Item 2. Properties.

We own or lease various manufacturing, office and research and development facilities in locations around the world. We own properties in Switzerland where our operations center and state-of-the-art research and development facility are located.

At December 31, 2025, we operated and owned a total of 50 manufacturing facilities across our segments. Among them, 11 factories produced heated tobacco units and 10 factories produced oral nicotine products.

In 2025, certain of our facilities each manufactured over 30 billion units (cigarettes and heated tobacco units combined). Our largest manufacturing facilities, in terms of cigarette and heated tobacco unit volume, are located in Turkey (SSEA, CIS & MEA), Russia (SSEA, CIS & MEA), Poland (Europe), Indonesia (SSEA, CIS & MEA), Italy (Europe), Czech Republic (Europe), Lithuania (Europe) and Portugal (Europe). Our largest nicotine pouch manufacturing facility is located in the United States. As part of our global operating model, products manufactured in a particular manufacturing facility are not necessarily distributed in the geographical region where the facility is located.

We have integrated the production of our heated tobacco units and nicotine pouches into a number of our existing manufacturing facilities, and we are progressing with our plans to build manufacturing capacity for our smoke-free products. We will continue to optimize our manufacturing infrastructure.

We believe the properties owned or leased by our subsidiaries are maintained in good condition and are believed to be suitable and adequate for our present needs in all material respects. For additional information related to our manufacturing facilities in Ukraine, see the "War in Ukraine" section of Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.