Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s discussion and analysis of financial condition and results of operations is provided as a supplement to, and should be read in conjunction with, the interim Consolidated Financial Statements and related notes to enhance the understanding of the Company’s operations and present business environment. Components of management’s discussion and analysis of financial condition and results of operations include:

• Overview

• Result of Operations

• Segment Results

• Changes in Financial Condition

OVERVIEW

DuPont is a global innovation leader with technology-based materials and solutions that help transform industries and everyday life by applying diverse science and expertise to help customers advance their best ideas and deliver essential innovations in key markets including electronics, transportation, building and construction, healthcare and worker safety.

As of September 30, 2023, the Company has $3.1 billion of working capital and approximately $1.3 billion in cash and cash equivalents. The Company expects its cash and cash equivalents, cash generated from operations, and ability to access the debt capital markets to provide sufficient liquidity and financial flexibility to meet the liquidity requirements associated with its continuing operations.

Outlined below are recent developments and material historical transactions impacting this Quarterly Report on Form 10-Q.

Mobility & Materials Divestitures

On November 1, 2022, DuPont completed the divestiture of the majority of its historical Mobility & Materials segment, including the Engineering Polymers business line and select product lines within the Advanced Solutions and Performance Resins business lines (the “M&M Divestiture”), to Celanese Corporation (“Celanese”). The divestiture was pursuant to the Transaction Agreement (the "Transaction Agreement") with Celanese entered on February 17, 2022 and announced on February 18, 2022. The Company also announced on February 18, 2022, that its Board of Directors approved the divestiture of the Delrin® acetal homopolymer (H-POM) business (the “Delrin® Divestiture”), subject to entry into a definitive agreement and satisfaction of customary closing conditions, (the Delrin® Divestiture and together with the M&M Divestiture, collectively the "M&M Divestitures” and the businesses in scope of the M&M Divestitures collectively the "M&M Businesses"). The Company determined that the M&M Businesses met the criteria to be classified as held for sale and that the sale represents a strategic shift that has a major effect on the Company’s operations and results. On November 1, 2023, DuPont completed the previously announced divestiture of 80.1 percent ownership interest in the Delrin® business to TJC LP ("TJC"). See Note 22 – to the interim Consolidated Financial Statements for additional information.

The financial position of DuPont as of September 30, 2023 and December 31, 2022, present the businesses to be divested as part of the Delrin® Divestiture, as discontinued operations. The results of operations for the three and nine months ended September 30, 2023, present the financial results of Delrin® as discontinued operations. The results of operations for the three and nine months ended September 30, 2022, present the financial results of the M&M Businesses as discontinued operations. For the nine months ended September 30, 2023, the interim Consolidated Statements of Cash Flows present the cash flows of Delrin® as discontinued operations. The interim Consolidated Statements of Cash Flows for the nine months ended September 30, 2022, present the cash flows from the M&M Businesses as discontinued operations. The comprehensive income of the M&M Businesses have not been segregated and are included in the interim Consolidated Statements of Comprehensive Income for all periods presented. Unless otherwise indicated, the information in the notes to the interim Consolidated Financial Statements refer only to DuPont's continuing operations and do not include discussion of balances or activity of the M&M Businesses. See Note 4 to the interim Consolidated Financial Statements for additional information.

Recent Developments

Macroeconomic Conditions

In the third quarter 2023, DuPont continued to experience the impact of macroeconomic factors including continued demand declines in consumer facing markets, channel inventory destocking and slower industrial demand in China. The ultimate extent to which these macroeconomic factors will continue to impact DuPont's results is not known.

Spectrum Acquisition

On August 1, 2023, the Company completed the acquisition of Spectrum Plastics Group (“Spectrum”) from AEA Investors (the “Spectrum Acquisition”). The net purchase price was approximately $1,792 million, including a net upward adjustment of approximately $43.1 million for acquired cash and net working capital, among other items. See Note 3 to the interim Consolidated Financial Statements for additional information.

Delrin® Divestiture

On November 1, 2023, DuPont completed the previously announced divestiture of 80.1 percent ownership interest in the Delrin® business to TJC LP ("TJC"). See Note 22 to the interim Consolidated Financial Statements for additional information.

Share Buyback Program

On September 6, 2023 the Company announced the completion of the $3.25 billion accelerated share repurchase ("ASR") transaction and the entry into a new accelerated share repurchase transaction with three financial counterparties to repurchase an aggregate of $2 billion of common stock (the "$2B ASR Transaction"). The $2B ASR Transaction effectively completes the Company's remaining share repurchase authorization. See Note 16 to the interim Consolidated Financial Statements for additional information.

Dividends

On October 17, 2023, the Board of Directors declared a fourth quarter 2023 dividend of $0.36 per share, payable on December 15, 2023, to shareholders of record on November 30, 2023.

On June 27, 2023, the Company announced that its Board of Directors declared a third quarter dividend of $0.36 per share which was paid on September 15, 2023, to shareholders of record on July 31, 2023.

RESULTS OF OPERATIONS

Summary of Sales Results			Three Months Ended September 30,						Nine Months Ended September 30,
In millions			2023			2022			2023			2022
Net sales			$	3,058		$	3,317		$	9,170		$	9,913

The following table summarizes sales variances by segment and geographic region from the prior year:

Sales Variances by Segment and Geographic Region
Percentage change from prior year			Three Months Ended September 30, 2023															Nine Months Ended September 30, 2023
Local Price & Product Mix			Currency			Volume			Portfolio & Other			Total			Local Price & Product Mix			Currency			Volume			Portfolio & Other			Total
Electronics & Industrial			(1)		%	—		%	(12)		%	4		%	(9)		%	1		%	(1)		%	(13)		%	—		%	(13)		%
Water & Protection			1			—			(9)			—			(8)			4			(1)			(5)			—			(2)
Corporate & Other 1			(1)			1			2			—			2			2			(1)			3			(9)			(5)
Total			—		%	—		%	(10)		%	2		%	(8)		%	2		%	(1)		%	(8)		%	—		%	(7)		%
U.S. & Canada			1		%	—		%	(11)		%	5		%	(5)		%	3		%	—		%	(8)		%	1		%	(4)		%
EMEA 2			3			4			(5)			—			2			4			—			(2)			—			2
Asia Pacific			(1)			(2)			(11)			(1)			(15)			1			(3)			(11)			(2)			(15)
Latin America			—			—			2			4			6			1			—			6			2			9
Total			—		%	—		%	(10)		%	2		%	(8)		%	2		%	(1)		%	(8)		%	—		%	(7)		%

1.Corporate & Other includes activities of the Retained Businesses, Biomaterials and previously divested businesses.

2.Europe, Middle East and Africa.

The Company reported net sales for the three months ended September 30, 2023 of $3.1 billion, down 8 percent from $3.3 billion for the three months ended September 30, 2022, due to a 10 percent decrease in volume partially offset by a 2 percent increase in portfolio actions. Volume decreases in Electronics & Industrial (down 12 percent) and Water & Protection (down 9 percent) were slightly offset by Corporate & Other (up 2 percent). Portfolio and other changes increased by 4 percent within Electronics & Industrial driven by the Spectrum Acquisition. Currency was flat compared with the same period last year, driven by EMEA (up 4 percent) offset by Asia Pacific (down 2 percent).

Net sales for the nine months ended September 30, 2023 of $9.2 billion, down 7 percent from $9.9 billion for the nine months ended September 30, 2022, due to a 8 percent decrease in volume and a 1 percent unfavorable currency impact, partially offset by a 2 percent increase in local price and product mix. Volume decreases in Electronics & Industrial (down 13 percent) and Water & Protection (down 5 percent) were slightly offset by Corporate & Other (up 3 percent). Local price and product mix increase was driven by Water & Protection (up 4 percent), Corporate & Other (up 2 percent) and Electronics & Industrial (up 1 percent). Local price and product mix increased across all regions. Currency was down 1 percent compared with the same period last year, driven by Asia Pacific (down 3 percent).

Cost of Sales

Cost of sales was $2.0 billion for the three months ended September 30, 2023, down slightly from $2.1 billion for the three months ended September 30, 2022. Cost of sales decreased for the three months ended September 30, 2023 primarily due to decreased sales volume.

Cost of sales as a percentage of net sales for the three months ended September 30, 2023 was 64 percent compared with 63 percent for the three months ended September 30, 2022. The increase as a percentage of sales for the three months ended September 30, 2023 as compared with the same period of the prior year was primarily due the impact of reduced production rates to better align inventory with demand partially offset by lower logistics and energy costs.

For the nine months ended September 30, 2023, cost of sales was $6.0 billion, down slightly from $6.4 billion for the nine months ended September 30, 2022. Cost of sales decreased for the nine months ended September 30, 2023 primarily due to decreased sales volume.

Cost of sales as a percentage of net sales for the nine months ended September 30, 2023 was 65 percent compared with 64 percent for the nine months ended September 30, 2022. The increase as a percentage of sales for the nine months ended September 30, 2023 as compared with the same period of the prior year was primarily due the impact of reduced production rates to better align inventory with demand.

Research and Development Expenses ("R&D")

R&D expenses totaled $128 million in the third quarter of 2023, down from $129 million in the third quarter of 2022. R&D as a percentage of net sales was consistent period over period at 4 percent for the three months ended September 30, 2023 and 2022.

For the first nine months of 2023, R&D expenses totaled $380 million down from $413 million in the first nine months of 2022. R&D as a percentage of net sales was consistent period over period at 4 percent for the nine months ended September 30, 2023 and 2022.

Selling, General and Administrative Expenses ("SG&A")

SG&A expenses were $360 million in the third quarter of 2023, up from $356 million in the third quarter of 2022. SG&A as a percentage of net sales was relatively consistent period over period at 12 percent and 11 percent for the three months ended September 30, 2023 and 2022. The slight increase for the three months ended September 30, 2023 as compared with the same period of the prior year was primarily due to incremental cost from the Spectrum Acquisition.

For the first nine months of 2023, SG&A expenses were $1,058 million down from $1,130 million in the first nine months of 2022. SG&A as a percentage of net sales was relatively consistent period over period at 12 percent and 11 percent for the nine months ended September 30, 2023 and 2022, respectively. The decline in SG&A expenses for the nine months ended September 30, 2023 as compared with the same period of the prior year was primarily due to lower stranded costs related to the M&M divestiture, lower personnel related expenses, lower bad debt expense and currency fluctuations.

Amortization of Intangibles

Amortization of intangibles was $155 million in the third quarter of 2023, up from $146 million in the third quarter of 2022. In the first nine months of 2023, amortization of intangibles was $448 million, up from $447 million in the same period of the prior year. The increase for the three and nine months ended September 30, 2023 as compared with the same period of the prior year was primarily due to the Spectrum Acquisition and currency fluctuations.

Restructuring and Asset Related Charges - Net

Restructuring and asset related charges - net were $8 million in the third quarter of 2023, up from zero charges in the third quarter of 2022. The activity in the third quarter of 2023 is primarily related to the 2022 Restructuring Program.

In the first nine months of 2023, restructuring and asset related charges - net were $39 million, down from $101 million in the same period last year. The activity for the nine months of 2023 is primarily related to the 2022 Restructuring Program. The activity for the first nine months of 2022 includes a $94 million impairment charge related to an equity method investment.

Acquisition, Integration and Separation Costs

Acquisition, integration and separation costs primarily consist of financial advisory, information technology, legal, accounting, consulting and other professional advisory fees. The Company recorded $9 million related to continuing operations for the three months ended September 30, 2023 and recorded costs of $7 million for the three months ended September 30, 2022*.* In the first nine months of 2023, acquisition, integration and separation costs were $15 million, down from $28 million in the same period of the prior year. For the three and nine months ended September 30, 2023, these costs were primarily associated with the Spectrum Acquisition. Comparatively, for three and nine months ended September 30, 2022, these costs were primarily associated with the divestiture of the Biomaterials business unit and the terminated agreement to acquire the outstanding shares of Rogers Corporation.

Equity in Earnings of Nonconsolidated Affiliates

The Company's share of the earnings of nonconsolidated affiliates was $11 million in the third quarter of 2023, down from $16 million in the third quarter of 2022. In the first nine months of 2023, the Company's share of the earnings of nonconsolidated affiliates was $40 million, down from $62 million in the first nine months of 2022. The 2022 earnings of equity affiliates includes a joint venture that was part of the divestiture of the Biomaterial division.

Sundry Income (Expense) - Net

Sundry income (expense) - net includes a variety of income and expense items such as foreign currency exchange gains or losses, interest income, dividends from investments, gains and losses on sales of investments and assets, non-operating pension and other post-employment benefit plan credits or costs, and certain litigation matters. Sundry income (expense) - net in the third quarter of 2023 was income of $55 million compared with income of $26 million in the third quarter of 2022. The third quarter of 2023 primarily related to interest income of $34 million and foreign currency exchange gains of $17 million. The third quarter of 2022 included income related to non-operating pension and other post-employment benefit credits of $7 million, interest income of $5 million, a $6 million adjustment to gain on prior divestitures and foreign currency exchange gains of $5 million.

In the first nine months of 2023, sundry income (expense) - net was income of $112 million compared with income of $123 million in the first nine months of 2022. The first nine months of 2023 included interest income of $132 million, partially offset by foreign currency exchange losses of $31 million. The first nine months of 2022 included benefits related to income related to non-operating pension and other post-employment benefit credits of $20 million, net gain on the sale of the Biomaterials business unit of $26 million and $37 million related to the sale of a land use right within the Water & Protection segment.

Interest Expense

Interest expense was $102 million and $128 million for the three months ended September 30, 2023 and 2022, respectively. Interest expense was $295 million and $370 million for the nine months ended September 30, 2023 and 2022, respectively. The decrease in interest expense from the prior year is primarily due to the redemption of $2.5 billion fixed-rate long-term senior unsecured notes due 2023 in November 2022.

Provision for Income Taxes on Continuing Operations

The Company's effective tax rate fluctuates based on, among other factors, where income is earned and the level of income relative to tax attribute. The effective tax rate on continuing operations for the third quarter of 2023 was 28.7 percent, compared with an effective tax rate of 27.9 percent for the third quarter of 2022. The higher effective tax rate for the third quarter of 2023 was due to the geographic mix of earnings offset by the U.S. taxation of foreign operations. For the first nine months of 2023, the effective tax rate on continuing operations was 25.6 percent, compared with 23.8 percent for the first nine months of 2022. The effective tax rate for the first nine months of 2023 was primarily due to a geographic mix of earnings. The lower effective tax rate for the first nine months of 2022 principally resulted from the recognition of a $94 million impairment charge of an equity method investment which resulted in a tax benefit of $29 million*.*

SEGMENT RESULTS

Effective February 2022, the revenues and certain expenses of the M&M Businesses are classified as discontinued operations in the current and historical periods. In addition, the Auto Adhesives & Fluids, MultibaseTM and Tedlar® product lines within the historical Mobility & Materials segment (the "Retained Businesses") are not included in the scope of the M&M Divestitures. Effective with the signing of the Transaction Agreement, the Retained Businesses were realigned to Corporate & Other. The reporting changes have been retrospectively reflected for all periods presented.

The costs of the M&M Businesses that are classified as discontinued operations include only direct operating expenses incurred prior to the November 1, 2022 M&M Divestiture and costs which the Company will no longer incur upon the close of the Delrin® Divestiture. Indirect costs, such as those related to corporate and shared service functions previously allocated to the M&M Businesses, do not meet the criteria for discontinued operations and remain reported within continuing operations. A portion of these indirect costs related to activities the Company continues to undertake post-closing of the M&M Divestiture, and for which it is and will be reimbursed (“Future Reimbursable Indirect Costs”). In addition, a portion of these indirect costs relates to activities the Company will perform post the close of the Delrin® Divestiture and for which it will be reimbursed. Future Reimbursable Indirect Costs are reported within continuing operations but are excluded from operating EBITDA as defined below. The remaining portion of these indirect costs are not subject to future reimbursement (“Stranded Costs”). Stranded Costs are reported within continuing operations in Corporate & Other and are included within Operating EBITDA.

On August 1, 2023, the Company completed the previously announced acquisition of Spectrum Plastics Group (“Spectrum”) from AEA Investors (the “Spectrum Acquisition”). Spectrum is part of the Electronics & Industrial segment.

The Company's measure of profit/loss for segment reporting purposes is Operating EBITDA as this is the manner in which the Company's chief operating decision maker ("CODM") assesses performance and allocates resources. The Company defines Operating EBITDA as earnings (i.e., “Income from continuing operations before income taxes") before interest, depreciation, amortization, non-operating pension / OPEB benefits / charges, and foreign exchange gains / losses, excluding Future Reimbursable Indirect Costs, and adjusted for significant items. Reconciliations of these measures can be found in Note 21 to the interim Consolidated Financial Statements.

ELECTRONICS & INDUSTRIAL

The Electronics & Industrial segment is a leading global supplier of differentiated materials and systems for a broad range of consumer electronics including mobile devices, medical devices, television monitors, personal computers and electronics used in a variety of industries. The segment is a leading provider of materials and solutions for the fabrication and packaging of semiconductors and integrated circuits and provides innovative solutions for thermal management and electromagnetic shielding as well as metallization processes for metal finishing, decorative, and industrial applications. Electronics & Industrial is a leading provider of platemaking systems and photopolymer plates for the packaging graphics industry, digital printing inks and cutting-edge materials for the manufacturing of displays for organic light emitting diode ("OLED"). In addition, the segment produces innovative engineering polymer solutions, high performance parts, flexible packaging products, plastic and silicone extrusions, medical silicones and specialty lubricants.

Electronics & Industrial			Three Months Ended						Nine Months Ended
In millions			September 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022
Net sales			$	1,368		$	1,511		$	3,976		$	4,574
Operating EBITDA			$	383		$	473		$	1,094		$	1,429
Equity earnings			$	3		$	7		$	11		$	26

Electronics & Industrial			Three Months Ended			Nine Months Ended
Percentage change from prior year			September 30, 2023			September 30, 2023
Change in Net Sales from Prior Period due to:
Local price & product mix			(1)		%	1		%
Currency			—			(1)
Volume			(12)			(13)
Portfolio & other			4			—
Total			(9)		%	(13)		%

Electronics & Industrial net sales were $1,368 million for the three months ended September 30, 2023, down 9 percent from $1,511 million for the three months ended September 30, 2022. Net sales decreased due to a 12 percent volume decline and a 1 percent decrease in local price and product mix, partially offset by a 4 percent increase in portfolio. Volume declines in Semiconductor Technologies were driven by the continuation of inventory destocking and reduced semiconductor fab utilization rates due to ongoing consumer electronics demand weakness, led by China. Volume declines in Interconnect Solutions related to decreased spending on consumer electronics including a continued slow recovery in China and channel inventory destocking. Within Industrial Solutions, volume declines were driven by channel inventory destocking within biopharma markets and continued lower demand in electronics-related markets, slightly offset by increased demand for OLED materials. The portfolio impact primarily reflects the acquisition of Spectrum.

Operating EBITDA was $383 million for the three months ended September 30, 2023, down 19 percent compared with $473 million for the three months ended September 30, 2022, primarily due to decreased sales volumes and the impact of reduced production rates slightly offset by lower input costs and the earnings associated with Spectrum.

Electronics & Industrial net sales were $3,976 million for the nine months ended September 30, 2023, down 13 percent from $4,574 million for the nine months ended September 30, 2022. Net sales decreased due to a 13 percent volume decline and offsetting 1 percent unfavorable currency decrease, partially offset by a 1 percent favorable local price and product mix increase. Volume declines in Semiconductor Technologies were driven by reduced semiconductor fab utilization rates due to ongoing consumer electronics demand weakness, led by China, and channel inventory destocking. Volume declines in Interconnect Solutions related to decreased spending on consumer electronics including a continued slow recovery in China and channel inventory destocking. Within Industrial Solutions, volume declines were driven by lower demand in electronics-related and advanced printing applications and channel inventory destocking within biopharma markets, partially offset by volume gains in aerospace and automotive. Local price and product mix gains in Semiconductor Technologies and Industrial Solutions are a result of actions taken to offset cost inflation were partially offset by declines in Interconnect Solutions. Unfavorable currency impact is driven by the Chinese Yuan and the Japanese Yen.

Operating EBITDA was $1,094 million for the nine months ended September 30, 2023, down 23 percent compared with $1,429 million for the nine months ended September 30, 2022, primarily due to decreased sales volumes and the impact of reduced production rates.

WATER & PROTECTION

The Water & Protection segment is a leading provider of engineered products and integrated systems for a number of industries including worker safety, water purification and separation, aerospace, energy, medical packaging and building materials. The segment satisfies the growing global needs of businesses, governments, and consumers for solutions that make life safer, healthier, and better. By uniting market-driven science with the strength of highly regarded brands, the segment strives to bring new products and solutions to solve customers' needs faster, better and more cost effectively.

Water & Protection			Three Months Ended						Nine Months Ended
In millions			September 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022
Net sales			$	1,413		$	1,534		$	4,356		$	4,460
Operating EBITDA			$	362		$	382		$	1,074		$	1,071
Equity earnings			$	8		$	9		$	29		$	31

Water & Protection			Three Months Ended			Nine Months Ended
Percentage change from prior year			September 30, 2023			September 30, 2023
Change in Net Sales from Prior Period due to:
Local price & product mix			1		%	4		%
Currency			—			(1)
Volume			(9)			(5)
Portfolio & other			—			—
Total			(8)		%	(2)		%

Water & Protection net sales were $1,413 million for the three months ended September 30, 2023, down 8 percent from $1,534 million for the three months ended September 30, 2022. The net sales decreased due to a 9 percent decline in volume partially offset by a 1 percent increase in local price. Volume declines within Safety Solutions due to a broad-based slowdown driven by aerospace, personal protection and defense markets. Shelter Solutions volume declines driven by continued weak demand in construction markets including channel inventory destocking. Water Solutions volume declines within Reverse Osmosis and Ultrafiltration were primarily due to weaker industrial demand and distributor inventory destocking in China. Local price and product mix gains are the result of broad-based actions taken in 2022 across all lines of business to offset cost inflation.

Operating EBITDA was $362 million for the three months ended September 30, 2023, down 5 percent compared with $382 million for the three months ended September 30, 2022, driven by decreased sales volumes partially offset by the impact of net pricing gains.

Water & Protection net sales were $4,356 million for the nine months ended September 30, 2023, down 2 percent from $4,460 million for the nine months ended September 30, 2022. Net sales decreased due a 5 percent decline in volume and a 1 percent unfavorable currency impact, partially offset by a 4 percent increase in local price. Volume declines were primarily driven by Shelter Solutions as a result of continued weak demand in construction markets, including channel inventory destocking, and to a much lesser extent within Safety Solutions related to weak demand in personal protection and commodity markets. These declines were slightly offset by volume gains in Water Solutions driven by Ion Exchange Resins and Systems. Local price and product mix gains are the result of broad-based actions taken in 2022 across all lines of business to offset cost inflation.

Operating EBITDA was $1,074 million for the nine months ended September 30, 2023, flat from $1,071 million for the nine months ended September 30, 2022, driven by net pricing gains, which were offset by lower volumes and unfavorable currency impacts driven by the Chinese Yuan and the Japanese Yen.

CORPORATE AND OTHER

Corporate & Other includes sales and activity of the Auto Adhesives & Fluids, MultibaseTM and Tedlar® product lines, (the "Retained Businesses"). The results of Corporate & Other for the nine months ended September 30, 2022 also includes the sales and activity of the Biomaterials business unit through its divestiture in May 2022. Corporate & Other also includes certain enterprise and governance activities including non-allocated corporate overhead costs and support functions, leveraged services, non-business aligned litigation expenses and other costs not absorbed by reportable segments. Related to the M&M Divestitures, Corporate & Other includes Future Reimbursable Indirect Costs.

Corporate & Other			Three Months Ended						Nine Months Ended
In millions			September 30, 2023			September 30, 2022			September 30, 2023			September 30, 2022
Net sales			$	277		$	272		$	838		$	879
Operating EBITDA			$	30		$	1		$	59		$	3
Equity earnings			$	—		$	—		$	—		$	5

CHANGES IN FINANCIAL CONDITION

Liquidity & Capital Resources

Information related to the Company's liquidity and capital resources can be found in the Company's 2022 Annual Report, Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, Liquidity and Capital Resources. Discussion below provides the updates to this information for the nine months ended September 30, 2023.

The Company continually reviews its sources of liquidity and debt portfolio and may make adjustments to one or both to ensure adequate liquidity and increase the Company’s optionality and financing efficiency as it relates to financing cost and balancing terms/maturities. The Company’s primary source of incremental liquidity is cash flows from operating activities. Management expects the generation of cash from operations and the ability to access the debt capital markets and other sources of liquidity will continue to provide sufficient liquidity and financial flexibility to meet the Company’s and its subsidiaries' obligations as they come due. However, DuPont is unable to predict the extent of macroeconomic related impacts which depend on uncertain and unpredictable future developments. In light of this uncertainty, the Company has taken steps to further ensure liquidity and capital resources, as discussed below.

In millions			September 30, 2023			December 31, 2022
Cash, cash equivalents and marketable securities			$	1,338		$	4,964
Total debt			$	8,215		$	8,074

The Company's cash, cash equivalents and marketable securities at September 30, 2023 and December 31, 2022 were $1.3 billion and $5.0 billion, respectively, of which approximately $1.2 billion at both September 30, 2023 and December 31, 2022 were held by subsidiaries in foreign countries, including United States territories. The balance in cash and cash equivalents held by subsidiaries in foreign countries is due to cash flows during the period, offset by repatriation. For each of its foreign subsidiaries, the Company makes an assertion regarding the amount of earnings intended for permanent reinvestment, with the balance available to be repatriated to the United States. Refer to subsequent paragraphs for drivers of the change in cash, cash equivalents and marketable securities.

Total debt at September 30, 2023 and December 31, 2022 was $8.2 billion and $8.1 billion, respectively. The increase was primarily due to the increase in commercial paper issuances partially offset by the mark-to-market impact of interest rate swap.

As of September 30, 2023, the Company is contractually obligated to make future cash payments of $8.2 billion and $5.1 billion associated with principal and interest, respectively, on debt obligations. Related to the principal, $300 million will be due in the next twelve months, and the remainder will be due subsequent to September 30, 2024. Related to interest, $399 million will be due in the next twelve months, and the remainder will be due subsequent to September 30, 2024.

Revolving Credit Facilities

On May 10, 2023, the Company entered into a new $1 billion 364-day revolving credit facility (the "364-Day Revolving Credit Facility"). The 364-Day Revolving Credit Facility will be used for general corporate purposes. There were no drawdowns of the facility during the nine month period ended September 30, 2023.

Commercial Paper

At September 30, 2023, the Company had $175 million issuances outstanding of commercial paper, none at December 31, 2022. The Company’s issuance under the Commercial Paper Program was used for general corporate purposes.

Water District Settlement Agreement

On July 10, 2023, the Water District Settlement Agreement was submitted to the Court for preliminary approval together with a motion seeking certification of the proposed settlement class. On August 22, 2023, the Court provided preliminary approval of the agreement. At the time of preliminary approval DuPont was obligated to contribute about $400 million to a Qualified Settlement Fund (the “Water District Settlement Fund”). The Company utilized the MOU escrow account balance of approximately $100 million and cash on hand to make the contribution to the Water District Settlement Fund. The $400 million contribution, plus interest, to the Water District Settlement Fund is reflected as "Restricted cash and cash equivalents" on the Condensed Consolidated Balance sheets. Final Court approval of the settlement is expected around six months after the preliminary approval. Upon Final Court approval the settlement will be reflected as a cash outflow within cash flows from discontinued operations.

See Note 14 to the interim Consolidated Financial Statement for additional information.

Spectrum Acquisition

On August 1, 2023, the Company completed the acquisition of Spectrum Plastics Group (“Spectrum”) from AEA Investors (“Spectrum Acquisition”) for a net purchase price was approximately $1,792 million, including a net upward adjustment of approximately $43.1 million for acquired cash and net working capital, among other items. The Company utilized existing cash balances to complete the acquisition.

Delrin® Divestiture

On November 1, 2023, DuPont completed the previously announced divestiture of 80.1 percent ownership interest in the Delrin® business to TJC LP ("TJC"). See Note 22 to the interim Consolidated Financial Statements for additional information.

Share Buyback Programs

In November 2022, DuPont’s Board of Directors approved a new share repurchase program authorizing the repurchase and retirement of up to $5 billion of common stock (the “$5B Share Buyback Program"). The $5B Share Buyback Program expires on June 30, 2024, unless extended or shortened by the Board of Directors.

In the fourth quarter 2022, DuPont entered into accelerated share repurchase ("ASR") agreements with three financial counterparties (the "$3.25B ASR Transaction"). DuPont paid with cash on hand an aggregate of $3.25 billion to the counterparties and received initial deliveries of 38.8 million shares in aggregate of DuPont common stock, which were retired immediately and recorded as a reduction to retained earnings of $2.6 billion. The $3.25B ASR Transaction was completed during the third quarter 2023 with DuPont receiving and retiring an additional 8.0 million shares of DuPont common stock. In connection with the completion the remaining $613 million was settled as a forward contract indexed to DuPont common stock at the time of settlement, classified within stockholders’ equity. At the completion of the $3.25B ASR Transaction, the Company had repurchased and retired a total of 46.8 million shares at an average price of $69.44 per share.

In the third quarter 2023, DuPont entered into new accelerated share repurchase agreements with three financial counterparties to repurchase an aggregate of $2.0 billion of common stock (the "$2B ASR Transaction"). DuPont paid an aggregate of $2.0 billion to the counterparties and received initial deliveries of 21.2 million shares in aggregate of DuPont common stock, which were retired immediately and recorded as a reduction to retained earnings of $1.6 billion. The remaining $400 million was evaluated as an unsettled forward contract indexed to DuPont common stock, classified within stockholders’ equity. The $2B ASR Transaction was funded with cash on hand and will expire in February 2024. The final number of shares to be repurchased will be based on the volume-weighted average stock price for DuPont common stock during the term of the $2B ASR Transaction, less an agreed upon discount. The completion of the $2B ASR Transaction will effectively complete the $5B Share Buyback Program and the Company's stock repurchase authorization.

See Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds, for additional information.

Credit Ratings

The Company's credit ratings impact its access to the debt capital markets and cost of capital. The Company remains committed to maintaining a strong financial position with a balanced financial policy focused on maintaining a strong investment-grade rating and driving shareholder value and remuneration. At October 31, 2023, DuPont's credit ratings were as follows:

Credit Ratings			Long-Term Rating			Short-Term Rating			Outlook
Standard & Poor’s			BBB+			A-2			Stable
Moody’s Investors Service			Baa1			P-2			Stable
Fitch Ratings			BBB+			F-2			Stable

The Company's indenture covenants include customary limitations on liens, sale and leaseback transactions, and mergers and consolidations, subject to certain limitations. The senior unsecured notes (the "2018 Senior Notes") also contain customary default provisions. The $1B 364-Day Revolving Credit Facility contains a financial covenant, typical for companies with similar credit ratings, requiring that the ratio of Total Indebtedness to Total Capitalization for the Company and its consolidated subsidiaries not exceed 0.60. At September 30, 2023, the Company was in compliance with this financial covenant.

Summary of Cash Flows

Beginning in the second quarter of 2023, the Company has segregated the cash flows from discontinued operations from the cash flows from continuing operations in accordance with ASC 230, Statement of Cash Flows. The interim Consolidated Statements of Cash Flows have been recast for all periods to reflect the change in presentation.

The Company’s cash flows from operating, investing and financing activities from continuing operations and cash used in discontinued operations, as reflected in the interim Consolidated Statements of Cash Flows, are summarized in the following table.

Cash Flow Summary			Nine Months Ended
In millions			September 30, 2023			September 30, 2022
Cash provided by (used for) from continuing operations:
Operating activities			$	1,545		$	1,064
Investing activities			$	(919)		$	(129)
Financing activities			$	(2,359)		$	(461)
Cash used in discontinued operations			$	(236)		$	(425)
Effect of exchange rate changes on cash, cash equivalents and restricted cash			$	(56)		$	(191)

Cash Flows from Operating Activities - Continuing Operations

In the first nine months of 2023, cash provided by operating activities of continuing operations was $1,545 million, compared with $1,064 million in the same period last year. The increase in cash provided by operating activities of continuing operations is primarily due to higher credit for deferred income tax and other tax related items and the release of cash from accounts and notes receivable and inventory partially offset by lower net income and cash used by accounts payable and other assets and liabilities.

The table below reflects net working capital on a continuing operations basis:

Net Working Capital 1			September 30, 2023			December 31, 2022
In millions (except ratio)
Current assets 2			$	6,621		$	9,979
Current liabilities			3,551			3,587
Net working capital			$	3,070		$	6,392
Current ratio			1.86:1			2.78:1

1.Net working capital has been presented to exclude the assets and liabilities related to the Delrin® Divestiture. The assets and liabilities related to the Delrin® Divestiture are presented as assets of discontinued operations and liabilities of discontinued operations, respectively.

2.The decrease in Current assets from December 31, 2022 to September 30,2023 is primarily related to activity within Cash and cash equivalents, as discussed within the preceding disclosures in the Liquidity & Capital Resources section above.

Cash Flows from Investing Activities - Continuing Operations

In the first nine months of 2023, cash used for investing activities of continuing operations was $919 million, compared with $129 million in the first nine months of 2022. The increase in cash used for investing activities of continuing operations is primarily attributable to the cash paid for the Spectrum acquisition and the absence of cash proceeds from the sale of businesses partially offset by the increase in cash provided by proceeds from sales and maturities of investments.

Cash Flows from Financing Activities - Continuing Operations

In the first nine months of 2023, cash used for financing activities of continuing operations was $2,359 million compared with $461 million in the same period last year. The increase in cash used for financing activities of continuing operations is primarily attributable to the purchase of common stock for the new $2 billion accelerated share repurchase transaction and lower cash provided by short-term borrowings. See Note 18 to the interim Consolidated Financial Statements for more information.

Cash Flows from Discontinued Operations

In the first nine months of 2023, cash used from discontinued operations was $236 million compared with $425 million in the same period last year. The cash used from discontinued operations includes MOU activity, refer to Note 4 to the interim Consolidated Financial Statements for additional information. For the nine months ended September 30, 2023, the interim Consolidated Statements of Cash Flows present the cash flows of Delrin® as discontinued operations. The interim Consolidated Statements of Cash Flows for the nine months ended September 30, 2022, present the financial results of the M&M Businesses as discontinued operations.

Dividends

On February 6, 2023, the Board of Directors declared a first quarter 2023 dividend of $0.36 per share, paid on March 15, 2023, to shareholders of record on February 28, 2023.

On April 19, 2023, the Board of Directors declared a second quarter 2023 dividend of $0.36 per share, paid on June 15, 2023, to shareholders of record on May 31, 2023.

On June 27, 2023, the Board of Directors declared a third quarter dividend of $0.36 per share paid on September 15, 2023, to shareholders of record on July 31, 2023.

On October 17, 2023, the Company announced that its Board declared a fourth quarter dividend of $0.36 per share payable on December 15, 2023, to shareholders of record on November 30, 2023.

Pension and Other Post-Employment Plans

DuPont expects to make additional contributions in the aggregate of approximately $19 million by year-end 2023 to pension and other post-employment benefit plans, including plans held in discontinued operations. Any such contribution could be funded by existing cash balances and/or cash from other available sources of liquidity.

Restructuring

In October 2022, the Company approved targeted restructuring actions to capture near-term cost reductions and to further simplify certain organizational structures following the M&M Divestitures (the "2022 Restructuring Program"). As a result in the fourth quarter 2022, the Company recorded pre-tax restructuring charges of $93 million inception to date, comprised of $80 million of severance and related benefit costs and $13 million of asset related charges. At September 30, 2023, total liabilities related to the 2022 Restructuring Program were $42 million for severance and related benefit costs, recognized in "Accrued and other current liabilities" in the Consolidated Balance Sheets. The Company expects the program to be substantially complete by the end of 2023.

See Note 6 to the interim Consolidated Financial Statements for more information on the Company's restructuring programs.