC Dash share sale and **$8.5 million** from refranchising stores, offsetting **$56.7 million** in capital expenditures[143](index=143&type=chunk) - Financing cash flow increase due to **$1.00 billion** new debt issuance, **$1.14 billion** debt repayment, **$274.7 million** share repurchases, and **$119.5 million** dividend payments[144](index=144&type=chunk) [Critical Accounting Estimates](index=34&type=section&id=Critical%20Accounting%20Estimates) Identifies the company's most significant accounting policies and estimates, noting no material changes - The Company's most significant accounting policies and estimates include long-lived assets, casualty insurance reserves, and income taxes[145](index=145&type=chunk) - There have been no material changes to the Company's critical accounting estimates since December 29, 2024[145](index=145&type=chunk) [Forward-Looking Statements](index=35&type=section&id=Forward-Looking%20Statements) Highlights that the filing contains forward-looking statements subject to risks and uncertainties detailed in the 2024 Form 10-K - This filing contains forward-looking statements based on current management expectations, subject to substantial risks and uncertainties[146](index=146&type=chunk) - Important factors that could cause actual results to differ materially are described in the 'Risk Factors' section of the 2024 Form 10-K[146](index=146&type=chunk) - Risks include substantial indebtedness, competitive industry, labor shortages, commodity costs, economic conditions, and regulatory changes[146](index=146&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Outlines exposure to market risks, including interest rate fluctuations on variable funding notes, commodity price changes, and foreign currency exchange risk [Market Risk](index=36&type=section&id=Market%20Risk) Discusses exposure to interest rate risk on variable and fixed-rate debt, and commodity price fluctuations - The Company is exposed to interest rate risk on borrowings under its 2025 Variable Funding Notes, which bear interest at fluctuating rates based on Term SOFR[147](index=147&type=chunk)[148](index=148&type=chunk) - Fixed-rate debt exposes the Company to changes in market interest rates reflected in the fair value of the debt and the risk of refinancing at higher rates[149](index=149&type=chunk) - The Company is exposed to market risks from changes in food and commodity prices (e.g., cheese) but does not engage in speculative transactions or use financial instruments for trading purposes to manage this risk[150](index=150&type=chunk) [Foreign Currency Exchange Risk](index=36&type=section&id=Foreign%20Currency%20Exchange%20Risk) Addresses exposure to foreign currency exchange rate fluctuations from international operations and its potential impact - The Company has exposure to foreign currency exchange rate fluctuations for revenues generated by operations outside the U.S., primarily from its international franchise segment and Canadian supply chain[151](index=151&type=chunk) - International franchise revenues constituted approximately **6.8%** of total revenues in Q3 and three fiscal quarters of 2025[151](index=151&type=chunk) - A hypothetical **10%** adverse change in foreign currency rates would result in an estimated negative impact of **$20.4 million** on royalty revenues for the three fiscal quarters of 2025[151](index=151&type=chunk) - The Company does not enter into financial instruments to manage foreign currency exchange risk[151](index=151&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 7, 2025, with no material changes in internal control over financial reporting - The Company's disclosure controls and procedures were evaluated by management, including the CEO and CFO, and concluded to be effective as of September 7, 2025[152](index=152&type=chunk) - There were no material changes in the Company's internal control over financial reporting during the quarterly period ended September 7, 2025[153](index=153&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) Presents additional information including legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) Details the company's involvement in ordinary course legal and administrative proceedings, with no expected material adverse effect - The Company is a party to lawsuits, revenue agent reviews, and administrative proceedings in the ordinary course of business[155](index=155&type=chunk) - The Company does not believe these matters, individually or in the aggregate, will have a material adverse effect on its business or financial condition[156](index=156&type=chunk) - Established accruals are expected to adequately provide for the estimated resolution of such claims[156](index=156&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) Reports no material changes to the risk factors previously disclosed in the 2024 Form 10-K - No material changes with respect to those risk factors previously disclosed in Item 1A 'Risk Factors' in Part I of the 2024 Form 10-K[157](index=157&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details common stock repurchases during Q3 2025 and the remaining authorization under the share repurchase program Purchases of Equity Securities by the Issuer | Period | Total Number of Shares Purchased (1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program (2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (2) (in thousands) | | :----------------------------------- | :----------------------------------- | :--------------------------- | :----------------------------------------------------------------------- | :------------------------------------------------------------------------------------------------- | | Period 7 (June 16, 2025 to July 13, 2025) | 1,185 | $454.44 | — | $614,338 | | Period 8 (July 14, 2025 to August 10, 2025) | 1,784 | $464.70 | — | $614,338 | | Period 9 (August 11, 2025 to September 7, 2025) | 167,061 | $450.47 | 165,778 | $539,681 | | Total | 170,030 | $450.64 | 165,778 | $539,681 | - As of September 7, 2025, **$539.7 million** remained available for future purchases of the Company's common stock under its share repurchase program[160](index=160&type=chunk) [Item 3. Defaults Upon Senior Securities](index=37&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) Confirms no defaults occurred on senior securities during the reporting period - None[162](index=162&type=chunk) [Item 4. Mine Safety Disclosures](index=37&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) States that this item is not applicable to the company's operations - Not applicable[163](index=163&type=chunk) [Item 5. Other Information](index=38&type=section&id=Item%205.%20Other%20Information) Details Rule 10b5-1 trading plans adopted by certain Section 16 officers during the fiscal quarter [Rule 10b5-1 Trading Plans](index=38&type=section&id=Rule%2010b5-1%20Trading%20Plans) Outlines new Rule 10b5-1 trading arrangements adopted by key executives, in compliance with company policy - Cynthia A. Headen, EVP, Chief Supply Chain Officer, adopted a new Rule 10b5-1 trading arrangement on August 18, 2025, for up to **3,525** shares and **7,453** stock options[167](index=167&type=chunk) - Jessica L. Parrish, VP, Chief Accounting Officer and Treasurer, adopted a new Rule 10b5-1 trading arrangement on August 27, 2025, for up to **1,845** shares[167](index=167&type=chunk) - These trading arrangements were adopted and precleared in accordance with Domino's Insider Trading Policy[166](index=166&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the Form 10-Q, including debt agreements, CEO/CFO certifications, and XBRL documents - Includes debt agreements related to the 2025 refinancing, such as the Ninth Supplement to the Amended and Restated Base Indenture and Series 2025-1 Supplement[168](index=168&type=chunk) - Contains certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002[168](index=168&type=chunk) - Includes XBRL Instance Document and Taxonomy Extension documents for interactive data filing[168](index=168&type=chunk) [SIGNATURES](index=41&type=section&id=SIGNATURES) The report was signed by Sandeep Reddy, EVP and CFO, on October 14, 2025, on behalf of Domino's Pizza, Inc - The report was signed by Sandeep Reddy, Executive Vice President, Chief Financial Officer, on October 14, 2025[170](index=170&type=chunk)

[Agreement Overview](index=1&type=section&id=Agreement%20Overview) This section outlines the agreement's purpose and conditions for employee compensation related to the Indian Motorcycle divestiture [Introduction and Purpose of Agreement](index=1&type=section&id=Introduction) This agreement, dated October 10, 2025, is between Polaris Industries Inc. and Michael Dougherty, outlining compensation for the employee's assistance with the potential divestiture of the Company's Indian Motorcycle business - Agreement between Polaris Industries Inc. (the 'Company') and Michael Dougherty (the 'Employee'), effective **October 10, 2025**[1](index=1&type=chunk) - Purpose is to compensate Employee for services related to a potential confidential transaction to divest the Company's Indian Motorcycle business[2](index=2&type=chunk) [Compensation Committee Approval and Transaction Cooperation](index=1&type=section&id=1.%20Compensation%20Committee%20Approval%20and%20Transaction%20Cooperation) Employee's eligibility for transaction bonus, profit sharing, and equity award treatment is conditional on Compensation Committee approval, adherence to senior management directives, and best efforts to facilitate the transaction, including due diligence and presentations. The Committee retains sole discretion to withhold payments - Employee's eligibility for Transaction Bonus, 2025 Profit Sharing Bonus, and equity award treatment is conditioned on Compensation Committee approval[3](index=3&type=chunk) - Employee must follow senior management guidance and use best efforts to facilitate the Transaction process, including participating in due diligence activities and management presentations[3](index=3&type=chunk) - The Compensation Committee may, in its sole discretion, determine not to pay the Transaction Bonus Opportunity, 2025 Profit Sharing Bonus, or provide equity award treatment at any time prior to the Transaction Closing[3](index=3&type=chunk) [Compensation and Benefits Details](index=1&type=section&id=Compensation%20and%20Benefits%20Details) This section details the employee's eligibility for transaction bonuses, profit sharing, equity awards, and other benefits contingent on the divestiture [Transaction Bonus](index=1&type=section&id=2.%20Transaction%20Bonus) Upon Transaction Closing, the employee is eligible for a cash bonus equal to four times their base salary, contingent on continuous employment. If the transaction does not close, the Company may still pay the bonus, 2025, and 2026 profit sharing bonuses if the employee remains continuously employed until the determination date - Employee is eligible to earn cash bonus payments equal to **four times their then-current base salary** upon a Transaction Closing[4](index=4&type=chunk) - Payment of the Transaction Bonus Opportunity is subject to Employee remaining Continuously Employed through the Transaction Closing[4](index=4&type=chunk) - If the Company determines the Transaction Closing will not occur, **100%** of the Transaction Bonus Opportunity, 2025 Profit Sharing Bonus, and 2026 Profit Sharing Bonus will be paid, subject to continuous employment until the Determination Date[5](index=5&type=chunk) [Profit Sharing Bonus](index=2&type=section&id=3.%20Profit%20Sharing%20(Bonus)) Upon Transaction Closing, the employee is eligible for a 2025 annual profit sharing bonus based on the greater of target or actual performance, paid by March 15, 2026. A pro-rata 2026 profit sharing bonus, based on target performance and days worked in 2026, will also be paid within 60 days of closing. Both are contingent on continuous employment - Employee is eligible for a 2025 annual profit sharing incentive plan opportunity upon Transaction Closing, based on the greater of target or actual performance, payable by **March 15, 2026**[8](index=8&type=chunk) - A pro-rata cash payment for the 2026 annual profit sharing incentive plan opportunity (based on target performance) will be paid within **60 days** following Transaction Closing[8](index=8&type=chunk) - Both 2025 and 2026 profit sharing bonuses are subject to Employee remaining Continuously Employed through the Transaction Closing[8](index=8&type=chunk) [Equity Awards Treatment](index=2&type=section&id=4.%20Equity%20Awards) Upon Transaction Closing and separation from service, outstanding equity awards will be treated according to the Retirement Provisions of the Severance Agreement, as if the employee retired, waiving the one-year retirement notice. This also applies if the transaction does not close, upon the Determination Date and separation from service - Upon Transaction Closing and Employee's separation from service, outstanding equity awards will be treated in accordance with the Retirement Provisions as if Employee's separation had been a retirement[7](index=7&type=chunk) - The one-year retirement notice requirement in Employee's outstanding equity award agreements shall not apply[9](index=9&type=chunk) - If the Company determines the Transaction Closing will not occur, outstanding Equity Awards will be treated in accordance with the Retirement Provisions upon the Determination Date and Employee's separation from service[9](index=9&type=chunk) [Release Requirement](index=3&type=section&id=5.%20Release) Employee is not entitled to any payments under this agreement unless they timely execute and deliver a signed Confidential Release of Claims to the Company within 45 days after the Transaction Closing - Employee will not be entitled to any payments under this Agreement unless they timely execute and deliver a signed Confidential Release of Claims within **45 days** after the Transaction Closing[9](index=9&type=chunk) [Continued Participation in Active Officer Product Program and Executive Retirement Benefits](index=3&type=section&id=7.%20Continued%20Participation%20in%20the%20Active%20Officer%20Product%20Program%20and%20Executive%20Retirement%20Benefits%20or%20Plans) Employee remains eligible to use Company products annually under the Active Officer Product Program based on officer level. For executive retirement benefits, the employee will be deemed retired as of the Transaction Closing or Determination Date, entitling them to participate in applicable plans - Employee will be eligible to continue to use Company products annually under the Active Officer Product Program, with quantities varying by officer level (e.g., **8-12 Off Road/On Road products, one boat**)[10](index=10&type=chunk) - Employee shall be deemed to have retired as of the Transaction Closing or the Determination Date for purposes of participating in the Company's executive retirement benefits or plans[10](index=10&type=chunk) [General Terms and Legal Provisions](index=3&type=section&id=General%20Terms%20and%20Legal%20Provisions) This section covers key definitions, employee acknowledgements, legal and tax implications, and final contractual clauses [Key Definitions](index=3&type=section&id=6.%20Definitions) This section defines key terms used throughout the agreement, including 'Continuously Employed,' 'Purchaser,' 'Senior Executive Incentive Plan,' 'Termination Date,' and 'Transaction Closing' - 'Continuously Employed' means Employee's continuous employment with the Company or any of its affiliates through the specified date[10](index=10&type=chunk) - 'Transaction Closing' means the consummation of the Transaction on or before the **seven-month anniversary** of the definitive purchase agreement execution, expected in **October 2025**[10](index=10&type=chunk) [Employee Acknowledgements](index=4&type=section&id=Employee%20Acknowledgements) This section outlines the employee's understanding and agreement regarding retention rights and the Company's right to assign the agreement [No Right to Retention](index=4&type=section&id=8.%20Employee%20Agreement) This clause clarifies that the agreement does not guarantee the employee's continued employment with the Company or its affiliates - Employee understands and agrees that this Agreement does not confer any right to be retained in any position with the Company, Purchaser, or their affiliates[11](index=11&type=chunk) [Company's Right to Assign](index=4&type=section&id=9.%20Assignment) This clause grants the Company the right to assign the agreement, obligating the employee to fulfill criteria for the assignee's benefit - The Company may assign this Agreement, and Employee will be obligated to meet the outlined criteria for the assignee's benefit to be eligible for payments[11](index=11&type=chunk) [Legal and Tax Provisions](index=4&type=section&id=Legal%20and%20Tax%20Provisions) This section addresses the legal enforceability, tax implications, and governing law for the agreement [Severability](index=4&type=section&id=10.%20Severability) This clause ensures that if any part of the agreement is invalid, the remaining provisions remain enforceable and will be replaced to achieve their intent - If any provision of this Agreement is declared void, illegal, or unenforceable, the remainder will be valid and enforceable, and parties will replace the invalid provision to achieve its intended purpose[11](index=11&type=chunk) [Tax Implications and Withholding](index=4&type=section&id=11.%20Taxes) This clause addresses the Company's right to withhold taxes and ensures compliance with Section 409A of the Internal Revenue Code for compensation payments - The Company may withhold all applicable federal, state, city, or other taxes from any amounts payable under this Agreement[11](index=11&type=chunk) - The Agreement is intended to comply with or be exempt from Section 409A of the Internal Revenue Code[11](index=11&type=chunk) - For 'specified employees,' nonqualified deferred compensation payments may be delayed by **six months** from the Termination Date to comply with Section 409A[11](index=11&type=chunk) [Agreement Interpretation](index=4&type=section&id=12.%20Interpretation%20of%20Agreement) This clause specifies that the agreement is a result of good faith negotiations and will be governed by the laws of the State of Minnesota - The Agreement is the result of good faith negotiations, and any statute or rule of construction resolving ambiguities against drafting parties will not be employed[11](index=11&type=chunk) - This Agreement will be construed according to and governed by the laws of the State of Minnesota[11](index=11&type=chunk) [Jurisdiction and Governing Law](index=4&type=section&id=13.%20Jurisdiction%2FVenue%20and%20Governing%20Law) This clause establishes exclusive jurisdiction in Minnesota federal and state courts for any disputes arising from the agreement - Each party irrevocably submits to the exclusive jurisdiction of the federal and state courts located in the State of Minnesota for any action or proceeding arising out of or relating to this Agreement[11](index=11&type=chunk)[12](index=12&type=chunk) [Final Clauses](index=5&type=section&id=Final%20Clauses) This section covers the execution of the agreement in counterparts and confirms it as the entire understanding between the parties [Execution in Counterparts](index=5&type=section&id=14.%20Counterparts) This clause allows the agreement to be executed in multiple counterparts, with electronic signatures holding the same legal validity - The parties may execute this Agreement in counterparts, each deemed an original, and electronic delivery of executed signature pages has the same effect as original delivery[13](index=13&type=chunk) [Entire Agreement](index=5&type=section&id=15.%20Entire%20Agreement) This clause confirms the agreement constitutes the entire understanding between parties, superseding prior agreements, and requires written amendments - This Agreement, including the Confidential Release of Claims, contains the entire agreement between the parties and supersedes all prior agreements or understandings[13](index=13&type=chunk) - No modification or amendment to this Agreement will be valid or binding unless made in writing and signed by the parties[13](index=13&type=chunk) [Execution](index=6&type=section&id=Execution) This section formally concludes the agreement with the required signatures from both the employee and the Company's CEO [Signatures](index=6&type=section&id=Signatures) This section confirms the agreement's formal acceptance through the signatures of the employee and Polaris Industries Inc.'s CEO - The Agreement is signed by Michael Dougherty (Employee) and Robert P. Mack (CEO, Polaris Industries Inc.)[16](index=16&type=chunk)

[Executive Summary & Business Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Highlights) This section provides an overview of Domino's strong third-quarter 2025 financial performance and strategic achievements, highlighting key operational and financial metrics [Third Quarter 2025 Overview](index=1&type=section&id=Third%20Quarter%202025%20Overview) Domino's Pizza announced strong financial results for the third quarter of 2025, with significant global retail sales growth, positive U.S. same-store sales, and an increase in income from operations Third Quarter 2025 Key Highlights | Metric | Value | | :------------------------------------------------ | :------ | | Global retail sales growth (excluding foreign currency impact) | 6.3% | | U.S. same store sales growth | 5.2% | | International same store sales growth (excluding foreign currency impact) | 1.7% | | Global net store growth | 214 | | Income from operations increase | 12.2% | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Russell Weiner highlighted the successful execution of the 'Hungry for MORE' strategy, driving positive order counts in the U.S. and strong growth in both delivery and carryout, expressing confidence in continued market share gains - The 'Hungry for MORE' strategy is successfully driving **positive order counts in the U.S.** through promotions like 'Best Deal Ever' and product innovation such as stuffed crust pizza[2](index=2&type=chunk) - The company achieved **strong growth in both delivery and carryout businesses** in the U.S. during the third quarter[2](index=2&type=chunk) - Management is confident in continuing to **gain QSR pizza market share globally** in 2025 and beyond, leveraging tools for long-term value creation for franchisees and shareholders[2](index=2&type=chunk) [Operational Performance](index=1&type=section&id=Operational%20Performance) This section details Domino's global retail sales, same-store sales growth, and net store expansion, showcasing robust performance across U.S. and international markets [Global Retail Sales and Same Store Sales Growth](index=1&type=section&id=Global%20Retail%20Sales%20and%20Same%20Store%20Sales%20Growth) Domino's reported robust global retail sales and same-store sales growth for both the third quarter and the three fiscal quarters of 2025, with U.S. performance notably strong Global Retail Sales (in millions of U.S. dollars) | Metric | Third Quarter 2025 | Third Quarter 2024 | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | | :------------------ | :----------------- | :----------------- | :------------------------- | :------------------------- | | U.S. stores | $2,320.4 | $2,168.4 | $6,896.8 | $6,602.5 | | International stores | $2,375.8 | $2,223.6 | $6,933.5 | $6,581.9 | | Total | $4,696.2 | $4,392.0 | $13,830.3 | $13,184.4 | Global Retail Sales Growth (versus prior year period, excluding foreign currency impact) | Metric | Third Quarter 2025 | Third Quarter 2024 | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | | :------------------ | :----------------- | :----------------- | :------------------------- | :------------------------- | | U.S. stores | +7.0% | +5.1% | +4.5% | +6.6% | | International stores | +5.7% | +5.1% | +6.6% | +6.5% | | Total | +6.3% | +5.1% | +5.5% | +6.5% | Same Store Sales Growth (versus prior year period) | Metric | Third Quarter 2025 | Third Quarter 2024 | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | | :------------------------------------------ | :----------------- | :----------------- | :------------------------- | :------------------------- | | U.S. Company-owned stores | +3.4% | +3.1% | +1.0% | +5.4% | | U.S. franchise stores | +5.3% | +3.0% | +2.7% | +4.4% | | U.S. stores | +5.2% | +3.0% | +2.7% | +4.5% | | International stores (excluding foreign currency impact) | +1.7% | +0.8% | +2.5% | +1.1% | [Store Growth](index=2&type=section&id=Store%20Growth) Domino's achieved significant global net store growth in Q3 2025, adding 214 stores worldwide, with a substantial portion from international markets Third Quarter 2025 Store Counts | Metric | U.S. Company-owned Stores | U.S. Franchise Stores | Total U.S. Stores | International Stores | Total | | :-------------------------- | :------------------------ | :-------------------- | :---------------- | :------------------- | :------ | | Store count at June 15, 2025 | 258 | 6,803 | 7,061 | 14,475 | 21,536 | | Openings | 2 | 28 | 30 | 220 | 250 | | Closings | — | (1) | (1) | (35) | (36) | | Store count at September 7, 2025 | 260 | 6,830 | 7,090 | 14,660 | 21,750 | | Third quarter 2025 net store growth | 2 | 27 | 29 | 185 | 214 | | Trailing four quarters net store growth | 3 | 157 | 160 | 588 | 748 | [Financial Performance](index=2&type=section&id=Financial%20Performance) This section analyzes Domino's consolidated revenues, gross margins, income from operations, net income, earnings per share, and cash flow, detailing key financial drivers and capital allocation strategies [Consolidated Revenues and Gross Margins](index=2&type=section&id=Consolidated%20Revenues%20and%20Gross%20Margins) Total revenues increased by 6.2% in Q3 2025, driven by higher supply chain revenues and U.S. franchise royalties. Supply chain gross margin improved due to procurement productivity, while U.S. Company-owned store gross margin slightly decreased Total Revenues and Gross Margins | Metric | Third Quarter 2025 | Third Quarter 2024 | Change (%) | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | Change (%) | | :-------------------------- | :----------------- | :----------------- | :--------- | :------------------------- | :------------------------- | :--------- | | Total revenues | $1,147.1M | $1,080.1M | +6.2% | $3,404.3M | $3,262.5M | +4.3% | | U.S. Company-owned store gross margin | 16.3% | 16.8% | (0.5) pp | 16.0% | 17.3% | (1.3) pp | | Supply chain gross margin | 11.3% | 10.6% | +0.7 pp | 11.6% | 11.0% | +0.6 pp | - The increase in supply chain revenues was primarily due to **higher order volumes** and a **3.3% increase in food basket pricing** to stores[5](index=5&type=chunk) - U.S. Company-owned store gross margin decreased due to **increased food basket pricing and higher wage rates**, partially offset by higher sales leverage[5](index=5&type=chunk) [Income from Operations and Net Income](index=2&type=section&id=Income%20from%20Operations%20and%20Net%20Income) Income from operations increased significantly in Q3 2025, primarily driven by higher U.S. franchise royalties and supply chain gross margin. However, net income decreased due to an unfavorable change in unrealized losses on DPC Dash Ltd. investment and a higher effective tax rate Income from Operations and Net Income | Metric | Third Quarter 2025 | Third Quarter 2024 | Change (%) | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | Change (%) | | :-------------------- | :----------------- | :----------------- | :--------- | :------------------------- | :------------------------- | :--------- | | Income from operations | $223.2M | $198.8M | +12.2% | $658.3M | $605.3M | +8.7% | | Net income | $139.3M | $146.9M | (5.2)% | $420.1M | $414.7M | +1.3% | - The decrease in net income was primarily due to a **$29.2 million unfavorable change in pre-tax unrealized losses and gains** associated with the investment in DPC Dash Ltd[10](index=10&type=chunk) - The effective tax rate increased to **22.3% in Q3 2025 from 20.4% in Q3 2024**, contributing to a $2.2 million increase in the provision for income taxes[10](index=10&type=chunk) [Earnings Per Share (EPS)](index=2&type=section&id=Earnings%20Per%20Share%20%28EPS%29) Diluted EPS decreased in Q3 2025 compared to the prior year, primarily due to lower net income, partially offset by a reduced weighted average diluted share count from share repurchases Diluted Earnings Per Share | Metric | Third Quarter 2025 | Third Quarter 2024 | Change (%) | Three Fiscal Quarters 2025 | Three Fiscal Quarters 2024 | Change (%) | | :------------------ | :----------------- | :----------------- | :--------- | :------------------------- | :------------------------- | :--------- | | Diluted earnings per share | $4.08 | $4.19 | (2.6)% | $12.22 | $11.80 | +3.6% | - The decrease in diluted EPS for Q3 2025 was driven by **lower net income**, partially mitigated by a **lower weighted average diluted share count** due to share repurchases[10](index=10&type=chunk) [Cash Flow and Capital Allocation](index=2&type=section&id=Cash%20Flow%20and%20Capital%20Allocation) Domino's demonstrated strong cash flow generation, with significant increases in operating and free cash flow, alongside continued capital returns to shareholders through dividends and share repurchases [Operating and Free Cash Flow](index=2&type=section&id=Operating%20and%20Free%20Cash%20Flow) Net cash provided by operating activities and free cash flow saw substantial increases for the three fiscal quarters of 2025, driven by positive changes in operating assets and liabilities, higher net income, and lower capital expenditures Cash Flow Summary (Three Fiscal Quarters) | Metric | 2025 | 2024 | Change (%) | | :-------------------------------- | :--------- | :--------- | :--------- | | Net cash provided by operating activities | $552.3M | $446.9M | +23.6% | | Capital expenditures | ($56.7M) | ($70.8M) | (19.9)% | | Free cash flow | $495.6M | $376.1M | +31.8% | - The increase in free cash flow was a result of the **positive impact of changes in operating assets and liabilities**, higher net income excluding non-cash operating activities, timing of advertising activities, and **lower investments in capital expenditures**[10](index=10&type=chunk) [Quarterly Dividend](index=3&type=section&id=Quarterly%20Dividend) The Board of Directors declared a quarterly dividend of $1.74 per share subsequent to the third quarter - A quarterly dividend of **$1.74 per share** was declared on October 7, 2025, for shareholders of record as of December 15, 2025, to be paid on December 26, 2025[6](index=6&type=chunk) [Share Repurchases](index=3&type=section&id=Share%20Repurchases) The company continued its share repurchase program, buying back shares in Q3 and year-to-date, with a substantial amount remaining authorized Share Repurchase Activity | Period | Shares Repurchased | Total Value | | :---------------------- | :----------------- | :------------ | | Third Quarter 2025 | 165,778 | $74.7 million | | Three Fiscal Quarters 2025 | 596,754 | $274.7 million | - As of September 7, 2025, the Company had a remaining authorized amount for share repurchases of **$539.7 million**[7](index=7&type=chunk) [Debt and Capital Structure](index=3&type=section&id=Debt%20and%20Capital%20Structure) This section outlines Domino's recent refinancing activities and leverage ratio, demonstrating its approach to managing debt and maintaining a stable capital structure [2025 Refinancing](index=3&type=section&id=2025%20Refinancing) Domino's completed a $1.00 billion refinancing transaction in September 2025, issuing new fixed-rate senior secured notes to repay existing debt and prefund interest, along with establishing a new variable funding note facility - On September 5, 2025, the Company completed a **$1.00 billion refinancing**, issuing $500.0 million of 4.930% fixed rate senior secured notes (five-year term) and $500.0 million of 5.217% fixed rate senior secured notes (seven-year term)[8](index=8&type=chunk) - Proceeds from the new notes and **$160.0 million of unrestricted cash** were used to repay $742.0 million of 2015 notes and $402.7 million of 2018 notes, prefund interest, and capitalize financing costs[9](index=9&type=chunk) - A new **$320.0 million variable funding note facility** was issued, replacing previous facilities, and was undrawn at closing[9](index=9&type=chunk) [Leverage Ratio](index=2&type=section&id=Leverage%20Ratio) The company's leverage ratio improved to 4.5x in Q3 2025 from 4.9x in Q3 2024, falling within its historical operating range of four to six times Leverage Ratio | Metric | September 7, 2025 | September 8, 2024 | | :------------ | :------------------ | :------------------ | | Leverage ratio | 4.5x | 4.9x | - The leverage ratio is calculated as securitized debt related to fixed-rate notes and variable funding notes, divided by Consolidated Adjusted EBITDA on a trailing four quarters basis[19](index=19&type=chunk) - Domino's historically operates with a leverage ratio between **four and six times**[19](index=19&type=chunk) [Non-GAAP Financial Measures and Statistical Definitions](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Statistical%20Definitions) This section defines key non-GAAP financial measures and statistical metrics used by Domino's to analyze performance and communicate with investors [Definitions of Key Metrics](index=4&type=section&id=Definitions%20of%20Key%20Metrics) This section provides definitions for various non-GAAP financial measures and statistical metrics used by Domino's to analyze performance and communicate with investors, including global retail sales, same store sales growth, net store growth, food basket pricing change, free cash flow, income from operations excluding foreign currency impact, Consolidated Adjusted EBITDA, and leverage ratio - Global retail sales refer to total worldwide retail sales at Company-owned and franchise stores, used to **analyze revenues and assess business trends**[12](index=12&type=chunk) - Same store sales growth is calculated by including retail sales from stores that had sales in comparable weeks of both periods, with international growth reported **excluding foreign currency impacts**[13](index=13&type=chunk) - Free cash flow is defined as net cash provided by operating activities less capital expenditures, indicating **cash available for working capital, debt repayment, acquisitions, share repurchases, or dividends**[16](index=16&type=chunk) - Consolidated Adjusted EBITDA is calculated as Segment Income less unallocated corporate administrative costs, used for business objectives, long-range planning, and **evaluating total Company operating performance**[18](index=18&type=chunk) [Company Information & Forward-Looking Statements](index=6&type=section&id=Company%20Information%20%26%20Forward-Looking%20Statements) This section provides an overview of Domino's company profile and includes a safe harbor statement regarding forward-looking information and associated risks [Conference Call and Company Profile](index=6&type=section&id=Conference%20Call%20and%20Company%20Profile) Domino's Pizza, founded in 1960, is the world's largest pizza company with over 21,700 stores globally, primarily operated by independent franchisees, and a strong digital sales presence in the U.S - Domino's Pizza is the **largest pizza company globally**, with over 21,700 stores in more than 90 markets[23](index=23&type=chunk) - The company's system is comprised of independent franchise owners, accounting for **99% of stores** as of the end of Q3 2025[23](index=23&type=chunk) - In 2024, **over 85% of U.S. retail sales were generated via digital channels**, supported by innovative ordering platforms[23](index=23&type=chunk) [Safe Harbor Statement](index=7&type=section&id=Safe%20Harbor%20Statement) This section provides a safe harbor statement for forward-looking statements, outlining inherent risks and uncertainties that could cause actual results to differ materially from expectations, advising caution against undue reliance - The press release contains forward-looking statements based on current management expectations, subject to **substantial risks and uncertainties**[25](index=25&type=chunk) - Important factors that could cause actual results to differ materially are described in SEC filings, including the **'Risk Factors' section of the Annual Report on Form 10-K**[25](index=25&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of the press release[25](index=25&type=chunk) [Condensed Consolidated Financial Statements](index=9&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Domino's unaudited condensed consolidated statements of income, balance sheets, and cash flows for the reported periods [Condensed Consolidated Statements of Income (Quarterly)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20%28Quarterly%29) The unaudited condensed consolidated statements of income for the fiscal quarter ended September 7, 2025, show total revenues of $1,147.1 million and net income of $139.3 million, with diluted EPS of $4.08 Condensed Consolidated Statements of Income (Fiscal Quarter Ended September 7, 2025 vs. September 8, 2024) | (In thousands) | September 7, 2025 | % of Total Revenues | September 8, 2024 | % of Total Revenues | | :---------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Total revenues | $1,147,054 | 100.0% | $1,080,119 | 100.0% | | Total cost of sales | $687,152 | 59.9% | $656,372 | 60.8% | | Gross margin | $459,902 | 40.1% | $423,747 | 39.2% | | Income from operations | $223,168 | 19.5% | $198,831 | 18.4% | | Net income | $139,319 | 12.1% | $146,924 | 13.6% | | Diluted earnings per share | $4.08 | | $4.19 | | [Condensed Consolidated Statements of Income (Year-to-Date)](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20%28Year-to-Date%29) For the three fiscal quarters ended September 7, 2025, total revenues reached $3,404.3 million, with net income of $420.1 million and diluted EPS of $12.22 Condensed Consolidated Statements of Income (Three Fiscal Quarters Ended September 7, 2025 vs. September 8, 2024) | (In thousands) | September 7, 2025 | % of Total Revenues | September 8, 2024 | % of Total Revenues | | :---------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Total revenues | $3,404,254 | 100.0% | $3,262,502 | 100.0% | | Total cost of sales | $2,040,235 | 59.9% | $1,979,854 | 60.7% | | Gross margin | $1,364,019 | 40.1% | $1,282,648 | 39.3% | | Income from operations | $658,307 | 19.3% | $605,347 | 18.6% | | Net income | $420,061 | 12.3% | $414,726 | 12.7% | | Diluted earnings per share | $12.22 | | $11.80 | | [Condensed Consolidated Balance Sheets](index=12&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The unaudited condensed consolidated balance sheet as of September 7, 2025, shows total assets of $1,660.3 million and a total stockholders' deficit of ($3,962.0) million Condensed Consolidated Balance Sheets (as of September 7, 2025 vs. December 29, 2024) | (In thousands) | September 7, 2025 | December 29, 2024 | | :---------------------------------- | :------------------ | :------------------ | | Total current assets | $867,734 | $905,278 | | Total assets | $1,660,277 | $1,737,013 | | Total current liabilities | $539,153 | $1,612,462 | | Total long-term liabilities | $5,083,083 | $4,086,842 | | Total stockholders' deficit | ($3,961,959) | ($3,962,291) | | Total liabilities and stockholders' deficit | $1,660,277 | $1,737,013 | [Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the three fiscal quarters ended September 7, 2025, net cash provided by operating activities was $552.3 million, while net cash used in investing activities was $6.1 million and net cash used in financing activities was $558.2 million Condensed Consolidated Statements of Cash Flows (Three Fiscal Quarters Ended September 7, 2025 vs. September 8, 2024) | (In thousands) | September 7, 2025 | September 8, 2024 | | :---------------------------------- | :------------------ | :------------------ | | Net cash provided by operating activities | $552,256 | $446,879 | | Net cash used in investing activities | ($6,063) | ($71,895) | | Net cash used in financing activities | ($558,241) | ($312,998) | | Change in cash and cash equivalents, restricted cash and cash equivalents | ($10,561) | $61,397 | | Cash and cash equivalents, end of period | $139,728 | $189,084 |