In February 2026, Qnity launched a multi‑year transformation plan, designed to strengthen operational productivity, enhance commercial and innovation excellence and optimize the Company’s presence in key markets. Costs incurred under this plan primarily comprise external consulting and separation services, severance, asset‑related charges, and program‑related operating costs.

As further discussed in Note 1, beginning in the first quarter of 2026, the Company combined its historical “Restructuring and asset‑related charges – net” financial‑statement line item with its historical “Acquisition, integration and separation costs” into a single operating expense caption titled “Transformation, integration and other charges.” This change represents a presentation change only, and does not represent a change in accounting principle. Consistent with SEC interim reporting requirements, prior‑period amounts presented herein have been recast to conform to the current‑period presentation. Although restructuring is no longer presented as a separate financial‑statement line item, the Company continues to monitor these charges as a discrete component of the new combined operating expense caption.


Reclassification of Prior-Period Amounts	Three Months Ended March 31, 2025
In millions
Restructuring and asset related charges – net	$	17
Acquisition, integration and separation costs	—
Transformation, integration and other charges (recast)	$	17

The following table presents the components of Transformation, integration and other charges by major cost category. Amounts include costs recognized under ASC 420 (exit and disposal activities), ASC 712 (compensation – nonretirement postemployment benefits), ASC 360 (asset impairments), and other transformation and integration costs.


Transformation, Integration and Other Charges by Cost Category	Three Months Ended March 31,
In millions	2026		2025
Pre-Separation restructuring programs1


Severance	$	(1)	$	17
Asset related charges	—		—
Total Pre-Separation restructuring programs	$	(1)	$	17
Qnity Transformation Plan



IT independence 2	$	24	$	—
Integration and other 2	3		—
Transformation initiative charges2	2		—
Total Qnity Transformation Plan	$	29	$	—
Total transformation, integration and other charges (recast)	$	28	$	17

1. This activity represents charges and credits related to DuPont-approved restructuring programs initiated prior to the Separation.

2. Charges primarily consist of external advisory services, professional fees, program management costs, internal program labor, and other operating expenses that are incremental and directly attributable to the Company’s transformation and separation activities. Internal program labor represents payroll costs for employees predominantly dedicated to the transformation and separation initiatives and reflects costs that are incremental to the Company’s normal operating activities.

Exit and disposal operations were a credit of $1 million and charges of $17 million for the three months ended March 31, 2026 and 2025, respectively. The entirety of these charges related to DuPont-approved restructuring programs that were initiated prior to the Separation. The total liability related to these programs was $3 million as of March 31, 2026, recorded in "Accrued and other current liabilities" in the interim Condensed Consolidated Balance Sheets.

Refer to Note 19 for the disaggregation of Transformation, integration and other charges incurred by segment. The Company expects the majority of the remaining cash outflows of the program to be incurred in the next two years.