Financial Analysis

NOTE L LITIGATION, CLAIMS AND CONTINGENCIES Asbestos litigation Ashland is subject to liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims result from indemnification obligations undertaken in 1990 in connection with the sale of Riley and the acquisition of Hercules in November 2008. Although Riley, a former subsidiary, was neither a producer nor a manufacturer of asbestos, its industrial boilers contained some asbestos-containing components provided by other companies. Hercules, an indirect wholly-owned subsidiary of Ashland, has liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims typically arise from alleged exposure to asbestos fibers from resin encapsulated pipe and tank products sold by one of Hercules former subsidiaries to a limited industrial market. To assist in developing and annually updating independent reserve estimates for future asbestos claims and related costs given various assumptions for Ashland and Hercules asbestos claims, Ashland retained third party actuarial experts Gnarus. The methodology used by Gnarus to project future asbestos costs is based largely on recent experience, including claim-filing and settlement rates, disease mix, open claims and litigation defense. The claim experience of Ashland and Hercules are separately compared to the results of previously conducted third party epidemiological studies estimating the number of people likely to develop asbestos-relate …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"NOTE H DEBT AND OTHER FINANCING ACTIVITIES The following table summarizes Ashlands long-term debt as of: (In millions) June 30, 2026 September 30, 2025 3.375 % Senior Notes, due 2031 $ 450 $ 450 2.00 % Senior Notes, due 2028 (Euro 500 million principal) 571 586 6.875 % Notes, due 2043 282 282 6.50 % Junior Subordinated Notes, due 2029 76 72 Other (a) ( 5 ) ( 6 ) Long-term debt (less debt issuance costs) (b) $ 1,374 $ 1,384 (a) Other includes $ 9 million and $ 10 million of debt issuance costs as of June 30, 2026 and September 30, 2025 , respectively. (b) The current portion of the long-term debt was zero for both June 30, 2026 and September 30, 2025 . The scheduled aggregate maturities for long-term debt by year (excluding debt issuance costs) are as follows as of June 30, 2026 : zero 2026, $ 4 million in 2027, $ 571 million in 2028, $ 97 million in 2029, zero in 2030 and $ 450 million in 2031. Credit agreements and refinancing On May 28, 2026 (the Closing Date), Ashland Inc. and its Swiss subsidiary, Ashland Industries Europe GmbH (""the Swiss Borrower""), entered into a Second Amended and Restated Credit Agreement (the 2026 Credit Agreement). The 2026 Credit Agreement provides for a $ 500 million five-year revolving credit facility (including a $ 125 million letter of credit sublimit) (""The Revolving Facility""), which may be drawn by Ashland or the Swiss Borrower. The 2026 Credit Agreement amends and restates the Amended and Restated Credit Agreement dated as of July 22, …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Ashland disaggregates its revenue by reportable segment and geographical region as Ashland believes these categories best depict how management reviews the financial performance of its operations. Ashland includes only U.S. and Canada in its North America designation and includes Europe, the Middle East and Africa in its Europe designation. See the following tables for details. See Note Q for additional information. Sales by geography Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Life Sciences North America $ 33 $ 31 $ 92 $ 84 Europe 71 60 188 179 Asia Pacific 56 52 155 151 Latin America & other 20 19 56 54 $ 180 $ 162 $ 491 $ 468 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Personal Care North America $ 39 $ 35 $ 107 $ 116 Europe 59 59 165 163 Asia Pacific 38 34 102 94 Latin America & other 19 19 54 53 $ 155 $ 147 $ 428 $ 426 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Specialty Additives North America $ 48 $ 47 $ 127 $ 133 Europe 48 48 127 130 Asia Pacific 34 30 98 97 Latin America & other 6 6 20 20 $ 136 $ 131 $ 372 $ 380 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Intermediates North America $ 24 $ 21 $ 68 $ 69 Europe 7 9 17 20 Asia Pacific 4 2 12 10 Latin America & other 2 1 6 5 $ 37 $ 33 $ 103 $ 104

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NOTE O STOCK INCENTIVE PLANS The components of Ashlands pre-tax stock-based compensation expense included in continuing operations are as follows: Three months ended Nine months ended June 30 June 30 (In millions) 2026 (a) 2025 (b) 2026 (a) 2025 (b) Stock appreciation rights $ 1 $ $ 2 $ Nonvested stock awards 3 2 9 9 Performance share awards 2 1 5 3 $ 6 $ 3 $ 16 $ 12 (a) Included $ 1 million and $ 2 million of expense related to cash-settled nonvested restricted stock awards during the three and nine months ended June 30, 2026 , respectively, and zero and $ 1 million of expense related to cash-settled performance units during the three and nine months ended June 30, 2026 , respectively. (b) Included zero and $ 1 million of expense related to cash-settled nonvested restricted stock awards during the three and nine months ended June 30, 2025, respectively, and zero and income of $ 1 million related to cash-settled performance units during the three and nine months ended June 30, 2025 , respectively. …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

NOTE E FAIR VALUE MEASUREMENTS As required by U.S. GAAP, Ashland uses applicable guidance for defining fair value, the initial recording and periodic remeasurement of certain assets and liabilities measured at fair value and related disclosures for instruments measured at fair value. Fair value accounting guidance establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). An instruments categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the instruments fair value measurement. The three levels within the fair value hierarchy are described as follows. Level 1 Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3 Unobservable inputs for the asset or liability for which there is little, if any, market activity at the measurement date. Unobservable inputs reflect Ashlands own assump …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"NOTE G GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Ashland tests goodwill and other indefinite-lived intangible assets for impairment annually as of July 1 or whenever events and circumstances indicate an impairment may have occurred. No indicators of impairment were identified during the three and nine months ended June 30, 2026. During the three months ended June 30, 2025, Ashland performed an interim quantitative goodwill impairment assessment following a sustained decline in the market price of its Common Stock and weakened operating performance resulting from a challenging macroeconomic environment. The assessment indicated that the carrying values of the Life Sciences and Specialty Additives reporting units exceeded their estimated fair values. As a result, Ashland recorded non-cash goodwill impairment charges of $ 375 million and $ 331 million for the Life Sciences and Specialty Additives reporting units, respectively, for a total goodwill impairment charge of $ 706 million. The impairment charge was recorded within goodwill impairment in the Statements of Condensed Consolidated Comprehensive Income (Loss) during the three and nine months ended June 30, 2025. Prior to the impairment, goodwill balances associated with the Life Sciences and Specialty Additives reporting units were $ 841 million and $ 443 million, respectively. The goodwill impairment charges were not deductible for income tax purposes. The fair value estimates used in the interim quantitative impairme …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

NOTE J INCOME TAXES Current fiscal year Ashlands effective tax rate in any interim period is subject to adjustments related to discrete items and the mix of domestic and foreign operating results. The effective tax rate was 27 % and 30 % f or the three and nine months ended June 30, 2026, respectively. The tax rate for the three months ended June 30, 2026 , was primarily impacted by jurisdictional income mix and a net $ 3 million from unfavorable tax discrete items primarily related to cash repatriation and changes in uncertain tax positions. The tax rate for the nine months ended June 30, 2026 , was primarily impacted by jurisdictional income mix, as well as a net $ 4 million from unfavorable tax discrete items primarily related to cash repatriation, equity compensation adjustments and changes in uncertain tax positions. Prior fiscal year The effectiv e tax rate was negative 2 % and 2 % for the three and nine months ended June 30, 2025, respectively. The tax rate for the three months ended June 30, 2025, was primarily impacted by jurisdictional income mix, nondeductible goodwill impairment of $ 706 million and a net $ 16 million from unfavorable tax discrete items primarily related to return to provision adjustments and changes in uncertain tax positions. The tax rate for the nine months ended June 30, 2025 , was impacted by jurisdictional income mix, nondeductible goodwill impairment of $ 706 million, and a net $ 23 million from unfavorable tax discrete items primarily rela …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

NOTE I LEASING ARRANGEMENTS The components of lease cost recognized within the Statements of Condensed Consolidated Comprehensive Income (Loss) are as follows: Three months ended Nine months ended June 30 June 30 (In millions) Location 2026 2025 2026 2025 Lease cost: Operating lease cost Selling, general and administrative $ 3 $ 3 $ 9 $ 9 Operating lease cost Cost of sales 3 4 9 10 Variable lease cost Selling, general and administrative 1 1 4 4 Variable lease cost Cost of sales 1 1 3 5 Short-term leases (a) Cost of sales 1 1 3 Total lease cost $ 8 $ 10 $ 26 $ 31 (a) Zero denotes less than $1 million of activity. Right-of-use assets exchanged for new operating lease obligations were $ 1 million and $ 3 million for the three months ended June 30, 2026 and 2025 , respectively, and $ 5 million for both the nine months ended June 30, 2026 and 2025. The following table provides cash paid for amounts included in the measurement of lease liabilities: Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Operating cash flows from operating leases $ 6 $ 7 $ 19 $ 20 …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

New accounting pronouncements A description of new U.S. GAAP accounting standards issued or adopted during the current quarter is required in interim financial reporting. A detailed listing of new accounting standards relevant to Ashland is included in the Annual Report on Form 10-K for the fiscal year ended September 30, 2025 . There were no new accounting pronouncements recently adopted or issued since then that are expected to have a material impact on the Condensed Consolidated Financial Statements.

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NOTE K - EMPLOYEE BENEFIT PLANS Restructuring and plan remeasurement In June 2026, Ashland completed a buy-out transaction for certain retirees participating in two of its U.S. defined benefit pension plans. Under the buy-out transaction, the pension plans purchased group annuity contracts from an insurance company, which assumed responsibility for future benefit payments to the affected retirees. As a result, Ashland was relieved of the related pension obligations and derecognized the associated projected benefit obligations and related plan assets from its Condensed Consolidated Balance Sheet. The affected pension plans continue to operate following the transaction, with remaining active, deferred vested and retiree participants. The buy-in transaction triggered a remeasurement of the affected pension plans immediately prior to settlement. Based on the remeasurement and settlement accounting, Ashland recognized a settlement gain of $ 2 million within the other net periodic benefit (income) loss caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three and nine months ended June 30, 2026. As of June 30, 2026 , Ashland transferred approximately $ 30 million of projected benefit obligations and $ 28 million of related plan assets associated with the affected retirees to the insurance company. The remaining projected benefit obligations and related plan assets of the two pension plans continue to be reflected in Ashland's Condensed Consolidat …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

"NOTE D RESTRUCTURING ACTIVITIES Ashland periodically implements restructuring programs related to acquisitions, divestitures and other cost reduction programs in order to enhance profitability through streamlined operations and an improved overall cost structure. Restructuring costs During fiscal 2025, Ashland initiated a restructuring plan to offset the impact from the Nutraceuticals business sale completed in fiscal 2024, the Avoca business sale completed in fiscal 2025, and other portfolio optimization actions (""2025 Restructuring Program""). As a part of the 2025 Restructuring Program, Ashland is also advancing a multi-year manufacturing network optimization to improve operational cost and strengthen its competitive position. The 2025 Restructuring Program continued into fiscal 2026. During fiscal 2023, Ashland implemented targeted organizational restructuring actions to reduce costs (""2023 Restructuring Program""). The 2023 Restructuring Program is now completed. The following tables detail the amount of restructuring severance expense related to these programs. Three months ended June 30, 2026 Three months ended June 30, 2025 (In millions) Severance expense (a) Utilization (cash paid) Severance expense (a) Utilization (cash paid) 2025 Restructuring Program $ 1 $ ( 2 ) $ 4 $ ( 2 ) 2023 Restructuring Program ( 2 ) Total $ 1 $ ( 2 ) $ 4 $ ( 4 ) (a) Severance expense is recorded within the selling, general and administrative expense caption of the Statements of Condensed …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

"NOTE P REVENUE Disaggregation of revenue Ashland disaggregates its revenue by reportable segment and geographical region as Ashland believes these categories best depict how management reviews the financial performance of its operations. Ashland includes only U.S. and Canada in its North America designation and includes Europe, the Middle East and Africa in its Europe designation. See the following tables for details. See Note Q for additional information. Sales by geography Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Life Sciences North America $ 33 $ 31 $ 92 $ 84 Europe 71 60 188 179 Asia Pacific 56 52 155 151 Latin America & other 20 19 56 54 $ 180 $ 162 $ 491 $ 468 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Personal Care North America $ 39 $ 35 $ 107 $ 116 Europe 59 59 165 163 Asia Pacific 38 34 102 94 Latin America & other 19 19 54 53 $ 155 $ 147 $ 428 $ 426 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Specialty Additives North America $ 48 $ 47 $ 127 $ 133 Europe 48 48 127 130 Asia Pacific 34 30 98 97 Latin America & other 6 6 20 20 $ 136 $ 131 $ 372 $ 380 Three months ended Nine months ended June 30 June 30 (In millions) 2026 2025 2026 2025 Intermediates North America $ 24 $ 21 $ 68 $ 69 Europe 7 9 17 20 Asia Pacific 4 2 12 10 Latin America & other 2 1 6 5 $ 37 $ 33 $ 103 $ 104 Ashland has two product categories that represen …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"NOTE Q REPORTABLE SEGMENT INFORMATION Ashland determines its reportable segments based on how operations are managed internally for the products and services sold to customers, including how the results are reviewed by Guillermo Novo, Chair and Chief Executive Officer of the Company, which includes determining resource allocation methodologies used for reportable segments. EBITDA is the primary measures of performance that are reviewed by the chief operating decision maker in assessing each reportable segment's financial performance. Ashland does not aggregate operating segments to arrive at these reportable segments. Reportable segment business descriptions Life Sciences is comprised of pharmaceuticals, nutrition, agricultural chemicals, diagnostic films (formerly known as advanced materials) and fine chemicals. Pharmaceutical solutions include controlled release polymers, disintegrants, tablet coatings, thickeners, solubilizers and tablet binders. Nutrition solutions include thickeners, stabilizers, emulsifiers and additives for enhancing mouthfeel, controlling moisture migration, reducing oil uptake and binding structured foods. Customers include pharmaceutical, food, beverage, hospitals and radiologists manufacturers. Personal Care is comprised of biofunctionals, microbial protectants (preservatives), skin care, sun care, oral care, hair care and household. These businesses have a broad range of natural, nature-derived, biodegradable, and high-performance ingredients for …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"NOTE N EQUITY ITEMS 2023 Stock repurchase program On June 28, 2023, Ashland's board of directors authorized a new evergreen $ 1 billion common share repurchase program (""2023 Stock Repurchase Program""). As of June 30, 2026 , $ 520 million remained available for repurchase under the 2023 Stock Repurchase Program. The following table provides the common stock repurchase activity: Three months ended Nine months ended June 30 June 30 (In millions, except per share data) 2026 2025 2026 2025 Number of shares repurchased 1.50 Weighted-average price per share (a) $ $ $ $ 64.90 Aggregate purchase price (a) $ $ $ $ 100 (a) Includes transaction costs. Stockholder dividends On May 5, 2026, Ashland's Board declared a quarterly cash dividend of 42.0 cents per share on the Company's common stock representing a 1 % increase from the previous quarter. The dividend was paid in the third quarter of fiscal 2026. Dividends of 41.5 cents per share were paid in the first and second quarters of fiscal 2026, and the third and fourth quarters of fiscal 2025. Dividends of 40.5 cents per share were paid in both the first and second quarters of fiscal 2025. Accumulated other comprehensive loss Components of other comprehensive income (loss) recorded in the Statements of Condensed Consolidated Comprehensive Income (Loss) are presented below, before tax and net of tax effects: 2026 2025 (In millions) Before tax Tax expense Net of tax Before tax Tax benefit (expense) Net of tax Three months ended June 30 …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing