The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this Annual Report. In addition, please refer to Item 5 in our Annual Report on Form 20-F for the year ended December 31, 2024 for our discussion and analysis comparing our financial condition and results of operations from 2024 to 2023. 41 Table of Contents Management’s Discussion and Analysis of Financial Condition and Results of Operations OVERVIEW Teekay Corporation Ltd. (or Teekay) is a leading provider of international crude oil and other marine transportation services. Teekay provides these services through its controlling ownership interest in Teekay Tankers Ltd. (NYSE: TNK) (or Teekay Tankers), a leading owner and operator of mid-sized crude oil and product tankers. Teekay and its current subsidiaries, other than Teekay Tankers, are referred to herein as "Teekay Parent". As of December 31, 2025, Teekay Parent had an economic interest of 30.8% and voting power of 54.9% in Teekay Tankers. Since Teekay Parent controls the voting interests of Teekay Tankers through its ownership of Class A and Class B common shares of Teekay Tankers, we consolidate the results of this subsidiary. We formed Teekay Tankers in 2007. Teekay Tankers holds all of our oil and product tanker assets, primarily consisting of Suezmax and Aframax / LR2 tankers, and engages in short to medium-term fixed-rate charter contracts and spot tanker market trading. In addition, Teekay Tankers also owns a Very Large Crude Carrier (or VLCC) tanker (which is under contract to be sold), a ship-to-ship transfer business that performs full service lightering and lightering support operations in the U.S. Gulf and Caribbean, and operations in Australia that provide operational and maintenance marine services provided to the Australian government, Australian energy companies and other third parties. The assets of Teekay Parent consist of Teekay Parent's controlling interest in publicly-listed Teekay Tankers, and a cash and short-term investments position of $120.2 million as at December 31, 2025. Our primary financial objective for Teekay Parent is to increase Teekay’s intrinsic value per share, which includes, among other things, increasing the intrinsic value of Teekay Tankers. Teekay has developed extensive industry experience and industry-leading capabilities over its 50-plus-year history. We believe our controlling interest in Teekay Tankers and its operating platform, together with both Teekay and Teekay Tankers' strong balance sheets, positions us well to pursue investments both in crude oil and product transportation and broader shipping markets where we can leverage our operating franchise and the proven capabilities of the Teekay platform to create long-term shareholder value. SIGNIFICANT DEVELOPMENTS Developments in Teekay Tankers in 2025 and Early 2026 For additional information about Teekay Tankers, please refer to Teekay Tankers' Annual Report on Form 20-F for the year ended December 31, 2025, as filed with the SEC. Global Tariffs and Trade During 2025, the U.S. administration and other governments have announced or taken actions to implement new or increased tariffs on foreign imports and port fees. These actions have resulted and may result in additional retaliatory tariffs being levied on various goods and commodities, which may trigger trade wars. Additionally, in early 2026, the U.S. Supreme Court struck certain of the tariffs implemented by the U.S. administration, who thereafter reimplemented certain tariffs in response, which may cause additional uncertainty and increase geopolitical tensions. These activities have disrupted global markets, resulting in an increase in general global economic uncertainty, including an increased risk of economic recessions. In 2025, the U.S. and China also announced new port fees that would apply to port calls of certain Chinese and U.S.-related tankers, respectively, which could be disruptive to our industry. These port fees subsequently have been suspended until October 2026. As a result of the rapidly changing and unpredictable geopolitical climate, the shipping industry is experiencing uncertainty as to future vessel demand, trade routes, rates and operating costs. Geopolitical Conflicts Geopolitical conflicts and related sanctions, export controls and price caps have significantly affected us and our industry, including by disrupting energy supply chains and trading patterns, and causing instability and volatility in the global economy. These conflicts include, among others, Russia’s ongoing invasion of Ukraine, Houthi rebel attacks on vessels in the Red Sea area, and the recent U.S., Israel and Iran conflict and related severe disruptions to voyages through the Strait of Hormuz. U.S. action in Venezuela during 2026, including the removal of President Nicolás Maduro and greater involvement in Venezuelan oil production and exports, has led to a collapse in crude oil flows to China via the “dark fleet” and shifted trade towards the compliant fleet of tankers. This development could benefit mid-size tankers in particular should more Venezuelan oil be sold to U.S. and European markets. The escalation and expansion of hostilities in the Middle East, and the possibility of continuing instability or further escalation in Ukraine, Venezuela or elsewhere could continue to affect the price of crude oil and the oil industry, the tanker industry and demand for our services. Vessel Sales During 2025, Teekay Tankers sold eight 2006 to 2009-built Suezmax tankers and three 2006 to 2007-built Aframax / LR2 tankers for a total price of $341.0 million, which resulted in an aggregate gain on sales of $100.5 million during 2025. All of these tankers were delivered to their purchasers during 2025. In December 2025, Teekay Tankers entered into an agreement to sell one 2007-built Suezmax tanker for $33.0 million. The tanker and its related bunker and lube oil inventories were classified as held for sale as at December 31, 2025. The tanker was delivered to the purchaser during January 2026. 42 Table of Contents In January 2026 and February 2026, Teekay Tankers entered into agreements to sell one 2009-built Suezmax tanker and one 2013-built VLCC tanker for a combined sales price of $124.5 million. The Suezmax tanker was delivered to its purchaser during March 2026, and the VLCC tanker is expected to be delivered to its purchaser during the second quarter of 2026. Vessel Acquisitions In May 2025, Teekay Tankers completed the purchase of one 2019-bulit Aframax / LR2 tanker for a purchase price of $63.0 million. In July 2025, Teekay Tankers completed the purchase of one 2017-built Suezmax tanker for a purchase price of $64.3 million. In August 2025, Teekay Tankers completed the purchase of one 2013-built VLCC, which was previously owned through our 50/50 joint venture, for a purchase price of $63.0 million. Following the completion of the purchase, the tanker continues to trade on spot voyage charters in a pool managed by a third party. In connection with the vessel purchase in August 2025, the joint venture fully repaid a $15.0 million outstanding loan balance with a financial institution. The first-priority mortgage associated with this loan and our guarantee on 50% of the outstanding loan balance were both terminated subsequent to the loan repayment. In February 2026 Teekay Tankers entered into an agreement to sell the VLCC as noted above. In December 2025, Teekay Tankers agreed to acquire three 2016-built Aframax / LR2 tankers for a total purchase price of $141.5 million. The full purchase price of $94.3 million related to two of the tankers and a deposit of $4.7 million related to the remaining tanker were placed in an escrow account, which is recorded in other non-current assets in our consolidated balance sheet as at December 31, 2025. Upon the completion of these purchases in January 2026, Teekay Tankers bareboat chartered-out each tanker to the seller for periods between four and eight months, after which Teekay Tankers will assume commercial and technical management of the vessels. Time Chartered-in Vessels During the first and third quarters of 2025, Teekay Tankers redelivered two chartered-in Aframax / LR2 tanker to their owners following the expiry of their time chartered-in contracts. In December 2025, Teekay Tankers exercised an option to extend one existing chartered-in contract for an Aframax / LR2 tanker for an additional period of 12 months at a rate of $33,150 per day, effective February 2026. Time Chartered-out Vessels The time charter-out contract of one Aframax / LR2 tanker expired in May 2025, at which time the tanker was delivered back to Teekay Tankers and has subsequently been trading in the spot market. During September 2025 and October 2025, Teekay Tankers entered into time charter-out contracts for two Aframax / LR2 tankers for terms between 12 months and 18 months at an average rate of $33,275 per day, both of which commenced in the fourth quarter of 2025. During September 2025, Teekay Tankers entered into a time charter-out contract for a Suezmax tanker for a term of 12 months at a rate of $42,500 per day, which commenced at the beginning of October 2025. Distribution from Equity-Accounted Joint Venture During the third quarter of 2025, in connection with Teekay Tankers' purchase of the VLCC tanker as noted above, Teekay Tankers received a cash distribution from its 50/50 joint venture in the amount of $25.6 million, of which $0.4 million was used to fully repay Teekay Tankers' advances to the joint venture. The net cash distribution of $25.2 million was $8.3 million in excess of the $16.9 million carrying amount of Teekay Tankers' investment in the equity-accounted joint venture, which had been previously written down by $11.6 million at the end of 2021 to its fair value at that time. Upon Teekay Tankers' receipt of the cash distribution, Teekay Tankers reduced the investment balance to nil and recognized the excess amount of $8.3 million as part of equity income and gain on distribution from equity-accounted investment in the consolidated statements of income. As at December 31, 2025, the joint venture no longer had any operational activities and is expected to be unwound during the first half of 2026. Investment in Marketable Securities During the second half of 2025, Teekay Tankers sold all of its investment in Ardmore Shipping (NYSE: ASC), which owns and manages a fleet of Medium-Range product and chemical tankers, for net proceeds of $26.3 million, which resulted in a realized gain of $2.9 million on the investment during the year ended December 31, 2025 and generated a total return of $3.3 million, or 14.4%, including dividends. Other Recent Developments During the year ended December 31, 2025, Teekay repurchased approximately 0.7 million common shares for $4.9 million, or an average of $6.71 per share, pursuant to its share repurchase programs. In May 2025, Teekay's Board of Directors (or Board) declared a special cash dividend in the amount of $1.00 per outstanding common share. This dividend was paid in July 2025 to all Teekay shareholders. IMPORTANT FINANCIAL AND OPERATIONAL TERMS AND CONCEPTS We use a variety of financial and operational terms and concepts when analyzing our performance. These include the following: 43 Table of Contents Revenues. Revenues primarily include revenues from time charters, voyage charters, full service lightering and lightering support services. In addition, revenues include revenues from operational and maintenance marine services. Revenues related to our crude oil and product tankers are affected by hire rates and the number of days a vessel operates. Revenues are also affected by the mix of our business between time charters and voyage charters and to a lesser extent, whether our vessels are subject to an RSA. Hire rates for voyage charters are more volatile, as they are typically tied to prevailing market rates at the time of a voyage. Our charters are explained further below. Voyage Expenses. Voyage expenses are all expenses unique to a particular voyage, including any fuel expenses, port fees, cargo loading and unloading expenses, canal tolls, agency fees and commissions. Voyage expenses are typically paid by the shipowner under voyage charters and the customer under time charters, except when the vessel is off-hire during the term of a time charter, in which case, the shipowner pays voyage expenses. Net Revenues. Net revenues represent income or loss from operations before vessel operating expenses, charter hire expenses, depreciation and amortization, general and administrative expenses, gain or loss on sale and write-down of assets, and restructuring charges. This is a non-GAAP financial measure; for more information about this measure, please read "Item 5 - Operating and Financial Review and Prospects - Non-GAAP Financial Measures". Vessel Operating Expenses. Under all types of charters and contracts for our vessels, except for bareboat charters, we are responsible for vessel operating expenses, which include crewing, repairs and maintenance, insurance, stores, lube oils, communication expenses and ship management services. The two largest components of our vessel operating expenses are crew costs and repairs and maintenance. We expect these expenses to increase as our fleet matures and to the extent that it expands. We seek to maintain these expenses at a stable level but expect an increase in line with inflation in respect of crew, material and maintenance costs. The strengthening or weakening of the U.S. Dollar relative to foreign currencies may result in significant decreases or increases, respectively, in our vessel operating expenses, depending on the currencies in which such expenses are incurred. Income or Loss from Operations. To assist us in evaluating our operations by segment, we analyze the income or loss from operations for each segment, which represents the income or loss we generate or incur from the segment after deducting operating expenses, but prior to interest expense, interest income, realized and unrealized gains or losses on non-designated derivative instruments, equity income or loss, gain on distribution from equity-accounted investment, other income or expenses and income taxes. Dry Docking. We must periodically dry dock each of our vessels for inspection, repairs and maintenance and any modifications to comply with industry certification or governmental requirements. Generally, we dry dock each of our vessels every two and a half to five years, depending upon the age of the vessel. We capitalize a substantial portion of the costs incurred during dry docking and amortize those costs on a straight-line basis from the completion of a dry docking over the estimated useful life of the dry dock. We expense, as incurred, costs for routine repairs and maintenance performed during dry dockings that do not improve or extend the useful lives of the assets. The number of dry dockings undertaken in a given period and the nature of the work performed determine the level of dry-docking expenditures. Depreciation and Amortization. Our depreciation and amortization expense typically consists of charges related to the depreciation of the historical cost of our fleet (less an estimated residual value) over the estimated useful lives of our vessels, charges related to the amortization of dry-docking expenditures over the estimated number of years to the next scheduled dry docking, and charges related to the amortization of our intangible assets over the estimated useful life of 10 years except in the case of in-definite-lived intangible assets, which are not subject to amortization. Time-Charter Equivalent (TCE) Rates. Bulk shipping industry freight rates are commonly measured in the shipping industry at the net revenues level in terms of “time-charter equivalent” (or TCE) rates, which represent net revenues divided by revenue days. We calculate TCE rates as net revenue per revenue day before costs to commercially manage our vessels, and off-hire bunker expenses. Revenue Days. Revenue days are the total number of calendar days our vessels were in our possession during a period, less the total number of off-hire days during the period associated with events such as major repairs or modifications, dry dockings, or special or intermediate surveys. Consequently, revenue days represents the total number of days available for the vessel to earn revenue. Idle days, which are days when the vessel is available to earn revenue but is not employed, are included in revenue days. We use revenue days to explain changes in our net revenues between periods. Average Number of Ships. Historical average number of ships consists of the average number of vessels that were in our fleet during a period. We use average number of ships primarily to highlight changes in vessel operating expenses and depreciation and amortization. Our Charters As part of our operations related to crude oil and product tankers, we generate revenues by charging customers for the transportation of their crude oil using our vessels. Historically, these services generally have been provided under the following basic types of contractual relationships: •Voyage charters are charters for shorter intervals that are priced on a current or spot market rate; and •Time charters, whereby vessels are chartered to customers for a fixed period of time at rates that are generally fixed, but may contain a variable component based on inflation, interest rates or current market rates. 44 Table of Contents The table below illustrates the primary distinctions among these types of charters and contracts: Voyage Charter Time Charter Typical contract length Single voyage One year or more Hire rate basis (1) Varies Daily Voyage expenses (2) We pay Customer pays Vessel operating expenses (3) We pay We pay Off hire (4) Customer does not pay Customer does not pay (1)Hire rate refers to the basic payment from the charterer for the use of the vessel. (2)Voyage expenses are all expenses unique to a particular voyage, including any fuel expenses, port fees, cargo loading and unloading expenses, canal tolls, agency fees and commissions. (3)Vessel operating expenses include crewing, repairs and maintenance, insurance, stores, lube oils and communication expenses. (4)Off hire refers to the time a vessel is not available for service. SUMMARY FINANCIAL DATA Set forth below is summary consolidated financial and other data of Teekay Corporation Ltd. and its subsidiaries for fiscal years 2025, 2024 and 2023, which have been derived from our consolidated financial statements. The following table should be read together with, and is qualified in its entirety by reference to the consolidated financial statements and accompanying notes for the years ended December 31, 2025, 2024 and 2023 (which are included herein). (in thousands of U.S. Dollars, except per share and fleet data) Years Ended December 31, 2025 2024 2023 GAAP Financial Comparison: Income Statement Data: Revenues 949,520 1,220,374 1,464,975 Income from operations 302,814 365,247 531,725 Net income 351,985 401,619 517,423 Net income attributable to shareholders of Teekay - basic 98,111 133,770 150,641 Per common share data: Basic income attributable to shareholders of Teekay 1.14 1.47 1.59 Diluted income attributable to shareholders of Teekay 1.13 1.42 1.54 Balance Sheet Data (at end of year): Cash and cash equivalents, and short-term investments 972,735 695,331 652,684 Vessels and equipment (1) 1,038,644 1,184,271 1,234,524 Total debt (2) — — 139,599 Total equity 2,162,603 1,935,167 1,800,346 Non-GAAP Financial Comparison: Net revenues - Tankers (3)(4) 506,641 700,732 890,081 EBITDA (3) 400,761 465,930 631,017 Adjusted EBITDA (3) 287,225 420,749 618,907 Fleet Data - average number of tankers(5): Suezmax 21.1 25.8 26.0 Aframax / LR2 18.5 23.7 25.6 Bunker tanker 1.0 0.2 — VLCC 0.7 0.5 0.5 (1) Total vessels and equipment consist of (a) our vessels, at cost less accumulated depreciation, (b) any vessels related to finance leases, at cost less accumulated depreciation, and (c) operating lease right-of-use assets. 45 Table of Contents (2) Total debt includes short-term debt, current and long-term portion of long-term debt, and current and long-term portion of obligations related to any finance leases. (3) Net revenues, EBITDA and Adjusted EBITDA are non-GAAP financial measures. Definitions and an explanations of the usefulness and purpose of these measures as well as reconciliations to the most directly comparable financial measures calculated and presented in accordance with GAAP are contained in the section “Non-GAAP Financial Measures” at the end of this Item 5 - Operating and Financial Review and Prospects. (4) Relates to net revenues from our Tankers segment which excludes net revenues from our Marine Services and Other segment. Please see section "Tankers - Operating Results" below in this Item 5 - Operating and Financial Review and Prospects. (5) Average number of tankers consists of the average number of vessels that were in our possession during a period, including chartered-in vessels, and the VLCC which was owned through our 50/50 High-Q Investments Ltd. (or High-Q) joint venture with Wah Kwong Maritime Transport Holdings Ltd. and was acquired by us from the joint venture in August 2025. In February 2026 Teekay Tankers entered into an agreement to sell the VLCC. ITEMS YOU SHOULD CONSIDER WHEN EVALUATING OUR RESULTS You should consider the following factors when evaluating our historical financial performance and assessing our future prospects: •Our voyage revenues are affected by cyclicality in the tanker markets. The cyclical nature of the tanker industry causes significant increases or decreases in the revenue we earn from our vessels, particularly those we trade in the spot market. •Tanker rates also fluctuate based on seasonal variations in demand. Tanker markets are typically stronger in the winter months as a result of increased oil consumption in the northern hemisphere but weaker in the summer months as a result of lower oil consumption in the northern hemisphere and increased refinery maintenance. In addition, unpredictable weather patterns during the winter months tend to disrupt vessel scheduling, which historically has increased oil price volatility and oil trading activities in the winter months. As a result, revenues generated by our vessels have historically been weaker during the quarters ended June 30 and September 30, and stronger in the quarters ended December 31 and March 31. •The conflicts in the Middle East, Ukraine and Venezuela have had and may continue to have material effects on our business, results of operations or financial condition. Since December 2023, Iran-backed Houthi rebels in Yemen have carried out numerous attacks on vessels in the Red Sea area, ostensibly in response to the Israel-Hamas war. As a result of these attacks, many shipping companies continue to suspend transit through the Red Sea, which has affected trading patterns, rates and expenses. The Houthi group in Yemen has pledged to stop attacks on shipping in the Red Sea should the ceasefire in Gaza hold. This could result in the resumption of tanker transits through the Red Sea area, which could impact seaborne trade patterns and reduce tanker tonne-mile demand. In addition, the recent U.S., Israel and Iran conflict has escalated throughout the region, leading to uncertainty and heightened security risks for shipping in that region and severe disruptions to voyages through the Strait of Hormuz, disrupting trade routes. The expansion of hostilities in the Middle East may lead to interventions by other groups or nations, the imposition of economic sanctions on any major oil producing nations, additional disruption of shipping transit in other trade routes, or similar outcomes that could affect the tanker industry, demand for our services, our business, results of operations, financial condition and cash flows. The Russia-Ukraine war has disrupted energy supply chains, caused instability and significant volatility in the global economy and resulted in economic sanctions on Russia by several nations. The ongoing conflict has contributed significantly to related increases in spot tanker rates. Additional sanctions, export controls and executive orders have been implemented and authorities are actively investigating compliance with the price cap requirement placed on Russian oil exports. This could further impact the trade of crude oil and petroleum products, as well as the supply of Russian oil to the global market and the demand for, and price of, crude oil and petroleum products. Recent U.S. action in Venezuela, including the removal of President Nicolás Maduro and greater involvement in Venezuelan oil production and exports, has led to a collapse in crude oil flows to China via the “dark fleet” and shifted trade towards the compliant fleet of tankers. This development could benefit mid-size tankers in particular should more Venezuelan oil be sold to U.S. and European markets. Please read “Item 3 - Key Information - Risk Factors” for additional information about risks to us and our business relating to political instability, terrorist or other attacks, war or international hostilities and the conflicts in Israel and Ukraine. •Our U.S. Gulf lightering business competes with alternative methods of delivering crude oil to ports and exports to offshore for consolidation onto larger vessels, which may limit our earnings in this area of our operations. Our U.S. Gulf lightering business faces competition from alternative methods of delivering crude oil shipments to port and exports to offshore for consolidation onto larger vessels, including the Louisiana Offshore Oil Platform and deep water terminals in Corpus Christi and Houston, Texas which can partially load VLCCs. While we believe that lightering offers advantages over alternative methods of delivering crude oil to and from U.S. Gulf ports, our lightering revenues may be limited due to the availability of alternative methods. •Vessel operating and other costs are facing industry-wide cost pressures. The shipping industry continues to forecast a shortfall in qualified personnel, highlighting the urgency of improving seafarer attraction and retention. This will continue to push an upward trend on wages. We will continue to focus on our manning and training strategies to meet future needs. In addition, factors such as client and regulatory demands for enhanced training and physical equipment, pressure on commodity and raw material prices, tariffs, and increasing cost of freight due to changing trade routes, as well as changes in regulatory requirements could also contribute to operating expenditure increases. We continue to take action aimed at improving operational efficiencies, and to temper the effect of any inflationary and other price escalations; however, increases to operational costs may occur in the future. •The amount and timing of vessel dry dockings and major modifications can significantly affect our revenues between periods. Our vessels are normally off-hire when they are being dry docked. We had nine vessels dry dock in 2025, compared to 13 vessels in 2024 and seven vessels in 2023. The total number of off-hire days relating to dry dockings and ballast water treatment systems (or BWTS) installations during the years ended December 31, 2025, 2024 and 2023 were 358, 478 and 304, respectively. For our current fleet, there are 12 vessels scheduled to dry dock in 2026 and incur off-hire days. 46 Table of Contents •Our financial results are affected by fluctuations in currency exchange rates. Under GAAP, all foreign currency-denominated monetary assets and liabilities (including cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, advances from affiliates and advances to affiliates) are revalued and reported based on the prevailing exchange rate at the end of the period. These foreign currency translation fluctuations based on the strength of the U.S. Dollar relative mainly to the Canadian Dollar, Singaporean Dollar, British Pound, Euro, Australian Dollar, Philippine Peso and Japanese Yen are included in our results of operations. The translation of all foreign currency-denominated monetary assets and liabilities at each reporting date results in unrealized foreign currency exchange gains or losses. Year Ended December 31, 2025, versus Year Ended December 31, 2024 RESULTS OF OPERATIONS In accordance with GAAP, we report gross revenues in our consolidated statements of income and include voyage expenses among our operating expenses. However, ship-owners base economic decisions regarding the deployment of their vessels upon anticipated TCE rates, which represent net revenues (or income or loss from operations before vessel operating expenses, charter hire expenses, depreciation and amortization, general and administrative expenses, gain or loss on sale and write-down of assets, and restructuring charges), which includes voyage expenses, divided by revenue days; in addition, industry analysts typically measure bulk shipping freight and hire rates in terms of TCE rates. This is because under time charter-out contracts, the customer usually pays the voyage expenses, while under voyage charters the ship-owner usually pays the voyage expenses, which typically are added to the hire rate at an approximate cost (as is also described in "Our Charters" above). Accordingly, the discussion of revenue below focuses on net revenues and TCE rates (both of which are non-GAAP financial measures) where applicable. Teekay has two primary lines of business: (1) tankers and (2) marine services and its segments are presented on this basis: (1) The tanker segment consists of the operation of all of our Suezmax, Aframax / LR2 and VLCC tankers (including the operations from those of our tankers employed on full service lightering contracts), and our U.S. based ship-to-ship support service operations (including our lightering support services provided as part of full service lightering operations); and (2) The marine services and other segment consists of operational and maintenance marine services provided to the Australian government, Australian energy companies and other third parties, and includes corporate and general administrative expense. Our consolidated income from operations was $302.8 million for the year ended December 31, 2025 compared to $365.2 million for the year ended December 31, 2024. The primary reasons for this net decrease in income are as follows: •a decrease of $69.9 million due to the sales of nine Suezmax tankers and five Aframax / LR2 tankers between the start of the first quarter of 2024 and the end of 2025; •a decrease of $65.1 million as a result of lower overall average realized spot TCE rates earned by our Suezmax tankers and Aframax / LR2 tankers in 2025 compared to 2024; and 47 •a decrease of $18.3 million due to the redeliveries of five chartered-in tankers to their owners between the start of the third quarter of 2024 and the end of the third quarter of 2025; partially offset by: •an increase of $63.7 million due to the gain on sales of eight Suezmax tankers and three Aframax / LR2 tankers in 2025 compared to the gain on sales of one Suezmax tanker and two Aframax / LR2 tankers in 2024; •an increase of $14.8 million due to the acquisitions of two Aframax / LR2 tankers, one Suezmax tanker, and one VLCC tanker between the start of the third quarter of 2024 and the end of the third quarter of 2025; and •a decrease in other operating expenses of $12.4 million including $6.3 million of lower general and administrative expenses in 2025 compared to 2024 and $5.6 million of restructuring expenses incurred in 2024 (the 2025 restructuring expenses were recovered through revenues in our Australia Operations). Tankers - Operating Results We own and operate crude oil and product tankers that (i) are subject to long-term, fixed-rate time-charter contracts (which have an original term of one year or more), (ii) operate in the spot tanker market, or (iii) are subject to time charters that are priced on a spot market basis or are short-term, fixed-rate contracts (which have original terms of less than one year), including those employed on FSL contracts. In addition, we provide STS support services, along with our tanker commercial management and technical management services. The following table presents the Tankers operating results for the years ended December 31, 2025 and 2024, and includes a comparison of net revenues(1), a non-GAAP financial measure, for those periods to income from operations, the most directly comparable GAAP financial measure. Year Ended December 31, (in thousands of U.S. dollars except percentages) 2025 2024 % Change Revenues 824,014 1,106,278 (26)% Voyage expenses (317,373) (405,546) (22)% Net revenues(1) 506,641 700,732 (28)% Vessel operating expenses (131,011) (150,605) (13)% Charter hire expenses (42,742) (74,379) (43)% Depreciation and amortization (86,630) (93,582) (7)% General and administrative expenses (46,568) (48,833) (5)% Gain on sale and write-down of assets 99,659 38,080 162% Restructuring charges — (5,952) (100)% Income from operations 299,349 365,461 (18)% Equity income and gain on distribution from equity-accounted investment 9,617 2,767 248% (1) This is a non-GAAP financial measure. Please refer to "Item 5 – Management's Discussion and Analysis of Financial Condition and Results of Operations - Non-GAAP Financial Measure" for a definition and reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP. Net Revenues. Net revenues were $506.6 million for the year ended December 31, 2025 compared to $700.7 million for the year ended December 31, 2024. The net decrease was primarily due to: •a net decrease of $131.0 million due to the sales of nine Suezmax tankers and five Aframax / LR2 tankers between the start of the first quarter of 2024 and the end of 2025, as well as the redeliveries of five chartered-in tankers to their owners between the start of the third quarter of 2024 and the end of the third quarter of 2025, partially offset by the acquisition of two Aframax / LR2 tankers, one Suezmax tanker and one VLCC tanker between the start of the third quarter of 2024 and the end of the third quarter of 2025; •a decrease of $65.1 million due to lower overall average realized spot rates earned by our Suezmax tankers and Aframax / LR2 tankers in 2025 compared to 2024; •a net decrease of $3.4 million due to certain vessels returning from time charter-out contracts during 2025 and earning a lower average spot compared to previous fixed rates, partially offset by certain vessels entering into new time charter-out contracts in the fourth quarter of 2025 and earning a higher average fixed rate compared to previous spot rates; •a decrease of $1.9 million due to one fewer calendar day in 2025 compared to 2024; and •a decrease of $1.4 million due to lower bunker commissions earned and lower revenues earned from our responsibilities in employing vessels subject to RSAs in 2025 compared to 2024; partially offset by: 48 •an increase of $5.4 million due to fewer off-hire days and lower off-hire bunker expenses during 2025, primarily related to fewer scheduled dry dockings compared to 2024; and •an increase of $3.5 million due to higher revenues related to certain STS support service activities in 2025 compared to 2024. Vessel Operating Expenses. Vessel operating expenses were $131.0 million for the year ended December 31, 2025 compared to $150.6 million for the year ended December 31, 2024. The net decrease was primarily due to: •a net decrease of $16.5 million resulting from the sales of nine Suezmax tankers and five Aframax / LR2 tankers between the start of the first quarter of 2024 and the end of 2025, partially offset by the acquisition of two Aframax / LR2 tankers, one Suezmax tanker and one VLCC tanker between the start of the third quarter of 2024 and the end of the third quarter of 2025; •a decrease of $2.3 million resulting from lower repair and maintenance related expenditures in 2025 compared to 2024; •a decrease of $1.8 million resulting from lower expenditures related to certain STS support service activities in 2025 compared to 2024; and •a decrease of $1.3 million resulting from an insurance claim settlement in 2025; partially offset by: •an increase of $1.8 million related to higher crewing-related expenditures in 2025. Charter Hire Expenses. Charter hire expenses were $42.7 million for the year ended December 31, 2025 compared to $74.4 million for the year ended December 31, 2024. The net decrease was primarily due to: •a decrease of $32.1 million resulting from the redeliveries of five chartered-in tankers to their owners between the start of the third quarter of 2024 and the end of the third quarter of 2025; and •a decrease of $2.2 million resulting from impairments of operating lease right-of-use assets related to three chartered-in vessels between the start of the fourth quarter of 2024 and the end of the first quarter of 2025, which impairments related to declines in prevailing short-term time-charter rates; partially offset by: •an increase of $2.7 million due to increases in the daily hire rates for one Aframax / LR2 tanker and two STS support vessels after extending their chartered-in contracts during the second quarter of 2024 and the third quarter of 2025. Depreciation and Amortization. Depreciation and amortization was $86.6 million for the year ended December 31, 2025 compared to $93.6 million for the year ended December 31, 2024. The net decrease was primarily due to the sales of nine Suezmax tankers and four Aframax / LR2 tankers between the start of the fourth quarter of 2024 and the end of 2025, partially offset by the acquisitions of two Aframax / LR2 tankers, one Suezmax tanker and one VLCC tanker between the start of the third quarter of 2024 and the end of the third quarter of 2025, as well as the dry docks of certain vessels that are subject to a shorter amortization period compared to the previous dry docks. General and Administrative Expenses. General and administrative expenses were $46.6 million for the year ended December 31, 2025 compared to $48.8 million for the year ended December 31, 2024. The decrease was primarily due to lower expenditures related to compensation, benefits and payroll taxes, partly resulting from organizational changes made during the second half of 2024. Gain on Sale and Write-down of Assets. The gain on sale and write-down of assets of $99.7 million for the year ended December 31, 2025 was related to: •the sales of eight Suezmax tankers and three Aframax / LR2 tankers, which resulted in an aggregate gain on sales of $100.5 million during the year ended December 31, 2025; partially offset by: •the impairment recorded on two of our operating lease right-of-use assets resulting from a decline in the prevailing short-term time-charter rates, which resulted in a write-down of $0.8 million during the year ended December 31, 2025. The gain on sale and write-down of assets of $38.1 million for the year ended December 31, 2024 were related to: •the sales of two Aframax / LR2 tankers and one Suezmax tanker, which resulted in an aggregate gain on sales of $39.5 million during the year ended December 31, 2024; partially offset by: •the impairment recorded on three of our operating lease right-of-use assets resulting from a decline in the prevailing short-term time-charter rates, which resulted in a write-down of $1.4 million during the year ended December 31, 2024. Restructuring Charges. Restructuring charges of $6.0 million for the year ended December 31, 2024 were related to changes made to Teekay Tankers' senior management team. 49 Equity Income and Gain on Distribution from Equity-Accounted Investment. Equity income and gain on distribution from equity-accounted investment was $9.6 million for the year ended December 31, 2025 compared to $2.8 million for the year ended December 31, 2024. The increase was primarily due to a $8.3 million gain on distribution received from the equity-accounted joint venture in the third quarter of 2025, partially offset by lower net income from the equity-accounted investment, as the joint venture had no operational activities after selling its VLCC tanker to us in August 2025, as well as lower spot rates in 2025 compared to 2024 realized by the VLCC tanker during the period when it was owned by the joint venture. Tanker Market Mid-size crude tanker spot rates strengthened during the fourth quarter of 2025. Global seaborne oil trade volumes were near record highs during the fourth quarter of 2025 due to the unwinding of OPEC+ supply cuts coupled with rising oil production from non-OPEC+ countries, particularly in the Americas. In addition, tighter sanctions against Russia, Iran, and Venezuela, including U.S. sanctions against Russian oil producers Rosneft and Lukoil, have created trading inefficiencies which have benefited tanker tonne-mile demand while pushing more trade volumes away from the “dark fleet” towards the compliant fleet of tankers. Geopolitical events continue to shape global oil trade flows at the beginning of 2026 and mid-size tanker spot rates remain at very firm levels. U.S. action in Venezuela, including the removal of President Nicolás Maduro and greater involvement in Venezuelan oil production and exports, has led to a sharp decrease in crude oil flows to China via the “dark fleet” at the start of 2026 and shifted trade towards the compliant fleet of tankers. This could benefit compliant mid-size tankers in particular if more Venezuelan oil is sold to U.S. and European markets. Tighter sanctions on Russia and Iran and the military action in the Middle East (including as a result of the recent U.S., Israel and Iran conflict and the related disruption of shipping transit via the Strait of Hormuz) may continue to drive trade inefficiencies in the near-term and further marginalize the “dark fleet” vessels, although the geopolitical environment remains highly volatile and unpredictable. Underlying tanker demand and supply fundamentals remain supportive. Global oil demand is projected to increase by 1.1 million barrels per day (or mb/d) in 2026, which is in line with levels seen in 2024 and 2025. Demand could be further boosted by strategic stockpiling, particularly in China where the country is projected to add just under 1 mb/d to strategic reserves during 2026 according to the U.S. Energy Information Administration (or EIA). Non-OPEC+ supply growth is expected to continue to be led by the Americas in 2026, with the International Energy Agency (or IEA) projecting 1.3 mb/d of non-OPEC+ growth in 2026. The OPEC+ group, which unwound over 2 mb/d of voluntary supply cuts in 2025, has announced a pause on further unwinds during the first quarter of 2026, and its supply policy for the remainder of the year is uncertain. On the fleet supply side, tanker newbuild deliveries are set to increase in 2026, although actual net fleet growth will depend on the level of vessel removals via scrapping, the relative mix of vessels trading in the compliant fleet versus the “dark fleet” of tankers, and the utilization rate of older vessels. In summary, we believe that the near-term outlook for the tanker market remains strong driven by a combination of positive underlying tanker supply and demand fundamentals and various geopolitical factors which are driving trade inefficiencies and tonne-mile demand for the compliant fleet of tankers. However, the longer-term outlook is highly uncertain and will depend, to a large extent, on how the various geopolitical factors currently supporting the tanker market develop in the coming months and years. Tankers - Fleet and TCE Rates As at December 31, 2025, Teekay Tankers owned 33 double-hulled oil and product tankers and chartered-in two Aframax / LR2 tankers, one Suezmax tanker, one bunker tanker and two STS support vessels. As defined and discussed above, we calculate TCE rates as net revenue per revenue day before costs to commercially manage our vessels, and off-hire bunker expenses. The following tables highlight the average TCE rates earned by Teekay Tankers' spot vessels (including those trading on voyage charters, in RSAs and in FSL) and our time charter-out vessels for 2025 and 2024: Year Ended December 31, 2025 Revenues (1) Voyage Expenses (2) Adjustments (3) TCE Revenues Revenue Days Average TCE per Revenue Day (3) (in thousands) (in thousands) (in thousands) (in thousands) Voyage-charter contracts - Suezmax (4) $ 424,952 $ (170,378) $ 2,599 $ 257,173 7,244 $ 35,502 Voyage-charter contracts - Aframax / LR2 (4) $ 349,312 $ (140,045) $ 613 $ 209,880 6,336 $ 33,124 Voyage-charter contracts - VLCC (5) $ 10,975 $ (2,989) $ 287 $ 8,273 133 $ 62,164 Time charter-out contracts - Suezmax $ 3,892 $ (67) $ 36 $ 3,861 92 $ 41,969 Time charter-out contracts - Aframax / LR2 $ 11,196 $ (183) $ 13 $ 11,026 270 $ 40,919 Total $ 800,327 $ (313,662) $ 3,548 $ 490,213 14,075 $ 34,830 (1)Excludes $14.7 million of revenues related to our STS support services operations, $8.1 million of revenues related to certain bunker related activities, and $0.9 million of revenue earned from our responsibilities in employing the vessels subject to the RSAs. (2)Excludes $7.1 million of expenses related to certain bunker related activities and includes $3.4 million of operating expenses related to providing lightering support services to FSL operations. (3)Adjustments primarily include off-hire bunker expenses, which are excluded from Average TCE per Revenue Day. (4)Includes $24.0 million of revenues and $10.0 million of voyage expenses related to Aframax / LR2 FSL operations, and $11.4 million of revenues and $7.5 million of voyage expenses related to our Suezmax FSL operations. 50 (5)Includes one VLCC tanker, which was acquired by Teekay Tankers from the Company's 50/50 joint venture in August 2025, is trading in a pooling arrangement managed by a third party, and is under contract to be sold. Year Ended December 31, 2024 Revenues (1) Voyage Expenses (2) Adjustments (3) TCE Revenues Revenue Days Average TCE per Revenue Day (3) (in thousands) (in thousands) (in thousands) (in thousands) Voyage-charter contracts - Suezmax (4) $ 547,261 $ (216,951) $ 2,788 $ 333,098 8,779 $ 37,941 Voyage-charter contracts - Aframax / LR2 (4) $ 519,702 $ (192,126) $ 1,224 $ 328,800 8,234 $ 39,933 Time charter-out contracts - Suezmax $ 12,767 $ (725) $ 1 $ 12,043 321 $ 37,513 Time charter-out contracts - Aframax / LR2 $ 12,006 $ (424) $ 300 $ 11,882 243 $ 48,879 Total $ 1,091,736 $ (410,226) $ 4,313 $ 685,823 17,577 $ 39,018 (1)Excludes $11.2 million of revenues related to our STS support services operations, $1.9 million of revenues related to certain bunker related activities, and $1.4 million of revenue earned from our responsibilities in employing the vessels subject to the RSAs. (2)Includes $4.7 million of operating expenses related to providing lightering support services to our FSL operations. (3)Adjustments primarily include off-hire bunker expenses, which are excluded from Average TCE per Revenue Day. (4)Includes $40.9 million of revenues and $18.7 million of voyage expenses related to the Aframax / LR2 FSL operations, and $10.1 million of revenues and $5.6 million of voyage expenses related to the Suezmax FSL operations. Marine Services and Other - Operating Results As part of our Australian operations, we provide marine services to the Australian government, energy companies and other third parties. Our marine services business in Australia provides operations, supply, maintenance and engineering support, as well as crewing and training services, primarily under long-term contracts with the Commonwealth of Australia, for 11 Australian government-owned vessels. In addition, we provided crewing services under a management contract, which expired in August 2025, for an FPSO unit in Western Australia, provide technical and crewing management services for two patrol boats, as well as bareboat charter-in a bunker tanker which we have time chartered-out to a third party. Marine Services and Other also consists of management services provided to third parties. The following table presents the Marine Services and Other operating results for the years ended December 31, 2025 and 2024. Year ended December 31, (in thousands of U.S. dollars) 2025 2024 Revenues (1) 125,506 114,096 Vessel operating expenses (107,845) (101,989) Charter hire expenses (2,515) (416) General and administrative expenses (2) (8,199) (11,905) Gain on sale of assets (3) 2,086 — Restructuring expenses(1) (5,568) — Income (loss) from operations 3,465 (214) (1)Restructuring charges include severance costs of $5.6 million resulting from the termination of a management contract related to the Australian operations; the severance costs were fully recovered from the customer, and the recovery is presented in revenues. (2)Includes direct general and administrative expenses and indirect general and administrative expenses allocated based on estimated use of corporate resources. (3)The gain on sale of assets relates to management fees earned by Teekay Corporation Ltd. from the sale of certain vessels by Teekay Tankers. Income from operations for Marine Services and Other was $3.5 million for the year ended December 31, 2025, compared to a $0.2 million loss from operations for the year ended December 31, 2024. The positive change in results is primarily due to lower compensation and corporate expenses in 2025 compared to 2024, commissions earned on the sales of certain Teekay Tankers' vessels in 2025, and the time charter-out of a bareboat chartered-in bunker tanker which charter-out contract commenced in the fourth quarter of 2024 within our Australian operations, partially offset by lower results from our operational and maintenance marine services in Australia related to higher crewing-related expenditures in 2025, as well as the termination of a crew management contract in August 2025. 51 Other Consolidated Operating Results The following table compares our other consolidated operating results for 2025 and 2024: Year Ended December 31, (in thousands of U.S. dollars) 2025 2024 Interest income 36,166 37,218 Interest expense (2,896) (7,542) Other - net 1,700 4,334 Income tax recovery (expense) 4,584 (405) Interest income. Interest income decreased to $36.2 million for the year ended December 31, 2025, compared to $37.2 million for the year ended December 31, 2024. The decrease was primarily due to lower average interest rates on cash and short-term investment balances, partially offset by higher average balances earning interest. Interest expense. Interest expense was $2.9 million for the year ended December 31, 2025, compared to $7.5 million for the year ended December 31, 2024. The decrease was primarily due to the repurchase of eight Suezmax tankers during the first quarter of 2024, all of which were previously held under sale-leaseback arrangements. Other - net. Other net income was $1.7 million for the year ended December 31, 2025, compared to $4.3 million for the year ended December 31, 2024. The decrease was primarily due to a recovery related to the settlement of a claim in the third quarter of 2024, changes in foreign currency exchange rates related to our accrued tax and working capital balances, as well as an unrealized loss on marketable securities recognized during 2025, partially offset by a realized gain on marketable securities recognized during 2025 and premiums paid during the first quarter of 2024 in relation to the repurchase of eight Suezmax tankers which were previously under sale-leaseback arrangements. Income tax recovery (expense). Income tax recovery was $4.6 million for the year ended December 31, 2025, compared to a $0.4 million tax expense for the year ended December 31, 2024. The change was primarily due to higher recoveries during 2025 related to the expiry of the tax limitation periods in certain jurisdictions, as well as changes in vessel trading activities. This is partially offset by the reversal of certain freight tax liabilities during the first quarter of 2024 based on an assessment of our tax position for a certain jurisdiction. For additional information, please read "Item 18 – Financial Statements: Note 17 - Income Tax Recovery (Expense)" of this Annual Report. Year Ended December 31, 2024, versus Year Ended December 31, 2023 For a discussion of our operating results for the year ended December 31, 2024, compared with the year ended December 31, 2023, please see "Item 5 – Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 20-F for the year ended December 31, 2024. LIQUIDITY AND CAPITAL RESOURCES Sources and Uses of Capital Teekay Parent Teekay Parent primarily generates cash flows from dividends received from Teekay Tankers and from interest income from short-term investments and cash and cash equivalent balances. Teekay Parent's other potential sources of funds are borrowings under credit facilities and proceeds from issuances of debt or equity securities. As at December 31, 2025, Teekay Parent had no debt outstanding. Teekay Parent's primary uses of cash include funding general and administrative expenses and other working capital requirements. As at December 31, 2025, Teekay Parent held $120.2 million in cash, cash equivalents and short-term investments, which are comprised of bank deposits and short-term debt securities issued by the United States government. During the year ended December 31, 2025, Teekay Parent repurchased approximately 0.7 million Teekay common shares for $4.9 million, including transaction costs, under its share repurchase program. As at December 31, 2025, the total remaining share repurchase authorization was $28.1 million. In May 2025, Teekay's Board declared a special cash dividend in the amount of $1.00 per outstanding common share, which resulted in total cash dividends paid of $85.3 million in July 2025. Teekay Tankers Teekay Tankers generates cash flows primarily from chartering out its vessels, from managing vessels for the Australian government, and from providing management services to certain third parties. Teekay Tankers employs a chartering strategy for the tanker segment that seeks to capture upside opportunities in the tanker spot market while using fixed-rate time charters to reduce potential downside risks. Teekay Tankers' short-term charters and spot market tanker operations contribute to the volatility of its net operating cash flow, and thus may impact its ability to generate sufficient cash flows to meet its short-term liquidity needs. Historically, the tanker industry has been cyclical, experiencing volatility in profitability and asset values resulting from changes in the supply of, and demand for, vessel capacity. In addition, tanker spot markets historically have exhibited seasonal variations in charter rates. Tanker spot markets are typically stronger in the winter months as a result of increased oil consumption in the northern hemisphere and unpredictable weather patterns that tend to disrupt vessel scheduling. However, there can be other factors that override typical seasonality, such as geopolitical events, sanctions and other factors which influence oil trade routes and tonne-mile supply and demand. 52 While exposure to the volatile spot market is the largest potential cause for changes in Teekay Tankers' net operating cash flow from period to period, variability in its net operating cash flow also reflects changes in interest rates, fluctuations in working capital balances, the timing and the amount of dry-docking expenditures, repairs and maintenance activities, the average number of vessels in service, including chartered-in vessels, and vessel acquisitions or vessel dispositions, among other factors. The number of vessel dry dockings varies each period depending on vessel maintenance schedules. Teekay Tankers' other primary sources of cash are interest income from short-term investments, long-term bank borrowings, lease or equity financings, and proceeds from the sales of older vessels. As at December 31, 2025, Teekay Tankers has one credit facility, the 2023 Revolver, with no balance drawn, and it had no vessels subject to finance leases. Teekay Tankers' obligations related to its 2023 Revolver is described in "Item 18 – Financial Statements: Note 8 – Long-Term Debt" of this report. Teekay Tankers' 2023 Revolver contains covenants and other restrictions that we believe are typical of debt financing collateralized by vessels, including those that restrict the relevant subsidiaries from: incurring or guaranteeing additional indebtedness; making certain negative pledges or granting certain liens; and selling, transferring, assigning or conveying assets. Teekay Tankers' 2023 Revolver requires it to maintain certain financial covenants. The terms of and compliance with these financial covenants are described in further detail in "Item 18 – Financial Statements: Note 8 – Long-Term Debt" of this Annual Report. If Teekay Tankers does not meet these financial or other covenants, the lenders may declare Teekay Tankers' obligations under the agreement immediately due and payable and terminate any further loan commitments, which, depending upon Teekay Tankers' other liquidity at the time, could significantly affect Teekay Tankers' short-term liquidity requirements. As at December 31, 2025, Teekay Tankers was in compliance with all covenants under the 2023 Revolver. Teekay Tankers' 2023 Revolver require it to make interest payments based on SOFR plus a margin. Depending upon the amount of its floating-rate credit facility and balance from time to time, significant increases in interest rates could adversely affect its results of operations and its ability to service its debt. From time to time, Teekay Tankers uses interest rate swaps to reduce its exposure to market risk from changes in interest rates. As at December 31, 2025, Teekay Tankers was not committed to any interest rate swap agreements. The extent of Teekay Tankers' exposure to changes in interest rates is described in further detail in "Item 11 - Quantitative and Qualitative Disclosures About Market Risk” of this Annual Report. Teekay Tankers' primary uses of cash include the payment of operating expenses, dry-docking expenditures, costs associated with modifications to its vessels, funding its other working capital requirements, dividend payments on Teekay Tankers' common shares, repurchases of Teekay Tankers' Class A common shares under its repurchase program, debt servicing costs, as well as scheduled repayments of long-term debt. In addition, Teekay Tankers may use cash to acquire new or second-hand vessels. The timing of the acquisition of vessels depends on a number of factors, including newbuilding prices, second-hand vessel values, the age, condition and size of Teekay Tankers' existing fleet, the commercial outlook for its vessels and other considerations. As such, vessel acquisition activity may vary significantly from year to year. Cash Flows The following table summarizes our consolidated cash and cash equivalents provided by (used for) operating, financing and investing activities for the periods presented: Year Ended December 31, (in thousands of U.S. Dollars) 2025 2024 Net cash flow provided by operating activities 301,767 467,185 Net cash flow used for financing activities (129,770) (416,448) Net cash flow provided by investing activities 80,426 157,496 Net Operating Cash Flow Our consolidated net cash flow from operating activities fluctuates primarily as a result of changes in vessel utilization and TCE rates, changes in interest rates, fluctuations in working capital balances, the timing and amount of dry-docking expenditures, repairs and maintenance activities, vessel additions and dispositions, and foreign currency rates. Teekay Tankers' exposure to the spot tanker market has contributed significantly to fluctuations in operating cash flows historically as a result of highly cyclical spot tanker rates. The $165.4 million decrease in net operating cash flow for the year ended December 31, 2025, compared to the prior year, was primarily due to: •a net decrease of $137.6 million in cash inflows primarily due to lower operating earnings during the year ended December 31, 2025, resulting from lower average realized spot tanker rates, the sales of nine Suezmax tankers and five Aframax / LR2 tankers between the start of the first quarter of 2024 and the end of 2025, as well as the redeliveries of five chartered-in tankers to their owners between the start of the third quarter of 2024 and the end of the third quarter of 2025, partially offset by lower interest expense resulting from the repurchase of eight tankers during the first quarter of 2024, all of which were previously held under sale-leaseback arrangements, as well as the acquisitions of two Aframax / LR2 tankers, one Suezmax tanker and one VLCC tanker between the start of the third quarter of 2024 and the end of the third quarter of 2025; and •a decrease of $38.7 million in cash inflows related to changes in net working capital during the year ended December 31, 2025 compared with the prior year; partially offset by: •a decrease of $7.9 million in cash outflows related to expenditures for dry-docking activities during the year ended December 31, 2025 compared with the prior year, and 53 •a decrease of $3.0 million in cash outflows related to expenditures for asset retirement obligations during the year ended December 31, 2025 compared with the prior year. Net Financing Cash Flow The $286.7 million decrease in net cash flow used for financing activities for the year ended December 31, 2025, compared to the prior year, was primarily due to: •a decrease of $142.2 million in cash outflows primarily due to a decrease in prepayments and scheduled repayments on Teekay Tankers' finance lease obligations resulting from the repurchase of eight Suezmax tankers under their previous sale-leaseback financing agreements in the first quarter of 2024; •a decrease of $61.3 million in cash outflows for Teekay Parent due to the repurchase of 0.7 million common shares for $4.9 million for the year ended December 31, 2025 compared 8.0 million common shares for $66.3 million during the year ended December 31, 2024; •a decrease of $50.0 million in cash outflows due to Teekay Parent's purchase of 0.8 million of Teekay Tankers Class A common shares through open market purchases during the year ended December 31, 2024; and •a decrease of $25.5 million in cash outflows due to Teekay Tankers' $47.7 million dividends paid to non-controlling interests during the year ended December 31, 2025, compared to $73.2 million in the prior year. During the years ended December 31, 2025 and 2024, Teekay Corporation Ltd. paid cash dividends of $85.3 million and $85.0 million to its shareholders, respectively. Net Investing Cash Flow The $77.1 million decrease in net cashflow provided by investing activities for the year ended December 31, 2025, compared to the prior year, was primarily due to: •a decrease of $185.2 million in cash inflows due to lower proceeds from short-term investments compared to 2024; •an increase $119.8 million in cash outflows resulting from the acquisitions of one Aframax / LR2 tanker, one Suezmax tanker and one VLCC tanker during the year ended December 31, 2025 compared to the acquisition of one Aframax / LR2 tanker during the year ended December 31, 2024; and •an increase of $99.0 million in cash outflows resulting from payments held in escrow related to acquisitions of three Aframax / LR2 tankers during the year ended December 31, 2025; partially offset by: •an increase of $256.4 million in cash inflows resulting from higher net proceeds received from the sales of eight Suezmax tankers and three Aframax / LR2 tankers during the year ended December 31, 2025 compared to net proceeds received from the sale of two Aframax / LR2 tankers and one Suezmax tanker during the year ended December 31, 2024; •an increase of $44.9 million net cash inflows resulting from $26.3 million proceeds received from the sale of our entire investment in marketable securities during the year ended December 31, 2025, and $18.7 million of decreased outflows resulting from purchases of the marketable securities primarily during the year ended December 31, 2024; and •an increase of $25.2 million in cash inflows resulting from a distribution from our equity-accounted joint venture during the year ended December 31, 2025. Liquidity We separately manage the liquidity for Teekay Parent and Teekay Tankers. As such, the discussion of liquidity that follows is broken down into these two groups. The primary objectives of Teekay Parent and Teekay Tankers' cash management policies are to preserve capital and seeking to ensure that cash investments can be sold readily and efficiently and provide an appropriate return. Teekay Parent Teekay Parent’s primary sources of liquidity are its existing cash and cash equivalents, short-term investments, and cash dividends paid by Teekay Tankers on its outstanding Class A and B common shares. Teekay Parent’s total liquidity, including cash, cash equivalents and short-term investments, was $120.2 million as at December 31, 2025, compared to $183.4 million as at December 31, 2024. This decrease was primarily the result of a dividend of $85.3 million paid to shareholders during the year ended December 31, 2025, partially offset by the receipt of cash dividends of $21.3 million from Teekay Tankers. 54 Teekay Parent has no contractual obligations as at December 31, 2025, that relate to the 12-month period following such date or in subsequent periods. Due to the capital-intensive industry in which we operate and our significant reliance on long-term borrowing, the timing of capital expenditure commitments and the timing of the repayment of debt obligations are important in understanding an assessment of our ability to generate and obtain adequate amounts of cash to meet our liquidity requirements. Teekay Parent anticipates that its liquidity at December 31, 2025, combined with cash it expects to generate for the 15 months following such date, will be sufficient to meet its cash requirements for at least the one-year period following the date of this Annual Report. Teekay Tankers Teekay Tankers' primary sources of liquidity are cash and cash equivalents, short-term investments, net operating cash flow, its undrawn credit facility, and capital raised through financing transactions. The nature and extent of amounts that can be borrowed under Teekay Tankers' 2023 Revolver are described in "Item 18 – Financial Statements: Note 8 – Long-Term Debt" of this Annual Report. In May 2023, Teekay Tankers' Board of Directors approved the initiation of a regular, fixed quarterly cash dividend in the amount of $0.25 per outstanding Class A and B common share. Teekay Tankers has paid such quarterly dividends since the first quarter of 2023. In addition, Teekay Tankers' Board of Directors declared a special cash dividend of $1.00 per common share in May 2023, a special cash dividend of $2.00 per common share in May 2024, and another special cash dividend of $1.00 per common share in May 2025. In May 2023, Teekay Tankers' Board of Directors also authorized a new share repurchase program for the repurchase of up to $100 million of Teekay Tankers' outstanding Class A common shares to be utilized at its discretion. As at December 31, 2025, no shares were repurchased under this program. Teekay Tankers' total consolidated liquidity, including cash, cash equivalents, short-term investments and undrawn credit facilities, increased by $258.4 million during the year ended December 31, 2025, from 765.9 million at December 31, 2024 to 1.0 billion at December 31, 2025. The increase was primarily a result of the following events or changes during the year ended December 31, 2025: $343.1 million received from the sales of eight Suezmax tankers and three Aframax / LR2 tankers; $305.9 million of net operating cash inflow; $26.3 million of proceeds received from the sale of the entire investment in marketable securities; a $25.2 million distribution received from the equity-accounted joint venture; and $1.7 million of proceeds received upon the exercise of stock options; partially offset by $190.3 million paid for the purchases of one Aframax / LR2 tanker, one Suezmax tanker and one VLCC tanker; $99.0 million for payments held in escrow for the purchase of three Aframax / LR2 tankers; $82.3 million of reduction in the borrowing capacity of the 2023 Revolver; $69.0 million of cash dividends paid on Teekay Tankers' Class A and Class B common shares; $3.0 million of expenditures for capital upgrades for vessels and equipment; and $2.3 million paid for an investment in marketable securities. Teekay Tankers anticipates that its liquidity as at December 31, 2024, combined with cash it expects to generate for the 15 months following such date, will be sufficient to meet its cash requirements for at least the one-year period following the date of this Annual Report. Teekay Tankers' 2023 Revolver matures in May 2029, and there was no amount outstanding under the facility as at December 31, 2025. Teekay Tankers' ability to refinance its 2023 Revolver will depend upon, among other things, the estimated market value of its vessels, its financial condition and the condition of credit markets at such time. Approximately 65% of Teekay Tankers' fleet is currently aged 15 years and older, and Teekay Tankers intends to continue the process of fleet renewal in the coming years. Teekay Tankers expects that any fleet renewal expenditures will be funded using cash on hand, the undrawn revolving credit facility and new financing arrangements, including bank borrowings, finance leases and, potentially, the issuance of debt and equity securities. The following table summarizes Teekay Tankers' contractual obligations as at December 31, 2025. (in millions of U.S. Dollars) Total 2026 2027 2028 2029 U.S. Dollar-Denominated Obligations Chartered-in vessels (operating leases) (1) 67.9 36.7 15.3 8.5 7.4 Vessel acquisition (2) 42.5 42.5 Total 110.4 79.2 15.3 8.5 7.4 (1)Excludes payments required if Teekay Tankers exercises options to extend the terms of in-chartered leases signed as of December 31, 2025. (2)In December 2025, Teekay Tankers signed agreements to acquire three 2016-built Aframax / LR2 tankers for a total purchase price of $141.5 million. The full purchase price of $94.3 million related to two of the tankers and a deposit of $4.7 million related to the remaining tanker were placed in an escrow account as at December 31, 2025. In January 2026, Teekay Tankers took delivery of the three tankers and paid the remaining balance related to one of the tankers using cash on hand. 55 Other risks and uncertainties related to Teekay Tankers' liquidity include changes to income tax legislation or the resolution of uncertain tax positions relating to freight tax liabilities as described in "Item 18 – Financial Statements: Note 17 – Income Tax Recovery (Expense)" of this Annual Report, which could have a significant financial impact on Teekay Tankers' business, which we cannot predict with certainty at this time. In addition, existing or future climate control legislation or other regulatory initiatives that restrict emissions of greenhouse gases could have a significant financial and operational impact on Teekay Tankers' business, which we cannot predict with certainty at this time. Such regulatory measures could increase Teekay Tankers' costs related to operating and maintaining its vessels and require it to install new emission controls, acquire allowances or pay taxes or penalties related to its greenhouse gas emissions, or administer and manage a greenhouse gas emissions program. The inclusion of the maritime industry in the European Union Emissions Trading System (or EU ETS) as of January 1, 2024, requires Teekay Tankers to acquire allowances related to its greenhouse gas emissions as outlined in "Item 18 - Financial Statements: Note 1 - Summary of Significant Accounting Policies", "Item 18 - Financial Statements: Note 6 – Goodwill, Intangible Assets and Other Non-Current Assets" and "Item 18 - Financial Statements: Note 7 – Accrued Liabilities and Other Long-Term Liabilities" of this Annual Report. In addition to the EU ETS, the introduction of the FuelEU Maritime regulation by the European Union as of January 1, 2025, requires Teekay Tankers to pay financial penalties in relation to certain voyages when not using low emission intensity fuels. Increased regulation of greenhouse gases may, in the long-term, lead to reduced demand for oil and reduced demand for Teekay Tankers' services. In addition, geopolitical conflicts, governmental sanctions and tariffs, and U.S. and Chinese port fee measures that took effect in October 2025 but have been mutually agreed to be suspended until October 2026, could have significant financial and other impacts on Teekay Tankers' industry and business, which we are cannot predict with certainty at this time. CRITICAL ACCOUNTING ESTIMATES We prepare our consolidated financial statements in accordance with GAAP, which requires us to make estimates in the application of our accounting policies based on our best assumptions, judgments and opinions. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments in an effort to ensure that our consolidated financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. Accounting estimates and assumptions discussed in this section are those that we consider to be the most critical to an understanding of our financial statements because they inherently involve significant judgments and uncertainties. For a further description of our material accounting policies, please read “Item 18 – Financial Statements: Note 1 – Summary of Significant Accounting Policies" included in this Annual Report. Revenue Recognition Description. We recognize voyage revenue on either a load-to-discharge or discharge-to-discharge basis. Voyage revenues are recognized ratably from the beginning of when product is loaded to when it is discharged (unloaded) if using a load-to-discharge basis, or from when product is discharged at the end of the prior voyage to when it is discharged after the current voyage, if using a discharge-to-discharge basis. However, we do not begin recognizing revenue for any of our vessels until a charter has been agreed to by the customer and us, even if the vessel has discharged its cargo and is sailing to the anticipated load port on its next voyage. Judgments and Uncertainties. Whether to use the load-to-discharge basis or the discharge-to-discharge basis depends on whether the customer directs the use of the vessel throughout the period of use, pursuant to the terms of the voyage charter. This is a matter of judgment. However, we believe that if the customer has the right to direct the vessel to different load and discharge ports, among other things, a voyage charter contract contains a lease, and the lease term begins on the later of the vessel’s last discharge or inception of the voyage charter contract. As such, in this case revenue is recognized on a discharge-to-discharge basis. Otherwise, it is recognized on a load-to-discharge basis. As at December 31, 2025, 2024 and 2023, revenue from voyages then in progress was recognized on a discharge-to-discharge basis. Effect if Actual Results Differ from Assumptions. If our assessment of whether the customer directs the use of the vessel throughout the period of use is not consistent with actual results, then the period over which voyage revenue is recognized would be different and as such our revenues could be overstated or understated for any given period by the amount of such difference. Had revenue from voyages in progress been recognized on a load-to-discharge basis, our income from operations for the year ended December 31, 2025 would have decreased by $1.1 million. Vessel Depreciation Description. The carrying value of each of our vessels represents its original cost at the time of delivery or purchase less depreciation and impairment charges. We depreciate the original cost, less an estimated residual value, of our vessels on a straight-line basis over each vessel’s estimated useful life. The carrying values of our vessels may not represent their market value at any point in time because the market prices of second-hand vessels tend to fluctuate with changes in charter rates and the cost of newbuildings, among other factors. Both charter rates and newbuilding costs tend to be cyclical in nature. Judgments and Uncertainties. For the years ended December 31, 2025, 2024 and 2023, depreciation was calculated using an estimated useful life of 25 years, commencing on the date the vessel is delivered from the shipyard. The estimated useful life of our vessels involves an element of judgment, which takes into account design life, commercial considerations and regulatory restrictions. Effect if Actual Results Differ from Assumptions. The actual life of a vessel may be different than the estimated useful life, with a shorter actual useful life resulting in an increase in depreciation expense and potentially resulting in an impairment loss. A longer actual useful life will result in a decrease in depreciation expense. Had we depreciated our vessels using an estimated useful life of 20 years instead of 25 years effective December 31, 2024, our depreciation for the year ended December 31, 2025 would have increased by approximately $57.1 million. 56 Vessel Impairment Description. We review vessels and equipment for impairment whenever events or circumstances indicate the carrying value of an asset, including the carrying value of the charter contract, if any, under which the vessel is employed, may not be recoverable. This occurs when the asset’s carrying value is greater than the future estimated undiscounted cash flows the asset is expected to generate over its remaining useful life. If the estimated future undiscounted cash flows of an asset exceed the asset’s carrying value, no impairment is recognized even though the fair value of the asset may be lower than its carrying value. If the estimated future undiscounted cash flows of an asset are less than the asset’s carrying value and the fair value of the asset is less than its carrying value, the asset is written down to its fair value. Fair value is determined based on appraised values or discounted cash flows. In cases where an active second-hand sale and purchase market exists, an appraised value is generally the amount we would expect to receive if we were to sell the vessel. The appraised values are provided by third parties where available or prepared by us based on second-hand sale and purchase market data. In cases where an active second-hand sale and purchase market does not exist, or in certain other cases, fair value is calculated as the net present value of estimated future cash flows, which, in certain circumstances, will approximate the estimated market value of the vessel. For a vessel under charter, the discounted cash flows from that vessel may exceed its market value, as market values may assume the vessel is not employed on an existing charter. Judgments and Uncertainties. Our evaluation of events or circumstances that may indicate impairment, include, among others, an assessment of the intended use of the assets and anticipated operating cash flows, which is primarily influenced by the estimate of future charter rates for the vessels. Our estimates of future undiscounted cash flows used to determine whether a vessel's carrying value is recoverable involve assumptions about future charter rates, vessel utilization, operating expenses, dry-docking expenditures, vessel residual values, the probability of the vessel being sold and the remaining estimated life of our vessels. Our estimated charter rates are based on rates under existing vessel contracts and market rates at which we expect we can re-charter our vessels. Such market rates for the first three years are based on prevailing market 3-year time-charter rates and thereafter, a 10-year historical average of actual spot-charter rates earned by our vessels. Our estimated charter rates are discounted for the years when the vessel age is 15 years and older, as compared to the estimated charter rates for years when the vessel is younger than 15 years. Such discounts primarily reflect expectations of lower utilization for older vessels. Our estimates of vessel utilization, including estimated off-hire time, are based on historical experience. Our estimates of operating expenses and dry-docking expenditures are based on historical operating and dry-docking costs as well as our expectations of future inflation, operating and maintenance requirements, and our vessel maintenance strategy. Vessel residual values are a product of a vessel’s lightweight tonnage and an estimated scrap rate per tonne. The probability of a vessel being sold is based on our current plans and expectations. The remaining estimated lives of our vessels used in our estimates of future cash flows are consistent with those used in the calculations of depreciation. In our experience, certain assumptions relating to our estimates of future cash flows are more predictable by their nature, including estimated revenue under existing contract terms, ongoing operating costs and remaining vessel life. Certain assumptions relating to our estimates of future cash flows require more judgment and are inherently less predictable, such as future charter rates beyond the firm period of existing contracts, the probability and timing of vessels being sold and vessel residual values, due to their volatility. We believe that the assumptions used to estimate future cash flows of our vessels are reasonable at the time they are made. We can make no assurances, however, as to whether our estimates of future cash flows, particularly future vessel charter rates or vessel values, will be accurate. Effect if Actual Results Differ from Assumptions. If we conclude that a vessel or equipment is impaired, we recognize a loss in an amount equal to the excess of the carrying value of the asset over its fair value at the date of impairment. The written-down amount becomes the new lower cost basis and will result in a lower annual depreciation expense in future periods than for periods before the vessel impairment. Consequently, any changes in our estimates of future undiscounted cash flows may result in a different conclusion as to whether a vessel or equipment is impaired, leading to a different impairment amount, including no impairment, and a different future annual depreciation expense. Consistent with our methodology in prior years, we have determined that none of our vessels has a market value less than its carrying value as of December 31, 2025. The recognition of an impairment in the future for our vessels may depend on future vessel values and charter rates, vessel utilization, operating expenses, dry-docking expenditures, vessel residual values, the probability of the vessel being sold and the remaining estimated life of our vessels. Taxes Description. The expenses we recognize relating to taxes are based on our income, statutory tax rates and our interpretations of the tax regulations in the various jurisdictions in which we operate. We review our tax positions quarterly and adjust the balances as new information becomes available. Judgments and Uncertainties. We recognize the tax benefits of uncertain tax positions only if it is more likely than not that a tax position taken or expected to be taken in a tax return will be sustained upon examination by the taxing authorities, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in evaluating uncertainties. Effect if Actual Results Differ from Assumptions. If we determine that an uncertain tax position is sustained upon examination, and such amount is in excess of the net amount previously recognized, we increase our net income or decrease our net loss in the period such determination was made. Likewise, if we determine that an uncertain tax position is not sustained upon examination, we typically decrease our net income or increase our net loss in the period such determination was made. See “Item 18 – Financial Statements: Note 17 – Income Tax Recovery (Expense)” of this Annual Report. As at December 31, 2025, the total amount of recognized uncertain freight tax liabilities was $31.1 million (December 31, 2024 - $41.4 million). If the uncertainty about these freight tax liabilities is resolved in our favor, we concurrently reverse these liabilities. 57 NON-GAAP FINANCIAL MEASURES Net Revenues - Tankers Net revenues is a non-GAAP financial measure. Consistent with general practice in the shipping industry, we use “net revenues” (defined as income or loss from operations before vessel operating expenses, charter hire expenses, depreciation and amortization, general and administrative expenses, gain or loss on sale and write-down of assets, and restructuring charges) as a measure of equating revenues generated from voyage charters to revenues generated from time charters, which assists us in making operating decisions about the deployment of our vessels and their performance. Since under time charters the charterer pays the voyage expenses, whereas under voyage charters, the ship-owner pays these expenses, we include voyage expenses in net revenues. Some voyage expenses are fixed, and the remainder can be estimated. If we, as the ship owner, pay the voyage expenses, we typically pass the approximate amount of these expenses on to our customers by charging higher rates to them. As a result, although revenues from different types of contracts may vary, the net revenues are comparable across the different types of contracts. We principally use net revenues because it provides more meaningful information to us than income from operations, the most directly comparable GAAP financial measure. Net revenues is also widely used by investors and analysts in the shipping industry for comparing financial performance between companies and to industry averages. The following table reconciles net revenues with income from operations. Year Ended December 31, (in thousands of U.S. Dollars) 2025 2024 2023 Tankers Segment Income from operations 299,349 365,461 535,910 Add (subtract) specific items affecting income from operations: Vessel operating expenses 131,011 150,605 148,960 Charter hire expenses 42,742 74,379 70,836 Depreciation and amortization 86,630 93,582 97,551 General and administrative expenses 46,568 48,833 45,936 Gain on sale and write-down of assets (99,659) (38,080) (10,360) Restructuring charges — 5,952 1,248 Net revenues 506,641 700,732 890,081 EBITDA and Adjusted EBITDA EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA represents net income or loss before net income or loss attributable to the Entities under Common Control, interest, taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA before gain or loss on sale and write-down of assets, dividend income, realized gain or loss on interest rate swaps, unrealized gain or loss on derivative instruments, equity income or loss, gain on distribution from equity-accounted investment and certain other income or expenses. EBITDA and Adjusted EBITDA are used as supplemental financial performance measures by management and by external users of our financial statements, such as investors. EBITDA and Adjusted EBITDA assist our management and investors by increasing the comparability of our fundamental performance from period to period and against the fundamental performance of other companies in our industry that provide EBITDA or Adjusted EBITDA-based information. This increased comparability is achieved by excluding the potentially disparate effects between periods or companies of interest expense, taxes, depreciation or amortization (or other items in determining Adjusted EBITDA), which items are affected by various and possibly changing financing methods, capital structure and historical cost basis and which items may significantly affect net income between periods. We believe that including EBITDA and Adjusted EBITDA benefits investors in (a) selecting between investing in us and other investment alternatives and (b) monitoring our ongoing financial and operational strength and health in order to assess whether to continue to hold our equity. Neither EBITDA nor Adjusted EBITDA should be considered an alternative to net income, operating income, or any other measure of financial performance presented in accordance with GAAP. EBITDA and Adjusted EBITDA exclude some items that affect net income and operating income, and these measures may vary among other companies. Therefore, EBITDA and Adjusted EBITDA as presented below may not be comparable to similarly titled measures of other companies. 58 The following table reconciles our consolidated EBITDA and Adjusted EBITDA to net income. Year Ended December 31, 2025 2024 2023 Income Statement Data: (in thousands of U.S. Dollars) Reconciliation of EBITDA and Adjusted EBITDA to Net income Net income $ 351,985 $ 401,619 $ 517,423 Depreciation and amortization 86,630 93,582 97,551 Interest (income) expense, net of interest expense (income) (33,270) (29,676) 3,881 Income tax (recovery) expense (4,584) 405 12,162 EBITDA 400,761 465,930 631,017 Gain on sale and write-down of assets (101,745) (38,080) (10,360) Realized gains from interest rate swaps — — (4,167) Unrealized losses (gains) on derivative instruments — — 3,709 Equity income and gain on distribution from equity-accounted investment (9,617) (2,767) (3,432) Other (income) loss (1) (2,174) (4,334) 2,140 Adjusted EBITDA 287,225 420,749 618,907 (1)The amount for the year ended December 31, 2025 relates to a realized gain on the sale of investment in marketable securities, an unrealized loss on investment in marketable securities, foreign exchange gains and dividend income. The amount for the year ended December 31, 2024 primarily relates to foreign exchange gains, recoveries related to the settlement of prior year claims, an unrealized gain on investment in marketable securities and the premium paid as part of the exercise of early purchase options for the repurchase of certain sale-leaseback vessels. The amount for the year ended December 31, 2023 primarily relates to a loss on disposal of a defined benefit pension plan, partially offset by the settlement of a legal claim, foreign exchange gains and the premium paid as part of the exercise of early purchase options in relation to the repurchase of certain sale-leaseback vessels, and decreases in an asset retirement obligation.