EDGAR 10-K Filing

Company CIK: 16040
Filing Year: 2025
Filename: 16040_10-K_2025_0001193125-25-292412.json

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ITEM 1. BUSINESS
Item 1. Business
General
Cabot is a global specialty chemicals and performance materials company headquartered in Boston, Massachusetts. Our principal products are reinforcing and specialty carbons, specialty compounds, conductive additives, carbon nanotubes, fumed metal oxides, inkjet colorants, and aerogel. Cabot and its affiliates have manufacturing facilities and operations in the United States (“U.S.”) and over 20 other countries. Cabot’s business was founded in 1882 and incorporated in the State of Delaware in 1960. The terms “Cabot”, “Company”, “we”, and “our” as used in this report refer to Cabot Corporation and its consolidated subsidiaries.
In early fiscal 2022, we introduced our “Creating for Tomorrow” growth strategy. This strategy is focused on investing for advantaged growth, developing innovative products and processes that enable a better future, and driving continuous improvement in all we do. Our products are generally based on technical expertise and innovation in one or more of our four core competencies: making and handling very fine particles; modifying the surfaces of very fine particles to alter their functionality; designing particles to impart specific properties to a formulation; and combining particles with other ingredients to deliver a formulated performance intermediate or composite. We focus on creating particles, and formulations of those particles, with the composition, morphology, and surface functionalities to deliver the requisite performance to support our customers’ existing and emerging applications.
Our business is currently organized into two reportable segments: Reinforcement Materials and Performance Chemicals.
Our internet address is www.cabotcorp.com. We make available free of charge on or through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after electronically filing such material with, or furnishing it to, the SEC. Information appearing on our website is not a part of, and is not incorporated in, this Annual Report on Form 10-K.
Reinforcement Materials
Products
Carbon black is a form of elemental carbon that is manufactured from by-product feedstock streams in a highly controlled process to produce particles and aggregates of varied size, structure, and surface chemistry, resulting in many different performance characteristics for a wide variety of applications. Reinforcing carbons (a class of carbon blacks manufactured by Cabot) are used to enhance the physical properties of the systems and applications in which they are incorporated.
Our reinforcing carbons products are used in tires and industrial products. Reinforcing carbons have traditionally been used in the tire industry as a rubber reinforcing agent to increase tread durability and are also used as a performance additive to reduce rolling resistance and improve traction. In industrial products such as hoses, belts, extruded profiles, and molded goods, reinforcing carbons are used to improve the physical performance of the product, including the product’s physical strength, fluid resistance, conductivity and resistivity.
In addition to our reinforcing carbons, we manufacture engineered elastomer composites (“E2C”) solutions that are composites of reinforcing carbons and rubber made using our patented elastomer composites manufacturing process. These composites improve abrasion/wear resistance, reduce fatigue of rubber parts and reduce rolling resistance compared to reinforcing carbons/rubber compounds made entirely by conventional rubber mix methods enabling rubber product manufacturers to reduce the need to make performance trade-offs. The use of E2C® composites enable our customers to produce better performing tires, including giant off-the-road tires and on-road commercial tires, as well as other rubber products used in high-wear applications such as mining. Additionally, because E2C® composites can be integrated into current product methods without additional significant capital investment, and require fewer mixing stages, lower mixing temperatures and shorter mixing cycles than conventional products, operating and production costs may be reduced. E2C is one of our focus areas for growth.
In fiscal 2023, we launched a new technology platform, EVOLVE® Sustainable Solutions. Our ambition under this platform is to work with customers and technology partners to develop products with reliable performance and produced at industrial scale across three sustainability categories: Renewable, Recovered and Reduced, meaning products made with renewable materials or materials recovered from end-of-life tires and/or using processes that result in reduced greenhouse gas emissions.
Drivers of Demand and Sales and Customers
Demand for our Reinforcement Materials products is largely driven by the growth and development of the tire and automotive industries. In addition to general global economic conditions, demand for reinforcing carbons in tires is mainly influenced by the number of replacement and original equipment tires produced, which in turn is driven by (i) vehicle and driving trends, including the number of miles driven, and the number of vehicles produced and registered, (ii) changes in supply chain inventory levels to adapt to end-market demand, (iii) demand for high-performance tires, (iv) demand for larger tires and larger
vehicles, such as trucks, buses, off-road vehicles used in agriculture, mining and similar vehicles, (v) demand for electric and hybrid vehicles, (vi) consumer and industrial spending on new vehicles and (vii) changes in regulatory requirements impacting vehicle fuel efficiency and tire regulations. Demand for reinforcing carbons for industrial products is mainly influenced by vehicle production and design trends, construction activity and general industrial production.
Demand in the developed Western European, Japanese, and North American regions is mainly driven by demographic changes, customers’ high-quality requirements, stringent tire regulation standards, changes in consumer preference (e.g., different tire sizes, model, and powertrain types), and relatively stable tire replacement demand. Demand in developing markets, such as China, Southeastern Asia, South America and Eastern Europe, has been mainly driven by the growing middle class, rapid industrialization, infrastructure spending and car ownership trends and demand for products exported from these regions to the Western markets. The growth in vehicle production, and in exports, in turn drives demand for both original equipment tires and replacement tires in developing regions. In recent years, demand in Western European and the Americas regions has been negatively impacted by increases in exports of tires from Asia to those regions.
Much of the reinforcing carbons we sell is used in tires and automotive products and, therefore, our financial results may be affected by the cyclical nature of the automotive industry. The majority of the market for our products is in replacement tires which historically has been less cyclical as demand for replacement tires is correlated to miles driven. However, the increase in exports of tires from Asia described above has also negatively impacted demand for our products in the Americas and Western Europe related to replacement tire production.
Sales of reinforcing carbons and E2C® composites are made primarily by Cabot employees and secondarily through distributors and sales representatives. We have a regional asset base, and while we typically “make and sell” in region, which, among other advantages, provides our customers a regional supply chain and typically reduces transportation costs; our asset base allows us to also support global demand. Sales to five major tire customers represent a material portion of Reinforcement Materials’ total net sales and operating revenues. The loss of any of these customers, or a significant reduction in volumes sold to them, could have a material adverse effect on the segment until such business is replaced.
Under appropriate circumstances, we have entered into supply arrangements with certain customers, the typical duration of which is one year. These arrangements typically provide for sales price adjustments to account for changes in relevant feedstock costs including natural gas and, in many cases, changes in other relevant costs (such as the cost of CO2 credits in Europe, vendor financing and product delivery). In fiscal 2025, approximately sixty percent of our reinforcing carbons volume was sold under these supply arrangements. The majority of the volumes sold under these arrangements are sold to customers in the Americas and Europe.
Competition
We are one of the leading manufacturers of reinforcing carbons in the world. We compete in the sale of reinforcing carbons with four companies that operate globally and numerous other companies that operate regionally, a number of which export product outside their region of manufacture. We also compete with substitute products, specifically precipitated silica, and products marketed as being made with more sustainable material, specifically reclaimed carbon, sometimes referred to as recovered carbon black. Competition for our Reinforcement Materials products is based on product performance, quality, reliability, price, service, technical innovation, sustainability performance, and logistics. We believe our product differentiation, technological leadership, global manufacturing presence, operations and logistics excellence, sustainability performance, and customer service provide us with a competitive advantage.
Raw Materials
Raw materials are, in general, readily available and in adequate supply. The principal raw material used in the manufacture of our reinforcing carbons is composed of by-product residual heavy oils derived from petroleum refining operations, the distillation of coal tars, and the production of ethylene throughout the world. This "feedstock" is not made-for-purpose; it is a by-product stream of other industrial processes and would generally otherwise be consumed as a fuel oil and burned for heat or power. Natural gas is also used as a feedstock in the production of our reinforcing carbons. Our manufacturing process also requires water and electricity. Raw material costs generally are influenced by the availability of various types of our feedstocks, supply and demand of such raw materials and related transportation costs.
Operations
We own, or have a controlling interest in, and operate plants that produce reinforcing carbons in Argentina, Brazil, Canada, China, Colombia, the Czech Republic, France, Indonesia, Italy, Japan, Mexico, the Netherlands, and the U.S. An equity affiliate operates a reinforcing carbons plant in Venezuela. In addition, we have a 98% ownership interest in an entity that manufactures our E2C products in Port Dickson, Malaysia.
The following table shows our ownership interest as of September 30, 2025 in operations in which we own less than 100%:
Location
Percentage Interest
Shanghai, China
70% (consolidated subsidiary)
Tianjin, China
70% (consolidated subsidiary)
Xingtai City, China
60% (consolidated subsidiary)
Valasske Mezirici (Valmez), Czech Republic
52% (consolidated subsidiary)
Cilegon, Indonesia
98% (consolidated subsidiary)
Port Dickson, Malaysia
98% (consolidated subsidiary)
Valencia, Venezuela
49% (equity affiliate)
In 2025, we completed our expansion project at our Cilegon, Indonesia plant, which added approximately 80,000 metric tons of capacity for reinforcing carbons.
In addition to carbon black, our manufacturing processes produce usable energy in the form of tailgas, as a by-product. Nine of our reinforcing carbons manufacturing sites and four reinforcing carbons/specialty carbons manufacturing sites have energy centers, and we are currently installing an energy center at our reinforcing carbons plant in Ville Platte, Louisiana. These energy centers allow us to utilize the tailgas through some form of energy co-generation, such as steam or electricity. We can use this co-generated energy internally to reduce our manufacturing operating costs or sell it and generate revenues from these energy center operations.
Performance Chemicals
In Performance Chemicals, we design, manufacture and sell materials that deliver performance in a broad range of customer applications across the automotive, construction, infrastructure, inkjet printing, electronics, and consumer products sectors and in applications related to the generation, transmission and storage of energy. In this reporting segment we combine our specialty carbons, specialty compounds, battery materials, fumed metal oxides, aerogel and inkjet product lines. Our focus areas for growth include conductive additives and other materials for battery applications, and inkjet dispersions for high-speed industrial printing applications, including packaging and graphic arts. The recent investments we have made for growth in this segment, including with respect to these specific areas of focus, are described below under the heading “Operations”.
Products
Carbon black is a form of elemental carbon that is manufactured in a highly controlled process to produce particles and aggregates of varied structure and surface chemistry, resulting in many different performance characteristics for a wide variety of applications.
Our specialty carbons are used to impart color, provide rheology control, enhance conductivity and static charge control, provide UV protection, enhance mechanical properties, and provide formulation flexibility through surface treatment. These specialty carbon products are used in a wide variety of applications, such as plastics, which applications represent the largest use for our products, inks, coatings, adhesives, toners, batteries, and displays.
Our masterbatch and conductive compound products, which we refer to as “specialty compounds”, are formulations derived from specialty carbons mixed with polymers and other additives. These products are generally used by plastic resin producers and converters in applications for the automotive, industrial, packaging, infrastructure, agriculture, consumer products, and electronics industries. As an alternative to directly mixing specialty carbon blacks, these formulations offer greater ease of handling and help customers achieve their desired levels of dispersion and color and manage the addition of small doses of additives. In addition, our electrically conductive compound products generally are used to help ensure uniform conductive performance and reduce risks associated with electrostatic discharge in plastics applications.
Our battery materials products include our conductive additives and fumed alumina, which are used principally in lithium-ion batteries used in electric vehicles and energy storage systems, as well as advanced lead acid batteries. Our conductive additives consist of conductive carbons, carbon nanotubes and carbon nano structures, and blends of these materials, each of which offers different levels of conductivity and formulation flexibility for battery manufacturers to address performance (energy density, cycle life, fast charging), cost and safety. In lithium-ion batteries, our conductive additives are used in both cathode and anode applications to increase energy density by providing a conductive network between active materials. Fumed alumina is used to reduce cathode material and electrolyte decomposition and improve capacity retention leading to longer battery cycle life.
Fumed silica is an ultra-fine, high-purity particle used as a reinforcing, thickening, abrasive, thixotropic, suspending or anti-caking agent in a wide variety of products for the automotive, construction, microelectronics, batteries and consumer products industries. These products include adhesives, sealants, cosmetics, batteries, inks, toners, silicone elastomers, coatings, polishing
slurries and pharmaceuticals. In addition to its battery applications discussed above, fumed alumina, also an ultra-fine, high-purity particle, is used as an abrasive, absorbent, or barrier agent in a variety of products, such as inkjet media, lighting, coatings, cosmetics and polishing slurries.
Aerogel is a hydrophobic, silica-based particle with a high surface area that is used in a variety of thermal insulation and specialty chemical applications. In the building and construction industry, the product is used in insulative sprayable plasters and composite building products, as well as translucent skylight, window, wall, and roof systems for insulating eco-daylighting applications. In the specialty chemicals industry, the product is used to provide matte finishing, insulating, and thickening properties for use in a variety of applications including thermal runaway management for lithium-ion batteries.
Our inkjet colorants are high-quality pigment-based black and color dispersions and inks. Our dispersions are based on our patented pigment surface modification technology and polymer encapsulation technology. The dispersions are used in aqueous inkjet inks to impart color, sharp print characteristics and durability, while maintaining high printhead reliability. These products are used in various inkjet printing applications, including traditional work-from-home and corporate office settings, and, increasingly, in graphic arts and packaging printing applications, all of which require a high level of dispersibility and colloidal stability. Our inkjet inks, which utilize our pigment-based colorant dispersions, are used in the commercial printing segment within graphic arts.
Drivers of Demand and Sales and Customers
Our specialty carbons products have a wide variety of end-uses and demand is largely driven by the growth and development of the construction and infrastructure, automotive, electronics and consumer products industries. Demand for our conductive additives for use in batteries is largely driven by the trend in electrification of vehicles and the increase in energy storage systems. Demand for fumed silica is mainly influenced by trends in key markets for silicones, adhesives, and coatings applications, notably, structural adhesives for automobile light-weighting, epoxy bonding paste for wind turbines, high-performance coatings and hybrid sealants for construction and silicones for medical devices, and the proliferation of electronics. Demand for specialty compounds is mainly influenced by growth and development of the automotive, infrastructure, consumer goods and electronic devices, packaging and agriculture industries.
Demand for our inkjet colorants is mainly influenced by developments in print media, pages printed in office and work-from-home environments, as well as press sales and utilization levels as digital aqueous pigment-based inks penetrate graphic arts and packaging applications historically served by analog printing methods.
Sales of these products are made by Cabot employees and through distributors and sales representatives. In our specialty carbons and specialty compounds product lines, sales are generally to a broad number of customers. In our fumed metal oxides product line, sales under contracts with six customers account for approximately one-third of the revenue. In our battery materials product line, sales to four customers account for approximately 50% of revenue.
Competition
We are a leading producer of the products we sell in this segment. We compete in the sale of specialty carbons and products for battery materials applications with a mix of global and regional companies. In recent years, a number of these companies that operate regionally have increased the export of products outside their region of manufacture. For fumed alumina, we compete primarily with one manufacturer of fumed alumina that operates globally. For fumed silica, we compete with two companies with a global presence and several other companies that have a regional presence. For aerogel, we compete globally principally with one other company that produces aerogel products. We also compete with non-aerogel insulation products manufactured by regional companies throughout the world. For specialty compounds, we compete with many regional companies and a small number of global companies. Our inkjet colorants and inks are designed to replace traditional pigment dispersions and dyes used in inkjet printing applications. Competitive products for inkjet colorants are organic dyes and other dispersed pigments manufactured and marketed by large chemical companies and small independent producers.
Competition for our Performance Chemicals products is based on product performance, quality, reliability, service, technical innovation and price. We believe our product differentiation, technological leadership, operations excellence and customer service provide us with a competitive advantage.
Raw Materials
Raw materials for our products are, in general, readily available and in adequate supply. The principal raw material used in the manufacture of our specialty carbons and conductive additives is composed of residual heavy oils derived from petroleum refining operations, the distillation of coal tars, and the production of ethylene throughout the world. Natural gas is also used in the production of our specialty carbons. As product purity is one of the most critical requirements for conductive carbons, we obtain raw materials for those products from select key suppliers. Our raw material costs generally are influenced by the availability of various types of our feedstocks and natural gas, supply and demand of such raw materials and related transportation costs. Our manufacturing processes also require water and electricity.
The primary raw materials for our carbon nanotubes are catalysts that we synthesize and propylene. Raw materials for the production of fumed silica are various chlorosilane feedstocks. We purchase feedstocks and for certain customers convert their feedstock to product on a fee-basis (so called “toll conversion”). We also purchase aluminum chloride as feedstock for the production of fumed alumina. We have long-term procurement contracts or arrangements in place for the purchase of fumed silica feedstock primarily from fence-line partners, which we believe will enable us to meet our raw material requirements for the foreseeable future. In addition, we buy some raw materials in the spot market to help ensure flexibility and minimize costs. The principal raw materials for the production of aerogel are silica sol and/or sodium silicate.
The primary raw materials used for our specialty compounds include carbon black, primarily sourced from our carbon black plants, prime and recycled thermoplastic resins and mineral fillers supplied from various sources. Raw materials for inkjet colorants include carbon black sourced from our carbon black plants, organic pigments and other treating agents available from various sources. Raw materials for inkjet inks include pigment dispersions, solvents and other additives.
Operations
We own, or have a controlling interest in, and operate plants that produce specialty carbons and produce and/or treat conductive additives primarily in China, the Netherlands, and the U.S. We also own, or have a controlling interest in, manufacturing plants that produce fumed metal oxides in China, Germany, the United Kingdom (“U.K.”), and the U.S., and a manufacturing plant that produces aerogel in Frankfurt, Germany, which is currently idled. An equity affiliate operates a fumed metal oxides plant in India. Our specialty compounds are predominately produced in facilities that we own, or have a controlling interest in, located in Belgium, Canada, Indonesia, China, and the United Arab Emirates. Our inkjet colorants and inks are manufactured at our facility in the U.S.
The following table shows our ownership interest as of September 30, 2025 in operations in which we own less than 100%:
Location
Percentage Interest
Tianjin, China (Specialty Carbons and Compounds business)
90% (consolidated subsidiary)
Jiangxi Province, China (Fumed Metal Oxides business)
90% (consolidated subsidiary)
Wuhai, China (Fumed Metal Oxides business)
80% (consolidated subsidiary)
Mettur Dam, India (Fumed Metal Oxides business)
50% (equity affiliate)
Cilegon, Indonesia (Specialty Compounds business)
98% (consolidated subsidiary)
Currently, four of our reinforcing carbons/specialty carbons manufacturing sites have energy centers. These are described above in the discussion of our Reinforcement Materials segment.
Over the last several years, we have been investing for growth with a number of capacity expansion projects and other transactions, particularly to increase manufacturing capacity for our specialty carbons and battery materials products. We intend to pace our investments in additional battery materials manufacturing capacity to meet demand.
Global Operations
Both of our segments operate globally, and a significant portion of our revenues and operating profits is derived from operations outside the U.S. In particular, manufacturers in China continue to be important producers of tires and products for automotive applications, including more recently of batteries for electric vehicles, and since we made our initial investment in China in 1988, we have increased our operations in China to support increased demand for our products in China. We employ local management teams for our operations in China, and our business model in China is predominantly to make and sell product in-country to established local and multi-national customers with operations in China. In fiscal 2025, sales in China across our segments constituted approximately 25% of our revenues, and our property, plant, and equipment located in China constituted approximately 21% of our total property, plant and equipment as of September 30, 2025, as disclosed in Note U to our Consolidated Financial Statements. There are legal, operational, and other risks associated with having substantial operations in China, which are more fully described under the heading “Risk Factors” in Item 1A. If our ability to operate in China were to be constrained by legal, regulatory, or operational risks, it could have a material negative impact on our overall operations and the value of our securities.
Patents and Trademarks
We own and are a licensee of various patents, which expire at different times, covering many of our products as well as processes and product uses. Although the products made and sold under these patents and licenses are important to Cabot, the loss of any particular patent or license would not materially affect our business, taken as a whole. We sell our products under a variety of trademarks we own and take reasonable measures to protect them. While our trademarks are important to Cabot, the loss of any one of our trademarks would not materially affect our business, taken as a whole.
Research and Development
Our products are highly versatile and meet specific performance requirements across many industries, creating opportunities for innovation. In fiscal 2025, we spent approximately $59 million on technology development. Our R&D activities included those focused in the areas of conductive additives, inkjet dispersions, and engineered elastomer composites. We are also focused on process innovation across our product lines. We are investing in furthering our sustainability efforts across various areas in order to reduce emissions and utilize more sustainable material in our production processes.
Seasonality
Our businesses are generally not seasonal in nature, although we may experience some regional seasonal declines during holiday periods.
Human Capital Resources
Our success is realized through the engagement and commitment of our people. We believe that our globally distributed workforce positions us well to serve our broad customer base in the regions and geographies in which they operate. As of September 30, 2025, we had approximately 4,100 employees across our global network of office and manufacturing locations, with 40% of our employees located in the Americas (60% of whom are in the United States), 33% in Asia Pacific (75% of whom are in China), and 27% in Europe, Middle East and Africa (“EMEA”). Of this global employee population, 43% are employed in manufacturing roles.
Our Management Executive Committee (“Executive Committee”) is comprised of our CEO and his nine direct reports who, collectively, have management responsibility for our businesses and regional operations, our financial, legal, safety, health, environment and sustainability, human resources, research and development, global business services, global engineering, and digital functions.
Our primary human capital objectives are to attract, retain, and develop the highest quality talent and ensure they feel safe, supported, and empowered to do their best work. Accordingly, our management team places significant focus and attention on matters concerning Cabot’s workforce - particularly in the areas of employee health and safety, talent, engagement, composition, retention and development, and total rewards. Our Board of Directors provides oversight of our human capital management efforts, with a focus on employee composition, engagement and development, executive succession and compensation, and employee health and safety. These areas of focus are also represented in our 2025 Sustainability Goals, which include:
•fostering an environment where employees report high levels of inclusion and support for their professional development;
•increasing broad representation in leadership and professional roles; and
•reducing injuries and frequency of significant process safety events by 50%.
Our Core Values & Culture
Our deeply held values of integrity, respect, excellence, and responsibility are the foundation of our company and the way we operate. They are the standards by which we interact with our customers, stakeholders, and each other, fostering a positive working environment that inspires collaboration and innovation, and supports our focus on delivering shareholder value.
Our culture embodies our values in the way we work to provide a safe environment where every team member can contribute and have an impact. Our culture is based on five pillars:
·Drive to Zero: We are committed to the health and safety of our people, the communities in which we work, and the environment. Our drive to zero pillar is our goal of achieving zero injuries at all of our facilities worldwide.
·One Cabot: We make decisions and act in Cabot's best interest in a collaborative manner.
·Renewal mindset: We challenge ourselves to think differently, learn, adapt, and continuously improve our way of working.
·Accountable: We take personal ownership and accountability for our actions, performance, and results.
·Inclusive: We strive to provide an environment where everyone feels accepted and valued with the opportunity to grow.
Our Employees
As of September 30, 2025, we had 4,064 employees. Globally, 25% of our employees self-identify as women. In addition, 25% of our U.S. based employees self-identify as People of Color.
Talent Attraction, Development and Retention
We have numerous initiatives and programs to attract, develop and retain our talent tailored to specific employee populations and geographies, including leadership and executive development programs, technical training, and other skill-based training. In fiscal 2025, we expanded our portfolio of programs tailored to key functions, which now include manufacturing, engineering, global business services, digital, technology, and product management with the goal of providing employee resources to support career development aligned with specific roles. For instance, we developed an onboarding framework and training curriculum for our product managers to accelerate success in this key role. We also deployed a new Sustainability leadership program in our Asia Pacific region to enhance leaders’ understanding and capabilities. This initiative included training on ESG frameworks, industry benchmarks, and Cabot’s sustainability journey, Net Zero ambition, and carbon management strategy. Leaders then shared practical tools and examples that can be applied at a local level.
Employee Engagement
We believe that our continued focus on and investment in employee engagement and development continues to be well received by our employees. In our biennial global employee engagement survey, employees reported high levels of engagement with an increase in scores in many areas including questions related to living by our values, well-being, fair treatment, empowerment, collaboration, belonging, and more.
We have well-established performance management and talent development processes in which managers provide regular feedback and coaching to develop employees. Throughout the year, managers and employees engage in annual objective setting, quarterly reviews of goal progress, performance feedback, career development discussions, and a year-end performance evaluation. In addition, we regularly review talent development and succession plans for each of our functions and business segments to identify and develop a pipeline of talent.
Some of our employees in the U.S. and abroad are covered by collective bargaining or similar agreements. We have generally positive and productive employee relations with our employees, unions, and works councils globally.
Cabot’s global voluntary turnover rate for fiscal 2025 was approximately 6.0%, which represents no change in the Company’s attrition rate relative to fiscal 2024.
Total Rewards
We strive to provide a total rewards program that enables us to attract, retain and motivate the best talent to support our businesses. Our compensation programs embrace a pay for performance philosophy and are designed to be competitive within the markets in which we compete for talent. Our pay practices reward achieving individual and Company performance goals and are equitably differentiated based on role, experience, contributions, and performance.
Cabot is committed to ensuring that employees are paid fairly and without discrimination while taking into account job-related factors such as responsibilities, location, work experience, education, performance, and contributions. We conduct reviews annually to monitor our pay practices and develop pay actions where appropriate. Our analysis continues to show strong gender pay equity globally and, within the United States, pay equity across underrepresented groups. This holds true across all pay components - base salary, short-term incentives, and long-term incentives - for employees in the same grade, job function, and location.
As pay transparency requirements continue to evolve globally, in fiscal year 2025, we conducted education sessions for leaders on our compensation philosophy, policies, and structures. We also provided workshops to help leaders effectively address employee questions related to pay.
We also aim to provide competitive benefits programs in all the locations where we operate, including meeting or exceeding local regulations and focusing on health and welfare, employee well-being, employee assistance program (EAP), and retirement savings. Examples of benefit programs we offer in the U.S. include a 401(k) plan that exceeds market standards in levels of employer matching contributions, health benefits (including medical, dental and vision), life and accident insurance, disability coverage, paid time off, tuition reimbursement, and other voluntary benefits.
Employee Health & Safety
We believe that our primary responsibilities as an employer include providing a safe work environment and promoting wellness across the workforce. Our goal is for all employees, contractors, and visitors to return home in the same condition as when they arrived at work that day. As part of our “Drive to Zero” initiative, we have set a long-term goal of achieving zero injuries at our
facilities worldwide. We intend to achieve this ambitious objective by following a number of measures, including training employees in hazard recognition, ensuring procedures are established to mitigate risks, and equipping supervisory personnel with the tools and skills required to execute our work safely. As part of this effort, members of our leadership team participate in root cause determinations, and the results are shared throughout our network of operating facilities. Recognizing that it may take many years to achieve our Drive to Zero goal, we established a continuous improvement goal for personal safety to achieve a 50% reduction in our recordable and severe injury rate from our baseline measurement in calendar year 2019 by calendar year 2025. For fiscal 2025, our Total Recordable Incident Rate (TRIR) based upon the number of injuries per 200,000 work hours for both employees and contractors was 0.17 and our Lost Time Incident Rate (LTIR) was 0.05. For comparison, the U.S. Bureau of Labor Statistics reports for chemical manufacturing an average TRIR of 1.8 and LTIR of 0.6 in calendar year 2023.
We continue to be recognized as an American Chemistry Counsil Responsible Care® company, and, as part of our commitment to Responsible Care, we remain focused on continuously improving the health and safety of our people, processes, and products. In accordance with this certification, we report our safety performance metrics annually and undergo external audits regularly to evaluate our program, identify gaps and undertake corrective actions as needed.
Through our global SHE & Sustainability Commitment, which is endorsed by our Management Executive Committee and adopted by our Board of Directors, we hold ourselves accountable to demonstrate our company values and continuously improve the way we operate. The SHE & Sustainability Commitment defines several important objectives for our continuous improvement in safety, including:
·Complying with all applicable regulations;
·Sharing complete information about the safe handling and appropriate use of our products;
·Maintaining the safety and security of our employees, contractors and neighbors;
·Managing our operations to minimize any impacts on our communities;
·Exemplifying the Responsible Care® Guiding Principles;
·Partnering with customers and suppliers to advance innovative and sustainable solutions; and
·Improving efficiencies, reducing environmental impacts, and ensuring that we are prepared for emergencies that could occur.
Safety, Health, Environment and Sustainability
In recognition of the importance of safety, health, environment and sustainability matters to Cabot, our Board of Directors has a Safety, Health, Environment, and Sustainability Committee. The Committee, which is comprised of independent directors, meets regularly and oversees our safety, health, and environmental performance, process safety, security, product stewardship, community engagement, and governmental affairs. In particular, the Committee reviews metrics, audit results, emerging trends, overall performance, risks and opportunity assessments and management processes related to our safety, health, environmental and sustainability program.
Our ongoing operations are subject to extensive federal, state, local, and foreign laws, regulations, rules, and ordinances relating to safety, health, and environmental matters (“SH&E Requirements”). The SH&E Requirements regulating our operations include requirements to obtain and comply with various environmental-related permits for constructing any new facilities and operating all of our existing facilities, as well as for product registrations. We have expended and will continue to expend considerable resources to construct, maintain, operate, and improve our facilities throughout the world for safety, health and environmental protection and to comply with SH&E Requirements. We spent $74 million in environmental-related capital expenditures in fiscal 2025. We anticipate spending approximately $60 million for such matters in fiscal 2026. A significant portion of these costs have been for the installation of air pollution control equipment, including costs associated with our compliance with the Consent Decree we entered into in November 2013 with the U.S. Environmental Protection Agency (“EPA”) and the Louisiana Department of Environmental Quality (“LDEQ”) regarding Cabot’s three carbon black manufacturing facilities in the U.S. This settlement is related to the EPA’s national enforcement initiative focused on the U.S. carbon black manufacturing sector alleging non-compliance with certain regulatory and permitting requirements under The Clean Air Act, including the New Source Review (“NSR”) construction permitting requirements. Pursuant to this settlement, Cabot has installed technology controls for sulfur dioxide and/or nitrogen oxide at its carbon black plants in Pampa, Texas and Franklin, Louisiana, and is in the process of installing such technology controls at its plant in Ville Platte, Louisiana. We are currently in discussions with the EPA and LDEQ to extend our compliance date at the Ville Platte facility. We expect that the total capital costs to install these technology controls will be approximately $270 million and will be incurred through early 2026. As of September 30, 2025, we have incurred $241 million to install these controls in the U.S. In addition, operating these technology controls increases our on-going plant operating costs. All carbon black manufacturers in the U.S. have settled with the EPA and have installed similar controls. In addition, under the Province of Ontario Ministry of Environment, Conservation and Parks’ (“MECP”) Regulation 419, a new requirement for sulfur dioxide (“SO2”) emissions went into effect on July 1, 2023 for our reinforcing carbons plant in Sarnia, Ontario. We are out of compliance with this
new air standard, and under the terms of the current abatement plan we have in place with the MECP regarding this requirement, we are required to install air pollution controls at the plant by July 1, 2028, with specified milestones before that date. To date, our ability to operate our reinforcing carbons plant in Sarnia has not been restricted as we are working with MECP on a solution. In addition, in the EU, the large volume inorganic chemicals Best Available Technique Reference (“BREF”) is currently under revision, and we expect that requirements to install technology controls for sulfur dioxide and/or nitrogen oxide at the Company’s four carbon black facilities in the EU may be finalized in 2028 with a four year compliance deadline.
As described above, environmental agencies worldwide are increasingly implementing regulations and other requirements resulting in more restrictive air emissions limits globally, particularly as they relate to nitrogen oxide, sulfur dioxide and particulate matter emissions. In addition, growing concerns about climate change have led to global efforts to reduce greenhouse gas (“GHG”) emissions with a goal of achieving net zero GHG emissions in the future, which will impact the carbon black industry and our business as carbon dioxide is emitted from those manufacturing processes. Currently, in Europe, our four carbon black facilities are subject to the EU Emissions Trading Scheme (“EU ETS”). The fourth phase of the EU ETS began in January 2021, with updated product benchmarks for our carbon black facilities. As a result of revisions to the EU ETS program following the ETS Directive reform adopted in May 2023 that increased the ambition of the EU ETS, the free allowances under the program will be phased out over time, and we anticipate increased costs to the Company beginning in 2026 due to an increased need to purchase emission credits. Further, in order for our carbon black plant in Botlek, the Netherlands, to retain the maximum amount of free allowances allocated to this plant beginning in calendar year 2025, in June 2024 we submitted to the Dutch Emission Authorities our plan for achieving carbon neutrality at that plant by 2050. Our plan assumes a potential investment in carbon capture, utilization and storage technology at the plant that would be installed and operational by 2050. We will continue to monitor revisions and updates to the EU ETS program and related reporting, including updates to the carbon black product benchmarks that will apply at the beginning of calendar year 2026, and other measures that may reduce the maximum amount of free allowances allocated to our carbon black plants and increase our compliance costs. In addition, we will continue to evaluate the future potential applicability of the new carbon border adjustment mechanism (“CBAM”) program in the EU as an alternative to free allowances under the EU ETS and as a system complementary to the EU ETS. Our carbon black facility in the Netherlands is also subject to the Netherlands CO2 tax, which is a top-up tax to the EU ETS scheme. In China, a national emissions trading program is currently in place for the power, cement, steel, and electrolytic sectors and it is expected to be expanded to apply to the carbon black sector in the future. We continue to monitor that program’s further implementation and expect it may apply to the carbon black industry in the future with the existing regional pilot programs expected to continue to operate until the national program becomes effective. Our carbon black facility in Ontario, Canada is subject to the Ontario Emissions Performance Standard trading system, a transition from the federal carbon tax program and under which specific transition requirements became effective on January 1, 2022. In Mexico, our carbon black facility is participating in the national ETS program, a transition from the pilot program that was in effect for our plant in 2023. In Japan, we expect our two carbon black plants to be subject to a national ETS program beginning in April 2026. In other regions where we operate, some of our facilities are required to report their greenhouse gas emissions but are not currently subject to programs requiring trading or emission controls but may be subject to limited carbon tax programs affecting fuels we purchase. We generally expect to pay any incurred taxes or purchase emission credits as needed to respond to any allocation shortfalls and pass these costs on to our customers. In addition, further air emission regulations may be adopted in the future in regions and countries where we operate, which could have an impact on our operations. Increasing regulatory programs associated with emissions and concerns regarding climate change are expected to increase our capital and operational costs in the future.
Cabot has been named as a potentially responsible party under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (the “Superfund law”) and comparable state statutes with respect to several sites primarily associated with our divested businesses. (See “Legal Proceedings” in Item 3 below, and Note S in Item 8 below, under the heading “Contingencies”.) During the next several years, as remediation of various environmental sites is carried out, we expect to spend against our environmental reserve for costs associated with such remediation. As of September 30, 2025, our environmental reserve was approximately $5 million. Adjustments are made to the reserve based on our continuing analysis of our share of costs likely to be incurred at each site. Inherent uncertainties exist in these estimates due to unknown conditions at the various sites, changing governmental regulations and legal standards regarding liability, and changing technologies for handling site investigation and remediation. While the reserve represents our best estimate of the costs we expect to incur, the actual costs to investigate and remediate these sites may exceed the amounts accrued in the environmental reserve. While it is always possible that an unusual event may occur with respect to a given site and have a material adverse effect on our results of operations in a particular period, we do not believe that the costs relating to these sites, in the aggregate, are likely to have a material adverse effect on our consolidated financial position. Furthermore, it is possible that we may also incur future costs relating to environmental liabilities not currently known to us or as to which it is currently not possible to make an estimate.
The International Agency for Research on Cancer (“IARC”) classifies carbon black as a Group 2B substance (known animal carcinogen, possible human carcinogen). We have communicated IARC’s classification of carbon black to our customers and
employees and have included that information in our safety data sheets and elsewhere, as appropriate. We continue to believe that the available evidence, taken as a whole, indicates that carbon black is not carcinogenic to humans, and does not present a health hazard when handled in accordance with good housekeeping and safe workplace practices as described in our safety data sheets.
Our products are subject to the chemical control laws and regulatory requirements of the countries in which they are manufactured or imported and distributed commercially. These laws include the regulation of chemical substances and inventories under the Toxic Substances Control Act (“TSCA”) in the U.S. and the Registration, Evaluation and Authorization of Chemicals (“REACh”) in the European Union. Manufacturers or importers of these chemical substances are required to submit specified health, safety, environment, risk and use information about these substances. Under the “Evaluation” portion of the REACh framework, the European Chemicals Agency (ECHA) and European Union Member States assess the information submitted by companies within registration dossiers and testing proposals to determine whether the associated substances are safe for use. The silica substance evaluation was concluded in 2021, and following this, the Netherlands has proposed a STOT RE 1 classification for untreated silica which was recently adopted by ECHA, but has not yet been finalized. Carbon black is scheduled for a substance review in 2026. Analogous regimes exist in other parts of the world, including the UK, Turkey, China, South Korea, and Taiwan. Many of these chemical control regulations are in the process of a multi-year implementation period for product/substance registrations or notifications.
Additional requirements for nanomaterials apply to many of our existing products including carbon black, fumed silica, inkjet pigments, fumed alumina, and advanced carbons such as carbon nano structures and carbon nanotubes. Country-specific nanomaterial reporting programs have been implemented in some countries and are being developed by others. In the European Union, application-specific safety evaluations are ongoing for nanomaterials. Our carbon nanotubes are bound in a matrix or contained within conductive materials in batteries, molded parts, plastics, coatings, adhesives, and sealants, and we do not believe they present a health risk to end users under normal use conditions. Exposure to carbon nanotubes could occur in the workplace. However, we believe workplace exposures can be appropriately managed with engineering controls in place at our manufacturing facilities and the use of required personal protective equipment at our sites.
A number of organizations and regulatory agencies have become increasingly focused on the issue of water scarcity, water conservation, and water quality, particularly in certain geographic regions. We are engaged in various activities to promote water conservation and wastewater recycling, particularly given that some of our manufacturing processes are water intensive and some of our manufacturing sites are located in water-stressed areas. The costs associated with these activities are not expected to have a material adverse effect on our operations.
Various U.S. agencies and international bodies have adopted security requirements applicable to certain manufacturing and industrial facilities and marine port locations. These security-related requirements involve the preparation of security assessments and security plans in some cases, and in other cases, the registration of certain facilities with specified governmental authorities. We closely monitor all security-related regulatory developments and believe we are in compliance with all existing requirements. Compliance with such requirements is not expected to have a material adverse effect on our operations.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors
In addition to factors described elsewhere in this report, the following are important factors that could adversely affect our business. The risks described below are not the only risks we face. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations and financial results.
Industry Risks
Our industry is highly competitive and demand for our products and our financial results may be negatively impacted by changes in industry capacity utilization, a material shift in the geographic area of tire production (in particular, shifts away from higher margin regions), and competition from other specialty chemical companies.
We operate in a highly competitive marketplace. Our businesses are sensitive to changes in industry capacity utilization, and pricing tends to decrease when industry capacity utilization decreases, which affects our financial performance. As a result, overcapacity in one region, such as China and India, that is exported to other geographies causing underutilization in those markets disrupts regional supply and demand dynamics and may reduce demand for our products.
Our Reinforcement Materials business is also sensitive to shifts in the geographic areas where tire production occurs. In recent years, the export of tires produced in Asia to the Americas and Western Europe has increased compared to historic levels and reduced the production of tires by our tire customers in those regions. In recent years, this shift in tire production has reduced, and may continue to reduce, demand for our Reinforcement Materials products in the Americas and Western Europe, and our capacity utilization, in those higher margin regions. This increase in tire exports from Asia and other actions by our competitors could also impact our ability to maintain or raise prices, successfully enter into new markets or maintain or grow our market position.
Further, our ability to compete successfully depends in part upon our ability to maintain a superior technological capability and to continue to identify, develop and commercialize new and innovative, high value-added products for existing and future customers. Increased competition from existing or newly developed products offered by our competitors or companies whose products offer similar functionality as our products, particularly those with an improved environmental footprint, that could be substituted for our products, may negatively affect demand for our products.
Environmental laws and regulations that affect our industries impose constraints on our operations, and could threaten our competitive position and increase our operating costs, which may adversely impact our business and results of operations.
Our ongoing manufacturing operations are subject to extensive federal, state, local and foreign laws, regulations, rules and ordinances relating to environmental matters, many of which provide for substantial monetary fines, civil and criminal sanctions and possible injunctive relief for violations. These include requirements to obtain and comply with various environmental-related and other permits for constructing new facilities and operating our existing facilities, as well as settlements with agencies regarding environmental matters and environmental requirements. These environmental regulatory requirements impose constraints on our operations and could threaten our competitive position. We have expended and will continue to expend considerable amounts to construct, maintain, operate, and improve our facilities around the world for environmental protection. In addition, an increased emphasis on environmental justice, which is the fair treatment and meaningful involvement of all individuals and communities in which we operate, regardless of race, color, national origin, or income, with respect to the development, implementation and enforcement of environmental laws, regulations, and policies, could result in increased compliance requirements and costs. Furthermore, our actual or perceived failure to adhere to these principles could harm our reputation.
Further, environmental agencies worldwide are increasingly implementing regulations and other requirements resulting in more restrictive air emission limits globally, particularly as they relate to nitrogen oxides, sulfur dioxide and particulate matter emissions. We expect complying with existing regulations and other regulatory and tax changes being proposed in regions where we operate, if approved, will require us to incur significant additional costs for compliance, capital improvements or possibly limit our current or planned operations. We may not be able to offset the costs of these compliance obligations through price increases. Our ability to implement price increases is largely influenced by competitive and economic conditions and could vary significantly depending on the segment served. Such increases may not be accepted by our customers, may not be sufficient to compensate for increased regulatory costs or may decrease demand for our products and our volume of sales. Further, the capital improvements needed to comply with environmental requirements frequently involve the development and installation of new technologies within existing plant operations and there is a risk that these new technologies will not operate as we expect. In addition, as with construction projects generally, these projects may be delayed because of the availability of labor and materials or contractor performance issues and may have unexpected cost increases. There may be delays in the start-up of these capital improvements and we may not be able to comply with environmental regulatory requirements in a timely manner. We have experienced these issues at our plant in Ville Platte. Further, following our termination of the construction contract for the design and installation of air pollution control equipment at Ville Platte as a result of the contractor’s poor performance, the contractor has filed a demand for arbitration against us in connection with our termination of the contract. Cabot has filed a counterclaim against the contractor seeking damages greater than the value of the contract on account of the contractor’s breaches of the contract.
A description of the regulatory matters is included in the discussion under the heading “Safety, Health, Environment, and Sustainability” in Item 1 above, and in Note S in Item 8 below under the heading “Contingencies”.
We may be exposed to certain regulatory and financial risks related to climate change developments and an increased focus on carbon neutrality and net zero emissions, which may adversely affect our business and results of operations, and increased pressures and adverse publicity about potential impacts on climate change by us or other companies in our industry could harm our reputation.
Carbon dioxide, a greenhouse gas, is emitted in carbon black manufacturing processes. Concerns about the relationship between greenhouse gases and global climate change, and an increased focus on carbon neutrality and net zero, may result in additional regulations on both national and supranational levels, to monitor, regulate, control and impose taxes on emissions of carbon dioxide and other greenhouse gases. Climate changes include extreme weather impacts, such as changes in rainfall and in storm patterns and intensities, water shortages, significantly changing sea levels and increasing atmospheric and water temperatures. A number of governmental bodies have introduced or are contemplating regulatory changes in response to climate change, including regulating greenhouse gas emissions. Specifically, in certain geographic areas, our carbon black facilities are or may become subject to greenhouse gas emission trading schemes or carbon tax programs under which we may be required to pay any incurred taxes or purchase emission credits if our emission levels exceed our free allocation. The outcome of new legislation or regulation in the U.S. and other jurisdictions in which we operate may result in new or additional requirements and fees or restrictions on certain activities. Compliance with greenhouse gas and climate change initiatives may result in additional costs to us, including, among other things, increased production costs, increased feedstock costs, additional taxes, reduced emission allowances
or additional restrictions on production or operations. In addition, certain of our carbon black products for specialty applications have higher greenhouse gas emissions than our other products, which may increase our compliance costs and make it more challenging to achieve our emissions goals without technology developments. We may not be able to offset the effects of these new or more stringent laws and regulations and compliance costs through price increases, which could adversely affect our business and negatively impact our profitability and our growth. Our ability to implement price increases is largely influenced by competitive and economic conditions and could vary significantly depending on the segment served. Such increases may not be accepted by our customers, may not be sufficient to compensate for increased regulatory costs or may decrease demand for our products and our volume of sales. Any adopted future climate change regulations could also negatively impact our ability to compete with companies situated in areas not subject to such limitations.
Furthermore, the potential impact of climate change and related regulation on our feedstock suppliers and customers is highly uncertain and there can be no assurance that it will not have an adverse effect on the availability, over time, of our traditional carbon black feedstocks, our customers’ businesses and sourcing arrangements, and on our financial condition and results of operations. For instance, lower demand for oil refinery products may reduce the availability and increase the cost of certain of the key raw materials we use. In addition, many of our tire customers have set sustainability goals for the 2030 to 2050 time period to purchase more sustainable raw materials, including reduced use of fossil-derived materials, which could reduce demand for our traditional carbon black products.
In addition, even without increased regulation, increased public awareness and adverse publicity about potential impacts on climate change or environmental harm from us or our industry could harm our reputation or otherwise impact the Company adversely. In recent years, investors have also begun to show increased interest in sustainability and climate change as it relates to their investment decisions. Our failure to execute our sustainability strategy in a way that adequately responds to these environmental concerns in a timely manner could harm our reputation and negatively impact the perceived value of our securities. In addition, new disclosure requirements related to GHG emissions and climate change, including the European Sustainability Reporting Standards and U.S. state laws requiring climate disclosure, may negatively impact our business by diverting resources, increasing our compliance costs and harming our reputation. Further, more frequent weather-related impacts on our operations and plant sites may impact the cost or availability of insurance.
We cannot predict how legal, regulatory and social responses to concerns about climate change, as well as other sustainability and environmental matters, will impact our business.
Volatility in the price and availability of raw materials and energy could impact our margins and working capital and our revenues from our energy center operations.
Our manufacturing processes consume significant amounts of energy and raw materials, the costs of which are subject to worldwide supply and demand as well as other factors beyond our control. Our carbon black businesses use a variety of feedstocks as raw material including high sulfur fuel oils, low sulfur fuel oils, coal tar distillates, and ethylene cracker residue, the cost and availability of which vary, based in part on geography. Significant movements or volatility in our carbon black feedstock costs could have an adverse effect on our working capital and results of operations. In addition, regulatory changes, tariffs, or geopolitical conflict may impact the availability and prices of our raw materials. For example, the Russian invasion of Ukraine and the resulting ongoing war has in the past disrupted and may in the future continue to disrupt the price and availability of natural gas in Europe.
Certain of our carbon black supply arrangements contain provisions that adjust prices to account for changes in relevant feedstock and natural gas price indices. We also attempt to offset the effects of increases in raw material and energy costs through price increases in our non-contract sales, productivity improvements and cost reduction efforts. Success in offsetting increased raw material and energy costs with price increases is largely influenced by competitive and economic conditions and could vary significantly depending on the segment served. Such increases may not be accepted by our customers, may not be sufficient to compensate for increased raw material and energy costs or may decrease demand for our products and our volume of sales. If we are not able to fully offset the effects of increased raw material or energy costs, it could have a significant impact on our financial results. Rapid declines in energy prices and raw material costs can also negatively impact our financial results, as such changes can negatively affect the revenues we receive from our energy centers and yield improvement investments, and may negatively impact our contract pricing adjustments. In addition, we use a variety of feedstock indices in our supply arrangements to adjust our prices for changes in raw materials costs. Depending on feedstock markets and our choice of feedstocks, the indices we use in our supply arrangements may not precisely track our actual costs. This could result in an incongruity between our pricing adjustments and changes in our actual feedstock costs, which can affect our net working capital and our margins. Further, the timing of the implementation of any of these pricing adjustments may not precisely track our actual costs as reflected in our financial statements.
We obtain certain of our raw materials from selected key suppliers and certain joint venture partners. If any supplier of raw materials ceases supplying raw materials to us or is unable to meet its obligations under supply agreements with us on a timely basis or at an acceptable price, or at all, we may be forced to incur higher costs to obtain the necessary raw materials elsewhere.
In addition, our manufacturing processes require water in their operations. If climate change, manufacturing, and trends in digitization and electricity demands create a mismatch between water supply and demand that makes water less available for our operations, there is a risk that our operations may be curtailed, particularly in situations where water for human use needs to be prioritized over other uses, such as manufacturing operations. These costs could increase in the future in the event of water shortages.
A significant adverse change in a customer or joint venture relationship or the failure of a customer or joint venture partner to perform its obligations under agreements with us could harm our business or cash flows.
Our success in strengthening relationships and growing business with our largest customers and retaining their business over extended time periods is important to our future results. We have a group of key customers across our businesses that together represent a significant portion of our total net sales and operating revenues. The loss of any of our important customers, or a significant reduction in volumes sold to them, could adversely affect our results of operations until such business is replaced or any temporary disruption ends. Further, in our Reinforcement Materials segment we enter into supply arrangements with a number of key customers that typically have a duration of one year, which account for approximately sixty percent of our total reinforcing carbons volumes. Our success in negotiating the price and volume terms under these arrangements has a material effect on our results. In addition, a number of our operations are conducted through joint venture arrangements that operate pursuant to long-term contracts, including for the supply of raw materials and the provision of other services for the joint venture operations. Any dispute as to the terms of these contractual arrangements or deterioration in the relationship between us and our joint venture partner, or the disruption or curtailment of a joint venture partner’s operations, could disrupt the operations of the joint venture, which could affect our financial results and harm our reputation. In addition, any deterioration in the financial condition of any of our customers that impairs our customers’ ability to make payments to us also could increase our uncollectible receivables and could affect our future results and financial condition.
We are exposed to political or country risk inherent in doing business in some countries, including China.
Sales outside of the U.S. constituted the majority of our revenues in fiscal 2025. We conduct business in several countries, including China, that have less developed legal systems and financial markets, and potentially less predictable business environments than the U.S. As set forth in Note U to our Consolidated Financial Statements, sales in China constituted approximately 25% of our revenues in fiscal 2025 and our property, plant and equipment located in China constituted approximately 21% of our total property, plant and equipment as of September 30, 2025. Our operations outside of the U.S., including in China, expose us to risks related to uncertain enforcement of laws by foreign governments as well as risks that foreign governmental entities will change applicable rules and regulations with minimal advance notice. These risks could result in a material change in our operations, which could negatively impact the value of our securities. Additionally, our operations in some countries, including China, are subject to various risks, including changes in the rate of economic growth; unsettled political or economic conditions; abrupt changes in regulation; possible expropriation or other governmental actions; corruption by government officials and other third parties; social unrest, war, terrorist activities or other armed conflict; confiscatory taxation or other adverse tax policies; deprivation of contract rights; trade regulations affecting production, pricing and marketing of products; reduced protection of intellectual property rights; restrictions or additional costs associated with repatriating cash; exchange controls; inflation; currency fluctuations and devaluation; political tension that could result in sanctions being imposed against our customers or suppliers in countries where sanctions have not been imposed in the past; the effect of global health, safety and environmental matters on economic conditions and market opportunities; and changes in financial policy and availability of credit.
For example, the Chinese government has, from time to time, curtailed manufacturing operations, with little or no notice, in industrial regions out of concerns over air quality. The timing and length of these curtailments has been difficult to predict and, at times, were applied to manufacturing operations without regard to whether the operations being curtailed comply with environmental regulations in the area. Accordingly, our manufacturing operations in China have been subject to these curtailments in the past and may be subject to them in the future. These events could negatively impact our results of operations and cash flows both during and after the period of any government-imposed curtailment affecting our operations. Further, any such curtailments on the operations at our customers’ facilities could reduce demand for our products and our volumes.
Operational Risks
As a chemical manufacturing company, our operations are subject to operational risks and have the potential to cause environmental or other damage as well as personal injury, or disrupt our ability to supply our customers, any of which could adversely affect our business, results of operations and cash flows.
The operation of a chemical manufacturing business as well as the sale and distribution of chemical products are subject to operational as well as safety, health and environmental risks. For example, the production and/or processing of carbon black, specialty compounds, fumed metal oxides, aerogel, carbon nanotubes and other chemicals involve the handling, transportation, manufacture or use of certain substances or components that may be considered dangerous, toxic or hazardous. While we take precautions to handle and transport these materials in a safe manner, if they are mishandled or released into the environment, they could cause property damage or result in personal injury claims against us.
Our manufacturing processes and the transportation of our chemical products and/or the raw materials used to manufacture our products are subject to risks inherent in chemical manufacturing, including leaks, fires, explosions, toxic releases, severe weather, mechanical failures or unscheduled downtime. In addition, the occurrence of material operating problems at our facilities, particularly at a facility that is the sole source of a particular product we manufacture, or a disruption in our supply chain or distribution operations may result in loss of production, which, in turn, may make it difficult for us to meet customer needs. For example, in recent years we have experienced unplanned plant outages at our plants in Franklin, Louisiana and Altamira, Mexico that caused a period of reduced volumes and earnings and increased our fixed costs. Other disruptions in supply chains and distribution channels, including those caused by global or regional logistics delays and constraints, such as rail or other transportation interruptions, could disrupt our business operations. These events and their consequences could negatively impact our results of operations and cash flows, both during and after the period of operational difficulties, and could harm our reputation.
An interruption in our operations as a result of fence-line arrangements or a joint venture partner's actions could disrupt our manufacturing operations and adversely affect our financial results.
At certain of our fumed metal oxides facilities, we have fence-line arrangements (many of which are closed-loop) with adjacent third-party manufacturing operations (“fence-line partners”), who provide raw materials for our manufacturing operations and/or take by-products generated from our operations. Accordingly, any disruptions or curtailments in a fence-line partner’s production facilities that impacts their ability to supply us with raw materials or to take our manufacturing by-products could disrupt our manufacturing operations or cause us to incur increased operating costs to mitigate such disruption. We have experienced disruptions in the supply of raw materials from certain of our fence-line partners in recent years, which caused us to curtail our operations or incur higher operating costs. Recently, in July 2025, Dow, our fence-line partner at our fumed metal oxides facility in Barry, Wales, announced that it would be ceasing its polysiloxane operations at their site by mid-calendar year 2026. Dow currently supplies our operations with chlorosilane feedstock, which we convert into fumed silica, under an agreement with a term through the end of calendar year 2028. We are engaged in discussions with Dow as to how it will satisfy its performance obligations to us; however, when our agreement with Dow ceases we may be forced to limit our manufacturing operations at our Barry site, which could decrease the site’s profitability and increase our costs. In addition, we operate certain of our carbon black facilities through joint venture arrangements, pursuant to which our joint venture partners provide feedstock and/or take by-products generated from our operations. A dispute with a joint venture partner concerning the terms of those arrangements could impact our joint venture operations and could decrease our income from such operations. For example, we were recently in arbitration following a dispute with our joint venture partner in the Czech Republic, and although we were successful on the merits of the arbitration, while the dispute was on-going, it negatively impacted those operations. Further, significant events at neighboring industrial facilities, such as environmental releases, could also disrupt our operations and result in negative publicity about us and harm our reputation.
Our products are subject to extensive safety, health and environmental requirements, which could impair our ability to manufacture and sell certain products.
In order to secure and maintain the right to produce or sell our products, we must satisfy product related registration and other regulatory requirements in different jurisdictions. Obtaining and maintaining these approvals requires a significant amount of product testing and data, and there is no certainty these approvals will be obtained.
Certain national and international health organizations have classified carbon black as a possible or suspected human carcinogen. To the extent that, in the future, (i) these organizations re-classify carbon black as a known or confirmed carcinogen, (ii) other organizations or government authorities in other jurisdictions classify carbon black or any of our other finished products, raw materials or intermediates as suspected or known carcinogens or otherwise hazardous, or (iii) there is discovery of adverse health effects attributable to production or use of carbon black or any of our other finished products, raw materials or intermediates, we could be required to incur significantly higher costs to comply with environmental, health and safety laws, or to comply with restrictions on sales of our products, be subject to legal claims, and our reputation and business could be adversely affected. Further, a subset of multi-walled carbon nanotubes that includes a carbon nanotube grade we currently manufacture have been classified as carcinogen category 1B and specific target organ toxicant (lung) after repeated exposure category 1 under European Union regulations. Although our carbon nanotubes are bound in a matrix or contained within conductive materials, exposure to carbon nanotubes could occur in the workplace. We could be required to incur additional costs to comply with requirements for the safe manufacturing and handling of these materials and we could be subject to legal claims associated with our products. In addition, chemicals that are currently classified as non-hazardous may be reclassified as hazardous in the future, and our products may have characteristics that are not recognized today but may be found in the future to impair human health or to be carcinogenic.
Information technology systems failures, data security breaches, cybersecurity attacks or network disruptions have harmed us in the past and could compromise our information, disrupt our operations and expose us to liability, which may adversely impact our operations.
We rely on information technology, some of which is managed by third parties, to manage the day-to-day operations and activities of our business, operate elements of our manufacturing facilities, manage our customer and vendor transactions, and maintain our financial, accounting and business records. In addition, we collect and store certain data, including proprietary business information, and may have access to confidential or personal information that is subject to privacy and security laws and regulations.
The secure processing, maintenance and transmission of this data are critical to our operations and business strategy. Failures in our information technology systems, including those involving our managed service provider, could disrupt our business. Challenges may also arise when maintaining or upgrading our systems, or when integrating information technology and other systems as part of business acquisitions. Such disruptions could impede our ability to process transactions and affect our financial reporting. Additionally, these issues may impact on our operations, potentially contributing to a process safety event. Any of these scenarios may have a material adverse effect on our business or results of operations. In the past, our networks have been subject to an attack, potentially by suspected foreign nation-state attackers, who conducted reconnaissance and deployed malware. While our systems were able to isolate and expel the attacker before material harm was caused, criminals, rogue insiders, nation-state, and other attackers may continue to attack our network, and our defenses may be unable to succeed in detecting their actions or stop them from inflicting potentially material harms including by theft, destruction, misuse, or corruption of our data or systems or those of other entities whose systems may interconnect with ours.
In addition, our information technology systems could be compromised by outside parties intent on extracting information, corrupting information or disrupting business processes. Despite our security design and controls, and those of our third-party providers, we may be vulnerable to cyber-attacks, computer viruses, security breaches, inadvertent or intentional employee actions, system failures and other risks that could potentially lead to the compromising of sensitive, confidential or personal data, improper use of our, or our third-party provider systems, solutions or networks, unauthorized access, use, disclosure, modification or destruction of information, or operational disruptions. We face increased information technology security and fraud risks due to our increased reliance on working remotely, which may create additional information security vulnerabilities and/or magnify the impact of any disruption in information technology systems. Additionally, as we increase our use of artificial intelligence tools into our operations, the risk of unauthorized access to our data and of making errors or erroneous decisions based on our reliance on the AI tool will increase. We have in the past and may in the future be exposed to unauthorized access to our information technology systems through undetected vulnerabilities in our or our service providers’ information systems or software. With the evolving nature of cybersecurity threats, the scope and impact of any information security incident cannot be predicted. In addition, more than a dozen states in the United States have also passed comprehensive data protection legislation, and the global regulatory environment pertaining to information security and privacy is increasingly demanding, with new and changing requirements, such as the European Union’s General Data Protection Regulation, The Personal Information Protection Law of the People’s Republic of China, and Brazil’s Lei Geral de Protecao de Dados. Complying with these laws and regulations may be more costly or take longer than we anticipate, and any failure to comply could result in fines or penalties.
Breaches of our security measures, cyber incidents and disruptions, use of AI tools, the theft or accidental loss, inadvertent disclosure, or unapproved dissemination of proprietary information or sensitive or confidential information about the Company, our employees, our vendors, or our customers, or failure to comply with laws and regulations related to information security or privacy, could harm our competitive position, reduce the value of our investment in research and development and other strategic initiatives
or result in legal claims or proceedings against us by governmental entities or individuals, significant fines, penalties and judgments, disruption of our operations, remediation requirements, changes to our business practices, and damage to our reputation, and could otherwise harm our business and our results of operations. In the case of a catastrophic cyber event, dedicating considerable resources to the restoration and security of our information technology systems may result in increased operational expenses and significant interruptions to business continuity, with the potential for negative financial consequences.
Natural disasters and severe weather events could affect our operations and financial results.
We operate facilities in areas of the world that are exposed to natural hazards, such as floods, windstorms, hurricanes, droughts and earthquakes. Extreme weather events and changing weather patterns present physical risks on existing infrastructure that may become more frequent or more severe as a result of factors related to climate change, including in areas that have not historically been exposed to natural hazards. Such events could disrupt our supply of raw materials or otherwise affect production, transportation and delivery of our products or affect demand for our products and otherwise harm our business and our results of operations, potentially in material ways that may exceed available insurance coverage in the particular circumstances. In addition, certain of our facilities are located in areas that have, in recent years, experienced extreme heat conditions. Our operations at those facilities may be disrupted if extreme heat conditions create an unsafe work environment or be subject to additional safe workplace requirements that could increase their operating costs.
We have experienced recent disruptions of the type described above. For example, the severe flooding that occurred in Western Europe in July 2021 caused significant damage to our specialty compounds plant in Pepinster, Belgium. That disruption resulted in a near-term reduction in earnings from lower volumes and certain increases in our operating costs. We also experienced severe weather events in fiscal 2024 that negatively impacted the results of our Reinforcement Materials segment. Specifically, drought conditions in Mexico affected our operations and flooding conditions in Brazil affected our customers. In 2025, the typhoon in China caused property damage to our plant in Zhuhai.
Financial and Other Risks
Negative or uncertain worldwide or regional economic conditions or trade relations may adversely impact our business.
Our operations and performance are affected by worldwide and regional economic conditions and global trade relations. Uncertainty or a deterioration in the economic conditions affecting the businesses to which, or geographic areas in which, we sell products could reduce demand for our products, while inflationary pressures may increase our costs. We may also experience pricing pressure on products and services, or be unsuccessful in passing along to our customers an increase in our raw materials costs or energy prices, which could decrease our revenues and have an adverse effect on our financial condition and cash flows. In addition, during periods of economic uncertainty, our customers may temporarily pursue inventory reduction (“destocking”) measures that exceed declines in the actual underlying demand. Given our position in the value chains for our principal products, we typically experience greater destocking impacts in our results of operations early in a recessionary cycle. Further, uncertainty created by volatile global trade and tariff policies may reduce demand for our products, negatively impact supply chain arrangements and inventory planning, and reduce our volumes and profitability.
Our operations in the EU are material to our business and important to our customers. If the competitiveness of chemical manufacturing in the EU continues to deteriorate in light of factors such as increased environmental compliance costs, prolonged high energy costs, inconsistent economic policies and rigid labor practices, our customers may have difficulty maintaining the competitiveness of their operations in this region or lose meaningful market share to lower cost imports from other regions, particularly Asia.
In addition, changes in, or tensions relating to, U.S. trade relations with countries where we do business may adversely impact our business. For example, tensions in the U.S.-China trade relationship have led to an increased risk of sanctions being imposed against our suppliers and customers in China which, if imposed, could restrict our ability to do business with such companies. In addition, we may encounter unexpected operating difficulties in China, more restrictive investment opportunities in China, customers switching to non-U.S.-source products, greater difficulty transferring funds, or negative currency impacts. In addition, tensions in the U.S.-China trade relationship and/or actual or potential additional restrictive policies by either country could cause us to duplicate, to the extent permitted under applicable law, the technology or other resources and capabilities we have in China, in a geography outside China, thereby increasing our costs.
Our global operations also expose us to risks associated with public health crises and outbreaks of epidemics, pandemics, or contagious diseases that could have a serious adverse impact on the economy and on our business, results of operations and cash flows.
Litigation or legal proceedings could expose us to significant liabilities and thus negatively affect our financial results.
As more fully described in Note S in Item 8 below under the heading “Contingencies”, we are a party to or the subject of lawsuits, claims, and proceedings, including, but not limited to, those involving environmental, and health and safety matters as well as product liability and personal injury claims relating to asbestosis, silicosis, and coal worker’s pneumoconiosis. We are also a potentially responsible party in various environmental proceedings and remediation matters wherein substantial amounts are at issue. Adverse rulings, judgments or settlements in pending or future litigation (including liabilities associated with respirator claims) or in connection with environmental remediation activities could adversely affect our financial results or cause our results to differ materially from those expressed or forecasted in any forward-looking statements.
Our tax rate and other tax obligations are dependent upon a number of factors, a change in any of which could impact our future tax rates and financial results.
Our future tax rates may be adversely affected by a number of factors, including: changes in the jurisdictions in which our profits are determined to be earned and taxed; changes in the estimated realization of our net deferred tax assets; the repatriation of non-U.S. earnings for which we have not previously accrued for non-U.S. withholding taxes; adjustments to estimated taxes upon finalization of various tax returns; increases in expenses that are not deductible for tax purposes; changes in available tax credits; the resolution of issues arising from tax audits with various tax authorities; and changes in tax laws including Pillar Two legislation adopted as part of the OECD Inclusion Framework, which established a global minimum corporate tax rate of 15% for certain multinational enterprises and the U.S. federal government enacted One Big Beautiful Bill Act or the interpretation of such tax laws. In addition, losses for which no tax benefits can be recorded could materially impact our tax rate and its volatility from one quarter to another.
Fluctuations in foreign currency exchange and interest rates affect our financial results.
We earn revenues, pay expenses, own assets, and incur liabilities in countries using currencies other than the U.S. dollar. In fiscal 2025, we derived a majority of our revenues from sales outside the U.S. Because our consolidated financial statements are presented in U.S. dollars, we must translate revenues and expenses, as well as assets and liabilities, into U.S. dollars at exchange rates in effect during or at the end of each reporting period. Therefore, increases or decreases in the value of the U.S. dollar against other currencies in countries where we operate will affect our results of operations and the value of balance sheet items denominated in foreign currencies. For example, in each of the last three fiscal years, we recorded foreign exchange losses related to the remeasurement of our net monetary assets denominated in Argentine pesos, as the official Argentine exchange rate weakened compared to the U.S. dollar throughout the year. In addition, we may have foreign currency losses from government-controlled currency devaluations, such as the foreign currency losses we recorded in both fiscal 2023 and 2024 related to the impact of the sharp devaluation of the Argentine peso that was guided by the Argentine central bank. Due to the geographic diversity of our operations, weaknesses in some currencies might be offset by strengths in others over time. In addition, we are exposed to adverse changes in interest rates. We use a combination of commercial paper and borrowings under our Credit Agreements to meet our short-term cash needs, with borrowings intra-quarter that may be higher than at quarter-end. As this debt is at variable interest rates, changes in interest rates can impact our borrowing costs. We manage both these risks through normal operating and financing activities and, when deemed appropriate, through the use of derivative instruments as well as foreign currency debt. We cannot be certain, however, that we will be successful in reducing the risks inherent in exposures to foreign currency and interest rate fluctuations.
We have entered into a number of derivative contracts with financial counterparties. The effectiveness of these contracts is dependent on the ability of these financial counterparties to perform their obligations, and their nonperformance could harm our financial condition. In addition, at maturity, settlement of the derivative contract may be a use of cash depending on the movement of foreign exchange rates, the amount of which is unpredictable.
We have entered into forward foreign currency contracts and cross-currency swaps as part of our financial risk management strategy. The effectiveness of our risk management program using these instruments is dependent, in part, upon the counterparties to these contracts honoring their financial obligations. If any of our counterparties are unable to perform their obligations in the future, we could be exposed to increased earnings and cash flow volatility due to an instrument’s failure to hedge or adequately address a financial risk. In addition, the settlement of any derivative contracts could, depending on movements in the exchange rates, result in a cash outflow at maturity in an amount that is not predictable.
Technology Risks
We may not be successful achieving our growth expectations from new products, new applications and technology developments, and money we spend on these efforts may not result in an increase in revenues or profits commensurate with our investment.
We may not be successful in achieving our growth expectations from developing new products or product applications. Moreover, we cannot be certain that the costs we incur investing in new product and technology development will result in an increase in revenues or profits commensurate with our investment or within the time period we expect. For example, our investments to further develop our E2C® composites, inkjet dispersions and inks, and battery materials applications may not result in the earnings growth expectations on which these investments are being made. Further, we attempt to pace our strategic investments, including those we are making to develop our battery materials business in Europe and the U.S. to meet market expectations for the growth in demand for electric vehicles, but, as has been the case with the transition to electric vehicles, market demand for and acceptance of new products may not develop as we expect and we may not realize growth in line with our expectations at the time we make such investments. Similarly, we cannot be certain that the investments we are making in our EVOLVE® Sustainable Solutions technology platform to develop products for our customers using sustainable reinforcing carbons from renewable or recycled materials or using processes that result in lower GHG emissions will be successful, including within the time period our customers expect. In addition, the timely commercialization of products that we are developing may be disrupted or delayed by manufacturing or other technical difficulties, market acceptance or insufficient market size to support a new product, competitors’ new products launched in advance of our own, and difficulties in moving from the experimental stage to the production stage. These disruptions or delays could affect our future business results.
The continued protection of our patents, trade secrets and other proprietary intellectual property rights is important to our success.
Our patents, trade secrets and other intellectual property rights are important to our success and competitive position. We own various patents and other intellectual property rights in the U.S. and other countries covering many of our products, as well as processes and product uses. Where we believe patent protection is not appropriate or obtainable, we rely on trade secret laws and practices to protect our proprietary technology and processes, such as physical security, limited dissemination and access and confidentiality agreements with our employees, customers, consultants, business partners, potential licensees and others to protect our trade secrets and other proprietary information. However, trade secrets can be difficult to protect and the protective measures we have put in place may not prevent disclosure or unauthorized use of our proprietary information or provide an adequate remedy in the event of misappropriation or other violations of our proprietary rights. In addition, we are a licensee of various patents and intellectual property rights belonging to others in the U.S. and other countries. Because the laws and enforcement mechanisms of some countries may not allow us to protect our proprietary rights to the same extent as we are able to do in the U.S., the strength of our intellectual property rights will vary from country to country.
Irrespective of our proprietary intellectual property rights, we may be subject to claims that our products, processes or product uses infringe the intellectual property rights of others. These claims, even if they are without merit, could be expensive and time-consuming to defend and if we were to lose such claims, we could be enjoined from selling our products or using our processes and/or be subject to damages, or be required to enter into licensing agreements requiring royalty payments and/or use restrictions. Licensing agreements may not be available to us, or if available, may not be available on acceptable terms.
We are exposed to risks related to the use of artificial intelligence tools by us and others.
Our use of artificial intelligence tools may subject us to significant competitive, legal, regulatory and other risks and there can be no assurance that our use of artificial intelligence tools will enhance our business operations or result in a benefit to us. Our competitors may be more successful in their use of artificial intelligence tools, including by developing superior products or product applications or improving their operations with the assistance of artificial intelligence. Additionally, there could be adverse impacts from inaccurate or flawed algorithms, training or data sets. Our use of artificial intelligence tools could also result in the loss of confidential information or intellectual property or an inability to claim or enforce intellectual property rights, as well as subject us to risks related to intellectual property infringement or misappropriation, data privacy, cybersecurity and the unauthorized use of company information. The jurisdictions in which we conduct business have and may adopt laws and regulations related to artificial intelligence that could cause us to incur greater compliance costs, limit our use of artificial intelligence tools, or subject us to legal liabilities.
Portfolio Management, Capacity Expansion and Integration Risks
Any failure to realize benefits from acquisitions, alliances or joint ventures or to achieve our portfolio management objectives could adversely affect future financial results.
In achieving our strategic plan objectives, we may pursue acquisitions, alliances or joint ventures intended to complement or expand our existing businesses globally or add product technology, or both. The success of acquisitions of businesses, new
technologies and products, or arrangements with third parties is not always predictable and we may not be successful in realizing our objectives as anticipated. We may not be able to integrate any acquired businesses successfully into our existing businesses, make such businesses profitable, or realize anticipated cost savings or synergies, if any, from these acquisitions, which could adversely affect our business results. In addition to strategic acquisitions, we evaluate our portfolio in light of our objectives and alignment with our growth strategy. In implementing this strategy, we may not be successful in separating non-strategic assets. The gains or losses on the divestiture of, or lost operating income from, such assets may affect our earnings. Moreover, we have in the past, and may again in the future, incur asset impairment charges related to acquisitions or divestitures that reduce earnings.
Plant capacity expansions and site development projects may impact existing plant operations, be delayed and/or not achieve the expected benefits.
Our ability to complete capacity expansions and site development projects as planned may be delayed or interrupted by the need to obtain environmental and other regulatory approvals, unexpected cost increases, availability of labor and materials, unforeseen hazards such as weather conditions, and other risks customarily associated with construction projects. These risks include the risk that existing plant operations are disrupted as well as the risk associated with delays in the start-up of operations using new technologies, which disruptions could make it difficult for us to meet our customers’ needs. Moreover, in the case of capacity expansions, the cost of these activities could have a negative impact on the financial performance of the relevant business until capacity utilization at the particular facility is sufficient to absorb the incremental costs associated with expansion. In addition, our ability to expand capacity in emerging regions depends in part on economic and political conditions in these regions and, in some cases, on our ability to establish operations, construct additional manufacturing capacity or form strategic business alliances.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments
None.

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ITEM 2. PROPERTIES
Item 2. Properties
Cabot’s corporate headquarters are in leased office space in Boston, Massachusetts. We also own or lease office, manufacturing, storage, distribution, marketing and research and development facilities in the U.S. and in foreign countries. The locations of our principal manufacturing and/or administrative facilities are set forth in the table below. Unless otherwise indicated, all the properties are owned.
Location by Region
Reinforcement
Materials
Performance
Chemicals
Americas Region
Alpharetta, Georgia*
X
X
Tuscola, Illinois
X
Carrollton, Kentucky**
X
Hopkinsville, Kentucky**
X
Franklin, Louisiana
X
X
Ville Platte, Louisiana
X
Billerica, Massachusetts
X
X
Haverhill, Massachusetts
X
Midland, Michigan
X
Pampa, Texas
X
X
Campana, Argentina
X
Maua, Brazil
X
X
Sao Paulo, Brazil*(1)
X
X
Saint-Jean-sur-Richelieu, Québec, Canada
X
Sarnia, Ontario, Canada
X
X
Cartagena, Colombia
X
Altamira, Mexico
X
Europe, Middle East and Africa Region
Loncin, Belgium
X
Pepinster, Belgium
X
Valasske Mezirici (Valmez), Czech Republic**
X
Port Jerome, France**
X
Frankfurt, Germany*
X
Münster, Germany*
X
Rheinfelden, Germany
X
Ravenna, Italy
X
Riga, Latvia*(1)
X
X
Schaffhausen, Switzerland*
X
X
Botlek, Netherlands**
X
X
Dubai, United Arab Emirates*
X
Barry, United Kingdom (Wales)**
X
Location by Region
Reinforcement
Materials
Performance
Chemicals
Asia Pacific Region
Jiangsu Province, China**
X
Jiangxi Province, China**
X
Tianjin, China** (2 plants)
X
X
Shanghai, China*(1)
X
X
Shanghai, China** (plant)
X
Xingtai City, China**
X
Wuhai, China**
X
Shenzhen, China**
X
Zhuhai, China**
X
Mumbai, India*
X
X
Cilegon, Indonesia**
X
X
Jakarta, Indonesia*(1)
X
X
Chiba, Japan
X
Shimonoseki, Japan**
X
Tokyo, Japan*(1)
X
X
Port Dickson, Malaysia**
X
(1)Global Business Services center
* Leased premises
** Building(s) owned by Cabot on leased land
We conduct research and development for our various businesses primarily at facilities in Billerica, Massachusetts; Pampa, Texas; Pepinster, Belgium; Münster, Germany; Chiba, Japan, Port Dickson, Malaysia and Zhuhai and Shanghai, China.
With our existing manufacturing plants and planned expansions, we generally have sufficient production capacity to meet current requirements and expected near-term growth. These plants are generally well maintained, in good operating condition and suitable and adequate for their intended use. Our administrative offices and other facilities are suitable and adequate for their intended purposes.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings
Cabot is a party in various lawsuits and environmental proceedings wherein substantial amounts are claimed. Additional information regarding legal proceedings involving Cabot is disclosed in Note S in Item 8 below, under the heading “Contingencies”, which disclosure is incorporated herein by reference.

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ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures
Not applicable.
Information about our Executive Officers
Set forth below is certain information about Cabot’s executive officers as of November 24, 2025.
Sean D. Keohane, age 58, is President and Chief Executive Officer and a member of Cabot’s Board of Directors, positions he has held since March 2016. Mr. Keohane joined Cabot in 2002. From November 2014 until March 2016, he was Executive Vice President and President of Reinforcement Materials. From March 2012 until November 2014, he was Senior Vice President and President of Performance Chemicals, and from May 2008 until March 2012, he was General Manager of Performance Chemicals. He was appointed Vice President in March 2005, Senior Vice President in March 2012 and Executive Vice President in November 2014. He was a member of the Interim Office of the Chief Executive Officer, which was in place from December 2015 until March 2016.
Erica McLaughlin, age 49, is Executive Vice President, Chief Financial Officer and Head of Corporate Strategy. Ms. McLaughlin joined Cabot in 2002. She was elected Executive Vice President effective December 2022, Senior Vice President and Chief Financial Officer in May 2018, and in October 2018 she assumed responsibility for Corporate Strategy and Development. From June 2016 until May 2018, she was Vice President of Business Operations for Reinforcement Materials and General Manager of the tire business, and from July 2011 until June 2016, she was Vice President of Investor Relations and Corporate Communications. Prior to July 2011, she held a variety of leadership positions in Finance and Corporate Planning.
Karen A. Kalita, age 46, is Senior Vice President and General Counsel. Ms. Kalita joined Cabot in 2008. Prior to assuming her current position in June 2019, she held several key positions in Cabot’s Law Department, including Chief Counsel to the Company’s Reinforcement Materials segment from November 2015 to June 2019 and Purification Solutions segment from June 2013 to June 2019, and senior legal counsel to the Company’s previous Advanced Technologies segment. Prior to joining the Company, Ms. Kalita was in private practice at WilmerHale LLP in Boston, MA.
William Masterson, age 51, is Senior Vice President and President of the Reinforcement Materials Segment. Mr. Masterson joined Cabot in 2011 and was elected to his current position effective November 21, 2025. Prior to this, from January 2024, he was Vice President, Business Operations, Performance Chemicals and, from January 2019 to January 2024, was Vice President and Regional Business Director, Americas Region, for the Performance Additives business. Prior to 2019, Mr. Masterson held numerous commercial, marketing, and technical service roles. Prior to joining Cabot, from 2007 to 2011, Mr. Masterson was global market development manager for W.R. Grace.
Jeff Zhu, age 57, is Executive Vice President and President, Carbon and Silica Technologies, and Battery Materials businesses within Cabot’s Performance Chemicals Segment and President, Asia Pacific Region. Mr. Zhu joined Cabot in 2012. He was elected Executive Vice President effective December 2022 and Senior Vice President and President, Performance Additives business and President, Asia Pacific Region in October 2019. Prior to this, he had served as President, Asia Pacific Region since joining Cabot. Prior to joining Cabot, Mr. Zhu served in a variety of regional and global business leadership roles at Rhodia from 1994 until 2010, including Asia Pacific regional commercial director from 1994 to 2002, regional vice president and general manager of Rhodia Novacare Asia Pacific from 2002 to 2008, and vice president and global director of Rhodia electronics and catalysis from 2008 to 2010. In addition, Mr. Zhu served as head of global pulp and paper sales at Asia Pacific Resources International Holdings Limited from 2010 to 2012.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Cabot’s common stock is listed for trading (symbol CBT) on the New York Stock Exchange. As of November 14, 2025, there were 519 holders of record of Cabot’s common stock.
Issuer Purchases of Equity Securities
The table below sets forth information regarding Cabot’s purchases of its equity securities during the quarter ended September 30, 2025:
Period
Total Number
of Shares
Purchased(1)(2)
Average
Price Paid
per Share
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs(1)
Maximum Number of Shares that
May Yet Be Purchased
Under the Plans or
Programs(1)
July 1, 2025 - July 31, 2025
-
$
-
-
9,955,759
August 1, 2025 - August 31, 2025
212,471
$
79.86
212,471
9,743,288
September 1, 2025 - September 30, 2025
287,132
$
80.21
287,132
9,456,156
Total
499,603
499,603
(1)On December 3, 2024, Cabot publicly announced that the Board of Directors authorized the Company to repurchase up to an additional ten million shares of its common stock on the open market or in privately negotiated transactions, increasing the balance of shares available for repurchase at that time to approximately eleven million shares. The authorization does not have a set expiration date.
(2)Total number of shares purchased does not include 1,368 shares withheld to pay taxes on the vesting of equity awards made under the Company's equity incentive plans or to pay the exercise price of options exercised during the period.
Comparative Stock Performance
The graph compares the cumulative total stockholder return on Cabot common stock for the five-year period ended September 30, 2025 with the S&P 400 Chemical Index and the S&P Midcap 400 Index. The comparisons assume the investment of $100 on October 1, 2020 in Cabot’s common stock and in each of the indices and the reinvestment of all dividends.
The stock price performance on the graph below is not necessarily indicative of future price performance.
The information included under the heading comparative stock performance in Item 5 shall not be deemed to be “soliciting material” or subject to Regulation 14A, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.

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ITEM 6. SELECTED FINANCIAL DATA

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Estimates
Our consolidated financial statements have been prepared in conformity with U.S. GAAP. This preparation of our financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and related disclosure of contingent assets and liabilities. We consider an accounting estimate to be critical to the financial statements if (i) the estimate is complex in nature or requires a high degree of judgment and if (ii) different estimates and assumptions were used, the results could have a material impact on the consolidated financial statements. On an ongoing basis, we evaluate our estimates and the application of our policies. We base our estimates on historical experience, current conditions, and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. We believe the following critical accounting estimates are the most significant to understanding our consolidated financial statements.
Deferred Tax Assets
We have established valuation allowances against a variety of deferred tax assets, including net operating loss carryforwards, capital loss carryforwards, foreign tax credits and other income tax credits. We assess the realizability of our deferred tax assets quarterly and recognize a valuation allowance when it is more likely than not that some or all of our deferred tax assets are not realizable. This assessment is completed on a jurisdiction-by-jurisdiction basis and relies on the weight of all positive and negative evidence available. Cumulative pre-tax losses for a three-year period are considered significant objective negative evidence that some or all of our deferred tax assets may not be realizable. Cumulative reported pre-tax income is considered objectively verifiable positive evidence of our ability to generate positive pretax income in the future.
In accordance with U.S. GAAP, when there is a recent history of pre-tax losses, there is little weight placed on forecasts for purposes of assessing the recoverability of our deferred tax assets. Judgment is required when considering the relative impact of positive and negative evidence. The weight given to the potential effect of positive and negative evidence is commensurate with the extent that it can be objectively verified. The more negative evidence that exists, the more positive evidence is necessary to support a conclusion that a valuation allowance is not needed. We consider the availability of objectively verifiable evidence, such as positive recent core operating results after adjusting for nonrecurring items in determining our ability to utilize deferred tax assets. We use systematic and logical methods to estimate when deferred tax liabilities will reverse and generate taxable income and when deferred tax assets will reverse and generate tax deductions. Assumptions, judgment, and estimates are required when estimating future income and scheduling the reversal of deferred tax assets and liabilities, and the exercise is inherently complex and subjective.
Refer to Note A and Note Q of our Notes to the Consolidated Financial Statements for description of our policies related to income taxes.
Contingencies
We have recorded a significant reserve for respirator liability claims. Our current estimate of the cost of our share of pending and future respirator liability claims is based on facts and circumstances existing at this time, including the number and nature of the remaining claims. Developments that could affect our estimate include, but are not limited to, (i) significant changes in the number of future claims, (ii) changes in the rate of dismissals without payment of pending claims, (iii) significant changes in the average cost of resolving claims, including potential settlements of groups of claims, (iv) significant changes in the legal costs of defending these claims, (v) changes in the nature of claims received or changes in our assessment of the viability of these claims, (vi) trial and appellate outcomes, (vii) changes in the law and procedure applicable to these claims, (viii) the financial viability of the parties that contribute to the payment of respirator claims, (ix) exhaustion or changes in the recoverability of the insurance coverage maintained by certain of the parties that contribute to the settlement of respirator claims, or a change in the availability of the indemnity provided by a former owner of the business, (x) changes in the allocation of costs among the various parties paying legal and settlement costs, and (xi) a determination that the assumptions that were used to estimate our share of liability are no longer reasonable. We cannot determine the impact of these potential developments on our current estimate of our share of liability for these existing and future claims. Because reserves are limited to amounts that are probable and estimable as of a relevant measurement date, and there is inherent difficulty in projecting the impact of potential developments on our share of liability for these existing and future claims, it is reasonably possible that the liabilities for existing and future claims could change in the near term and that change could be material. Refer to Note A and Note S of our Notes to the Consolidated Financial Statements for description of our policies related to contingencies.
Goodwill Impairment
Goodwill is comprised of the purchase price of business acquisitions in excess of the fair value assigned to the net tangible and identifiable intangible assets acquired. Goodwill is not amortized and is subject to impairment testing annually, or when events or changes in the business environment indicate that the carrying value of the reporting unit may exceed its fair value.
Evaluating goodwill for impairment involves applying significant assumptions including discount rates and forecasted results for the applicable reporting unit, including earnings before interest and tax (“EBIT”), market multiples and growth rates. These assumptions are forward-looking and could be affected by future economic and market conditions. We engage third-party valuation specialists as needed to develop the assumptions used in the calculation and the evaluation of goodwill balances. Refer to Note A and Note F of our Notes to the Consolidated Financial Statements for a description of our policies related to goodwill.
Recently Issued Accounting Pronouncements
Refer to the discussion in Note B of our Notes to the Consolidated Financial Statements.
Results of Operations
Cabot is organized into two reportable segments: Reinforcement Materials and Performance Chemicals. Cabot is also organized for operational purposes into three geographic regions: the Americas; EMEA; and Asia Pacific. The discussions of our results of operations for the periods presented reflect these structures.
Our analysis of financial condition and operating results should be read together with our consolidated financial statements and accompanying notes. Unless a calendar year is specified, all references to years in this discussion are to our fiscal years ended September 30.
This section discusses our fiscal 2025 and 2024 results of operations and year-to-year comparisons between fiscal 2025 and 2024. For the discussions of our fiscal 2023 results and year-to-year comparisons between fiscal 2024 and fiscal 2023, refer to our discussions under the headings “Results of Operations” and “Cash Flows and Liquidity” in Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2024, which was filed with the United States Securities and Exchange Commission on November 20, 2024.
Definition of Terms and Non-GAAP Financial Measures
When discussing our results of operations, we use several terms as described below.
The term “product mix” refers to the mix of types and grades of products sold or the mix of geographic regions where products are sold, and the positive or negative impact this has on the revenue or profitability of the business and/or segment.
Our discussion under the heading “(Provision) Benefit for Income Taxes and Reconciliation of Effective Tax Rate to Operating Tax Rate” includes a discussion and reconciliation of our “effective tax rate” and our “operating tax rate” for the periods presented, as well as management’s projection of our operating tax rate range for the next fiscal year. Our operating tax rate is a non-GAAP financial measure and should not be considered as an alternative to our effective tax rate, the most comparable GAAP financial measure. The operating tax rate excludes income tax (expense) benefit on certain items and discrete tax items. The income tax (expense) benefit on certain items is determined using the applicable rates in the taxing jurisdictions in which the certain items occurred and includes both current and deferred income tax (expense) benefit based on the nature of the certain items. Discrete tax items include, but are not limited to, changes in valuation allowance, uncertain tax positions, and other tax items, such as the tax impact of legislative changes and tax accruals on historic earnings due to changes in indefinite reinvestment assertions. Our definition of the operating tax rate may not be comparable to the definition used by other companies. Management believes that this non-GAAP financial measure is useful supplemental information because it helps our investors compare our tax rate year-to-year on a consistent basis and to understand what our tax rate on current operations would be without the impact of these items.
Our discussion under the heading “Fiscal 2025 versus Fiscal 2024-By Business Segment” includes a discussion of Total segment EBIT, which is a non-GAAP financial measure defined as Income (loss) from operations before income taxes and equity in earnings from affiliated companies less certain items and other unallocated items. Our Chief Operating Decision Maker, who is our President and Chief Executive Officer, uses segment EBIT to evaluate the operating results of each segment and to allocate resources to the segments. We believe Total segment EBIT, which reflects the sum of EBIT from our reportable segments, provides useful supplemental information for our investors as it is an important indicator of our operational strength and performance, allows investors to see our results through the eyes of management, and provides context for our discussion of individual business segment performance. Total segment EBIT should not be considered an alternative for Income (loss) from operations before income taxes and equity in earnings of affiliated companies, which is the most directly comparable U.S. GAAP financial measure. A reconciliation of Total segment EBIT to Income (loss) from operations before income taxes and equity in earnings of affiliated companies is provided under the heading “Fiscal 2025 versus Fiscal 2024-By Business Segment”. Investors should consider the limitations associated with this non-GAAP measure, including the potential lack of comparability of this measure from one company to another.
In calculating Total segment EBIT, we exclude from our Income (loss) from operations before income taxes and equity in earnings of affiliated companies (i) items of expense and income that management does not consider representative of our fundamental on-going segment results, which we refer to as “certain items”, and (ii) items that, because they are not controlled by the business segments and primarily benefit corporate objectives, are not allocated to our business segments, such as interest expense and other corporate costs, which include unallocated corporate overhead expenses, such as certain corporate salaries and headquarters expenses, plus costs related to special projects and initiatives, which we refer to as “other unallocated items”. Management believes excluding the items identified as certain items facilitates operating performance comparisons from period to period by eliminating differences that would not otherwise be apparent on a GAAP basis and also facilitates an evaluation of our operating performance without the impact of these costs or benefits. The items of income and expense that we have excluded from Total segment EBIT, as applicable, but that are included in our GAAP Income (loss) from operations before income taxes and equity in earnings of affiliated companies, as applicable, are described below.
•Global restructuring activities, which include costs or benefits associated with cost reduction initiatives or plant closures and are primarily related to (i) employee termination costs, (ii) asset impairment charges associated with restructuring actions, (iii) costs to close facilities, including environmental costs and contract termination penalties, and (iv) gains realized on the sale of land or equipment associated with restructured plants or locations
•Indirect tax settlement charges, which include unfavorable charges related to the settlement of indirect taxes
•Legal and environmental matters and reserves, which consist of costs or benefits for matters typically related to former businesses or that are otherwise incurred outside of the ordinary course of business
•Employee benefit plan settlements and other charges, which consist of either charges or benefits associated with the termination of a pension plan or the transfer of a pension plan to a multi-employer plan
•Acquisition and integration-related charges, which include transaction costs, redundant costs incurred during the period of integration, and costs associated with transitioning certain management and business processes to Cabot’s processes
•Argentina controlled currency devaluation loss related to the foreign exchange loss from government-controlled currency devaluations on our net monetary assets denominated in the Argentine peso and investment losses related to the utilization of government bond programs established for the settlement of certain foreign payables
•Gains (losses) on sale of a business
Drivers of Demand and Key Factors Affecting Profitability
Drivers of demand and key factors affecting our profitability differ by segment. In Reinforcement Materials, longer term demand is driven primarily by: i) the number of vehicle miles driven globally; ii) the number of original equipment and replacement tires produced; iii) the number of automotive builds; iv) changes in supply chain inventory levels to adapt to end-market demand and other market dynamics; v) demand for high-performance tires; vi) demand for larger tires and larger vehicles, such as trucks, buses, off-road vehicles used in agriculture, mining and similar vehicles; vii) demand for electric and hybrid vehicles; viii) consumer and industrial spending on new vehicles; and ix) changes in regulatory requirements impacting vehicle fuel efficiency and tire regulations. Over the past several years, operating results have been driven by a number of factors, including: i) increases or decreases in our sales volumes driven by changes in production levels for tires or industrial rubber products, and the region in which the production occurs, and the level at which we service that demand; ii) changes in raw material costs and our ability to adjust the sales price for our products commensurate with changes in raw material costs; iii) changes in pricing and product mix, which includes customer pricing as well as the mix of products sold or the region in which they are sold; iv) global and regional capacity utilization for carbon black; v) fixed cost savings achieved through restructuring and other cost saving activities; vi) the growth of our volumes and market position in emerging economies; vii) capacity management and technology investments, including the impact of energy utilization and yield improvement technologies at our manufacturing facilities; viii) royalties and technology payments related to our patented elastomer composites technology that is used in tire applications; and ix) changes in energy prices associated with our energy center sales and the cost of utilities.
In Performance Chemicals, longer term demand is driven primarily by the construction and infrastructure, automotive, including sales into batteries for electric vehicles, electronics, inkjet printing and consumer products industries. In recent years, operating results in Performance Chemicals have been driven by: i) increases or decreases in sales volumes to the industries previously noted; ii) changes in pricing and product mix, which includes customer pricing as well as the mix of products sold or the region in which they are sold; iii) our ability to deliver differentiated products that drive enhanced performance in customers’ applications; iv) our ability to obtain value pricing for this differentiation; v) the cost of new capacity; vi) changes in selling prices relative to variations in the cost of raw materials; vii) the adoption of new products for use in our customers’ applications; and viii) changes in supply chain inventory levels to adapt to end-market demand and other market dynamics.
Overview of Results for Fiscal 2025
During fiscal 2025, Income (loss) from operations before income taxes and equity in earnings of affiliated companies increased compared to fiscal 2024 primarily due to lower losses from government-controlled currency devaluations in Argentina and higher segment EBIT in our Performance Chemicals segment, partially offset by lower segment EBIT in our Reinforcement Materials segment.
Fiscal 2025 compared to Fiscal 2024-Consolidated
Net Sales and Other Operating Revenues and Gross Profit
Years Ended September 30
(In millions)
Net sales and other operating revenues
$
3,713
$
3,994
Gross profit
$
$
Net sales and other operating revenues decreased by $281 million in fiscal 2025 as compared to fiscal 2024. The decrease in net sales and other operating revenues was driven by lower volumes in our Reinforcement Materials segment ($125 million) and less favorable pricing and product mix in both our Reinforcement Materials and Performance Chemicals segment ($160 million combined). The lower volumes in our Reinforcement Materials segment were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix in both segments were primarily driven by lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments.
Gross profit decreased by $20 million in fiscal 2025 as compared to fiscal 2024. The decrease was primarily due to lower volumes in our Reinforcement Materials segment, partially offset by higher volumes in our Performance Chemicals segment and lower selling and administrative expenses in both our Reinforcement Materials and Performance Chemicals segments.
Selling and Administrative Expenses
Years Ended September 30
(In millions)
Selling and administrative expenses
$
$
Selling and administrative expenses decreased by $23 million in fiscal 2025 as compared to fiscal 2024. The decrease was primarily due to cost management efforts.
Research and Technical Expenses
Years Ended September 30
(In millions)
Research and technical expenses
$
$
Research and technical expenses decreased by $4 million in fiscal 2025 as compared to fiscal 2024. The decrease was primarily due to cost management efforts.
Interest and Dividend Income
Years Ended September 30
(In millions)
Interest and dividend income
$
$
Interest and dividend income in fiscal 2025 decreased by $5 million as compared to fiscal 2024 primarily due to lower interest rates, partially offset by higher average deposit balances.
Interest Expense
Years Ended September 30
(In millions)
Interest expense
$
$
Interest expense decreased by $5 million in fiscal 2025 as compared to fiscal 2024 primarily due to lower interest rates on short-term borrowings, partially offset by higher average short-term borrowings.
Other Income (Expense)
Years Ended September 30
(In millions)
Other income (expense)
$
(7
)
$
(36
)
Other expense decreased during fiscal 2025 by $29 million as compared to fiscal 2024. The decrease was primarily due to lower foreign currency losses in Argentina, including the impact of the government devaluation of the currency that occurred during the first quarter of fiscal 2024.
(Provision) Benefit for Income Taxes and Reconciliation of Effective Tax Rate to Operating Tax Rate
Years Ended September 30
(Provision) / Benefit for Income Taxes
Rate
(Provision) / Benefit for Income Taxes
Rate
(Dollars in millions)
Effective tax rate(1)
$
(196
)
%
$
(111
)
%
Less: Non-GAAP tax adjustments(2)
(36
)
Operating tax rate
$
(160
)
%
$
(151
)
%
(1)Refer to the reconciliation of computed tax expense at the federal statutory rate to the Provision (benefit) for income taxes in Note Q of our Notes to the Consolidated Financial Statements.
(2)Non-GAAP tax adjustments made to arrive at the operating tax provision include the income tax (expense) benefit on certain items and discrete tax items, as further described above under the heading “Definition of Terms and Non-GAAP Financial Measures”.
For the year ended September 30, 2025, the (Provision) benefit for income taxes was a $196 million expense compared to a $111 million expense for fiscal 2024. Included in the (provision) benefit for income taxes for the year ended September 30, 2025 is a tax expense of $31 million compared to a tax benefit of $24 million for fiscal 2024, related to a valuation allowance adjustment on our U.S. net deferred tax assets in each year. Our income taxes are affected by the mix of earnings in the tax jurisdictions in which we operate and the presence of valuation allowances in certain tax jurisdictions.
For fiscal 2026, we expect our Operating tax rate to be in the range of 27% to 29%. We are not providing a forward-looking reconciliation of the operating tax rate range with an effective tax rate range because, without unreasonable effort, we are unable to predict with reasonable certainty the matters we would allocate to “certain items,” including unusual gains and losses, costs associated with future restructurings, acquisition-related expenses, and litigation outcomes. These items are uncertain, depend on various factors, and could have a material impact on the effective tax rate in future periods.
Equity in Earnings of Affiliated Companies and Net Income (Loss) Attributable to Noncontrolling Interest, Net of Tax
Years Ended September 30
(In millions)
Equity in earnings of affiliated companies, net of tax
$
$
Net income (loss) attributable to noncontrolling interests,
net of tax
$
$
Equity in earnings of affiliated companies, net of tax, increased by $1 million in fiscal 2025 compared to fiscal 2024 primarily due to higher profitability at our equity affiliate in Venezuela.
Net income (loss) attributable to noncontrolling interests, net of tax, increased by $1 million in fiscal 2025 compared to fiscal 2024 primarily due to higher profitability of our several joint ventures in China.
Net Income (Loss) Attributable to Cabot Corporation
In fiscal 2025 and 2024, we reported net income attributable to Cabot Corporation of $331 million ($6.02 earnings per diluted common share) and $380 million ($6.72 earnings per diluted common share), respectively. The decrease in fiscal 2025 was primarily due to a higher provision for income taxes ($85 million) driven by an increase in the partial valuation allowance recorded on our U.S. deferred tax assets, and lower segment EBIT in Reinforcement Materials ($29 million), partially offset by lower losses from government-controlled currency devaluations in Argentina ($43 million) and higher segment EBIT in Performance Chemicals ($30 million).
Fiscal 2025 compared to Fiscal 2024-By Business Segment
Income (loss) from operations before income taxes and equity in earnings of affiliated companies, pre-tax certain items, other unallocated items and Total segment EBIT for fiscal 2025 and 2024 are set forth in the table below. The details of certain items and other unallocated items are shown below and in Note U of our Notes to the Consolidated Financial Statements.
Years Ended September 30
(In millions)
Income (loss) from operations before income
taxes and equity in earnings of affiliated companies
$
$
Less: Certain items, pre-tax
(30
)
(59
)
Less: Other unallocated items
(107
)
(113
)
Total segment EBIT
$
$
Certain Items:
Details of the certain items for fiscal 2025 and 2024 are as follows:
Years Ended September 30
(In millions)
Global restructuring activities (Note N)
$
(11
)
$
(13
)
Indirect tax settlement charges (Note S)
(7
)
-
Legal and environmental matters and reserves
(7
)
(2
)
Employee benefit plan settlement and other charges (Note L)
(3
)
-
Acquisition and integration-related charges
(1
)
-
Argentina controlled currency devaluation and other losses (Note A)
-
(43
)
Other certain items
(1
)
(1
)
Total certain items
$
(30
)
$
(59
)
An explanation of these items of expense and income is included in our discussion under the heading “Definition of Terms and Non-GAAP Financial Measures”.
Other Unallocated Items:
Years Ended September 30
(In millions)
Interest expense
$
(76
)
$
(81
)
Unallocated corporate costs
(52
)
(68
)
General unallocated income (expense)
Less: Equity in earnings of affiliated companies, net of tax
Total other unallocated items
$
(107
)
$
(113
)
A discussion of items that we refer to as “other unallocated items” can be found under the heading “Definition of Terms and Non-GAAP Financial Measures”. The balances of unallocated corporate costs are primarily comprised of expenditures related to managing a public company that are not allocated to the segments and corporate business development costs related to ongoing corporate projects. The balances of General unallocated income (expense) consist of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, interest and dividend income, and the profit or loss related to the corporate adjustment for unearned revenue and unrealized holdings gains (losses) for investments. This does not include items of income or expense from the items that are separately treated as Certain items.
In fiscal 2025, Total other unallocated items expense decreased $6 million as compared to fiscal 2024 primarily due to lower Unallocated corporate costs and Interest expense partially offset by lower General unallocated income. Interest expense declined $5 million due to lower overall debt balances and lower borrowing rates. Unallocated corporate costs were lower year-over-year by $16 million primarily due to a lower mark to market on deferred equity compensation payable to certain of our directors and lower incentive compensation expense. General unallocated income (expense) was lower in fiscal 2025 by $14 million primarily due to lower investment income in Argentina from lower investment balances and lower interest rates in the country.
Reinforcement Materials
Sales and EBIT for Reinforcement Materials for fiscal 2025 and 2024 are as follows:
Years Ended September 30
(In millions)
Reinforcement Materials Sales
$
2,341
$
2,610
Reinforcement Materials EBIT
$
$
In fiscal 2025, sales in Reinforcement Materials decreased by $269 million compared to fiscal 2024. The decrease was primarily due to lower volumes ($125 million) and less favorable pricing and product mix ($127 million). The lower volumes were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix were primarily driven by lower raw material costs which, in most instances, are passed through to our customers through formulas and other market-based adjustments.
EBIT in Reinforcement Materials decreased by $29 million compared to fiscal 2024. The decrease was driven by lower volumes ($51 million), partially offset by lower selling and administrative expenses ($15 million) and the favorable impact from foreign currency translation ($7 million). The lower volumes were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The lower selling and administrative expenses were primarily due to cost management and optimization efforts.
Performance Chemicals
Sales and EBIT for Performance Chemicals for fiscal 2025 and 2024 are as follows:
Years Ended September 30
(In millions)
Performance Chemicals Sales
$
1,250
$
1,250
Performance Chemicals EBIT
$
$
In fiscal 2025, sales in Performance Chemicals remained flat compared to the same period of fiscal 2024.
EBIT in Performance Chemicals increased by $30 million compared to fiscal 2024 primarily due to higher volumes ($20 million), lower selling and administrative expenses ($3 million) and the favorable impact from foreign currency translation ($3 million). The higher volumes were primarily in our fumed metal oxides and battery materials product lines. The lower selling and administrative expenses were primarily due to cost management and optimization efforts.
Fiscal 2026 Outlook
Looking forward to fiscal 2026, we remain focused on executing our strategy of Creating for Tomorrow, generating strong cash flows, and continuing our disciplined approach to capital allocation. We expect EBIT in our Reinforcement Materials segment to decline driven by our expectation for the outcomes of our annual tire customer agreements to be lower in calendar 2026 as compared to calendar 2025 given the impact of tire trade flows on the regional demand for our product and a challenging macroeconomic backdrop. We expect an increase in EBIT in our Performance Chemicals segment driven by continued growth in areas such as battery materials and alternative energy applications.
Liquidity and Capital Resources
Overview
Our liquidity position, as measured by cash and cash equivalents plus borrowing availability, increased by $75 million during fiscal 2025, primarily due to a higher cash balance and lower outstanding commercial paper at the end of the period. As of September 30, 2025, we had cash and cash equivalents of $258 million and borrowing availability under our revolving credit agreements of $1.2 billion.
We have access to borrowings under the following two credit agreements:
•$1 billion unsecured revolving credit agreement (the “U.S. Credit Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent, Citibank, N.A., as Syndication Agent, and the other lenders party thereto, which matures in August 2027. The U.S. Credit Agreement supports our issuance of commercial paper, and borrowings under it may be used for working capital, letters of credit and other general corporate purposes.
•€300 million unsecured revolving credit agreement (the “Euro Credit Agreement”, and together with the U.S. Credit Agreement, the “Credit Agreements”), with PNC Bank, National Association, as Administrative Agent, and the other lenders party thereto, which matures in August 2027. Borrowings under the Euro Credit Agreement may be used for the repatriation of earnings of our foreign subsidiaries to the United States, the repayment of indebtedness of our foreign subsidiaries owing to us or any of our subsidiaries and for working capital and general corporate purposes.
As of September 30, 2025, we were in compliance with the debt covenants under the Credit Agreements, which, with limited exceptions, require us to comply on a quarterly basis with a leverage test requiring the ratio of consolidated net debt to consolidated EBITDA not to exceed 3.50 to 1.00. Consolidated net debt is defined as consolidated debt offset by the lesser of (i) unrestricted cash and cash equivalents and (ii) $150 million.
A significant portion of our business occurs outside the U.S. and our cash generation does not always align geographically with our cash needs. The vast majority of our cash and cash equivalent holdings tend to be held outside the U.S. We generally use a combination of U.S. earnings, repatriation of certain foreign earnings, commercial paper issuances and borrowings under our U.S. Credit Agreement to meet our U.S. cash needs. With the exception of Argentina, which has some currency controls that prevent the distribution of cash, we are generally able to move cash throughout the Company through our cash pooling structures, intercompany accounts and/or distributions, as needed. Although we repatriate certain foreign earnings, cash held by foreign subsidiaries is generally considered permanently reinvested and is used to finance the subsidiaries’ operational activities and future investments. We usually reduce our commercial paper balance and, if applicable, borrowings under our Credit Agreements, at quarter-end using cash derived from customer collections, including the utilization of customer supply chain financing programs, settlement of intercompany balances and short-term intercompany loans. If additional funds are needed in the U.S., we expect to be able to repatriate cash, including cash from China, while paying any withholding or other taxes. Changes in regulations and tax laws in the U.S. or foreign countries could restrict our ability to transfer funds or impose material costs on such transfers.
As of September 30, 2025 and 2024, we had $130 million and $113 million, respectively, of borrowings outstanding under the Euro Credit Agreement and no outstanding borrowings under the U.S. Credit Agreement at either date. There was $6 million and $45 million of commercial paper outstanding at September 30, 2025 and 2024, respectively.
We anticipate sufficient liquidity from (i) cash on hand; (ii) cash flows from operating activities; and (iii) cash available from the Credit Agreements and our commercial paper program to meet our operational and capital investment needs and financial obligations for both the next twelve months and the foreseeable future. The liquidity we derive from cash flows from operations is, to a large degree, predicated on our ability to collect our receivables in a timely manner, the cost of our raw materials, and our ability to manage inventory levels.
The following discussion of the changes in our cash balance refers to the various sections of our Consolidated Statements of Cash Flows.
Cash Flows from Operating Activities
Cash provided by operating activities, which consists of net income adjusted for the various non-cash items included in income, changes in working capital, and changes in certain other balance sheet accounts, totaled $665 million in fiscal 2025. Operating activities provided $692 million of cash in fiscal 2024.
Cash provided by operating activities in fiscal 2025 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $154 million, plus a decrease in net working capital of $56 million. The decrease in net working capital was driven by a decrease in inventories from lower cost of raw materials and accounts receivable from lower sales volume in our Reinforcement Materials segment partially offset by lower accounts payable and accrued liabilities.
Cash provided by operating activities in fiscal 2024 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $151 million, plus a decrease in net working capital of $57 million. The decrease in net working capital was largely driven by a decrease in inventories from lower cost of raw materials and an increase in accounts payable and accrued liabilities, partially offset by an increase in accounts receivable from increased sales volumes.
Cash Flows from Investing Activities
Investing activities consumed $298 million of cash in fiscal 2025 compared to $235 million in fiscal 2024. In fiscal 2025, the use of cash by investing activities primarily consisted of $274 million of capital expenditures for sustaining and compliance capital projects at our operating facilities as well as growth-related capital. In addition, in fiscal 2025, investing activities included $27 million for cash paid for the asset acquisition described in Note C of our Notes to the Consolidated Financial Statements.
In fiscal 2024, the use of cash by investing activities primarily consisted of $241 million of capital expenditures for sustaining and compliance capital projects at our operating facilities as well as growth-related capital, including capacity expansion projects.
Capital expenditures for fiscal 2026 are expected to be between $200 million and $250 million. Our planned capital spending program for fiscal 2026 is primarily for sustaining, compliance, and improvement capital projects at our operating facilities.
Cash Flows from Financing Activities
Financing activities consumed $336 million of cash in fiscal 2025 compared to $415 million consumed in fiscal 2024. The cash consumed by financing activities in fiscal 2025 primarily consisted of repurchases of common stock of $168 million, net repayments of commercial paper of $39 million, dividend payments to stockholders of $96 million and dividend payments to noncontrolling interests of $57 million. These payments were partially offset by net proceeds from short-term borrowings of $8 million, net proceeds from long-term debt of $8 million and proceeds from the sales of common stock of $8 million from stock option exercises.
The cash consumed by financing activities in fiscal 2024 primarily consisted of repurchases of common stock of $172 million, net repayments of commercial paper of $127 million, dividend payments to stockholders of $93 million, dividend payments to noncontrolling interests of $27 million, and net repayments of long-term debt of $12 million under our Euro Credit Agreement, which includes repayments of $26 million partially offset by proceeds of $14 million. These payments were partially offset by proceeds from the sales of common stock of $20 million from stock option exercises.
Our long-term total debt, of which $260 million is current, matures at various times as presented in Note H of our Notes to the Consolidated Financial Statements. Our current plan is to refinance the $250 million in registered notes with a coupon of 3.4% that mature in September of 2026 prior to its maturity. The weighted-average interest rate on our fixed rate long-term debt was 4.29% as of September 30, 2025.
Share Repurchases
In December 2024, our Board of Directors authorized us to repurchase up to an additional ten million shares of common stock, increasing the total shares authorized for repurchase at the time to approximately eleven million shares. In fiscal 2025, we repurchased approximately 1.8 million shares of common stock on the open market for $156 million. In fiscal 2024, we repurchased approximately 1.7 million shares of common stock on the open market for $159 million. Additionally, during fiscal 2025 and 2024, we repurchased 0.1 million and 0.2 million, respectively, shares of our common stock associated with employee tax obligations on stock-based compensation awards for $12 million and $13 million, respectively. As of September 30, 2025, we had approximately 9.5 million shares available for repurchase under the Board of Directors’ share repurchase authorization.
Dividend Payments
In fiscal 2025 and 2024, we paid cash dividends on our common stock of $1.76 and $1.66 per share, respectively. These cash dividend payments totaled $96 million and $93 million in fiscal 2025 and 2024, respectively.
Employee Benefit Plans
As of September 30, 2025, we had a consolidated pension obligation, net of the fair value of plan assets, of $26 million, primarily associated with postretirement benefit plan liabilities.
In fiscal 2025, we made cash contributions totaling $4 million to our defined benefit pension plans. In fiscal 2026, we expect to make cash contributions of $5 million to our defined benefit pension plans.
The $23 million of unfunded postretirement benefit plan liabilities is comprised of $12 million for our U.S. and $11 million for our foreign postretirement benefit plans. These postretirement benefit plans provide certain health care and life insurance benefits for retired employees. Typical of such plans, our postretirement plans are unfunded and, therefore, have no plan assets. We fund these plans as claims or insurance premiums come due. In fiscal 2025, we paid postretirement benefits of $3 million. For fiscal 2026, our benefit payments for our postretirement plans are expected to be $2 million.
In fiscal 2023, we commenced the plan termination process for the Cabot Carbon Limited Pension Plan and Carbon Plastics Pension Plan and expect to complete this process in fiscal 2026.
Contractual Obligations
The following table sets forth our long-term contractual obligations.
Payments Due by Fiscal Year
Thereafter
Total
(In millions)
Purchase commitments
$
$
$
$
$
$
1,037
$
1,745
Long-term debt
-
1,092
Fixed interest on long-term debt
Variable interest on long-term debt
-
-
-
-
Finance leases(1)
Operating leases(1)
Total
$
$
$
$
$
$
1,553
$
3,204
(1)Lease liabilities include interest.
Purchase Commitments
We have entered into long-term, volume-based purchase agreements primarily for the purchase of raw materials and natural gas with various key suppliers for all of our business segments. Under certain of these agreements the quantity of material being purchased is fixed, but the price we pay changes as market prices change. For purposes of the table above, current purchase prices have been used to quantify those total commitments. We have also entered into long-term purchase agreements primarily for services related to information technology, which are included in the table above.
Leases
We have entered into various leases as the lessee, primarily related to certain transportation vehicles, warehouse facilities, office space, and machinery and equipment. These leases have remaining lease terms between one and fifteen years, some of which may include options to extend the leases for up to fifteen years or options to terminate the leases. Our land leases have remaining lease terms up to seventy-seven years.

---

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to changes in interest rates and foreign currency exchange rates because we finance certain operations through long- and short-term borrowings and denominate our transactions in a variety of foreign currencies. Changes in these rates may have an impact on future cash flows and earnings. We manage these risks through normal operating and financing activities and, when deemed appropriate, using derivative financial instruments.
We have policies governing our use of derivative instruments, and we do not enter into financial instruments for trading or speculative purposes.
By using derivative instruments, we are subject to credit and market risk. The derivative instruments are booked in our balance sheet at fair value and reflect the asset or liability position as of September 30, 2025. If a counterparty fails to fulfill its performance obligations under a derivative contract, our exposure will equal the fair value of the derivative. Generally, when the fair value of a derivative contract is positive, the counterparty owes Cabot, thus creating a payment risk for Cabot. We minimize counterparty credit or repayment risk by entering into these transactions with major financial institutions of investment grade credit rating. Our exposure to market risk is not hedged in a manner that completely eliminates the effects of changing market conditions on earnings or cash flow.
Foreign Currency Risk
Our international operations are subject to certain risks, including currency exchange rate fluctuations from financial markets and government actions. We have cross-currency swaps designated as hedges of our net investments in certain Euro-denominated subsidiaries. The following table summarizes the principal terms of our cross-currency swaps, including the aggregate notional amount of the swaps, the interest rate payment we receive from and pay to our swap counterparties, the term and fair value at September 30, 2025 and 2024.
Description
Notional Amount
Interest Rate Received
Interest Rate Paid
Fiscal Year Entered Into
Maturity Year
Fair Value at September 30, 2025
Fair Value at September 30, 2024
Cross Currency Swaps
USD 250 million swapped to EUR 223 million
3.40%
1.94%
$(12 million)
$1 million
We also have foreign currency exposures arising from monetary assets and liabilities denominated in foreign currencies other than the functional currency of a given subsidiary, as well as the risk that currency fluctuations could affect the dollar value of future cash flows generated in foreign currencies. Accordingly, we use short-term forward contracts to minimize the exposure to foreign currency risk. At September 30, 2025, we had $184 million in notional foreign currency contracts, which were denominated in Euro, Indonesian rupiah, Czech koruna, and Colombian peso. At September 30, 2024, we had $138 million in notional foreign currency contracts, which were denominated in Indonesian rupiah, Czech koruna, and Colombian peso. These forwards had a fair value of less than $1 million as of both September 30, 2025 and 2024.
In certain situations where we have forecasted purchases under a long-term commitment or forecasted sales denominated in a foreign currency, we may enter into appropriate financial instruments in accordance with our risk management policy to hedge future cash flow exposures.
In fiscal 2025, due to the strengthening of most foreign currencies against the U.S. dollar, foreign currency translations in the aggregate increased our segment EBIT by $10 million, which affected the results of the Reinforcement Materials and Performance Chemicals segments. In fiscal 2024, due to the weakening of most foreign currencies against the U.S. dollar, foreign currency translations in the aggregate decreased our segment EBIT $5 million, which affected the results of the Reinforcement Materials and Performance Chemicals segments. In fiscal 2025 and 2024, we recognized net foreign exchange losses of $8 million and $46 million,
respectively, in Other income (expense) from the revaluation of monetary assets and liabilities from transactional currencies to functional currency, largely attributable to changes in the value of the Argentine peso in both periods.

---

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8.	Financial Statements and Supplementary Data
Description
Page
(1)
Consolidated Statements of Operations
(2)
Consolidated Statements of Comprehensive Income
(3)
Consolidated Balance Sheets
(4)
Consolidated Statements of Cash Flows
(5)
Consolidated Statements of Changes in Stockholders’ Equity
(6)
Notes to the Consolidated Financial Statements
(7)
Reports of Independent Registered Public Accounting Firm (PCAOB ID 34)
CABOT CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended September 30
(In millions, except per share amounts)
Net sales and other operating revenues
$
3,713
$
3,994
$
3,931
Cost of sales
2,773
3,034
3,092
Gross profit
Selling and administrative expenses
Research and technical expenses
Loss on sale of business
-
-
Income (loss) from operations
Interest and dividend income
Interest expense
(76
)
(81
)
(90
)
Other income (expense)
(7
)
(36
)
(16
)
Income (loss) from operations before income taxes and
equity in earnings of affiliated companies
(Provision) benefit for income taxes
(196
)
(111
)
Equity in earnings of affiliated companies, net of tax
Net income (loss)
Net income (loss) attributable to noncontrolling interests, net of tax
of $12, $11 and $9
Net income (loss) attributable to Cabot Corporation
$
$
$
Weighted-average common shares outstanding:
Basic
53.7
55.1
56.1
Diluted
54.2
55.7
56.5
Earnings (loss) per common share:
Basic
$
6.07
$
6.79
$
7.79
Diluted
$
6.02
$
6.72
$
7.73
The accompanying notes are an integral part of these consolidated financial statements.
CABOT CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Years Ended September 30
(In millions)
Net income (loss)
$
$
$
Other comprehensive income (loss), net of tax
Foreign currency translation adjustment, net of tax
Derivatives: net investment hedges
(Gains) losses reclassified to interest expense, net of tax
(4
)
(4
)
(6
)
(Gains) losses excluded from effectiveness testing and amortized to
interest expense, net of tax
Pension and other postretirement benefit liability adjustments,
net of tax
(1
)
(9
)
Other comprehensive income (loss), net of tax of $2, $14 and $1
Comprehensive income (loss)
Net income (loss) attributable to noncontrolling interests, net of tax
Foreign currency translation adjustment attributable to noncontrolling
interests, net of tax
-
Comprehensive income (loss) attributable to noncontrolling interests
Comprehensive income (loss) attributable to Cabot Corporation
$
$
$
The accompanying notes are an integral part of these consolidated financial statements.
CABOT CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS
September 30
(In millions, except
share and per share amounts)
Current assets:
Cash and cash equivalents
$
$
Accounts and notes receivable, net of reserve for doubtful accounts of $5 and $5
Inventories
Prepaid expenses and other current assets
Total current assets
1,539
1,605
Property, plant and equipment
4,405
4,082
Accumulated depreciation
(2,694
)
(2,548
)
Net property, plant and equipment
1,711
1,534
Goodwill
Equity affiliates
Intangible assets, net
Deferred income taxes
Other assets
Total assets
$
3,815
$
3,736
The accompanying notes are an integral part of these consolidated financial statements.
CABOT CORPORATION
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS’ EQUITY
September 30
(In millions, except
share and per share amounts)
Current liabilities:
Short-term borrowings
$
$
Accounts payable and accrued liabilities
Income taxes payable
Current portion of long-term debt
Total current liabilities
Long-term debt
1,087
Deferred income taxes
Other liabilities
Commitments and contingencies (Note S)
Stockholders’ equity:
Preferred stock:
Authorized: 2,000,000 shares of $1 par value, Issued and Outstanding: None and none
-
-
Common stock:
Authorized: 200,000,000 shares of $1 par value, Issued: 52,962,353 and 54,430,316 shares, Outstanding: 52,842,481 and 54,297,251 shares
Less cost of 119,872 and 133,065 shares of common treasury stock
(3
)
(3
)
Additional paid-in capital
-
-
Retained earnings
1,835
1,734
Accumulated other comprehensive income (loss)
(335
)
(360
)
Total Cabot Corporation stockholders’ equity
1,550
1,425
Noncontrolling interests
Total stockholders’ equity
1,705
1,590
Total liabilities and stockholders’ equity
$
3,815
$
3,736
The accompanying notes are an integral part of these consolidated financial statements.
CABOT CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended September 30
(In millions)
Cash Flows from Operating Activities:
Net income (loss)
$
$
$
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Depreciation and amortization
Loss on sale of a business
-
-
Gain on sale of land
-
-
(1
)
Deferred tax provision (benefit)
(37
)
(156
)
Equity in net income of affiliated companies
(7
)
(6
)
(5
)
Share-based compensation
Other non-cash (income) expense
Cash dividends received from equity affiliates
Changes in assets and liabilities:
Accounts and notes receivable
(26
)
Inventories
Prepaid expenses and other assets
(1
)
Accounts payable and accrued liabilities
(67
)
(152
)
Income taxes payable
(8
)
(4
)
Other liabilities
Cash provided by operating activities
Cash Flows from Investing Activities:
Additions to property, plant and equipment
(274
)
(241
)
(244
)
Proceeds from sale of a business
-
-
Asset acquisition
(27
)
-
-
Proceeds from sale of land
-
-
Proceeds from insurance settlements
-
-
Other
Cash used in investing activities
(298
)
(235
)
(214
)
Cash Flows from Financing Activities:
Proceeds from short-term borrowings
-
Repayments of short-term borrowings
(11
)
(1
)
(48
)
Proceeds from issuance of (repayments of) commercial paper, net
(39
)
(127
)
(149
)
Proceeds from long-term debt, net of issuance costs
Repayments of long-term debt
(7
)
(30
)
(90
)
Purchases of common stock
(168
)
(172
)
(98
)
Proceeds from sales of common stock
Cash dividends paid to noncontrolling interests
(57
)
(27
)
(42
)
Cash dividends paid to common stockholders
(96
)
(93
)
(88
)
Cash provided by (used in) financing activities
(336
)
(415
)
(403
)
Effects of exchange rate changes on cash
(57
)
Increase (decrease) in cash, cash equivalents
(15
)
Cash, cash equivalents at beginning of year
Cash, cash equivalents at end of year
$
$
$
Non-cash investing activities and supplemental cash flow information:
Additions to property, plant and equipment included in Accounts payable and
accrued liabilities
$
$
$
Income taxes paid
$
$
$
Interest paid
$
$
$
The accompanying notes are an integral part of these consolidated financial statements.
CABOT CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(In millions, except shares in thousands and per share amounts)
Common Stock, Net of Treasury Stock
Additional
Paid-in
Retained
Accumulated Other Comprehensive
Total Cabot Corporation Stockholders’
Noncontrolling
Total Stockholders’
Shares
Cost
Capital
Earnings
Income (Loss)
Equity
Interests
Equity
Balance at September 30, 2022
56,249
$
$
$
1,284
$
(439
)
$
$
$
1,032
Net income (loss)
Total other comprehensive income (loss)
-
Cash dividends declared to common stockholders, $1.54 per
share
(88
)
(88
)
(88
)
Cash dividends declared to noncontrolling interests
-
(30
)
(30
)
Issuance of stock under equity compensation plans
Share-based compensation
Purchase and retirement of common stock
(1,362
)
(1
)
(30
)
(67
)
(98
)
(98
)
Balance at September 30, 2023
55,244
-
1,574
(362
)
1,264
1,407
Net income (loss)
Total other comprehensive income (loss)
Cash dividends declared to common stockholders, $1.66 per
share
(93
)
(93
)
(93
)
Cash dividends declared to noncontrolling interests
-
(27
)
(27
)
Issuance of stock under equity compensation plans
Share-based compensation
Purchase and retirement of common stock
(1,859
)
(2
)
(44
)
(127
)
(173
)
(173
)
Balance at September 30, 2024
54,297
-
1,734
(360
)
1,425
1,590
Net income (loss)
Total other comprehensive income (loss)
Cash dividends declared to common stockholders, $1.76 per
share
(96
)
(96
)
(96
)
Cash dividends declared to noncontrolling interests
-
(57
)
(57
)
Issuance of stock under equity compensation plans
Share-based compensation
Purchase and retirement of common stock
(1,957
)
(2
)
(31
)
(134
)
(167
)
(167
)
Balance at September 30, 2025
52,842
$
$
-
$
1,835
$
(335
)
$
1,550
$
$
1,705
The accompanying notes are an integral part of these consolidated financial statements.
Notes to the Consolidated Financial Statements
Note A. Significant Accounting Policies
The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”). The significant accounting policies of Cabot Corporation (“Cabot” or “the Company”) are described below.
Unless otherwise indicated, all disclosures and amounts in the Notes to the Consolidated Financial Statements relate to the Company’s operations.
Principles of Consolidation
The consolidated financial statements include the accounts of Cabot and its wholly-owned subsidiaries and majority-owned and controlled subsidiaries. Additionally, Cabot considers consolidation of entities over which control is achieved through means other than voting rights, of which there were none in the periods presented. Intercompany transactions have been eliminated in consolidation.
Cash and Cash Equivalents
Cash equivalents include all highly liquid investments with an original maturity of three months or less at date of acquisition. Cabot continually assesses the liquidity of cash equivalents and, as of September 30, 2025, has determined that they are readily convertible to cash. The Company regularly maintains deposits in accredited financial institutions in excess of federally insured limits. Management believes that the Company is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.
Inventories
Inventories are stated at the lower of cost or net realizable value. The cost of inventories is determined using the first-in, first-out method.
Cabot periodically reviews inventory for both potential obsolescence and potential declines in anticipated selling prices. In this review, the Company makes assumptions about the future demand for and market value of the inventory, and based on these assumptions, estimates the amount of any obsolete, unmarketable, slow moving, or overvalued inventory. Cabot writes down the value of these inventories by an amount equal to the difference between the cost of the inventory and its estimated net realizable value.
Investments
The Company has investments in equity affiliates and marketable securities. Unless consolidation is required, investments in equity affiliates, where Cabot generally owns between 20% and 50% of the affiliate, are accounted for using the equity method. Cabot records its share of the equity affiliate’s results of operations based on its percentage of ownership of the affiliate. Dividends declared from equity affiliates are a return on investment and are recorded as a reduction to the equity investment value. As of September 30, 2025 and 2024, Cabot had equity affiliate investments of $16 million and $23 million, respectively. Dividends declared and received from these investments were $13 million, $2 million and $2 million in fiscal 2025, 2024 and 2023, respectively. As circumstances warrant, all investments are subject to periodic impairment reviews. As of September 30, 2025 and 2024, none of the investments was considered impaired.
Intangible Assets and Goodwill Impairment
The Company records tangible and intangible assets acquired and liabilities assumed in business combinations under the acquisition method of accounting. Amounts paid for an acquisition are allocated to the assets acquired and liabilities assumed based on their fair values at the date of acquisition. The Company uses assumptions and estimates in determining the fair value of assets acquired and liabilities assumed in a business combination. The determination of the fair value of intangible assets requires the use of significant judgment with regard to assumptions used in the valuation model. The Company estimates the fair value of identifiable acquisition-related intangible assets principally based on projections of cash flows that will arise from these assets. The projected cash flows are discounted to determine the fair value of the assets at the dates of acquisition.
Definite-lived intangible assets, which are comprised of trademarks, customer relationships, and developed technologies, are amortized over their estimated useful lives and are reviewed for impairment when indication of potential impairment exists, such as a significant reduction in cash flows associated with the assets.
Goodwill is comprised of the purchase price of business acquisitions in excess of the fair value assigned to the net tangible and identifiable intangible assets acquired. Goodwill is not amortized and is subject to impairment testing annually, or when events or changes in the business environment indicate that the carrying value of the reporting unit may exceed its fair value.
A reporting unit, for the purpose of the impairment test, is at or below the operating segment level, and constitutes a business for which discrete financial information is available and regularly reviewed by segment management. Reinforcement Materials, and the fumed metal oxides, specialty compounds, specialty carbons and battery materials product lines within Performance Chemicals, which are considered separate reporting units, carry the Company’s goodwill balances as of September 30, 2025.
For the purpose of the goodwill impairment test, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If an initial qualitative assessment identifies that it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value, an additional quantitative evaluation is performed. Alternatively, the Company may elect to proceed directly to the quantitative goodwill impairment test. If based on the quantitative evaluation the fair value of the reporting unit is less than its carrying amount, a goodwill impairment loss would result. The goodwill impairment loss would be the amount by which the carrying value of the reporting unit, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. The fair value of a reporting unit is based on discounted estimated future cash flows. The assumptions used to estimate fair value include management’s best estimates of future growth rates, operating cash flows, capital expenditures and discount rates over an estimate of the remaining operating period at the reporting unit level. The fair value is also benchmarked against the value calculated from a market approach using the guideline public company method. Based on the Company's most recent qualitative annual goodwill impairment assessment performed as of August 31, 2025, the Company determined that it was not more likely than not that the fair values of the Reinforcement Materials, fumed metal oxides, specialty compounds, specialty carbons and battery materials reporting units were less than their carrying values.
Long-lived Assets Impairment
Long-lived assets are grouped with other assets and liabilities at the lowest level for which independent identifiable cash flows are determinable. The carrying values of long-lived assets are reviewed for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset may not be recoverable. To test for impairment of assets, the Company generally uses a probability-weighted estimate of the future undiscounted net cash flows of the assets over their remaining lives to determine if the value of the asset is recoverable.
An asset impairment is recognized when the carrying value of the asset is not recoverable based on the analysis described above, in which case the asset is written down to its fair value. If the asset does not have a readily determinable market value, a discounted cash flow model may be used to determine the fair value of the asset.
Property, Plant and Equipment
Property, plant and equipment is recorded at cost. Depreciation of property, plant and equipment is calculated using the straight-line method over the estimated useful lives of the related assets. The depreciable lives for buildings, machinery and equipment, and other fixed assets are generally between twenty and twenty-five years, ten and twenty-five years, and three and twenty-five years, respectively. The cost and accumulated depreciation for property, plant and equipment sold, retired, or otherwise disposed of are removed from the Consolidated Balance Sheets and resulting gains or losses are included in earnings in the Consolidated Statements of Operations. Expenditures for repairs and maintenance are charged to expenses as incurred. Expenditures for major renewals and betterments, which significantly extend the useful lives of existing plant and equipment, are capitalized and depreciated.
Cabot capitalizes interest costs when they are part of the cost of acquiring and constructing certain assets that require a period of time to prepare for their intended use. During fiscal 2025, 2024 and 2023, Cabot capitalized $12 million, $9 million and $6 million of interest costs, respectively. These amounts are amortized over the lives of the related assets when they are placed in service.
Asset Retirement Obligations
Cabot estimates incremental costs for special handling, removal and disposal of materials that may or will give rise to conditional asset retirement obligations (“ARO”) and then discounts the expected costs back to the current year using a credit adjusted risk-free rate. Cabot recognizes ARO liabilities and costs when they are probable and can be reasonably estimated. In certain instances, Cabot has not recorded a reserve for AROs because sufficient information is not available to reasonably estimate the obligation. The ARO reserves were $18 million and $11 million as of September 30, 2025 and September 30, 2024, respectively. The ARO balances are included in Accounts payable and accrued liabilities and Other liabilities on the Consolidated Balance Sheets.
Foreign Currency Translation
The functional currency of the majority of Cabot’s foreign subsidiaries is the local currency in which the subsidiary operates. Assets and liabilities of foreign subsidiaries are translated into U.S. dollars at exchange rates in effect at the balance sheet dates. Income and expense items are translated at average monthly exchange rates during the year. The functional currency of Cabot’s foreign subsidiaries that operate in a highly inflationary economy is the U.S. dollar. Refer below to Argentinian Government Actions for detail regarding foreign currency exchange losses recorded by Cabot’s wholly-owned Argentinian subsidiary which operates in a highly inflationary economy. Cabot’s operations in other highly inflationary economies are not material.
Unrealized currency translation adjustments (“CTA”) are included as a separate component of Accumulated other comprehensive income (loss) (“AOCI”) within stockholders’ equity. Realized and unrealized foreign currency gains and losses arising from transactions denominated in currencies other than the subsidiary’s functional currency are reflected in earnings with the exception of (i) intercompany transactions considered to be of a long-term investment nature; (ii) income taxes upon future repatriation of unremitted earnings from non-U.S. subsidiaries that are not indefinitely reinvested; and (iii) foreign currency borrowings designated as net investment hedges. Gains or losses arising from these transactions are included within the CTA component of Other comprehensive income (loss). In fiscal 2025, 2024 and 2023, net foreign currency transaction loss of $8 million, $46 million, and $35 million, respectively, is included in Other income (expense) in the Consolidated Statements of Operations.
Argentinian Government Actions
The Company’s wholly-owned Argentinian subsidiary operates in a highly inflationary economy and, as a result, the functional currency of the subsidiary is Cabot’s reporting currency, the U.S. dollar. During fiscal 2025, 2024 and 2023, the Company recorded foreign exchange losses of $9 million, $43 million, and $33 million respectively, related to the revaluation of non-functional currency denominated monetary asset and liability balances. The foreign exchange losses in fiscal 2024 and 2023 include foreign exchange losses related to a single devaluation action by the Argentine government of $33 million and $7 million, respectively. The Company invested cash in money market funds and recorded investment income of $2 million, $17 million, and $16 million for fiscal 2025, 2024 and 2023, respectively. The foreign exchange losses and investment gains are recorded in Other income (expense) in the Consolidated Statement of Operations.
During the second quarter of fiscal 2024, the Company purchased $30 million in BOPREAL bonds (standing for “Bond for the Reconstruction of a Free Argentina” in Spanish), which are U.S. dollar-denominated securities issued by the Central Bank of Argentina, as part of an Argentine government program to settle foreign payables for importers with debts for goods with customs registration and/or services, incurred on or prior to December 12, 2023. The Company subsequently sold the bonds for $22 million and utilized the proceeds to partially repay its foreign payables in Argentina. The purchase and proceeds of BOPREAL bonds are included in the Changes in Prepaid expenses and other assets in the Consolidated Statement of Cash Flows. The $8 million investment loss is included in Other non-cash (income) expense in the Consolidated Statement of Cash Flows and in Other income (expense) in the Consolidated Statement of Operations. In accordance with Argentine government regulations, the Company purchased an additional $8 million of U.S. dollars in the third quarter of fiscal 2024 at a foreign exchange loss of $2 million and utilized the funds to complete the settlement of outstanding foreign payables incurred on or prior to December 12, 2023. Payables incurred after December 12, 2023 are not subject to payment through the BOPREAL bond program and the Company has settled these payables through regular operations. As such, there has been no BOPREAL bond activity in fiscal 2025.
Shares of Common Stock and Share Repurchases
The Company has 200 million shares of common stock authorized for issuance, with $1 par value per share. As of September 30, 2025, there were 52,842,481 shares outstanding. The holders of the Company’s common stock are entitled to one vote per share held on all matters submitted to a vote of shareholders and to receive dividends, as may be declared by the board of directors.
Periodically, Cabot repurchases shares of the Company’s common stock under the authorization provided by the Board of Directors. The Company retires the repurchased shares and records the excess of the purchase price over par value to additional paid-in capital (“APIC”) until such amount is reduced to zero and then charges the remainder against retained earnings.
Financial Instruments
Cabot’s financial instruments consist primarily of cash and cash equivalents, accounts and notes receivable, investments, accounts payable and accrued liabilities, short-term and long-term debt, and derivative instruments. The carrying values of Cabot’s financial instruments approximate fair value with the exception of fixed rate long-term debt, which is recorded at amortized cost. The fair values of the Company’s financial instruments are based on quoted market prices, if such prices are available. In situations where quoted market prices are not available, the Company relies on valuation models to derive fair value. Such valuations take into account the ability of the financial counterparty to perform and the Company’s own credit risk.
Cabot uses derivative financial instruments primarily for purposes of hedging the exposures to fluctuations in foreign currency exchange rates, which exist as part of its on-going business operations. Cabot does not enter into derivative contracts for speculative purposes, nor does it hold or issue any derivative contracts for trading purposes. All derivatives are recognized on the Consolidated Balance Sheets at fair value. Where Cabot has a legal right to offset derivative settlements under a master netting agreement with a counterparty, derivatives with that counterparty are presented on a net basis. The changes in the fair value of derivatives are recorded in either earnings or AOCI, depending on whether or not the instrument is designated as part of a hedge transaction and, if designated as part of a hedge transaction, the type of hedge transaction. The gains or losses on derivative instruments reported in AOCI are reclassified to earnings in the period in which earnings are affected by the underlying hedged item. The ineffective portion of all hedges is recognized in earnings during the period in which the ineffectiveness occurs.
In accordance with Cabot’s risk management strategy, the Company may enter into certain derivative instruments that may not be designated as hedges for hedge accounting purposes. Although these derivatives are not designated as hedges, the Company believes that such instruments are closely correlated with the underlying exposure, thus managing the associated risk. The Company records in earnings the gains or losses from changes in the fair value of derivative instruments that are not designated as hedges. Cash movements associated with these instruments are presented in the Consolidated Statements of Cash Flows as Cash Flows from Operating Activities because the derivatives are designed to mitigate risk to the Company’s cash flow from operations.
Revenue Recognition
Cabot recognizes revenue when its customers obtain control of promised goods or services. The revenue recognized is the amount of consideration which the Company expects to receive in exchange for those goods or services. The Company’s contracts with customers are generally for sales of operating segment products only, do not include other performance obligations, and have an original duration of less than one year. As performance obligations are satisfied in less than a year, the Company has applied the optional exemption of not disclosing remaining performance obligations associated with unfulfilled orders. Generally, Cabot considers purchase orders, which in some cases are governed by master supply agreements, to be contracts with customers. The transaction price as specified on the purchase order or sales contract is considered the standalone selling price for each distinct product. To determine the transaction price, the Company evaluates whether the price is subject to adjustments, such as for returns, discounts or volume rebates, which are stated in the customer contract, to determine the net consideration to which the Company expects to be entitled. Substantially all revenue from product sales is based on a point in time model and is recognized when control of the product is transferred to the customer, which typically occurs upon shipment or delivery of the product to the customer and title, risk and rewards of ownership have passed to the customer. For contracts where Cabot completes its performance obligation prior to its right to consideration or contracts where consideration is received prior to completing the Company’s performance obligation, the Company records a contract asset or a contract liability, respectively, on the Consolidated Balance Sheets. In any period presented, the Company did not have material balances of contract assets or liabilities.
Shipping and handling activities that occur after the transfer of control to the customer are billed to customers and are recorded as sales revenue, as the Company considers these to be fulfillment costs. These shipping and handling costs are expensed in the period incurred and included in Cost of sales within the Consolidated Statement of Operations. Taxes collected on sales to customers are excluded from the transaction price.
The Company generally provides a warranty that its products will substantially conform to the identified specifications. The Company’s liability typically is limited to either a credit equal to the purchase price or replacement of the non-conforming product. Returns under warranty have historically been immaterial.
Payment terms typically range from zero to ninety days. When the period of time between the transfer of control of the goods and the time the customer pays for the goods is one year or less, the Company does not consider there to be a significant financing component associated with the contract.
No customer accounted for more than 10 percent of revenue on a consolidated basis in any of the periods presented.
Cost of Sales
Cost of sales consists of the cost of raw and packaging materials, direct manufacturing costs, depreciation, internal transfer costs, inspection costs, inbound and outbound freight and shipping and handling costs, plant purchasing and receiving costs and other overhead expenses necessary to manufacture the products.
Accounts and Notes Receivable
Trade receivables are recorded at the invoiced amount and generally do not bear interest.
Cabot maintains allowances for doubtful accounts based on an assessment of the collectability of specific customer accounts, the aging of accounts receivable and other economic information on both a historical and prospective basis. Customer account balances are charged against the allowance when it is probable the receivable will not be recovered. There were no material changes in the allowance for any of the years presented.
Share-based Compensation
Cabot recognizes compensation expense for share-based awards granted to employees using the fair value method. Under the fair value recognition provisions, share-based compensation cost is measured at the grant date based on the fair value of the award, and is recognized as expense over the service period, which generally represents the vesting period, and includes an estimate of what level of performance the Company will achieve for Cabot’s performance-based stock awards. Cabot calculates the fair value of its stock options using the Black-Scholes option pricing model. The fair value of restricted stock units is determined using the closing price of Cabot stock on the day of the grant. The Company has made an accounting policy election to recognize forfeitures as they occur.
Selling and Administrative Expenses
Selling and administrative expenses consist of salaries and fringe benefits of sales and office personnel, general office expenses, and other expenses not directly related to manufacturing operations.
Research and Technical Expenses
Research and technical expenses include salaries, equipment and material expenditures, and contractor fees and are expensed as incurred.
Pensions and Other Postretirement Benefits
The Company recognizes the funded status of defined benefit pension and other postretirement benefit plans as an asset or liability. This amount is defined as the difference between the fair value of plan assets and the benefit obligation. Pension and post-retirement benefit costs other than service cost are included in Other income (expense) in the Consolidated Statement of Operations. Service cost is included with other employee compensation costs within Cost of sales, Selling and administrative expenses, or Research and technical expenses. The Company recognizes actuarial gains and losses and prior service costs and credits as a component of Other comprehensive income (loss), net of tax, which are subsequently amortized into earnings as a component of net periodic benefit cost.
Accumulated Other Comprehensive Income (Loss)
AOCI, which is included as a component of stockholders’ equity, includes unrealized gains or losses on derivative instruments, currency translation adjustments in foreign subsidiaries and pension and post-retirement related adjustments.
Income Taxes
Deferred income taxes are determined based on the estimated future tax effects of differences between financial statement carrying amounts and the tax bases of existing assets and liabilities. Deferred tax assets are recognized to the extent that realization of those assets is considered to be more likely than not. A valuation allowance is established for deferred taxes when it is more likely than not that all or a portion of the deferred tax assets will not be realized. Provisions are made for the U.S. income tax liability and additional non-U.S. taxes on the undistributed earnings of non-U.S. subsidiaries, except for amounts Cabot has designated to be indefinitely reinvested.
Cabot records benefits for uncertain tax positions based on an assessment of whether the position is more likely than not to be sustained, including resolution of any related appeals or litigation, on the basis of technical merit, upon examination by the taxing authorities. If this threshold is not met, no tax benefit of the uncertain tax position is recognized. If the threshold is met, the tax benefit that is recognized is the largest amount that is greater than 50% likely of being realized upon ultimate settlement. This analysis presumes the taxing authorities’ full knowledge of the positions taken and all relevant facts but does not consider the time value of money. The Company also accrues for interest and penalties on its uncertain tax positions and includes such charges in its income tax provision in the Consolidated Statements of Operations.
Contingencies
Cabot accrues costs related to contingencies when it is probable that a liability has been incurred and the amount can be reasonably estimated. Contingencies could arise from litigation, environmental remediation or contractual arrangements. When a single liability amount cannot be reasonably estimated, but a range can be reasonably estimated, Cabot accrues the amount that reflects the best estimate within that range or the low end of the range if no estimate within the range would be considered more likely than any other estimate. The amount accrued is determined through the evaluation of various information, which could include claims, settlement offers, demands by government agencies, estimates performed by independent third parties, identification of other responsible parties and an assessment of their ability to contribute, and the Company’s prior experience. Cabot does not reduce its estimated liability for possible recoveries from insurance carriers. Proceeds from insurance carriers are recorded when realized by either the receipt of cash or a contractual agreement.
Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates.
Note B. Recent Accounting Pronouncements
Recently Adopted Accounting Standards
In November 2023, the FASB issued a new standard, Improvement to Reportable Segment Disclosures. The new guidance enhances the disclosure of significant reportable segment expenses. The Company adopted this standard on October 1, 2024. See Note U for disclosures related to the Company's reportable segments. The adoption of the standard did not have a material impact on the Company’s Consolidated Financial Statements.
Recent Accounting Pronouncements and Tax Legislation
In September 2025, the FASB issued a new standard, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which is intended to modernize the accounting for the costs of internal-use software given the evolution of software development to the incremental and iterative development method. The amendments remove all references to prescriptive and sequential development stages and require an entity to start capitalizing software costs when management has authorized and committed to funding the software project, it is probable that the project will be completed, and the software will be used to perform the function intended. The amendments are effective for annual reporting periods beginning after December 15, 2027. Early adoption is permitted as of the beginning of an annual reporting period with the amendments to be applied using a prospective, modified or retrospective transition approach. The Company is currently evaluating the impact of adopting this guidance on the Company’s Consolidated Financial Statements.
On July 4, 2025, the U.S. federal government enacted the One Big Beautiful Bill Act (“OBBBA”). The OBBBA contains significant changes to federal tax law, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The Company has completed its evaluation of the impact of the OBBBA on the realizability of the Company’s U.S. net deferred tax assets and recorded the results of this assessment in the Company’s Consolidated Financial Statements for its fiscal year ending September 30, 2025. Refer to the discussion in Note Q for further information.
In November 2024, the FASB issued a new standard, Expense Disaggregation Disclosures. The new guidance requires quantitative and qualitative disclosure of certain cost and expense categories in the notes to the financial statements for interim and annual reporting periods. The new standard is effective for the Company's fiscal years and interim periods beginning October 1, 2027, with early adoption permitted. The Company is currently evaluating the timing of adoption and the impact of the adoption of this standard on the Company’s Consolidated Financial Statements.
In December 2023, the FASB issued a new standard, Improvements to Income Tax Disclosures. The new guidance requires additional disclosures primarily related to the income tax rate reconciliation and income taxes paid. The new standard is effective for the Company’s fiscal years and interim periods beginning October 1, 2025. The Company is currently evaluating the impact of the adoption of this standard on the Company’s Consolidated Financial Statements.
Note C. Acquisitions
On August 4, 2025, Cabot entered into an agreement with Bridgestone Corporation to purchase its carbon black manufacturing facility, Mexico Carbon Manufacturing, S.A. de C.V., in Tamaulipas, Mexico for approximately $70 million, which will be subject to customary closing adjustments. The acquisition is expected to close in the first half of fiscal 2026, subject to regulatory approval.
In October 2024, the Company completed the purchase of certain assets and licensed related technology, which the Company expects to use to manufacture certain products for its battery materials product line. The Company paid $27 million, which was allocated to the identifiable assets on a relative fair value basis, with $19 million allocated to property, plant and equipment and $8 million to intangible assets.
Note D. Inventories
Inventories, net of obsolete, unmarketable and slow-moving reserves, are as follows:
September 30
(In millions)
Raw materials
$
$
Finished goods
Other(1)
Total
$
$
(1) Other inventory is comprised of certain spare parts and supplies.
At September 30, 2025 and 2024, total inventory reserves were $13 million and $14 million, respectively.
Note E. Property, Plant and Equipment
Property, plant and equipment consists of the following:
September 30
(In millions)
Land and land improvements
$
$
Buildings
Machinery and equipment
2,957
2,780
Other
Construction in progress
Total property, plant and equipment
4,405
4,082
Accumulated depreciation
(2,694
)
(2,548
)
Net property, plant and equipment
$
1,711
$
1,534
Depreciation expense for fiscal 2025, 2024 and 2023 was $148 million, $145 million and $138 million, respectively.
Note F. Goodwill and Intangible Assets
The carrying amount of goodwill attributable to each reportable segment with goodwill balances and the changes in those balances during the fiscal years ended September 30, 2025 and 2024 are as follows:
Reinforcement
Materials
Performance
Chemicals
Total
(In millions)
Balance at September 30, 2023
$
$
$
Foreign currency impact
(3
)
(1
)
Balance at September 30, 2024
Foreign currency impact
(1
)
Balance at September 30, 2025
$
$
$
The following table provides information regarding the Company’s intangible assets with finite lives:
September 30, 2025
September 30, 2024
Gross
Carrying
Value
Accumulated
Amortization
Net
Intangible
Assets
Gross
Carrying
Value
Accumulated
Amortization
Net
Intangible
Assets
(In millions)
Developed technologies(1)
$
$
(14
)
$
$
$
(12
)
$
Trademarks
(1
)
$
(1
)
Customer relationships
(36
)
(30
)
Total intangible assets
$
$
(51
)
$
$
$
(43
)
$
(1)Included within Developed technologies as of September 30, 2025 is $8 million of intangible assets acquired during the first quarter of fiscal 2025 as discussed in Note C above.
Intangible assets are amortized over their estimated useful lives, which range between ten and twenty-five years, with a weighted average amortization period of sixteen years. Amortization expense for each of fiscal 2025, 2024 and 2023 was $6 million and is included in Cost of sales, Selling and administrative expenses and Research and technical expenses in the Consolidated Statements of Operations. Total amortization expense is estimated to be approximately $7 million each year for the next five fiscal years.
Note G. Accounts Payable, Accrued Liabilities and Other Liabilities
Accounts payable and accrued liabilities included in current liabilities consist of the following:
September 30
(In millions)
Accounts payable
$
$
Accrued employee compensation
Other accrued liabilities
Total
$
$
Other long-term liabilities consist of the following:
September 30
(In millions)
Employee benefit plan liabilities
$
$
Operating lease liabilities
Other accrued liabilities
Total
$
$
Note H. Debt and Other Obligations
Short-term Borrowings
Commercial Paper- The Company has a commercial paper program and the maximum aggregate balance of commercial paper notes outstanding and the amounts borrowed under the revolving credit facility may not exceed the borrowing capacity of $1 billion under the revolving credit facility. The proceeds from the issuance of the commercial paper have been used for general corporate purposes, which may include working capital, refinancing existing indebtedness, capital expenditures, share repurchases, and acquisitions. The revolving credit facility is available to repay the outstanding commercial paper, if necessary.
There was an outstanding balance of commercial paper of $6 million as of September 30, 2025 with a weighted average interest rate of 4.26% and an outstanding balance of commercial paper of $45 million as of September 30, 2024 with a weighted average interest rate of 4.94%
Other - During fiscal 2025, PT Cabot Indonesia entered into an $8 million corporate facility that can be used for short term working capital needs. As of September 30, 2025, the outstanding balance was $8 million with an interest rate of 6.68%.
Long-term Obligations
The Company’s long-term obligations, the fiscal year in which they mature and their respective interest rates are summarized below:
September 30
(In millions)
Variable Rate Debt:
Revolving Credit Facility, expires fiscal 2027
$
-
$
-
Revolving Credit Facility - Euro, expires fiscal 2027
Total variable rate debt
Fixed Rate Debt:
3.4% Notes due fiscal 2026
4.0% Notes due fiscal 2029
5.0% Notes due fiscal 2032
Medium-Term Notes due fiscal 2028, 6.57% - 7.28%
Chinese Renminbi Debt, due fiscal 2026, 4.3%
Total fixed rate debt
Finance lease obligations (Note R)
Unamortized debt issuance costs and debt discount
(6
)
(7
)
Total debt
1,116
1,095
Less Current portion of long-term debt
Total long-term debt
$
$
1,087
Revolving Credit Facility, expiring fiscal 2027-In August 2021, the Company entered into a revolving credit agreement (the “U.S. Credit Agreement”) with a loan commitment not to exceed $1 billion. The U.S. Credit Agreement supports the Company’s issuance of commercial paper, and borrowings may be used for working capital, letters of credit and other general corporate purposes. Outstanding commercial paper balances reduce the amount available for borrowing under the U.S. Credit Agreement, which was $994 million as of September 30, 2025. The U.S. Credit Agreement, which matures in August 2027, contains affirmative and negative covenants, the financial debt covenant described below, and annual sustainability performance targets related to the Company’s reduction in its nitrogen oxide and sulfur dioxide emissions intensity, the achievement of which may adjust pricing under the U.S. Credit Agreement. The borrowing rate is currently based on an adjusted daily risk-free borrowing rate, plus a Cabot-specific spread based on the Company’s credit rating and achievement of the annual sustainability performance targets. Based on the performance against the sustainability performance targets during calendar year 2024, there is no adjustment to commitment fee and borrowing rate, effective July 2025 through August 2026.
Revolving Credit Facility-Euro, expiring fiscal 2027-In May 2023, several subsidiaries entered into a revolving credit agreement (the “Euro Credit Agreement”, and together with the U.S. Credit Agreement, the "Credit Agreements") with a loan commitment not to exceed 300 million Euros. The amount available for borrowing under this revolving credit agreement was $223 million as of September 30, 2025, and the weighted average interest rate on the outstanding balance during the year was 4.27%. The borrowing rate is based on an adjusted daily risk-free borrowing rate, plus a Cabot-specific spread based on the Company’s credit rating. The revolving credit agreement, which matures in August 2027, may be used for repatriation of earnings of Cabot’s foreign subsidiaries to the U.S., the repayment of indebtedness of the Company’s foreign subsidiaries owing to the Company or any of its subsidiaries, and for working capital and general corporate purposes. The obligations of the subsidiaries under the revolving credit agreement are guaranteed by the Company. The Company paid debt issuance costs of $1 million upon entering the agreement, which are being amortized over the life of the revolver.
Debt Covenants-As of September 30, 2025, Cabot was in compliance with the financial debt covenants under the Credit Agreements, which, with limited exceptions, require us to comply on a quarterly basis with a leverage test requiring the ratio of consolidated net debt to consolidated EBITDA not to exceed 3.50 to 1.00. Consolidated net debt is defined as consolidated debt offset by the lessor of (i) unrestricted cash and cash equivalents and (ii) $150 million.
Chinese Renminbi Debt-The Company’s consolidated Chinese subsidiaries had $4 million of unsecured long-term debt outstanding with a noncontrolling shareholder of a consolidated subsidiary as of both September 30, 2025 and 2024.
3.4% Notes due fiscal 2026-In September 2016, Cabot issued $250 million in registered notes with a coupon of 3.4% that mature on September 15, 2026. These notes are unsecured and pay interest on March 15 and September 15. The net proceeds of this offering were $248 million after deducting discounts and issuance costs. The discount of less than $1 million was recorded at issuance and is being amortized over the life of the notes. The Company plans to refinance the notes prior to the notes’ maturity in fiscal 2026.
4.0% Notes due fiscal 2029-In June 2019, Cabot issued $300 million in registered, unsecured notes with a coupon of 4.0% that mature on July 1, 2029. Interest is payable under the notes semi-annually on January 1 and July 1. The net proceeds of this offering were $296 million after deducting discounts and issuance costs of $1 million and $3 million, respectively, which were paid at issuance and are being amortized over the life of the notes.
5.0% Notes due fiscal 2032-In June 2022, Cabot issued $400 million in unsecured notes with a coupon of 5% that mature on June 30, 2032. Interest is payable semi-annually on June 30 and December 30. The net proceeds of this offering were $394 million after deducting discounts and issuance costs, each of which were $3 million, which were paid at issuance and are being amortized over the life of the notes.
Medium-Term Notes-At both September 30, 2025 and 2024, there were $8 million of unsecured medium-term notes outstanding issued to numerous lenders with various fixed interest rates and maturity dates. The weighted average maturity of the total outstanding medium-term notes is 2 years with a weighted average interest rate of 7.24%.
Finance Lease obligations-See Note R for a discussion of the Company’s leases.
Future Years Payment Schedule
The aggregate principal amounts of long-term debt, excluding finance lease liabilities presented separately in Note R, due in each of the five years from fiscal 2026 through 2030 and thereafter are as follows:
Years Ending September 30
Principal Payments
on Long-Term
Debt
(In millions)
$
-
Thereafter
Total
$
1,092
Standby letters of credit-At September 30, 2025, the Company had provided standby letters of credit that were outstanding and not drawn totaling $7 million, which expire through fiscal 2026.
Note I. Financial Instruments and Fair Value Measurements
The FASB authoritative guidance on fair value measurements defines fair value, provides a framework for measuring fair value, and requires certain disclosures about fair value measurements. The required disclosures focus on the inputs used to measure fair value. The guidance establishes the following hierarchy for categorizing these inputs:
Level 1
-
Quoted market prices in active markets for identical assets or liabilities
Level 2
-
Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs)
Level 3
-
Significant unobservable inputs
There were no transfers of financial assets or liabilities measured at fair value between Level 1 and Level 2, and there were no Level 3 investments during fiscal 2025 or 2024.
At both September 30, 2025 and 2024, the fair values of cash and cash equivalents, accounts and notes receivable, accounts payable and accrued liabilities, and short-term borrowings and variable rate debt approximated their carrying values due to the short-term nature of these instruments. Cash and cash equivalents are classified as Level 1 within the fair value hierarchy.
At both September 30, 2025 and 2024, Cabot had derivatives relating to foreign currency risks carried at fair value. The Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of Cabot or the financial counterparty to perform. For interest rate and cross-currency swaps, the significant inputs to these models are interest rate curves for discounting future cash flows and are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows, and exchange rate curves of the foreign currency for translating future cash flows. These derivatives are classified as Level 2 instruments within the fair value hierarchy as the fair value determination was based on observable inputs.
At September 30, 2025 and 2024, the fair value of Guaranteed investment contracts, included in Other assets on the Consolidated Balance Sheets was $9 million and $8 million, respectively. Guaranteed investment contracts were classified as Level 2 instruments within the fair value hierarchy as the fair value determination was based on other observable inputs.
The carrying value and fair value of the long-term fixed rate debt were each $1.09 billion as of September 30, 2025 and each $1.08 billion as of September 30, 2024. The carrying amounts of Cabot’s floating rate long-term debt approximates the fair value. All such measurements are based on observable inputs and are classified as Level 2 within the fair value hierarchy.
Note J. Derivatives
The Company has foreign currency exposure arising from its net investments in foreign operations. The Company uses cross-currency swaps to partially mitigate the impact of the Euro currency rate changes on the Company’s Euro-denominated net investments. The Company’s cross-currency swaps are designated as net investment hedges.
The Company also has foreign currency exposure arising from the denomination of monetary assets and liabilities in foreign currencies other than the functional currency of a given subsidiary as well as the risk that currency fluctuations could affect the dollar value of future cash flows generated in foreign currencies. The Company uses short-term forward contracts to minimize the exposure to foreign currency risk.
By using derivative instruments, the Company is subject to credit and market risk. If a counterparty fails to fulfill its performance obligations under a derivative contract, the Company’s credit risk will equal the fair value of the derivative. The Company minimizes counterparty credit (or repayment) risk by entering into transactions with major financial institutions of investment grade credit rating. The Company’s exposure to market risk is not hedged in a manner that completely eliminates the effects of changing market conditions on earnings or cash flow. The Company had no significant concentration of credit risk at September 30, 2025 and 2024.
The following table provides details of the derivatives held as of September 30, 2025 and 2024 to manage foreign currency risk.
Notional Amount
Description
Borrowing
September 30, 2025
September 30, 2024
Hedge
Designation
Cross Currency Swaps
3.4% Notes
USD 250 million swapped to EUR 223 million
USD 250 million swapped to EUR 223 million
Net investment
Forward Foreign Currency Contracts(1)
N/A
USD 184 million
USD 138 million
No designation
(1)At September 30, 2025, the Company’s forward foreign exchange contracts were denominated in Euro, Indonesian rupiah, Czech koruna, and Colombian peso. At September 30, 2024, the Company’s forward foreign exchange contracts were denominated in Indonesian rupiah, Czech koruna, and Colombian peso.
Accounting for Derivative Instruments and Hedging Activities
Net Investment Hedge
For net investment hedges, changes in the fair value of the effective portion of the derivatives’ gains or losses are reported as CTA in AOCI while changes in the ineffective portion are reported in earnings. Effectiveness is assessed based on the hypothetical derivative method. The gains or losses on derivative instruments reported in AOCI are reclassified to earnings in the period in which earnings are affected by the underlying item, such as disposals or substantial liquidations of the entities being hedged.
Cash settlements related to the net investment hedge occur semi-annually on March 15th and September 15th for fixed rate interest payments and a cash exchange of the notional currency amount will occur at the end of the term in September 2026. During each of fiscal 2025, 2024 and 2023, the Company received net cash interest of $4 million. As of September 30, 2025, the fair value of these swaps was a liability of $12 million and was included in Prepaid expenses and other current assets and Other liabilities. As of September 30, 2024, the fair value of these swaps was an asset of $1 million and was included in Prepaid expenses and other current assets and Other assets. As of September 30, 2025 and 2024, the cumulative unrealized loss of $8 million and the cumulative unrealized gain of $5 million, respectively, was included in AOCI on the Consolidated Balance Sheets.
The following table summarizes the impact of the cross-currency swaps, net of tax, to AOCI and the Consolidated Statements of Operations:
Years Ended September 30
(In millions)
Gain/(loss) recognized in AOCI
$
(8
)
$
(6
)
$
(13
)
(Gain)/loss reclassified from AOCI into Interest expense
$
(4
)
$
(4
)
$
(6
)
(Gain)/loss recognized in Interest expense (amount excluded
from effectiveness testing)
$
$
$
Forward Foreign Currency Contracts
At both September 30, 2025 and 2024, the Company had foreign currency forward contracts that were not designated as hedges for accounting purposes. Although these derivatives do not qualify for hedge accounting, Cabot believes that such instruments are closely correlated with the underlying exposure, thus managing the associated risk. The gains or losses from changes in the fair value of derivative instruments that are not accounted for as hedges are recognized in current period earnings.
At both September 30, 2025 and 2024, the fair value of derivative instruments not designated as hedges was less than $1 million and was presented in Prepaid expenses and other current assets and Accounts payable and accrued liabilities on the Consolidated Balance Sheets.
Note K. Insurance Recoveries
In July 2021, the Company’s Specialty Compounds manufacturing and research and development facility in Pepinster, Belgium experienced significant flooding. Full production, which was temporarily halted, resumed in the second quarter of fiscal 2022. The Company agreed to a final insurance settlement in fiscal 2023 for total proceeds of $33 million.
During fiscal 2023, the Company recognized gains of $9 million related to lost margin and the replacement value of fixed assets exceeding their net book value. The flood-related expenses, loss recoveries and gains are included within Cost of sales in the Consolidated Statements of Operations in fiscal 2023.
During fiscal 2023, the Company received insurance proceeds of $14 million. Of the proceeds received, $12 million is included in Cash provided by investing activities and $2 million is included in Cash provided by operating activities for fiscal 2023 in the Consolidated Statements of Cash Flows. Proceeds of $19 million were received and recognized prior to fiscal 2023, as reported in previous filings.
Note L. Employee Benefit Plans
The information below provides detail concerning the Company’s benefit obligations under the defined benefit and postretirement benefit plans it sponsors.
Defined benefit plans provide pre-determined benefits to employees that are distributed upon retirement. Cabot is making all sponsor required contributions to these plans. The accumulated benefit obligation was $2 million for the U.S. defined benefit plan and $142 million for the foreign defined benefit plans as of September 30, 2025 and $2 million for the U.S. defined benefit plans and $145 million for the foreign defined benefit plans as of September 30, 2024. The U.S. defined benefit plan is the frozen Supplemental Cash Balance Plan.
The following provides information about projected benefit obligations, plan assets, the funded status and weighted-average assumptions of the defined benefit pension and postretirement benefit plans:
Years Ended September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Change in Benefit Obligations:
Benefit obligation at beginning of
year
$
$
$
$
$
$
$
$
Service cost
-
-
-
-
-
-
Interest cost
-
-
-
-
Plan participants’ contribution
-
-
-
-
-
-
Foreign currency exchange rate
changes
-
-
-
-
-
-
-
(Gain) loss from changes in actuarial
assumptions and plan experience
-
(4
)
-
-
-
Benefits paid
-
(8
)
-
(8
)
(2
)
(1
)
(2
)
(1
)
Plan Amendments
-
-
-
-
-
-
-
Settlements or curtailments
-
(4
)
-
(5
)
-
-
-
(1
)
Benefit obligation at end of year
$
$
$
$
$
$
$
$
Years Ended September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Change in Plan Assets:
Fair value of plan assets at beginning
of year
$
-
$
$
-
$
$
-
$
-
$
-
$
-
Actual return on plan assets
-
-
-
-
-
-
Employer contribution
-
-
Plan participants’ contribution
-
-
-
-
-
-
Foreign currency exchange rate
changes
-
(1
)
-
-
-
-
-
Benefits paid
-
(8
)
-
(8
)
(2
)
(1
)
(2
)
(1
)
Settlements or curtailments
-
(4
)
-
(5
)
-
-
-
(1
)
Fair value of plan assets at end
of year
$
-
$
$
-
$
$
-
$
-
$
-
$
-
Funded status
$
(2
)
$
(1
)
$
(2
)
$
$
(12
)
$
(11
)
$
(13
)
$
(12
)
Recognized asset (liability)
$
(2
)
$
(1
)
$
(2
)
$
$
(12
)
$
(11
)
$
(13
)
$
(12
)
Pension Assumptions and Strategy
The following assumptions were used to determine the pension benefit obligations and periodic benefit costs as of and for the years ended September 30:
Pension Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
Actuarial assumptions as of the year-end
measurement date:
Discount rate
4.9
%
4.3
%
5.1
%
4.1
%
6.0
%
4.7
%
Rate of increase in compensation
N/A
2.9
%
N/A
2.9
%
N/A
3.0
%
Cash balance interest credit rate
3.0
%
2.2
%
2.0
%
2.2
%
2.0
%
2.1
%
Actuarial assumptions used to determine net
periodic benefit cost during the year:
Discount rate - benefit obligation
5.1
%
4.1
%
6.0
%
4.7
%
5.6
%
4.5
%
Discount rate - service cost
N/A
3.2
%
N/A
3.9
%
N/A
3.6
%
Discount rate - interest cost
4.9
%
3.9
%
6.0
%
4.7
%
5.3
%
4.5
%
Expected long-term rate of return on
plan assets
N/A
4.9
%
N/A
5.2
%
N/A
5.1
%
Rate of increase in compensation
N/A
2.9
%
N/A
3.0
%
N/A
3.0
%
Cash balance interest credit rate
2.0
%
2.2
%
2.0
%
2.1
%
2.0
%
2.0
%
Postretirement Assumptions and Strategy
The following assumptions were used to determine the postretirement benefit obligations and net costs as of and for the years ended September 30:
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
Actuarial assumptions as of the year-end
measurement date:
Discount rate
5.1
%
5.1
%
5.1
%
4.8
%
6.0
%
5.7
%
Initial health care cost trend rate
7.0
%
6.1
%
5.0
%
6.3
%
5.0
%
6.4
%
Actuarial assumptions used to determine
net cost during the year:
Discount rate - benefit obligation
5.1
%
4.8
%
6.0
%
5.7
%
5.6
%
5.1
%
Discount rate - service cost
4.9
%
4.8
%
6.0
%
5.6
%
5.4
%
5.1
%
Discount rate - interest cost
5.0
%
4.6
%
5.9
%
5.7
%
5.3
%
5.1
%
Initial health care cost trend rate
5.0
%
6.3
%
5.0
%
6.4
%
-
%
6.8
%
Cabot uses discount rates as of September 30, the plans’ measurement date, to determine future benefit obligations under its U.S. and foreign defined benefit plans. The discount rates for the defined benefit plans in Canada, the Eurozone, Japan, Switzerland, the United Arab Emirates, the United Kingdom and the U.S. are derived from yield curves that reflect high quality corporate bond yield or swap rate information in each region and reflect the characteristics of Cabot’s employee benefit plans. The discount rates for the defined benefit plans in Mexico, the Czech Republic and Indonesia are based on government bond indices that best reflect the durations of the plans, adjusted for credit spreads presented in selected AA corporate bond indices. The rates utilized are selected because they represent long-term, high quality, fixed income benchmarks that approximate the long-term nature of Cabot’s pension obligations and related payouts.
Amounts recognized in the Consolidated Balance Sheets at September 30, 2025 and 2024 related to the Company's defined benefit pension and postretirement benefit plans were as follows:
September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Other assets
$
-
$
$
-
$
$
-
$
-
$
-
$
-
Accounts payable and accrued liabilities
$
-
$
(2
)
$
-
$
(2
)
$
(2
)
$
(1
)
$
(2
)
$
(1
)
Other liabilities
$
(2
)
$
(27
)
$
(2
)
$
(28
)
$
(10
)
$
(10
)
$
(11
)
$
(11
)
Amounts recognized in AOCI at September 30, 2025 and 2024 related to the Company's defined benefit pension and postretirement benefit plans were as follows:
September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Net actuarial (gain) loss
$
-
$
$
-
$
$
(4
)
$
(4
)
$
(5
)
$
(4
)
Net prior service credit
-
(1
)
-
(1
)
-
-
-
-
Balance in accumulated other
comprehensive (income) loss, pretax
$
-
$
$
-
$
$
(4
)
$
(4
)
$
(5
)
$
(4
)
Estimated Future Benefit Payments
The Company expects that the following benefit payments will be made to plan participants in the years from 2026 to 2035:
Pension Benefits
Postretirement Benefits
Years Ending September 30
U.S.
Foreign
U.S.
Foreign
(In millions)
$
-
$
$
$
$
-
$
$
$
$
-
$
$
$
$
-
$
$
$
$
-
$
$
$
2031 - 2035
$
$
$
$
Postretirement benefits are unfunded and impact Cabot’s cash flows as benefits become due, which is expected to be $2 million in fiscal 2026. The Company expects to contribute $5 million to its pension plans in fiscal 2026.
Net periodic defined benefit pension and other postretirement benefit costs include the following components:
Years Ended September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Service cost
$
-
$
$
-
$
$
-
$
$
-
$
-
$
-
$
-
$
-
$
-
Interest cost
-
-
-
-
Expected return on plan
assets
-
(8
)
-
(9
)
-
(7
)
-
-
-
-
-
-
Amortization of net (gains) losses
-
-
-
-
(1
)
(1
)
-
(1
)
(1
)
(1
)
-
Net periodic (benefit) cost
$
-
$
$
-
$
$
-
$
$
-
$
-
$
-
$
-
$
-
$
Other changes in plan assets and benefit obligations recognized in Other comprehensive income (loss) are as follows:
Years Ended September 30
Pension Benefits
Postretirement Benefits
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
U.S.
Foreign
(In millions)
Net (gains) losses
$
-
$
-
$
-
$
$
-
$
$
-
$
-
$
-
$
$
(1
)
$
(3
)
Prior service (credit) cost
-
-
(1
)
-
-
-
-
-
-
-
-
Amortization of prior
unrecognized gains (losses)
-
(3
)
-
-
-
-
-
-
Net changes recognized in
Total other comprehensive
(income) loss (1)
$
-
$
-
$
-
$
$
-
$
$
$
-
$
$
$
-
$
(3
)
(1)The tax impact on pension and other postretirement benefit liability adjustments arising during the period was a tax benefit of less than $1 million, a tax benefit of $2 million, and a tax provision of less than $1 million for fiscal 2025, 2024 and 2023, respectively.
U.K. Plans Termination
In fiscal 2023, the Company commenced the plan termination process for the Cabot Carbon Limited Pension Plan and Carbon Plastics Pension Plan and expects to complete the transaction in fiscal 2026. At September 30, 2025, the benefit obligation and plan assets associated with these plans were $43 million and $51 million, respectively. During fiscal 2025, the Company recognized a $3 million charge associated with finalizing terms related to the settlement of the plans.
Plan Assets
The Company’s foreign defined benefit pension plans' weighted-average asset allocations at September 30, 2025 and 2024 by asset category, are as follows:
September 30
Equity securities
%
%
Debt securities
%
%
Real estate
%
%
Cash and other securities
%
%
Total
%
%
To develop the expected long-term rate of return on plan assets assumption, the Company used a capital asset pricing model. The model considers the current level of expected returns on risk-free investments comprised of government bonds, the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns for each asset class. The expected return for each asset class was then weighted based on the target asset allocation to develop the expected long-term rate of return for each plan.
Cabot’s investment strategy for each of its foreign defined benefit plans is generally based on a set of investment objectives and policies that cover time horizons and risk tolerance levels consistent with plan liabilities. Periodic studies are performed to determine the asset mix that will meet pension obligations at a reasonable cost to the Company. The assets of the defined benefit plans are comprised principally of investments in equity and high-quality fixed income securities, which are broadly diversified across the capitalization and style spectrum and are managed using both active and passive strategies. The weighted average target asset allocation for the foreign plans is 30% in equity, 47% in fixed income, 18% in real estate and 5% in cash and other securities. The actual weighted average asset allocations differ from target asset allocation as a result of the insurance contracts with Cabot Carbon Limited Pension Plan and Carbon Plastics Pension Plan purchased with plan assets in anticipation of the settlement discussed above.
For pension plan assets classified as Level 1 measurements (measured using quoted prices in active markets), total fair value is either the price of the most recent trade at the time of the market close or the official close price, as defined by the exchange on which the asset is most actively traded on the last trading day of the period, multiplied by the number of units held without consideration of transaction costs.
For pension plan assets classified as Level 2 measurements, where the security is frequently traded in less active markets, fair value is based on the closing price at the end of the period; where the security is less frequently traded, fair value is based on the
price a dealer would pay for the security or similar securities, adjusted for any terms specific to that asset or liability. Market inputs are obtained from third-party vendors of market data and subjected to tolerance/quality checks.
The fair value of the Company’s pension plan assets at September 30, 2025 and 2024 by asset category is as follows:
September 30
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Total
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Total
(In millions)
Cash
$
$
-
$
$
$
-
$
Direct investments:
Non-U.S. equities
-
-
Non-U.S. government bonds
-
-
Non-U.S. corporate bonds
-
Other fixed income
-
-
Total direct investments
-
Investment funds:
Equity funds(1)
-
-
Fixed income funds(2)
-
-
Real estate funds(3)
-
-
Other investment funds
-
-
Total investment funds
-
-
Alternative investments:
Insurance contracts(4)
-
-
Other alternative investments
-
-
Total alternative investments
-
-
Total pension plan assets
$
$
$
$
$
$
(1)The equity funds asset class includes funds that invest in U.S. equities as well as equity securities issued by companies incorporated, listed or domiciled in countries in developed and/or emerging markets. These companies may be in the small-, mid- or large-cap categories.
(2)The fixed income funds asset class includes investments in high quality funds. High quality fixed income funds primarily invest in low-risk U.S. and non-U.S. government securities, investment-grade corporate bonds, mortgages and asset-backed securities. A significant portion of the fixed income funds include investment in long-term bond funds.
(3)The real estate funds asset class includes funds that primarily invest in entities which are principally engaged in the ownership, acquisition, development, financing, sale and/or management of income-producing real estate properties, both commercial and residential. These funds typically seek long-term growth of capital and current income that is above average relative to public equity funds.
(4)Insurance contracts held by the Company’s non-U.S. plans are issued by well-known, highly rated insurance companies.
Defined Contribution Plans
In addition to benefits provided under the defined benefit and postretirement benefit plans, the Company provides benefits under defined contribution plans. Cabot recognized expenses related to these plans of $22 million, $20 million and $19 million in fiscal 2025, 2024 and 2023, respectively.
Note M. Share-Based Compensation
The Cabot Corporation 2025 Long-Term Incentive Plan (the “2025 Plan”) was adopted by the Company to provide stock-based compensation to eligible employees. The 2025 Plan was approved by Cabot’s stockholders on March 13, 2025, and authorizes the issuance of up to an additional 1,400,000 shares of common stock. The Company ceased granting awards under the Cabot Corporation Amended and Restated 2017 Long-Term Incentive Plan when the 2025 Plan was adopted by the Company’s stockholders, and the shares remaining available for future grants under the 2017 Plan as of the effective date of the 2025 Plan were transferred to the 2025 Plan’s share pool. The 2025 Plan is the only equity incentive plan under which the Company may grant equity awards to employees.
The terms of awards made under Cabot’s equity compensation plans are generally determined by the Compensation Committee of Cabot’s Board of Directors. The awards made in fiscal 2025, 2024 and 2023 consist of grants of stock options, time-based restricted stock units and performance-based restricted stock units. The options were issued with an exercise price equal to 100% of the market price of Cabot’s common stock on the date of grant, generally vest over a three-year period (30% on each of the first and second anniversaries of the date of grant and 40% on the third anniversary of the date of grant) and have a ten-year term. The restricted stock units generally vest three years from the date of the grant. The number of shares issuable, if any, when a performance-based restricted stock unit award vests will depend on the degree of achievement of the corporate performance metrics for each year within the three-year performance period of the award. Accordingly, future compensation costs associated with outstanding awards of performance-based restricted stock units may increase or decrease based on the probability of the Company achieving the performance metrics.
Share-based employee compensation expense was $22 million, $23 million and $18 million, after tax, for fiscal 2025, 2024 and 2023, respectively.
The following table presents share-based compensation expenses included in the Company’s Consolidated Statements of Operations:
Years Ended September 30
(In millions)
Cost of sales
$
$
$
Selling and administrative expenses
Research and technical expenses
Share-based compensation expense
Income tax benefit
(2
)
(2
)
(2
)
Net share-based compensation expense
$
$
$
As of September 30, 2025, Cabot had $21 million and $3 million of total unrecognized compensation cost related to restricted stock units and options, respectively, granted under the Company’s equity incentive plans. These costs are expected to be recognized over a weighted-average period of approximately one year for restricted stock units and options.
Equity Incentive Plan Activity
The following table summarizes the total stock option and restricted stock unit activity in the equity incentive plans for fiscal 2025:
Stock Options
Restricted Stock Units
Total
Options (1)
Weighted
Average
Exercise
Price
Restricted
Stock
Units(4)
Weighted
Average
Grant Date
Fair Value
(Shares in thousands)
Outstanding at September 30, 2024
1,384
$
56.65
$
70.25
Granted
$
114.99
$
110.67
Performance-based adjustment(2)
-
$
-
$
78.68
Exercised / Vested
(171
)
$
52.21
(292
)
$
59.95
Cancelled / Forfeited
(6
)
$
74.21
(26
)
$
81.01
Outstanding at September 30, 2025(3)
1,315
$
61.96
$
86.48
Exercisable at September 30, 2025
1,032
$
54.30
(1)Unvested stock options were approximately 283,000 and 373,000 at September 30, 2025 and 2024 and their weighted average grant date fair values were $89.84 and $70.24, respectively.
(2)Represents the net incremental number of shares issuable upon vesting of performance-based restricted stock units based on the Company’s actual financial performance metrics for fiscal 2025.
(3)Stock options outstanding include options vested and expected to vest in the future and have a weighted average remaining contractual life of 5.48 years.
(4)The number granted represents the number of shares issuable upon vesting of time-based restricted stock units and performance-based restricted stock units, assuming the Company performs at the target performance level in each year of the three-year performance period.
Stock Options
As of September 30, 2025, the aggregate intrinsic value for all options outstanding and options exercisable was $23 million. The intrinsic value of options exercised during fiscal 2025, 2024 and 2023 was $6 million, $17 million and $2 million, respectively, and the Company received cash of $9 million, $20 million and $4 million, respectively, from these exercises. The Company recognized a tax benefit of $1 million in fiscal 2025, a tax benefit of $2 million in fiscal 2024 and immaterial tax benefits in fiscal 2023 from the exercise of stock options which were included in (Provision) benefit for income taxes within the Consolidated Statements of Operations.
The Company uses the Black-Scholes option-pricing model to estimate the fair value of the options at the grant date. The weighted average grant date fair values of options granted during fiscal 2025, 2024 and 2023 was $44.96, $27.42, and $26.28 per option, respectively. The fair values on the grant date were calculated using the following weighted-average assumptions:
Years Ended September 30
Expected stock price volatility
%
%
%
Risk free interest rate
4.4
%
4.8
%
4.0
%
Expected life of options (years)
Expected annual dividends per year
$
1.72
$
1.60
$
1.48
The expected stock price volatility assumption was determined using the historical volatility of the Company’s common stock over the expected life of the option. The expected term reflects the anticipated time period between the measurement date and the exercise date or post-vesting cancellation date.
Restricted Stock Units
The value of restricted stock unit awards is the closing stock price at the date of the grant. The weighted average grant date fair values of restricted stock unit awards granted during fiscal 2025, 2024 and 2023 was $110.67, $75.98 and $73.68, respectively. The intrinsic value of restricted stock units (meaning the fair value of the units on the date of vesting) that vested during fiscal 2025, 2024 and 2023 was $32 million, $37 million and $20 million, respectively.
Supplemental 401(k) Plan
Cabot’s Deferred Compensation and Supplemental Retirement Plan (“SERP 401(k)”) provides benefits to highly compensated employees when the retirement plan limits established under the Internal Revenue Code prevent them from receiving all of the Company matching and retirement contributions that would otherwise be provided under the qualified 401(k) plan. The SERP 401(k) is non-qualified and unfunded. Contributions under the SERP 401(k) are treated as if invested in Cabot common stock. The majority of the distributions made under the SERP 401(k) are required to be paid with shares of Cabot common stock. The remaining distributions, which relate to certain grandfathered accounts, will be paid in cash based on the market price of Cabot common stock at the time of distribution. The aggregate value of the accounts that will be paid out in stock, which is equivalent to approximately 110,000 and 117,000 shares of Cabot common stock as of September 30, 2025 and 2024, respectively, is reflected at historic cost in stockholders’ equity, and the aggregate value of the accounts that will be paid in cash, which was immaterial as of September 30, 2025 and 2024, was included in Other liabilities in the Consolidated Balance Sheets and marked-to-market quarterly.
Note N. Restructuring
2025 Reorganizations
During fiscal 2025, the Company undertook various actions that it believes have enabled the more efficient operation of the Company and reduced ongoing operational costs. These restructuring actions have resulted in reductions in workforce across business and functional teams. Under this plan, the Company recorded total charges of $10 million, primarily related to severance costs. The Company expects to record additional restructuring charges of $1 million and have cash payments of $7 million related to this plan in fiscal 2026.
2024 Reorganizations
During fiscal 2024, the Company initiated restructuring activities in both its Reinforcement Materials segment (“RM Plan”) and its Performance Chemicals segment (“PC Plan”). Under the RM Plan, the Company closed its reinforcing carbons unit at the facility in Tianjin, China that the Company acquired from Tokai Carbon Group in February 2022, consolidating its reinforcing carbons operations and reducing ongoing operational costs. Under the PC Plan, the Company temporarily idled its aerogel manufacturing plant in Frankfurt, Germany and reorganized certain positions within the Performance Chemicals segment to reduce operating costs. The Company anticipates restarting its aerogel manufacturing plant in fiscal 2026. As part of these plans, the Company recorded charges of $1 million and $13 million in fiscal 2025 and 2024, respectively, primarily for severance related costs and accelerated depreciation. The Company expects to have cash payments of $1 million related to these plans in fiscal 2026.
Details of the 2024 and 2025 Reorganization restructuring activities and the related reserves are as follows:
Severance and
Employee Benefits
Accelerated Depreciation on Assets
Other
Total
(In millions)
Reserve at September 30, 2023
$
-
$
-
$
-
$
-
Charges
Costs charged against assets
-
(6
)
-
(6
)
Cash paid
(5
)
-
(1
)
(6
)
Reserve at September 30, 2024
-
-
Charges
-
Cash paid
(3
)
-
(1
)
(4
)
Reserve at September 30, 2025
$
$
-
$
$
Cabot’s restructuring reserves are reflected in Accounts payable and accrued liabilities on the Company’s Consolidated Balance Sheets.
Cabot’s restructuring activities were recorded in the Consolidated Statements of Operations as follows:
Years Ended September 30
(In millions)
Cost of sales
$
$
$
Selling and administrative expenses
-
Research and technical expenses
-
-
Total
$
$
$
Note O. Accumulated Other Comprehensive Income (Loss)
Changes in each component of AOCI, net of tax, are as follows for fiscal 2025 and 2024:
Currency
Translation
Adjustment
Pension and Other
Postretirement
Benefit Liability
Adjustment
Total
(In millions)
Balance at September 30, 2023 attributable to
Cabot Corporation
$
(353
)
$
(9
)
$
(362
)
Other comprehensive income (loss) before reclassifications
(5
)
Amounts reclassified from AOCI
(2
)
(4
)
(6
)
Less: Other comprehensive income (loss) attributable to
noncontrolling interests
-
Balance at September 30, 2024 attributable to
Cabot Corporation
(342
)
(18
)
(360
)
Other comprehensive income (loss) before reclassifications
(3
)
Amounts reclassified from AOCI
(2
)
-
Less: Other comprehensive income (loss) attributable to
noncontrolling interests
-
Balance at September 30, 2025 attributable to
Cabot Corporation
$
(316
)
$
(19
)
$
(335
)
The amounts reclassified out of AOCI and into the Consolidated Statements of Operations for fiscal 2025, 2024 and 2023 are as follows:
Affected Line Item in the Consolidated
Years Ended September 30
Statements of Operations
(In Millions)
Derivatives: net investment hedges
(Gains) losses reclassified to interest
expense
Interest expense
$
(5
)
$
(5
)
$
(6
)
(Gains) losses excluded from effectiveness
testing and amortized to interest expense
Interest expense
Pension and other postretirement benefit
liability adjustment
Amortization of actuarial losses and prior service
cost (credit)
Other income (expense)
(2
)
(2
)
Total before tax
$
(1
)
$
(5
)
$
(6
)
Note P. Earnings Per Share
The following tables summarize the components of the basic and diluted earnings per common share (“EPS”) computations:
Years Ended September 30
(In millions, except per share amounts)
Basic EPS:
Net income (loss) attributable to Cabot Corporation
$
$
$
Less: Dividends and dividend equivalents to participating
securities
Less: Undistributed earnings allocated to participating
securities(1)
Earnings (loss) allocated to common shareholders (numerator)
$
$
$
Weighted average common shares and participating
securities outstanding
54.5
56.0
57.3
Less: Participating securities(1)
0.8
0.9
1.2
Adjusted weighted average common shares
(denominator)
53.7
55.1
56.1
Per share amounts-basic:
Net income (loss) attributable to Cabot Corporation
$
6.07
$
6.79
$
7.79
Diluted EPS:
Earnings (loss) allocated to common shareholders
$
$
$
Plus: Earnings allocated to participating securities
Less: Adjusted earnings allocated to participating
securities(2)
Earnings (loss) available to common shares (numerator)
$
$
$
Adjusted weighted average common shares outstanding
53.7
55.1
56.1
Effect of dilutive securities:
Common shares issuable(3)
0.5
0.6
0.4
Adjusted weighted average common shares
(denominator)
54.2
55.7
56.5
Per share amounts-diluted:
Net income (loss) attributable to Cabot Corporation
$
6.02
$
6.72
$
7.73
(1)Participating securities consist of shares underlying unvested time-based restricted stock units (the "TSUs"), earned and unvested performance-based restricted stock units (the "PSUs", and referred to in this note collectively with the TSUs as the "RSUs"), stock units accounted for under the Supplemental 401(k) Plan portion of the Company’s Deferred Compensation and Supplemental Retirement Plan, and stock units and phantom stock units accounted for under the Company’s Non-Employee Directors’ Deferral Plan. The holders of RSUs are entitled to receive dividend equivalents, payable in cash, to the extent dividends are paid on the outstanding shares of Common Stock, and equal in value to the dividends that would have been paid in respect of the Common Stock underlying the RSU. The accounts of holders of stock units and phantom stock units are credited with dividend equivalents, which are payable, in stock or cash, as the case may be, with the distribution of account balances.
Undistributed earnings are the earnings which remain after dividends declared during the period are assumed to be distributed to the common and participating shareholders. Undistributed earnings are allocated to common and participating shareholders on the same basis as dividend distributions. The calculation of undistributed earnings is as follows:
Years Ended September 30
(In millions)
Calculation of undistributed earnings:
Net income (loss) attributable to Cabot Corporation
$
$
$
Less: Dividends declared on common stock
Less: Dividends and dividend equivalents to participating
securities
Undistributed earnings (loss)
$
$
$
Allocation of undistributed earnings:
Undistributed earnings (loss) allocated to common
shareholders
$
$
$
Undistributed earnings allocated to participating
securities
Undistributed earnings (loss)
$
$
$
(2)Undistributed earnings (loss) are adjusted for the assumed conversion of dilutive securities, which are described in (3) below, to common shares and then reallocated to participating securities.
(3)Represents incremental shares of common stock from the assumed exercise of stock options issued under Cabot’s equity incentive plans. For fiscal 2025, 2024 and 2023, 163,845, 152,917 and 138,966 incremental shares of common stock, respectively, were excluded from the calculation of diluted earnings per share because the inclusion of these shares would have been antidilutive.
Note Q. Income Taxes
Income from operations before income taxes and equity in net earnings of affiliated companies was as follows:
Years Ended September 30
(In millions)
Domestic
$
$
$
Foreign
Income from operations before income taxes and
equity in earnings of affiliated companies
$
$
$
Tax provision (benefit) for income taxes consisted of the following:
Years Ended September 30
(In millions)
U.S. federal and state:
Current
$
$
$
Deferred
(31
)
(156
)
Total
(17
)
(151
)
Foreign:
Current
Deferred
(7
)
(6
)
-
Total
Provision (benefit) for income taxes
$
$
$
(28
)
The provision (benefit) for income taxes differed from the provision for income taxes as calculated using the U.S. statutory rate as follows:
Years Ended September 30
(In millions)
Computed tax expense at the federal statutory rate
$
$
$
Foreign impact of taxation at different rates, repatriation,
valuation allowance, and other
Global Intangible Low Taxed Income (GILTI)
-
(3
)
Impact of increase (decrease) in valuation allowance on
U.S. deferred taxes
(13
)
(156
)
U.S. and state benefits from research and experimentation
activities
(3
)
(3
)
(2
)
Provision (settlement) of unrecognized tax benefits
Permanent differences, net
(2
)
(4
)
State taxes, net of federal effect
-
(2
)
(8
)
Provision (benefit) for income taxes
$
$
$
(28
)
Significant components of deferred income taxes were as follows:
September 30
(In millions)
Deferred tax assets:
Deferred expenses
$
$
Intangible assets
Inventory
Operating lease liability
Other
U.S. federal interest expense carryforward
Pension and other benefits
Net operating loss carryforwards ("NOLs")
Capital loss carryforwards
Foreign tax credit carryforwards
R&D credit carryforwards
Other business credit carryforwards
Subtotal
Valuation allowance
(516
)
(494
)
Total deferred tax assets
$
$
September 30
(In millions)
Deferred tax liabilities:
Property, plant and equipment
$
(67
)
$
(58
)
Right of use asset
(21
)
(23
)
Unremitted earnings of non-U.S. subsidiaries
(16
)
(16
)
Total deferred tax liabilities
$
(104
)
$
(97
)
The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit utilization of the existing deferred tax assets. When performing this assessment, the Company looks to the potential future reversal of existing taxable temporary differences, taxable income in carryback years and the feasibility of tax planning strategies and estimated future taxable income. Failure to achieve operating income targets resulting in a cumulative loss may change the Company’s assessment regarding the realization of Cabot’s deferred tax assets, resulting in valuation allowances
being recorded against some or all of the Company’s deferred tax assets. The need for a valuation allowance can also be affected by changes to tax laws, changes to statutory tax rates and changes to future taxable income estimates. A valuation allowance represents management’s best estimate of the non-realizable portion of the deferred tax assets. Any adjustments in a valuation allowance would result in an adjustment to Provision (benefit) for income taxes in the Consolidated Statement of Operations.
The One Big Beautiful Bill Act (“OBBBA”), was signed into law on July 4, 2025. The OBBBA includes numerous provisions that affect corporate taxation, including permanent extension of certain provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and restoration of favorable tax treatment for certain business provisions. ASC 740, “Income Taxes”, requires the effects of changes in tax laws to be recognized in the period in which the legislation is enacted. The impact of these changes required the Company to re-evaluate its deferred taxes and subsequently record an increase in the valuation allowance related to future anticipated expirations of tax credit carryforwards. The provisions in the legislation are generally effective for the Company beginning in fiscal 2026 and are not expected to have any additional material impact on the Company’s Consolidated Financial Statements.
Since 2020, the Company has maintained a valuation allowance against its net U.S. deferred tax assets. On a quarterly basis, the Company evaluates all positive and negative evidence to determine if a valuation allowance is required. Based on updated forecasts of future taxable income and changes in tax laws, the Company determined that it is more likely than not that a portion of its tax credit carryforwards would not be realizable and increased the valuation allowance recorded against its U.S. Deferred tax assets by $31 million for fiscal 2025, compared to a non-cash income tax benefit of $24 million recorded in fiscal 2024. The Company continues to maintain a valuation allowance in the U.S. against capital losses, interest expense limitation carryforwards, certain foreign tax credits, certain R&D tax credits, and all state deferred tax assets that the Company does not expect to realize.
The valuation allowance increased by $22 million from $494 million in fiscal 2024 to $516 million in fiscal 2025, primarily due an adjustment to the valuation allowance on U.S. foreign tax credits and R&D tax credits, which was partially offset by a decrease in valuation allowance on foreign deferred tax assets.
After the valuation allowance, approximately $30 million of foreign NOLs and less than $1 million of other tax credit carryforwards remained at September 30, 2025. The benefits of these carryforwards are dependent upon taxable income during the carryforward period in the jurisdictions in which they arose.
The following table provides detail surrounding the expiration dates of NOLs, capital loss and other tax credit carryforwards before valuation allowances:
Years Ending September 30
NOLs/Capital Losses
Credits
(In millions)
2026 - 2032
$
1,014
$
2033 and thereafter
Indefinite carryforwards
Total
$
2,237
$
As of September 30, 2025, provisions have not been made for non-U.S. withholding taxes or other applicable taxes on $2 billion of undistributed earnings of non-U.S. subsidiaries as these earnings are considered indefinitely reinvested. It is not practicable to calculate the unrecognized deferred tax liability on undistributed earnings. Cabot continually reviews the financial position and forecasted cash flows of its U.S. consolidated group and foreign subsidiaries in order to reaffirm the Company’s intent and ability to continue to indefinitely reinvest earnings of its foreign subsidiaries or whether such earnings will need to be repatriated in the foreseeable future. Such review encompasses operational needs and future capital investments. From time to time, however, the Company’s intentions relative to specific indefinitely reinvested amounts change because of certain unique circumstances. These earnings could become subject to non-U.S. withholding taxes and other applicable taxes if they were remitted to the U.S.
A reconciliation of the beginning and ending amount of unrecognized tax benefits for fiscal 2025, 2024 and 2023 is as follows:
Years Ended September 30
(In millions)
Balance at beginning of the year
$
$
$
Additions based on tax positions related to the current
year
Additions for tax positions of prior years
-
Reductions of tax positions of prior years
(2
)
(1
)
(137
)
Reductions related to settlements
(1
)
(1
)
(2
)
Reductions from lapse of statute of limitations
-
-
(1
)
Balance at end of the year
$
$
$
Cabot has filed its tax returns in accordance with the tax laws in each jurisdiction and recognizes tax benefits for uncertain tax positions when the position would more likely than not be sustained based on its technical merits and recognizes measurement adjustments when needed. As of September 30, 2025, the total amount of unrecognized tax benefits was $29 million, of which $9 million was recorded in Accounts payable and accrued liabilities, $9 million in Other liabilities in the Consolidated Balance Sheet and $11 million was offset against deferred tax assets. As of September 30, 2024, the total amount of unrecognized tax benefits was $22 million, of which $9 million was recorded in Other liabilities in the Consolidated Balance Sheet and $13 million was offset against deferred tax assets. In 2022, the Company reported an uncertain tax position of $137 million related to the initial anticipated filing position on the character of a portion of the tax loss from the Purification Solutions business divestiture. Upon completion of the U.S. Consolidated tax return in 2023, the Company reversed the $137 million unrecognized tax benefit which reflects the final position taken on the filed tax return. In addition, accruals of $13 million and $10 million were recorded for penalties and interest, as of September 30, 2025 and 2024, respectively. Total penalties and interest recorded in the Provision (benefit) for income taxes in the Consolidated Statements of Operations was $5 million in fiscal 2025 and 2024, and $2 million in fiscal 2023. If the unrecognized tax benefits were recognized as of September 30, 2025, there would be $29 million favorable impact on the Company’s tax provision before consideration of the impact of the potential need for valuation allowances.
Cabot and certain subsidiaries are under audit in a number of jurisdictions. In addition, certain statutes of limitations are scheduled to expire in the near future. It is reasonably possible that a further change in the unrecognized tax benefits may occur within the next twelve months related to the settlement of one or more of these audits or the lapse of applicable statutes of limitations; however, an estimated range of the impact on the unrecognized tax benefits cannot be quantified at this time.
Cabot is subject to taxation in the United States and various states and foreign jurisdictions. The 2022 through 2024 tax years remain subject to examination by the IRS and various tax years from 2019 through 2024 remain subject to examination by the respective state tax authorities. In foreign jurisdictions, various tax years from 2006 through 2024 remain subject to examination by their respective tax authorities.
Note R. Leases
The Company determines if an arrangement is or contains a lease at inception. The Company considers a contract to be or to contain a lease if the contract conveys the right to control the use of identified property, plant or equipment (an identified asset) for a period of time in exchange for consideration.
A lease liability is recorded at commencement for the net present value of future lease payments over the lease term. The discount rate used is generally the Company’s estimated incremental borrowing rate based on credit-adjusted and term-specific discount rates, using a third-party yield curve. A right of use (“ROU”) asset is recorded and recognized at commencement at the lease liability amount, adjusted for lease prepayments, initial direct costs incurred and lease incentives received. The Company’s lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.
In the normal course of its business, the Company enters as the lessee into various leases, primarily related to certain transportation vehicles, warehouse facilities, office space, and machinery and equipment. These leases have remaining lease terms between one and twelve years, some of which may include options to extend the leases for up to fifteen years or options to terminate the leases. The Company’s land leases have remaining lease terms up to seventy-seven years.
The Company has elected not to recognize short-term leases on the balance sheet for all underlying asset classes. Short-term leases are leases that, at the commencement date, have a lease term of twelve months or less and do not include a purchase option that the Company is reasonably certain to exercise. Short-term leases are expensed on a straight-line basis over the lease term.
The components of the Company’s lease costs were as follows:
Years Ended September 30
(In millions)
Operating lease cost
$
$
$
Finance lease cost
Total lease cost
$
$
$
Included within operating lease costs are short-term lease costs, which were $7 million in each of fiscal 2025, 2024 and 2023. Some lease arrangements require variable payments that are dependent on usage, output, or index-based adjustments. Variable lease costs were $1 million in fiscal 2025 and $2 million in both fiscal 2024 and 2023.
Supplemental cash flow information related to the Company’s leases was as follows:
Years Ended September 30
(In millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
$
$
$
Operating cash flows from finance leases
Financing cash flows from finance leases
Right-of-use assets obtained in exchange for new operating lease
liabilities
$
$
$
Right-of-use assets obtained in exchange for new finance lease
liabilities
$
$
$
Supplemental balance sheet information related to the Company’s leases was as follows:
Description
Balance Sheet Classification
September 30, 2025
September 30, 2024
(In millions)
Lease ROU assets:
Operating
Other assets
$
$
Finance
Net property, plant and equipment
Total lease ROU assets
$
$
Lease liabilities:
Current:
Operating
Accounts payable and accrued liabilities
$
$
Finance
Current portion of long-term debt
Long-term:
Operating
Other liabilities
Finance
Long-term debt
Total lease liabilities
$
$
The following table presents the weighted-average remaining lease term and discount rates for the Company’s leases:
Description
September 30, 2025
September 30, 2024
Weighted-average remaining lease term (years):
Operating leases
Finance leases
Weighted-average discount rate:
Operating leases
3.22
%
3.11
%
Finance leases
4.69
%
5.09
%
Future minimum lease payments under non-cancelable operating and finance leases as of September 30, 2025 were as follows:
Years Ending September 30
Operating leases
Finance leases
(In millions)
$
$
2031 and thereafter
Total lease payments
Less: imputed interest
Total
$
$
Note S. Commitments and Contingencies
Other Long-Term Commitments
Cabot has entered into long-term purchase agreements primarily for the purchase of raw materials. Under certain of these agreements, the quantity of material being purchased is fixed, but the price paid changes as market prices change. Raw materials purchased under these agreements were $262 million, $280 million and $370 million during fiscal 2025, 2024 and 2023, respectively. Included in those raw materials purchased are purchases from noncontrolling shareholders of consolidated subsidiaries of $124 million, $138 million and $192 million during fiscal 2025, 2024 and 2023, respectively. Accounts payable and accrued liabilities owed to noncontrolling shareholders as of September 30, 2025 and 2024, were $8 million and $12 million, respectively. For these purchase commitments, the amounts included in the table below are based on market prices as of September 30, 2025 which may differ from actual market prices at the time of purchase. The Company has also entered into long-term purchase agreements primarily for services related to information technology, which are included in Other in the table below.
Payments Due by Fiscal Year
Thereafter
Total
(In millions)
Reinforcement Materials
$
$
$
$
$
$
$
1,427
Performance Chemicals
$
Other
$
Total
$
$
$
$
$
$
1,037
$
1,745
Guarantee Agreements
Cabot has provided certain indemnities pursuant to which it may be required to make payments to an indemnified party in connection with certain transactions and agreements. In connection with certain acquisitions and divestitures, Cabot has provided routine indemnities with respect to such matters as environmental, tax, insurance, product and employee liabilities. In connection with various other agreements, including service and supply agreements with customers, Cabot has provided indemnities for certain contingencies and routine warranties. Cabot is unable to estimate the maximum potential liability for these types of indemnities as a maximum obligation is not explicitly stated in most cases and the amounts, if any, are dependent upon the outcome of future contingent events, the nature and likelihood of which cannot be reasonably estimated. The duration of the indemnities varies, and in many cases are indefinite. Cabot has not recorded any liability for these indemnities in the consolidated financial statements, except as otherwise disclosed.
Self-Insurance and Retention for Certain Contingencies
The Company is partially self-insured for certain third-party liabilities globally, as well as workers’ compensation and employee medical benefits in the United States. The third-party and workers’ compensation liabilities are managed through a wholly-owned insurance captive and the related liabilities are included in the consolidated financial statements. The employee medical obligations are managed by a third-party provider and the related liabilities are included in the consolidated financial statements. To limit Cabot’s potential liabilities for these risks, however, the Company purchases insurance from third parties that provides stop-loss protection. The self-insured liability in fiscal 2025 for third-party liabilities was $500,000 per accident for auto, $2 million per occurrence for all other, $1 million per accident for U.S. workers’ compensation, and the retention for medical costs in the United States is at most $300,000 per person per annum.
Contingencies
Cabot is a defendant, or potentially responsible party, in various lawsuits and environmental proceedings wherein substantial amounts are claimed or at issue.
Environmental Matters
As of both September 30, 2025 and 2024, Cabot had $5 million reserved for environmental matters, almost all of which is for operation and maintenance work, and is included in Accounts payable and accrued liabilities and Other liabilities in the Consolidated Balance sheets. These environmental matters mainly relate to former operations. The Company’s reserves for environmental matters represent Cabot’s best estimates of the probable costs to be incurred at those sites where costs are reasonably estimable based on the Company’s analysis of the extent of clean up required, alternative clean-up methods available, abilities of other responsible parties to contribute and its interpretation of laws and regulations applicable to each site. Cabot reviews the adequacy of the reserves as circumstances change at individual sites and adjusts the reserves as appropriate. Almost all of Cabot’s environmental issues relate to sites that are mature and have been investigated and studied and, in many cases, are subject to agreed upon remediation plans. However, depending on the results of future testing, changes in risk assessment practices, remediation techniques and regulatory requirements, newly discovered conditions, and other factors, it is reasonably possible that the Company could incur additional costs in excess of environmental reserves currently recorded. Management estimates, based on the latest available information, that any such future environmental remediation costs that are reasonably possible to be in excess of amounts already recorded would be immaterial to the Company’s consolidated financial statements.
Charges for environmental expenses were $1 million in each of fiscal 2025, 2024 and 2023, and are included in Cost of sales in the Consolidated Statements of Operations. Cash payments related to these environmental matters were $1 million in each of fiscal 2025, 2024 and 2023. The Company anticipates that expenditures related to these environmental matters will be made over a number of years.
In November 2013, Cabot entered into a Consent Decree with the EPA and the Louisiana Department of Environmental Quality (“LDEQ”) regarding Cabot’s three carbon black manufacturing facilities in the U.S. This settlement is related to EPA’s national enforcement initiative focused on the U.S. carbon black manufacturing sector alleging non-compliance with certain regulatory and permitting requirements under The Clean Air Act, including the New Source Review (“NSR”) construction permitting requirements. Pursuant to this settlement, Cabot has installed technology controls for the reduction of sulfur dioxide and nitrogen oxide emissions at two of its plants and is in the process of installing these controls at the third plant. Cabot is currently in discussions with the EPA and LDEQ to extend its compliance date at the third plant. In addition, under the Province of Ontario Ministry of Environment, Conservation and Parks’ (“MECP”) Regulation 419, a new requirement for sulfur dioxide (“SO2”) emissions went into effect on July 1, 2023 for Cabot’s reinforcing carbons plant in Sarnia, Ontario. Cabot is out of compliance with this new air standard, and under the terms of the current abatement plan the Company has in place with the MECP regarding this requirement, Cabot is required to install air pollution controls at the plant by July 1, 2028, with specified milestones before that date. To date, Cabot’s ability to operate its reinforcing carbons plant in Sarnia has not been restricted as the Company is working with MECP on a solution.
Respirator Liabilities
Cabot has exposure in connection with a safety respiratory products business that a subsidiary acquired from American Optical Corporation (“AO”) in an April 1990 asset purchase transaction. The subsidiary manufactured respirators under the AO brand and disposed of that business in July 1995. In connection with its acquisition of the business, the subsidiary agreed, in certain circumstances, to assume a portion of AO’s liabilities, including costs of legal fees together with amounts paid in settlements and judgments, allocable to AO respiratory products used prior to the 1990 purchase by the Cabot subsidiary. In exchange for the subsidiary’s assumption of certain of AO’s respirator liabilities, AO agreed to provide to the subsidiary the benefits of: (i) AO’s insurance coverage for the period prior to the 1990 acquisition and (ii) a former owner’s indemnity of AO holding it harmless from any liability allocable to AO respiratory products used prior to May 1982.
Generally, these respirator liabilities involve claims for personal injury, including asbestosis, silicosis and coal worker’s pneumoconiosis (“CWP”), allegedly resulting from the use of respirators that are alleged to have been negligently designed and/or labeled. At no time did this respiratory product line represent a significant portion of the respirator market.
The subsidiary transferred the business to Aearo Technologies (“Aearo”) in July 1995. Cabot agreed to have the subsidiary retain certain liabilities associated with exposure to asbestos and silica while using respirators prior to the 1995 transaction so long as Aearo paid, and continues to pay, Cabot an annual fee of $400,000. Aearo can discontinue payment of the fee at any time, in which case it will assume the responsibility for and indemnify Cabot against those liabilities which Cabot’s subsidiary had agreed to retain. The Company anticipates that it will continue to receive payment of the $400,000 fee from Aearo and thereby retain these liabilities for the foreseeable future. Cabot has no liability in connection with any products manufactured by Aearo after 1995. Because of the difficulty in determining when a particular respirator was manufactured, Aearo and Cabot have applied the retention of liabilities under the 1995 agreement to claims arising out of the alleged use of respirators involving exposure to asbestos, silica or silica products prior to January 1, 1997.
In addition to Cabot’s subsidiary and as described above, other parties are responsible for significant portions of the costs of respirator liabilities, leaving Cabot’s subsidiary with a portion of the liability in only some of the pending cases. These parties include Aearo, AO, AO’s insurers, another former owner and its insurers and a third-party manufacturer of respirators formerly sold under the AO brand and its insurers (collectively, with the Company’s subsidiary, the “Payor Group”).
Cabot has contributed to the Payor Group’s defense and settlement costs with respect to a percentage of pending claims depending on several factors, including the period of alleged product use.
The methodology used to estimate the liability addresses the complexities surrounding Cabot’s potential liability by making assumptions about Cabot’s likely exposure based on various factors, including the Payor Group’s historical experience with these claims, the number of future claims and the cost to resolve pending and future claims. Using those and other assumptions, the Company estimates the costs that would be incurred in defending and resolving both currently pending and future claims.
As of September 30, 2025 and 2024, the Company had $33 million and $35 million, respectively, reserved for its estimated share of liability for pending and future respirator claims and for defense costs, the majority of which the Company expects to incur over the next ten years. The reserve is included in Other liabilities and Accounts payable and accrued liabilities on the Consolidated Balance Sheets. In fiscal 2025, 2024 and 2023, the Company recorded a charge of nil, nil and $8 million, respectively, related to the respirator liability which was included in Selling and administrative expense in the Consolidated Statements of Operations.
The Company made payments related to its respirator liability of $2 million, $3 million and $9 million in fiscal 2025, 2024 and 2023, respectively.
The Company’s current estimate of the cost of its share of pending and future respirator liability claims is based on facts and circumstances existing at this time, including the number and nature of the remaining claims. Developments that could affect the Company’s estimate include, but are not limited to, (i) significant changes in the number of future claims, (ii) changes in the rate of dismissals without payment of pending claims, (iii) significant changes in the average cost of resolving claims, including potential settlements of groups of claims, (iv) significant changes in the legal costs of defending these claims, (v) changes in the nature of claims received or changes in the Company’s assessment of the viability of these claims, (vi) trial and appellate outcomes, (vii) changes in the law and procedure applicable to these claims, (viii) the financial viability of the parties that contribute to the payment of respirator claims, (ix) exhaustion or changes in the recoverability of the insurance coverage maintained by certain members of the Payor Group, or a change in the availability of the indemnity provided by a former owner of AO, (x) changes in the allocation of costs among the various parties paying legal and settlement costs, and (xi) a determination that the assumptions that were used to estimate Cabot’s share of liability are no longer reasonable. The Company cannot determine the impact of these potential developments on its current estimate of its share of liability for existing and future claims. Because reserves are limited to amounts that are probable and estimable as of a relevant measurement date, and there is inherent difficulty in projecting the impact of potential developments on Cabot’s share of liability for these existing and future claims, it is reasonably possible that the liabilities for existing and future claims could change in the near term and that change could be material.
Other Matters
The Company has various other lawsuits, claims and contingent liabilities arising in the ordinary course of its business and with respect to its divested businesses. The Company does not believe that any of these matters will have a material adverse effect on its financial position; however, litigation is inherently unpredictable. Cabot could incur judgments, enter into settlements or revise its expectations regarding the outcome of certain matters, and such developments could have a material impact on its results of operations in the period in which the amounts are accrued or its cash flows in the period in which the amounts are paid.
The Company is subject to indirect tax audits in jurisdictions where it has business operations. In 2025, Cabot recognized a $7 million indirect tax settlement which is presented in Other Income (Expense) in the Consolidated Statements of Operations. Cabot’s exposure from indirect tax audits is not expected to be material.
Note T. Supplier Financing Programs
The Company maintains supply chain finance agreements with third-party financial institutions. These agreements allow the Company’s participating suppliers to sell their receivables to such third-party financial institutions to receive payment earlier than the negotiated commercial terms between the supplier and the Company. Such sales are at the sole discretion of the supplier, and on terms and conditions that are negotiated between the supplier and the respective financial institution. The terms and conditions of the supplier invoice, including payment terms and amounts due, are not impacted by a supplier’s participation in the program. Pursuant to the supply chain finance agreements, the Company has agreed to pay financial institutions on the original due date of the applicable invoice. There are no guarantees associated with these programs. The Company's outstanding payment obligations to financial institutions related to supplier financing programs are included within Accounts payable and accrued liabilities on the Consolidated Balance Sheets. The payment obligations as of September 30, 2025 and 2024, respectively, are as follows:
(In millions)
Outstanding payment obligations at beginning of year
$
$
Invoices added to supplier finance program
Invoices paid to supplier finance program
(60
)
(53
)
Outstanding payment obligations at September 30
$
$
Note U. Financial Information by Segment & Geographic Area
Segment Information
The Company identifies a product line as an operating segment if: i) it engages in business activities from which it may earn revenues and incur expenses; ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is Cabot’s President and Chief Executive Officer, to make decisions about resources to be allocated to the segment and assess its performance; and iii) it has available discrete financial information.
Operating segments are aggregated into a reportable segment if the operating segments are determined to have similar economic characteristics and if the operating segments are similar in the following areas: i) nature of products and services; ii) nature of production processes; iii) type or class of customer for their products and services; iv) methods used to distribute the products or provide services; and v) if applicable, the nature of the regulatory environment. The Company has two reportable segments: Reinforcement Materials and Performance Chemicals. The Performance Chemicals reporting segment aggregates the specialty carbons, specialty compounds, fumed metal oxides, battery materials, inkjet colorants and aerogel product lines.
The CODM reviews Segment earnings before interest and taxes (“Segment EBIT”) at the operating segment level to allocate resources and to assess operating results and financial performance. The CODM reviews the change in the actual results compared to the same period forecast, the same period year-ago, and the prior sequential period on a quarterly basis. Segment EBIT includes all items that are controlled by the business segment and those management considers are representative of the fundamental on-going segment results.
Details of Segment EBIT including segment revenue and significant segment expenses regularly reviewed by the CODM are as follows:
Years Ended September 30
Reinforcement
Materials
Performance
Chemicals
Segment
Total
(In millions)
Segment revenues from external customers
$
2,341
$
1,250
$
3,591
Segment cost of sales(1)
(1,704
)
(921
)
(2,625
)
Segment operating expenses(1)(2)
(132
)
(139
)
(271
)
Other Segment Items(3)
Segment EBIT
$
$
$
Segment revenues from external customers
$
2,610
$
1,250
$
3,860
Segment cost of sales(1)
(1,927
)
(947
)
(2,874
)
Segment operating expenses(1)(2)
(148
)
(143
)
(291
)
Other Segment Items(3)
Segment EBIT
$
$
$
Segment revenues from external customers
$
2,563
$
1,225
$
3,788
Segment cost of sales(1)
(1,959
)
(974
)
(2,933
)
Segment operating expenses(1)(2)
(124
)
(129
)
(253
)
Other Segment Items(3)
Segment EBIT
$
$
$
(1)Segment cost of sales and Segment operating expenses exclude the items described in the reconciliation of segment earnings before interest and income taxes to Income (loss) from operations before income taxes and equity in earnings of affiliated companies.
(2)Segment operating expenses include Selling and administrative expenses and Research and technical expenses.
(3)Other segment items include Equity in earnings of affiliated companies, net of tax.
Reconciliation of Segment earnings before interest and income taxes to Income (loss) from operations before income taxes and equity in earnings of affiliated companies is as follows:
Years Ended September 30
(In millions)
Segment EBIT
$
$
$
Interest Expense
(76
)
(81
)
(90
)
Certain items (1)
(30
)
(59
)
(29
)
Unallocated corporate costs (2)
(52
)
(68
)
(54
)
General unallocated income (expense) (3)
Less: Equity in earnings of affiliated companies, net of tax(4)
Income (loss) from operations before income taxes and
equity in earnings of affiliated companies
$
$
$
(1)Certain items are items of expense and income that management does not consider representative of the Company’s fundamental on-going segment results and they are, therefore, excluded from Segment EBIT.
Details of the certain items for fiscal 2025, 2024, and 2023 are as follows:
Years Ended September 30
(In millions)
Global restructuring activities (Note N)
$
(11
)
$
(13
)
$
(4
)
Indirect tax settlement charges (Note S)
(7
)
-
-
Legal and environmental matters and reserves
(7
)
(2
)
(10
)
Employee benefit plan settlement and other charges (Note L)
(3
)
-
-
Acquisition and integration-related charges
(1
)
-
(4
)
Argentina controlled currency devaluation and other losses
(Note A)
-
(43
)
(7
)
Loss on sale of business
-
-
(3
)
Other certain items
(1
)
(1
)
(1
)
Total certain items
$
(30
)
$
(59
)
$
(29
)
(2)Unallocated corporate costs are not controlled by the segments and primarily benefit corporate interests.
(3)General unallocated income (expense) consists of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, interest and dividend income, the profit or loss related to the corporate adjustment for unearned revenue, and unrealized holding gains (losses) for investments. This does not include items of income or expense that are separately treated as Certain items.
(4)Equity in earnings of affiliated companies, net of tax is included in Segment EBIT and is removed to reconcile to Income (loss) from operations before taxes and equity in earnings of affiliated companies.
Other Financial information by reportable segment is as follows:
Years Ended September 30
Reinforcement
Materials
Performance
Chemicals
Segment
Total
Unallocated
and
Other(1)
Consolidated
Total
(In millions)
Revenues from external customers(2)
$
2,341
$
1,250
$
3,591
$
$
3,713
Depreciation and amortization
$
$
$
$
-
$
Equity in earnings of affiliated companies, net of tax
$
$
$
$
-
$
Assets(3)
$
1,822
$
1,500
$
3,322
$
$
3,815
Total expenditures for additions to long-lived
assets(4)
$
$
$
$
$
Revenues from external customers(2)
$
2,610
$
1,250
$
3,860
$
$
3,994
Depreciation and amortization
$
$
$
$
$
Equity in earnings of affiliated companies, net of tax
$
$
$
$
-
$
Assets(3)
$
1,751
$
1,494
$
3,245
$
$
3,736
Total expenditures for additions to long-lived
assets(4)
$
$
$
$
$
Revenues from external customers(2)
$
2,563
$
1,225
$
3,788
$
$
3,931
Depreciation and amortization
$
$
$
$
$
Equity in earnings of affiliated companies, net of tax
$
$
$
$
-
$
Assets(3)
$
1,632
$
1,473
$
3,105
$
$
3,604
Total expenditures for additions to long-lived
assets(4)
$
$
$
$
$
(1)Unallocated and Other includes certain items and eliminations necessary to reflect management’s reporting of operating segment results.
(2)Consolidated Total Revenues from external customers reconciles to Net sales and other operating revenues on the Consolidated Statements of Operations. Revenues from external customers that are categorized as Unallocated and Other are summarized as follows:
Years Ended September 30
(In millions)
Shipping and handling fees
$
$
$
Other
Total
$
$
$
(3)Unallocated and Other assets include cash, marketable securities, cost investments, income taxes receivable, deferred taxes, and headquarters’ assets.
(4)Expenditures for additions to long-lived assets include property, plant and equipment and intangible assets.
Geographic Information
Revenues from external customers attributable to an individual country, other than the U.S. and China, were not material for disclosure. Revenues from external customers by individual country are summarized as follows:
Years Ended September 30
(In millions)
United States
$
$
$
China
Other countries
2,112
2,278
2,221
Total
$
3,713
$
3,994
$
3,931
Each of the Company’s segments operates globally. Revenues from external customers are attributed to geographic region based on customer location. In addition to presenting Revenue from external customers by reportable segment, the following tables further disaggregate Revenue from external customers by geographic region.
Year Ended September 30, 2025
Reinforcement
Materials
Performance
Chemicals
Consolidated Total
(In millions)
Americas
$
$
$
1,317
Asia Pacific
1,401
Europe, Middle East and Africa
Segment revenues from external customers
2,341
1,250
3,591
Unallocated and other
Net sales and other operating revenues
$
3,713
Year Ended September 30, 2024
Reinforcement
Materials
Performance
Chemicals
Consolidated Total
(In millions)
Americas
$
1,056
$
$
1,434
Asia Pacific
1,015
1,521
Europe, Middle East and Africa
Segment revenues from external customers
2,610
1,250
3,860
Unallocated and other
Net sales and other operating revenues
$
3,994
Year Ended September 30, 2023
Reinforcement
Materials
Performance
Chemicals
Consolidated Total
(In millions)
Americas
$
1,046
$
$
1,425
Asia Pacific
$
1,486
Europe, Middle East and Africa
Segment revenues from external customers
2,563
1,225
$
3,788
Unallocated and other
Net sales and other operating revenues
$
3,931
Property, plant and equipment, net of accumulated depreciation, attributable to an individual country, other than the U.S. and China, were not material for disclosure. Property, plant and equipment is attributed to an individual country based on asset location and is summarized as follows:
Years Ended September 30
(In millions)
United States
$
$
China
Other countries
Total
$
1,711
$
1,534
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of Cabot Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Cabot Corporation and subsidiaries (the "Company") as of September 30, 2025 and 2024, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended September 30, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended September 30, 2025, in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of September 30, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 24, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Commitments and Contingencies - CWP Respirator Liabilities - Refer to Note S to the consolidated financial statements
Critical Audit Matter Description
The Company has exposure in connection with a safety respiratory products business previously owned by one of its subsidiaries. The respirator liabilities involve claims for personal injury, including asbestosis, silicosis, and coal worker’s pneumoconiosis (“CWP”).
We identified CWP respirator liabilities, which are part of the total respirator liabilities, as a critical audit matter because there is significant uncertainty related to the number of future claims and the estimate of the cost to resolve pending and future claims. Audit procedures around CWP respirator liabilities required a high degree of auditor judgment and an increased extent of effort and specialized skill, including the need to involve our actuarial specialists.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to respirator liabilities included the following, among others:
•We tested the effectiveness of controls over management’s review of the determination of the CWP respirator liabilities, and the assumptions and data utilized by management.
•We evaluated the method and assumptions used by management to estimate the CWP respirator liabilities by utilizing our actuarial specialists to assist with the calculation of an independent estimate of the CWP respirator liabilities, and comparing our estimate to the Company’s estimate.
•We assessed the appropriateness of the disclosures in the financial statements.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
November 24, 2025
We have served as the Company's auditor since 2007.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of Cabot Corporation
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Cabot Corporation and subsidiaries (the “Company”) as of September 30, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended September 30, 2025, of the Company and our report dated November 24, 2025, expressed an unqualified opinion on those financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
November 24, 2025

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
Cabot carried out an evaluation, under the supervision and with the participation of its management, including its principal executive officer and its principal financial officer, of the effectiveness of the Company’s disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of September 30, 2025. Based on that evaluation, Cabot’s principal executive officer and its principal financial officer concluded that the Company’s disclosure controls and procedures are effective with respect to the recording, processing, summarizing and reporting, within the time periods specified in the Securities and Exchange Commission’s rules and forms, of information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and such information is accumulated and communicated to management to allow timely decisions regarding required disclosure.
Management’s Annual Report on Internal Control Over Financial Reporting
Cabot’s management is responsible for establishing and maintaining adequate internal control over financial reporting for Cabot. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
•Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;
•Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
•Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.
Cabot’s management assessed the effectiveness of Cabot’s internal control over financial reporting as of September 30, 2025 based on the framework established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, Cabot’s management concluded that Cabot’s internal control over financial reporting was effective as of September 30, 2025.
Cabot’s internal control over financial reporting as of September 30, 2025 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report above.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting that occurred during the Company’s fiscal quarter ending September 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information
(b). During our fiscal quarter ended September 30, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended) entered into, modified (as to amount, price or timing of trades) or terminated (i) contracts, instructions or written plans for the purchase or sale of our securities that are intended to satisfy the conditions specified in Rule 10b5-1(c) under the Exchange Act for an affirmative defense against liability for trading in securities on the basis of material nonpublic information or (ii) non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K).

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance
Certain information regarding our executive officers is included at the end of Part I of this annual report under the heading “Information about our Executive Officers.”
Cabot has adopted a Code of Business Ethics that applies to all of the Company’s employees and directors, including the Chief Executive Officer, the Chief Financial Officer, the Controller and other senior financial officers. The Code of Business Ethics is posted on our website, www.cabotcorp.com (under the “About Cabot” caption under “Company”). We intend to satisfy the disclosure requirement regarding any amendment to, or waiver of, a provision of the Code of Business Ethics applicable to the Chief Executive Officer, the Chief Financial Officer, the Controller or other senior financial officers by posting such information on our website.
The other information required by this item will be included in our Proxy Statement for the 2026 Annual Meeting of Stockholders (“Proxy Statement”) and is herein incorporated by reference.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation
The information required by this item will be included in our Proxy Statement and is incorporated herein by reference.

---

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table provides information as of September 30, 2025 about: (i) the number of shares of common stock that may be issued upon exercise of outstanding options and vesting of outstanding restricted stock units; (ii) the weighted-average exercise price of outstanding options; and (iii) the number of shares of common stock available for future issuance under our active plans: the 2025 Long-Term Incentive Plan and the 2024 Non-Employee Director Plan. Each of our equity compensation plans has been approved by our stockholders.
Plan category
Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights
(a)(1)
Weighted-average
exercise price of
outstanding option,
warrants and rights
(b)(2)
Number of securities remaining
available for future issuance under
equity compensation plans
(excluding securities reflected in
column (a))
(c)(3)
Equity compensation plans approved by
security holders
1,981,192
$
61.96
4,177,781
Equity compensation plans not approved by
security holders
N/A
N/A
N/A
(1) Includes (i) 1,315,434 shares issuable upon exercise of outstanding stock options, (ii) 313,280 shares issuable upon vesting of outstanding time-based restricted stock units, (iii) 202,014 shares issuable upon vesting of outstanding performance-based restricted stock units based upon the achievement of the annual financial performance metrics for the three years within the three-year performance period of the fiscal 2023 awards, the first two years within the three-year performance period of the fiscal 2024 awards, and the first year within the three-year performance period of the fiscal 2025 awards; and (iv) 150,464 shares issuable upon vesting of the performance-based stock units attributable to year three of the 2024 awards and years two and three of the 2025 awards, assuming Cabot performs at the maximum performance level in each of those years. If, instead, Cabot performs at the target level of performance in those years, a total of 75,232 shares would be issuable for year three of the 2024 awards and years two and three of the 2025 awards.
(2) The weighted-average exercise price includes all outstanding stock options but does not include restricted stock units, which do not have an exercise price.
(3)	Of these shares (i) 3,846,821 shares remain available for future issuance under the 2025 Long-Term Incentive Plan, and (ii) 330,960 remain available for future issuance under the 2024 Non-Employee Director Plan.
The other information required by this item will be included in our Proxy Statement and is incorporated herein by reference

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by this item will be included in our Proxy Statement and is incorporated herein by reference.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accounting Fees and Services
The information required by this item will be included in our Proxy Statement and is incorporated herein by reference.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits, Financial Statement Schedules
(a)Financial Statements.
See “Index to Financial Statements” under Item 8 of this Form 10-K.
(b)Schedules.
The Schedules have been omitted since the required information is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements and notes thereto included in this Form 10-K.
(c)Exhibits. (Certain exhibits not included in copies of the Form 10-K sent to stockholders.)
The exhibit numbers in the Exhibit Index correspond to the numbers assigned to such exhibits in the Exhibit Table of Item 601 of Regulation S-K. Cabot will furnish to any stockholder, upon written request, any exhibit listed in the Exhibit Index, upon payment by such stockholder of the Company’s reasonable expenses in furnishing such exhibit.
Exhibit
Number
Description
3(a)
Restated Certificate of Incorporation of Cabot Corporation effective January 9, 2009 (incorporated herein by reference to Exhibit 3.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2008, file reference 1-5667, filed with the SEC on February 9, 2009).
3(b)
The By-laws of Cabot Corporation as amended May 11, 2023 (incorporated herein by reference to Exhibit 3.2 of Cabot’s Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023, file reference 1-5667, filed with the SEC on August 8, 2023).
4(a)
Indenture, dated as of December 1, 1987, between Cabot Corporation and The First National Bank of Boston, Trustee (the “Indenture”)(incorporated herein by reference to Exhibit 4(a)(i) of Cabot’s Annual Report on Form 10-K for its fiscal year ended September 30, 2017, file reference 1-5667, filed with the SEC on November 22, 2017).
4(a)(i)
Second Supplemental Indenture, dated as of January 31, 1997, between Cabot Corporation and State Street Bank and Trust Company, Trustee (incorporated herein by reference to Exhibit 4 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 1996, file reference 1-5667, filed with the SEC on February 14, 1997).
4(a)(ii)
Indenture, dated as of September 15, 2016, between Cabot Corporation and U.S. Bank National Association, as Trustee (incorporated herein by reference to Exhibit 4.1 of Cabot Corporation’s Current Report on Form 8-K dated September 15, 2016, file reference 1-5667, filed with the SEC on September 15, 2016).
4(a)(iii)
First Supplemental Indenture, dated as of September 15, 2016, between Cabot Corporation and U.S. Bank National Association, as Trustee, including the form of Global Note attached as Annex A thereto, supplementing the Indenture dated as of September 15, 2016 (incorporated herein by reference to Exhibit 4.2 of Cabot Corporation’s Current Report on Form 8-K dated September 15, 2016, file reference 1-5667, filed with the SEC on September 15, 2016).
4(a)(iv)
Second Supplemental Indenture, dated June 20, 2019, between Cabot Corporation and U.S. Bank National Association, including the form of Global Note attached as Annex A thereto supplementing the Indenture dates as of September 15, 2016 (incorporated by reference to Exhibit 4.1 of Cabot Corporation’s Current Report on Form 8-K dated June 20, 2019, file reference 1-5667, filed with the SEC on June 20, 2019).
Exhibit
Number
Description
4(a)(v)
Indenture, dated June 22, 2022, between Cabot Corporation and U.S. Bank Trust Company, National Association (incorporated herein by reference to Exhibit 4.1 of Cabot Corporation’s Current Report on Form 8-K dated June 22, 2022, file reference 1-5667, filed with SEC on June 22, 2022).
4(a)(vi)
First Supplemental Indenture, dated June 22, 2022, between Cabot Corporation and U.S. Bank Trust Company, National Association. including the form of Global Note attached as Annex A thereto, supplementing the Indenture dated as of June 22, 2022 (incorporated herein by reference to Exhibit 4.2 of Cabot Corporation’s Current Report on Form 8-K dated June 22, 2022, file reference 1-5667, filed with SEC on June 22, 2022).
4(b)
Description of Cabot Securities (incorporated by reference to Exhibit 4(b) of Cabot Corporation’s Annual Report on Form 10-K for its fiscal year ended September 30, 2019, file reference 1-5667, filed with the SEC on November 22, 2019).
10(a)
Credit Agreement, dated August 6, 2021, among Cabot Corporation, JPMorgan Chase Bank, N.A., J.P. Morgan Securities LLC, Citibank, N.A., Bank of America, N.A., Mizuho Bank, Ltd., TD Bank, N.A., and Wells Fargo Bank, National Association, and the other lenders party thereto (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021, file reference 1-5667, filed with the SEC on August 9, 2021).
10(a)(i)
Amendment No. 1, dated as of April 21, 2023, to Credit Agreement dated as of August 6, 2021, by and among Cabot Corporation, the designated borrowers, the lenders party thereto, and the Administrative Agent (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023, file reference 1-5667, filed with the SEC on August 8, 2023).
10(a)(ii)
Amendment No. 2, dated as of July 27, 2023, to Credit Agreement dated as of August 6, 2021, by and among Cabot Corporation, the designated borrowers, the lenders party thereto, and the Administrative Agent (incorporated herein by reference to Exhibit 10.2 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023, file reference 1-5667, filed with the SEC on August 8, 2023).
10(a)(iii)
Amendment No. 3, dated as of September 20, 2023, to Credit Agreement dated as of August 6, 2021, by and among Cabot Corporation, the designated borrowers, the lenders party thereto, and the Administrative Agent. (incorporated herein by reference to Exhibit 10(a)(iii) to Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-5667, filed with the SEC on November 22, 2023).
10(b)
Credit Agreement, dated as of May 18, 2023, among certain subsidiaries of Cabot Corporation, guaranteed by Cabot Corporation, PNC Bank, National Association, ING Bank. N.V., Dublin branch, U.S. Bank National Association, and Mizuho Bank, Ltd. (incorporated herein by reference to Exhibit 10.3 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023, file reference 1-5667, filed with the SEC on August 8, 2023).
10(c)*
2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2017, file reference 1-5667, filed with the SEC on May 8, 2017).
10(c)(i)*
Amended and Restated 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, file reference 1-5667, filed with the SEC on May 5, 2021).
10(c)(ii)*
Cabot Corporation 2025 Long-Term Incentive Plan (incorporated herein by reference to Appendix A of Cabot's Proxy Statement on Schedule 14A relating to the 2025 Annual Meeting of Stockholders, file reference 1-5667, filed with the SEC on January 24, 2025.
10(c)(iii)*
Form of Performance-Based Restricted Stock Unit Award Certificate under the Cabot Corporation 2025 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.2 of Cabot's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, file reference 1-5667, filed with the SEC on May 7, 2025).
Exhibit
Number
Description
10(c)(iv)*
Form of Time-Based Restricted Stock Unit Award Certificate under the Cabot Corporation 2025 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.2 of Cabot's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, file reference 1-5667, filed with the SEC on May 7, 2025).
10(c)(v)*
Form of Stock Option Award Certificate under the Cabot Corporation 2025 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.2 of Cabot's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, file reference 1-5667, filed with the SEC on May 7, 2025).
10(c)(vi)*
Cabot Corporation 2024 Non-Employee Director Plan (incorporated herein by reference to Appendix B of Cabot’s Proxy Statement on Schedule 14A relating to the 2024 Annual Meeting of Stockholders, file reference 1-5667, filed with the SEC on January 26, 2024).
10(c)(vii)*
Cabot Corporation 2018 Short-Term Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2018, file reference 1-5667, filed with the SEC on February 8, 2019).
10(d)*
Cabot Corporation Amended and Restated Senior Management Severance Protection Plan, dated March 9, 2012 (incorporated herein by reference to Exhibit 10.5 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012, file reference 1-5667, filed with the SEC on May 7, 2012).
10(e)*
Form of Performance-Based Restricted Stock Unit Award Certificate under the Cabot Corporation 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(e) of Cabot’s Annual Report on Form 10-K for its fiscal year ended September 30, 2018, file reference 1-5667, filed with the SEC on November 21, 2018).
10(f)*
Form of Time-Based Restricted Stock Unit Award Certificate under the Cabot Corporation 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(f) of Cabot’s Annual Report on Form 10-K for its fiscal year ended September 30, 2018, file reference 1-5667, filed with the SEC on November 21, 2018).
10(g)*
Form of Stock Option Award Certificate under the Cabot Corporation 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(g) of Cabot’s Annual Report on Form 10-K for its fiscal year ended September 30, 2018, file reference 1-5667, filed with the SEC on November 21, 2018).
10(h)*
Form of Amendment of outstanding Time-Based Restricted Stock Units, Performance-Based Restricted Stock Units and Stock Options issued under the Cabot Corporation Amended and Restated 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(h) of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-556, filed with the SEC on November 22, 2023).
10(i)*
Form of Time-Based Restricted Stock Unit Award Certificate under the Cabot Corporation Amended and Restated 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(i) of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-557, filed with the SEC on November 22, 2023).
10(j)*
Form of Performance-Based Restricted Stock Unit Award Certificate under the Cabot Corporation Amended and Restated 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(j) of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-557, filed with the SEC on November 22, 2023).
10(k)*
Form of Stock Option Award Certificate under the Cabot Corporation Amended and Restated 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10(k) of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-557, filed with the SEC on November 22, 2023).
10(l)*
Cabot Corporation Deferred Compensation and Supplemental Retirement Plan, amended and restated January 1, 2014 (incorporated herein by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2013, file reference 1-5667, filed with the SEC on February 6, 2014).
Exhibit
Number
Description
10(l)(i)*
Amendment to the Cabot Corporation Deferred Compensation and Supplemental Retirement Plan dated September 8, 2025
10(m)*
Cabot Corporation Non-Employee Directors’ Deferral Plan, amended and restated January 1, 2014 (incorporated herein by reference to Exhibit 10.2 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2013, file reference 1-5667, filed with the SEC on February 6, 2014).
10(n)*
Offer Letter dated February 12, 2021, between Cabot Corporation and Jeff Zhu, as amended by letter agreement dated February 4, 2021 (incorporated by reference to Exhibit 10.1 of Cabot’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2020, file reference 1-5667, filed with the SEC on February 5, 2021).
10(o)*
Offer Letter dated June 3, 2025, between Cabot Corporation and Matthew Wood.
10(p)*
Form of Indemnification Agreement (incorporated herein by reference to Exhibit 10(k) of Cabot’s Annual Report on Form 10-K for its fiscal year ended September 30, 2022, file reference 1-5667, filed with the SEC on November 23, 2022).
Cabot Corporation Policy on Transactions in Securities (incorporated herein by reference to Exhibit 19 of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-5667; as filed with the SEC on November 20, 2024.
21
Subsidiaries of Cabot Corporation.
23
Consent of Deloitte & Touche LLP.
31(i)
Certification of Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
31(ii)
Certification of Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
32
Certifications of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350.
97*
Cabot Corporation Policy for Recoupment of Incentive Compensation (incorporated herein by reference to Exhibit 97 of Cabot's Annual Report on Form 10-K for its fiscal year ended September 30, 2023, file reference 1-5667; as filed with the SEC on November 20, 2024.
101.INS
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH
Inline XBRL Taxonomy Extension Schema Document.
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104
Cover Page Interactive Data File (embedded within the Inline XBRL document).
* Management contract or compensatory plan or arrangement.
 Filed herewith.
 Furnished herewith.