SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2025

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies describe:

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our election to be taxed as a real estate investment trust,

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how we report our results,

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changes in how we report our results and

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how we account for certain key items.

REAL ESTATE INVESTMENT TRUST (REIT)

We are organized as a REIT. Our holding company and two subsidiaries, which collectively hold most of the timberland assets related to our Timberlands segment, each operate as a REIT for federal income tax purposes. We also own Taxable REIT Subsidiaries (TRSs), which collectively hold the assets relating to our Wood Products segment and portions of our Timberlands and Real Estate, Energy and Natural Resources (Real Estate & ENR) segments. REIT income can be distributed to shareholders without first paying corporate level tax, which substantially eliminates the double taxation of income. We expect to derive most of our REIT income from investments in timberlands, including the sale of standing timber through pay-as-cut sales contracts and lump sum timber deeds. We continue to be required to pay federal corporate income taxes on earnings of our TRSs.

HOW WE REPORT OUR RESULTS

Our report includes:

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consolidated financial statements,

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our business segments,

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estimates,

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fair value measurements and

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foreign currency translation.

Consolidated Financial Statements

Our consolidated financial statements provide an overall view of our results and financial condition. They include our accounts and the accounts of entities that we control, including majority-owned domestic and foreign subsidiaries.

They do not include our intercompany transactions and accounts, which are eliminated.

Throughout these Notes to Consolidated Financial Statements, unless specified otherwise, references to “Weyerhaeuser,” "the company," “we” and “our” refer to the consolidated company.

Our Business Segments

Reportable business segments are determined based on the company’s "management approach," as defined by Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. The management approach is based on the way the chief operating decision maker organizes the segments within a company for making decisions about resources to be allocated and assessing their performance.

We are principally engaged in:

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growing and harvesting timber;

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maximizing the value of our acreage through the sale of higher and better use (HBU) properties and monetizing the value of surface and subsurface assets through leases and royalties and

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manufacturing, distributing and selling products made from trees.

Our business segments are organized based primarily on products and services.


SEGMENT	PRODUCTS AND SERVICES
Timberlands	Logs, timber, recreational leases and other products.
Real Estate & ENR	Real Estate (sales of timberlands) and ENR (rights to explore for and extract hard minerals, construction materials, natural gas production, wind and solar).
Wood Products	Structural lumber, oriented strand board, engineered wood products and building materials distribution.

We also transfer raw materials, semi-finished materials and end products among our business segments. Because of this intracompany activity, accounting for our business segments involves pricing products transferred between our business segments at current market values.

Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses, interest income and other.

Estimates

We prepare our financial statements according to U.S. generally accepted accounting principles (U.S. GAAP). This requires us to make estimates and assumptions during our reporting periods and at the date of our financial statements. The estimates and assumptions affect our:

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reported amounts of assets, liabilities and equity;

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disclosure of contingent assets and liabilities and

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reported amounts of revenues and expenses.

While we believe the assumptions used in preparing these estimates are appropriate and reasonable, actual results can and do differ from those estimates and assumptions.

Fair Value Measurements

We use a fair value hierarchy in accounting for certain nonfinancial assets and liabilities including:

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long-lived assets (asset groups) measured at fair value for an impairment assessment;

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pension plan assets measured at fair value and

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asset retirement obligations initially measured at fair value.

The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions.

The fair value hierarchy consists of the following three levels:

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Level 1: Inputs are unadjusted quoted prices for identical assets or liabilities traded in an active market.

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Level 2: Inputs are quoted prices in non-active markets for which pricing inputs are observable either directly or indirectly at the reporting date.

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Level 3: Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.

Foreign Currency Translation

We translate foreign currencies into U.S. dollars in two ways:

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assets and liabilities — at the exchange rates in effect as of our balance sheet date and

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revenues and expenses — at average monthly exchange rates throughout the year.

CHANGES IN HOW WE REPORT OUR RESULTS

Changes in how we report our results come from:

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reclassification of certain balances and results from prior years to make them consistent with our current reporting and

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accounting changes made upon our adoption of new accounting guidance.

Reclassifications

We have reclassified certain balances and results from prior years to be consistent with our 2025 reporting. This makes balances comparable from year to year. Our reclassifications had no effect on consolidated net earnings or equity.

HOW WE ACCOUNT FOR CERTAIN KEY ITEMS

This section provides information about how we account for certain key items related to:

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capital investments,

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financing our business and

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our operations.

ITEMS RELATED TO CAPITAL INVESTMENTS

Key items related to accounting for capital investments pertain to property and equipment, timber and timberlands and impairment of long-lived assets.

Property and Equipment

We maintain property accounts on an individual asset basis and account for them as follows:

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Improvements to and replacements of major units of property are capitalized.

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Maintenance, repairs and minor replacements are expensed.

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Depreciation is calculated using a straight-line method at rates based on estimated service lives.

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Costs associated with logging roads that we intend to utilize for a period longer than one year are capitalized. These roads are then amortized over an estimated service life.

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Cost and accumulated depreciation of property sold or retired are removed from the accounts and the gain or loss is included in earnings.

Timber and Timberlands

We carry timber and timberlands at cost less depletion. Depletion refers to the carrying value of timber that is harvested or sold.

Key activities affecting how we account for timber and timberlands include:

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reforestation,

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depletion and

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forest management in Canada.

Reforestation. Generally, we capitalize initial site preparation and planting costs as reforestation and then expense costs after the first planting as they are incurred or over the period of expected benefit. These expensed costs include:

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fertilization,

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vegetation and insect control,

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pruning and precommercial thinning and

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property taxes.

Accounting practices for these costs do not change when timber becomes merchantable and harvesting starts.

Timber Depletion. To determine depletion rates, we divide the net carrying value of timber by the related volume of timber estimated to be available over the growth cycle. To determine the growth cycle volume of timber, we consider:

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regulatory and environmental constraints,

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our management strategies,

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inventory data improvements,

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growth rate revisions and recalibrations and

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known dispositions and inoperable acres.

In addition, the duration of the harvest cycle varies by geographic region and species of timber.

Depletion rate calculations do not include estimates for:

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future silviculture or sustainable forest management costs associated with existing stands;

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future reforestation costs associated with a stand's final harvest and

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future volume in connection with the replanting of a stand subsequent to its final harvest.

We include the cost of timber harvested in the carrying values of raw materials and product inventories. As these inventories are sold to third parties, we include them in costs of sales.

Forest Management in Canada. We manage timberlands under long-term licenses in various Canadian provinces that are:

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granted by the provincial governments;

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granted for initial periods of 15 to 25 years and

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renewable provided we meet reforestation, operating and management guidelines.

Calculation of the fees we pay on the timber we harvest:

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varies from province to province,

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is tied to product market pricing and

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depends upon the allocation of land management responsibilities in the license.

Impairment of Long-Lived Assets

We review the carrying value of long-lived assets whenever an event or a change in circumstance indicates that the carrying value of the asset or asset group may not be recoverable through future operations. The carrying value is the original cost, less accumulated depreciation and any past impairments recorded. If we evaluate recoverability, we are required to estimate future cash flows and residual values of the asset or asset group. Key assumptions used in developing estimates of future cash flows and residual values could include probability of alternative outcomes, product pricing, raw material cost and product sales. An impairment occurs when the carrying value of a long-lived asset is greater than the amount that could be recovered from the estimated undiscounted future cash flows of the asset and greater than fair market value (the amount we could receive if we were to sell the asset).

Impaired assets held for use are written down to fair value, while impaired assets held for sale are written down to fair value less cost to sell. We determine fair value based on:

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appraisals,

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market pricing of comparable assets,

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discounted value of estimated future cash flows from the asset,

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replacement values of comparable assets and

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agreed upon sale price or offer price.

Key assumptions used in developing estimates of fair value would include the estimated future cash flows used to assess recoverability, discount rates and probability of alternative outcomes.

ITEMS RELATED TO FINANCING OUR BUSINESS

Key items related to financing our business include financial instruments, cash equivalents and concentration of risk.

Financial Instruments

We estimate the fair value of financial instruments where appropriate. The assumptions we use — including the discount rate and estimates of cash flows — can significantly affect the fair value. These values are estimates and may not match the amounts we would realize upon sale or settlement of our financial positions.

Derivative Instruments. At times, we may manage exposure to certain risks by entering into derivative instruments. We do not enter into derivative instruments for speculative purposes.

We record all derivative instruments on our Consolidated Balance Sheet at fair value. We are allowed to net settle transactions with respective counterparties for certain derivative instruments; however, we have not offset derivative asset and liability balances on our Consolidated Balance Sheet.

For derivative instruments that are designated as hedging instruments in a qualifying cash flow hedge, the hedging instrument’s income or loss is reported as a component of other comprehensive income (loss) and recorded in accumulated other comprehensive loss on our Consolidated Balance Sheet. The income or loss is subsequently reclassified into net earnings when the hedged transaction affects net earnings in the same line item as the underlying hedged transaction in our Consolidated Statement of Operations. Where applicable, the initial value of hedged components excluded from the assessment of effectiveness are amortized over the life of the hedging instrument, using a systematic and rational method, and recognized in the same line item as the hedged transaction.

Cash flows from derivative instruments designated as hedging instruments are classified in the same category as the cash flows from the respective hedged transaction.

See Note 12: Fair Value of Financial Instruments.

Cash Equivalents

Cash equivalents are investments with maturities of 90 days or less at the date of purchase. We state cash equivalents at cost, which approximates market.

Concentration of Risk

We disclose customers that represent a concentration of risk. As of December 31, 2025 and December 31, 2024, no customer accounted for 10 percent or more of our net sales.

ITEMS RELATED TO OPERATIONS

Key items related to operations include revenue recognition, inventories, shipping and handling costs, income taxes, pension and other post-employment benefit plans and contingent liabilities.

Revenue Recognition

Refer to Note 3: Revenue Recognition for details on how we account for revenue.

Inventories

We state inventories at the lower of cost or net realizable value. Cost includes labor, materials and production overhead. LIFO applies to major inventory products held at our U.S. domestic locations. We began to use the LIFO method for domestic products in the 1940s as required to conform with the tax method elected. Subsequent acquisitions of entities added new products under the moving average cost or FIFO — the first-in, first-out — methods and those products continue to be recognized under those methods. The moving average cost or FIFO method applies to the balance of our domestic raw material and product inventories, all material and supply inventories and all foreign inventories.

Shipping and Handling Costs

We classify shipping and handling costs in "Costs of sales" in our Consolidated Statement of Operations.

Income Taxes

We account for income taxes under the asset and liability method. Unrecognized tax benefits represent potential future funding obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. Accrued interest and penalties related to unrecognized tax benefits are recognized as a component of income tax expense.

We recognize deferred tax assets and liabilities to reflect:

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future tax consequences due to differences between the carrying amounts for financial reporting purposes and the tax bases of certain items and

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net operating loss and tax credit carryforwards.

To measure deferred tax assets and liabilities, we:

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determine when the differences between carrying amounts and tax bases of affected items are expected to be recovered or resolved and

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use enacted tax rates expected to apply to taxable income in those years.

Pension and Other Post-Employment Benefit Plans

We recognize the overfunded or underfunded status of our defined benefit pension and other post-employment benefit plans on our Consolidated Balance Sheet and recognize changes in the funded status through comprehensive income (loss) in the year in which the changes occur.

Actuarial valuations determine the amount of the pension and other post-employment benefit obligations and the net periodic benefit cost we recognize. The net periodic benefit cost includes:

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cost of benefits provided in exchange for employees’ services rendered during the year;

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interest cost of the obligations;

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expected long-term return on plan assets;

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gains or losses on plan settlements and curtailments;

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amortization of prior service costs and plan amendments over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the participants affected by the plan amendment are inactive and

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amortization of cumulative unrecognized net actuarial gains and losses — generally in excess of 10 percent of the greater of the benefit obligation or the combination of market-related and fair value of plan assets at the beginning of the year — over the average remaining service period of the active employee group covered by the plans or the average remaining life expectancy in situations where the plan participants are inactive.

Pension plans. We have defined benefit pension plans covering approximately 30 percent of our employees. Determination of benefits differs for salaried, hourly and union employees as follows:

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Salaried employee benefits are based on each employee’s highest monthly earnings for five consecutive years during the final 10 years before retirement.

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Hourly and union employee benefits generally are stated amounts for each year of service.

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Union employee benefits are set through collective-bargaining agreements.

We contribute to our U.S. and Canadian pension plans according to established funding standards. The funding standards for the plans are:

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U.S. pension plans — according to the Employee Retirement Income Security Act of 1974 and

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Canadian pension plans — according to the applicable provincial pension act and the Income Tax Act.

Post-employment benefits other than pensions. We provide certain post-employment healthcare and life insurance benefits for some retired employees. In some cases, we pay a portion of the cost of the benefit. Note 8: Pension and Other Post-Employment Benefit Plans provides additional information about our post-employment benefit plans.

Estimates for pension and other post-employment benefit plans. Estimates we use in accounting for our pension and other post-employment benefit plans include the:

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fair value of our plan assets;

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expected long-term rate of return on plan assets and

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discount rates.

At the end of every year, we review our estimates with external advisers and make adjustments as appropriate. We use these estimates to calculate plan asset and liability information as of year-end as well as pension and post-employment expense for the following year. Actual experience that differs from our estimates and subsequent changes in our estimates could have a significant effect on our financial position, results of operations and cash flows.

Fair value of plan assets. Plan assets are assets of the pension plan trusts that fund the benefits provided under the pension plans. The fair value of our plan assets estimates the amount that would be received if we were to sell each asset in an orderly transaction between market participants at the reporting date. We estimate the fair value of these assets based on the information available during the year-end reporting process.

Refer to Note 8: Pension and Other Post-Employment Benefit Plans for information about the assets held within our pension plans and their related valuation methods.

Expected long-term rate of return on plan assets. Our expected long-term rate of return is our estimate of the return that our plan assets will earn over time. This rate is used in determining the net periodic benefit or cost we recognize for our plans.

Factors we consider in determining our expected long-term rate of return include:

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historical returns for a portfolio of assets similar to our expected allocation and

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expected future performance of similar asset classes.

The actual return on plan assets in any given year may vary from our expected long-term rate of return. Actual returns on plan assets affect the funded status of the plans. Differences between actual returns on plan assets and the expected long-term rate of return are reflected as adjustments to accumulated other comprehensive loss, a component of total equity.

Discount rates. Discount rates are used to estimate the net present value of our plan obligations. The discount rates are determined at the measurement date by matching current spot rates of high-quality corporate bonds with maturities similar to the timing of expected cash outflows for benefits.

Contingent Liabilities

We are subject to lawsuits, investigations and other claims related to environmental remediation, product and other matters, and are required to assess the likelihood of any adverse judgments or outcomes to these matters, as well as the amount or range of potential loss.

We record contingent liabilities when:

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it becomes probable that a loss has been incurred and

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the amount of loss can be reasonably estimated.

Assessing probability of loss and estimating the amount of loss can require analysis of multiple factors, such as:

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historical experience,

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evaluations of relevant legal and environmental authorities and regulations,

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judgments about the potential actions of third-party claimants and courts and

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consideration of potential environmental remediation methods.

In addition to contingent liabilities recorded for probable losses, we disclose contingent liabilities when there is a reasonable possibility that a loss may have been incurred.

Recorded contingent liabilities are based on the best information available and actual losses in any future period are inherently uncertain. Future expenditures for environmental remediation obligations are not discounted to their present value. If estimated probable future losses or actual losses exceed our recorded liability for such claims, we record additional charges. These exposures and proceedings can be significant and the ultimate outcomes could be material to our operating results or cash flows in any given period. Recoveries of environmental remediation costs from other parties are recorded as assets when the recovery is deemed probable and does not exceed the amount of losses previously recorded. See Note 13: Legal Proceedings, Commitments and Contingencies for more information.

NEW ACCOUNTING PRONOUNCEMENTS

Income Taxes

In 2025, we adopted the FASB Accounting Standards Update (ASU) 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, which expands annual income tax disclosures to disaggregate rate reconciliations and income taxes paid by nature and jurisdiction. The adoption of this standard did not impact our Consolidated Statement of Operations, Consolidated Balance Sheet or Consolidated Statement of Cash Flows. The expanded disclosures are incorporated in Note 18: Income Taxes.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which expands annual and interim disclosure requirements for certain income statement expenses. The new guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The adoption of the new guidance will not impact our Consolidated Statement of Operations, Consolidated Balance Sheet or Consolidated Statement of Cash Flows. We plan to incorporate these expanded disclosures beginning in fourth quarter 2027.

WEYERHAEUSER CO 10-K