You should carefully consider the risks described below. The global economic downturn may adversely affect our business and performance. The global economic outlook for the near future remains uncertain. Our business is affected by highly cyclical market demand for our products and services. In particular, POSCO and our other subsidiaries that engage in steel production activities are affected by market demand from a number of industries, including the construction, automotive, shipbuilding and electrical appliances industries as well as downstream steel processors, which are sensitive to general conditions in the global economy. Macroeconomic factors, such as the economic growth rate, employment levels, interest rates, inflation rates, exchange rates, commodity prices, demographic trends and fiscal policies of governments can have a significant effect on such industries. From time to 2 Table of Contents time, these industries have experienced significant and sometimes prolonged downturns, which in turn have negatively impacted our steel business. Global economic conditions have deteriorated in recent years, with global financial and capital markets experiencing substantial volatility. In particular, the COVID-19 pandemic that began in late 2019 and rapid increases in interest rates globally starting in the second half of 2021 to combat inflation have materially and adversely affected the global economy and financial markets. See “— Earthquakes, tsunamis, floods, severe health epidemics (including the occurrence of widespread infectious diseases such as the global COVID-19 pandemic) and other natural calamities could materially and adversely affect our business, results of operations or financial condition.” Such uncertainties have been caused by, and continue to be exacerbated by, among other things, deterioration in economic and trade relations between major economies (particularly between the United States and China), the outbreak of the Russia-Ukraine war in February 2022 and the military conflicts between Iran and other countries, including the United States and Israel, that have destabilized the global energy sector, the slowdown of economic growth in China and other major emerging market economies, adverse economic and political conditions in Europe and Latin America, continuing geopolitical and social instability in North Korea and various parts of the Middle East, and impositions of tariffs and other trade protective measures around the world. See “— Korea and the rest of Asia are our most important markets, and our current business and future growth could be materially and adversely affected if economic conditions in the region deteriorate.” Actual or anticipated further deterioration of global economic conditions may result in a decline in demand for our products. In the case of a prolonged decrease in demand (which may occur or be exacerbated as a result of tariffs imposed on imports into our major export markets), we may need to rationalize our production capacity and reduce fixed costs, and we will likely face pressure to reduce prices of our products. From time to time, we have adjusted our crude steel production levels and sales prices in response to sluggish demand from our customers in industries adversely impacted by the deteriorating economic conditions. We decreased our aggregate production level from 39.9 million tons in 2023 to 39.3 million tons in 2024 and to 38.6 million tons in 2025 in response to weak global economic conditions. During such periods, the weighted average unit sales price for our semi-finished and finished steel products produced by us and directly sold to external customers decreased from Won 1,272,754 per ton in 2023 to Won 1,217,705 per ton in 2024 and Won 1,159,315 per ton in 2025 primarily reflecting general deterioration of the global steel market conditions, which was partially offset by general depreciation of the Won against the U.S. dollar that increased our export prices in Won terms. Such weakening demand and a general oversupply in the market have negatively impacted our results of operations in 2024 and 2025. Our revenue decreased by 4.7%, or Won 3,597 billion, from Won 77,057 billion in 2023 to Won 73,459 billion in 2024, and our profit decreased by 45.6%, or Won 841 billion, from Won 1,846 billion in 2023 to Won 1,005 billion in 2024. Our revenue decreased by 6.1%, or Won 4,472 billion, from Won 73,459 billion in 2024 to Won 68,987 billion in 2025, and our profit decreased by 47.6%, or Won 478 billion, from Won 1,005 billion in 2024 to Won 527 billion in 2025. We expect fluctuation in demand for our steel products and trading services to continue at least in the near future. We may decide to further adjust our future crude steel production or our sales prices on an ongoing basis subject to market demand for our products, the production outlook of the global steel industry and global economic conditions in general. In addition, economic downturns in the Korean and global economies could result in market conditions characterized by weaker demand for steel products from a number of industries as well as falling prices for export and import products and reduced trade levels. Deterioration of market conditions may result in changes in assumptions underlying the carrying value of certain assets, which in turn could result in impairment of such assets, including intangible assets such as goodwill. Our ability to reduce expenditures for production facilities and research and development during an industry downturn is limited because of the need to maintain our competitive position. If we are unable to reduce our expenses sufficiently to offset reductions in 3 Table of Contents price and sales volume, our margins will suffer and our business, financial condition and results of operations may be materially and adversely affected. We operate in the highly competitive steel, trading, construction and energy industries, and our failure to successfully compete would adversely affect our market position and business. Steel Segment. Our subsidiaries that produce steel products, including POSCO, our wholly-owned subsidiary, operate in the highly competitive steel industry and face intense global competition. China is the largest steel-producing country in the world by a significant margin, with the balance between its domestic production and demand being an important factor in the determination of global steel prices. In recent years, a slowdown in domestic demand for steel products in China, resulting from slowed economic growth as well as the impact from the COVID-19 pandemic, combined with an expansion in steel production capacity, has led to production over-capacity in the Chinese steel industry, which in turn has led the Chinese government to pursue aggressive consolidation in the Chinese steel industry that has resulted in fewer but larger steel manufacturers that are able to compete more effectively in the global steel industry. Competition from such global steel manufacturers with expanded production capacity as well as competitors from emerging markets, especially from China and India, has resulted in significant price competition and may result in declining margins and reductions in revenue in the future. POSCO’s larger competitors may use their resources, which may be greater than POSCO’s, against POSCO in a variety of ways, including by making additional acquisitions, investing more aggressively in product development and capacity and displacing demand for our export products. Increased production capacity, combined with decreased demand resulting from a slowdown of the global economy, has from time to time resulted in production over-capacity in the global steel industry which in turn has resulted in downward pressure on global steel prices. In 2023, 2024 and 2025, global demand for steel products remained weak reflecting general deterioration of the global steel market conditions. Production over-capacity in the global steel industry may further intensify if global economic recovery slows or demand from developing countries, particularly from China, continues to lag behind the growth in production capacity. Production over-capacity in the global steel industry is likely to: • reduce export prices in U.S. dollar terms of our principal products, which in turn may reduce our sales prices in Korea as well; • increase competition in the Korean market as foreign producers seek to export steel products to Korea as other markets experience a slowdown; • negatively affect demand for our products abroad and our ability to expand export sales; and • affect our ability to increase steel production in general. Steel also competes with other natural and synthetic materials that may be used as steel substitutes, such as aluminum, cement, composites, glass, plastic and wood. Government regulatory initiatives mandating the use of such materials instead of steel, whether for environmental or other reasons, as well as the development of attractive alternative substitutes for steel products, may reduce demand for steel products and increase competition in the global steel industry. As part of our strategy to compete in this challenging landscape, our steel subsidiaries will continue to invest in developing innovative products that offer the greatest potential returns and enhance the overall quality of our products, as well as make additional investments in the development of new manufacturing technologies. However, there is no assurance that they will be able to continue to compete successfully in this economic environment or that the prolonged slowdown of the global economy or production over-capacity will not have a material adverse effect on our business, results of operations or financial condition. 4 Table of Contents Trading Segment of the Infrastructure Business. POSCO INTERNATIONAL Corporation (“POSCO INTERNATIONAL”), our consolidated subsidiary, competes principally with other Korean general trading companies that are affiliated with major domestic business groups, as well as global trading companies based in other countries. In the domestic market, competition for export transactions on behalf of domestic suppliers and import transactions on behalf of domestic purchasers was historically limited, as most affiliated general trading companies of large Korean business groups generally relied on affiliate transactions for the bulk of their trading business. However, many of these Korean general trading companies have reduced their reliance on their affiliated business group and transactions carried out on behalf of their member companies and instead have generally evolved to focus on segments of the import and export markets in which they have a competitive advantage. As a result, competition among Korean general trading companies in the area of traditional trade has become more intense. The overseas trading markets in which POSCO INTERNATIONAL operates are also highly competitive. POSCO INTERNATIONAL’s principal competitors in overseas trading markets include Korean trading companies that operate in various international markets, as well as foreign trading companies, particularly those based in Japan. As POSCO INTERNATIONAL diversifies into businesses other than traditional trading such as natural resources development, it also increasingly competes with other Korean and international companies involved in these businesses. Some of POSCO INTERNATIONAL’s competitors may be more experienced and have greater financial resources and pricing flexibility than POSCO INTERNATIONAL, as well as more extensive global networks and wider access to customers. There is no assurance that POSCO INTERNATIONAL will be able to continue to compete successfully in this economic environment or that the prolonged slowdown of the global economy will not have a material adverse effect on our business, results of operations or financial condition. On January 1, 2023, POSCO Energy Corporation (“POSCO Energy”), Korea’s largest domestic private power utility company and a provider of alternative environmentally-friendly energy solutions, merged into POSCO INTERNATIONAL. POSCO INTERNATIONAL’s power generation business competes principally with private-sector power generation companies in Korea that are affiliated with major domestic business groups, including SK Innovation Co., Ltd. and GS EPS Co., Ltd. Construction Segment of the Infrastructure Business. POSCO Eco & Challenge Co., Ltd. (“POSCO E&C” and formerly known as POSCO Engineering & Construction Co., Ltd.), our consolidated subsidiary, operates in the highly competitive construction industry. Competition is based primarily on price, reputation for quality, reliability, punctuality and financial strength of contractors. Intense competition among construction companies may result in, among other things, a decrease in the price POSCO E&C can charge for its services, difficulty in winning bids for construction projects, an increase in construction costs and difficulty in obtaining high-quality contractors and qualified employees. In Korea, POSCO E&C’s main competition in the construction of residential and non-residential buildings, engineering, procurement and construction (“EPC”) projects, urban planning and development projects and civil works projects consists of approximately ten major domestic construction companies, many of which are member companies of other large business groups in Korea and are capable of undertaking larger-scale, higher-value-added projects that offer greater potential returns. A series of measures introduced by the Government over the past several years to regulate housing prices in Korea, as well as increasing popularity of low-bid contracts in civil works project mandates, have contributed to increased competition in the Korean construction industry in recent years. Competition for new project awards in overseas markets is also intense. In these markets, POSCO E&C faces competition from local construction companies and other major Korean construction companies with overseas operations, as well as international construction companies from other countries. Construction companies from other developed countries may be more experienced, 5 Table of Contents have greater financial resources and possess more sophisticated technology than POSCO E&C, while construction companies from developing countries often have the advantage of lower wage costs. Some of these competitors have achieved higher market penetration than POSCO E&C has in specific markets in which it competes, and POSCO E&C may need to accept lower margins in order for it to compete successfully against them. POSCO E&C’s failure to successfully compete in the domestic or overseas construction markets could adversely affect its market position and our results of operations and financial condition. Logistics and Others Segment of the Infrastructure Business. POSCO DX Co., Ltd. (“POSCO DX” and previously named POSCO ICT Co., Ltd.) competes principally with system integration service providers in Korea that are affiliated with major domestic business groups, including Samsung SDS Co., Ltd., LG CNS Co., Ltd. and SK Inc. AX. POSCO FLOW Co., Ltd. (“POSCO FLOW”) competes principally with logistics service providers in Korea that are affiliated with major domestic business groups, including Hyundai Glovis Co., Ltd., Samsung SDS Co., Ltd. and LX Pantos Co., Ltd. Rechargeable Battery Materials Segment. In the energy materials market, POSCO Future M Co., Ltd. (“POSCO Future M” and previously named POSCO Chemical Co., Ltd.) competes with other global leading manufacturers of cathode and anode materials, including LG Chemical Co., Ltd. and Ecopro BM Co., Ltd. Global demand for electric vehicles has decreased in recent years, which in turn has decreased demand for cathode and anode materials from our key customers. In part due to a slowdown of the rechargeable battery industry, POSCO Pilbara Lithium Solution Co., Ltd. (“POSCO Pilbara Lithium Solution”), a subsidiary in which we hold a 82% interest that engages in the production of lithium hydroxide, recognized an inventory impairment loss of Won 56 billion in 2024. In addition, POSCO Argentina SAU (“POSCO Argentina”), our wholly-owned subsidiary that also engages in the production of lithium hydroxide, recognized an inventory impairment loss of Won 53 billion in 2024. In its legacy business areas of refractories and lime chemicals, POSCO Future M competes principally with Chosun Refractories ENG Co., Ltd. and Korea Refractories Co., Ltd. Korea and the rest of Asia are our most important markets, and our current business and future growth could be materially and adversely affected if economic conditions in the region deteriorate. We are a holding company incorporated in Korea, and a substantial portion of our subsidiaries’ operations and assets are located in Korea. Domestic demand for steel products is affected by the condition of major steel consuming industries, such as construction, shipbuilding, automotive, electrical appliances and downstream steel processors, and the Korean economy in general. In addition, the trading operations of POSCO INTERNATIONAL are affected by the general level of trade between Korea and other countries, which in turn tends to fluctuate based on general conditions in the Korean and global economies. As a result, we are subject to political, economic, legal and regulatory risks specific to Korea, and our performance and successful fulfillment of our operational strategies are largely dependent on the overall Korean economy. Following a period of deterioration due to the debilitating effects of the COVID-19 pandemic on the Korean economy as well as on the economies of Korea’s major trading partners in 2020, the overall Korean economy showed signs of recovery in 2021. However, adverse conditions and volatility in the worldwide financial markets, fluctuations in oil and commodity prices, supply chain disruptions and the increasing weakness of the global economy, as well as significant fluctuations in policy interest rates globally (including Korea), have contributed to the uncertainty of global economic prospects in recent years and have adversely affected, and may continue to adversely affect, the Korean economy. The value of the Won relative to major foreign currencies, in particular the U.S. dollar, has fluctuated significantly and, as a result of uncertain global and Korean economic, social and political conditions, there has been significant volatility in the stock prices of Korean companies recently. Future declines in the Korea Composite Stock Price Index (the “KOSPI”), and large amounts of sales of Korean securities 6 Table of Contents by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held by financial institutions in Korea, and the ability of Korean companies to raise capital. Any future deterioration of the Korean or global economy could adversely affect our business, financial condition and results of operations. Other developments that could have an adverse impact on Korea’s economy include: • declines in consumer confidence and a slowdown in consumer spending; • rising inflationary pressures leading to increases in costs of goods and services and a decrease in purchasing power; • hostilities or political or social tensions involving countries in the Middle East (including those resulting from the hostilities in the Middle East following the Israel-Hamas war and the military conflicts between Iran and other countries, including the United States and Israel) and Northern Africa and any material disruption in the global supply of oil or sudden increase in the price of oil; • hostilities or political or social tensions involving Russia (including the Russia-Ukraine war and the ensuing actions against Russia) and any resulting adverse effects on the global supply of oil and other natural resources or the global financial markets; • adverse conditions or developments in the economies of countries and regions that are important export markets for Korea, such as China, the United States, Europe and Japan, or in emerging market economies in Asia or elsewhere, including as a result of the deterioration of economic and trade relations among such countries (including escalations of tariffs) and increased uncertainties in the global financial markets and industry; • the imposition of significant tariffs on Korea’s exports by any of Korea’s major export markets; • adverse changes or volatility in foreign currency reserve levels, interest rates, inflation rates, commodity prices (including oil prices), exchange rates (including fluctuation of the U.S. dollar, Euro or Japanese Yen exchange rates or revaluation of the Chinese Yuan) or stock markets; • the occurrence of severe health epidemics in Korea or other parts of the world; • political uncertainty or increasing strife among or within political parties in Korea following the declaration of martial law by former President Yoon Suk-yeol in December 2024 that led to his impeachment and subsequent removal in April 2025 and the election of Mr. Lee Jae-myung as President in June 2025; • deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial or trade disputes or disagreements in foreign policy; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • increased sovereign default risks in select countries and the resulting adverse effects on the global financial markets; • deterioration in the financial condition or performance of small- and medium-sized enterprises and other companies in Korea; • investigations of large Korean business groups and their senior management for possible misconduct; 7 Table of Contents • continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small- and medium-sized enterprise borrowers in Korea; • shortages of imported raw materials, natural resources, rare earth minerals or component parts due to disruptions to the global supply chain; • social and labor unrest; • substantial changes in the market prices of Korean real estate; • a substantial decrease in tax revenues and a substantial increase in the Government’s expenditures for fiscal stimulus measures, unemployment compensation and other economic and social programs, which, would likely lead to a national budget deficit as well as an increase in the Government’s debt; • financial problems or lack of progress in the restructuring of Korean business groups, other large troubled companies, their suppliers or the financial sector; • loss of investor confidence arising from corporate accounting irregularities or corporate governance issues concerning certain Korean companies; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • a continued decrease in the population and birthrates in Korea; • geopolitical uncertainty and the risk of further attacks by terrorist groups around the world; • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States. We rely on export sales for a significant portion of our total sales. Adverse economic and financial developments in Asia in the future may have an adverse effect on demand for our products in Asia and increase our foreign exchange risks. We rely on export sales for a significant portion of our total sales. In particular, the Steel Segment’s export sales and overseas sales to customers abroad accounted for 61.7% of the Steel Segment’s total revenue in 2025. The Steel Segment’s export sales to customers in Asia, including China, Japan, Indonesia, Thailand and Malaysia, accounted for 52.5% of the Steel Segment’s total export sales revenue in 2025, and we expect our sales to these countries to remain important in the future. In particular, the Steel Segment’s export sales to Asia (other than China and Japan) accounted for 22.5% of the Steel Segment’s total export sales revenue in 2025. Accordingly, adverse economic and financial developments in these countries may have an adverse effect on demand for our products. Unfavorable or uncertain economic and market conditions can be caused by, among other factors, difficulties in the financial sector, corporate, political or other scandals that may reduce confidence in the markets, declines in business confidence, increases in inflation, natural disasters or pandemics and outbreaks of hostilities or other geopolitical instability. Deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial or trade disputes or disagreements in foreign policy, or a combination of these or other factors, has in the past adversely affected, and may in the future adversely affect, demand for our products. 8 Table of Contents Economic weakness in Asia may also adversely affect our sales to the Korean companies that export to the region, especially companies in the construction, shipbuilding, automotive, electrical appliances and downstream steel processing industries. Weaker demand in these countries, combined with an increase in global production capacity, may also reduce export prices in U.S. dollar terms of our principal products sold to customers in Asia. For a discussion of production over-capacity in the global steel industry, see “— We operate in the highly competitive steel, trading, construction and energy industries, and our failure to successfully compete would adversely affect our market position and business.” We attempt to maintain and expand our export sales to generate foreign currency receipts to cover our foreign currency purchases and debt service requirements. Consequently, any decrease in our export sales could also increase our foreign exchange risks. Depreciation of the value of the Won against the U.S. dollar and other major foreign currencies may have a material adverse effect on the results of our operations and on the price of the ADSs. Our consolidated financial statements are prepared from our local currency denominated financial results, assets and liabilities and our subsidiaries around the world, which are then translated into Won. A substantial proportion of our consolidated financial results is accounted for in currencies other than the Won. Accordingly, our consolidated financial results and assets and liabilities may be materially affected by changes in the exchange rates of foreign currencies. In 2025, 61.7% of the Steel Segment’s total revenue was from overseas markets outside of Korea. To the extent that we incur costs in one currency and make sales in another, our profit margins may be affected by changes in the exchange rates between the two currencies. Since the currency in which sales are recorded may not be the same as the currency in which expenses are incurred, foreign exchange rate fluctuations may materially affect our results of operations. Depreciation of the Won may materially affect the results of our operations because, among other things, it causes: • an increase in the amount of Won required for us to make interest and principal payments on our foreign currency-denominated debt; • an increase in Won terms in the costs of raw materials and equipment that we purchase from overseas sources and a substantial portion of our freight costs, which are denominated primarily in U.S. dollars; and • foreign exchange translation losses on foreign currency-denominated liabilities, which lower our earnings for accounting purposes. Appreciation of the Won against major currencies, on the other hand, causes: • our export products to be less competitive by raising our prices in U.S. dollar, Yen and Yuan terms; and • a reduction in net sales and accounts receivables in Won from export sales, which are primarily denominated in U.S. dollars and to a lesser extent in Yen and Yuan. The overall net impact from fluctuations of the Won against major currencies is difficult to estimate and varies from year to year. We strive to naturally offset our foreign exchange risk by matching foreign currency receivables with our foreign currency payables and our overseas subsidiaries have sought to further mitigate the adverse impact of exchange rate fluctuations by conducting business transactions in the local currency of the respective market in which the transactions occur. In particular, POSCO INTERNATIONAL’s exposure to fluctuations in exchange rates, including the Won/U.S. dollar exchange rate, is limited because trading transactions typically involve matched purchase and sale contracts, which result in limited settlement exposure, and because POSCO INTERNATIONAL’s contracts with domestic suppliers of products for export and with domestic purchasers of imported products are generally denominated in U.S. dollars. Although the 9 Table of Contents impact of exchange rate fluctuations is partially mitigated by such strategies, we and our subsidiaries, particularly POSCO INTERNATIONAL and POSCO E&C, also periodically enter into derivative contracts, primarily foreign currency swaps and forward exchange contracts, to further hedge some of our foreign exchange risks. However, our results of operations have historically been affected by exchange rate fluctuations and there can be no assurance that such strategies will be sufficient to reduce or eliminate the adverse impact of such fluctuations in the future. Fluctuations in the exchange rate between the Won and the U.S. dollar will also affect the U.S. dollar equivalent of the Won price of the shares of our common stock on the KOSPI Market and, as a result, will likely affect the market price of the ADSs. These fluctuations will also affect the U.S. dollar conversion by the depositary for the ADRs of cash dividends, if any, paid in Won on shares of common stock represented by the ADSs. We are dependent on imported raw materials, and significant increases in market prices of essential raw materials could adversely affect our margins and profits. We purchase substantially all of the principal raw materials we use from sources outside Korea, including iron ore and coal. POSCO imported approximately 49 million dry metric tons of iron ore and 24 million wet metric tons of coal in 2025. Iron ore is sourced primarily from Australia, Brazil and Canada. Coal is sourced primarily from Australia, Canada and the United States. Supply disruptions, which could be caused by political or other events in the countries from which we import these materials, could adversely affect our operations. In addition, we are particularly exposed to increases in the prices of coal, iron ore and nickel, which represent the largest components of our cost of goods sold. The prices of our key raw materials have fluctuated significantly in recent years. For example, the average market price of iron ore per dry metric ton (Iron Ore 62% Fe, CFR China Index announced by Platts) was US$120 in 2023, US$109 in 2024 and US$102 in 2025. The average market price of coal per wet metric ton (Premium Low Vol Coking Coal, FOB Australia Index announced by Platts) was US$296 in 2023, US$240 in 2024 and US$188 in 2025. Such fluctuations in the price of coal in recent years were in large part attributable to sanctions imposed on Russia, a large exporter of coal, following its invasion of Ukraine in February 2022. Our long-term supply contracts generally have terms of three to ten years and provide for periodic price adjustments to the then-market prices. We typically adjust the prices on a quarterly basis and maintain approximately one month of inventory of raw materials. Such price adjustments are driven by various factors, including the global economic outlook, global market prices of raw materials and steel products, supply and demand outlook of raw materials and production costs of raw materials. For both coal and iron ore, we typically agree on the purchase price with the suppliers primarily based on the spot market price periodically announced by Platts (Premium Low Vol Coking Coal, FOB Australia Index and Iron Ore 62% Fe, CFR China Index). As of December 31, 2025, 48 million tons of iron ore and 26 million tons of coal remained to be purchased under long-term supply contracts. Future increases in prices of our key raw materials and our inability to pass along such increases to our customers could adversely affect our margins and profits. Increased prices may also cause potential customers to defer purchase of steel products, while rapidly falling prices may increase loss on valuation of raw material inventory purchased when prices were higher, either of which could have an adverse effect on our business, financial condition and results of operations. Expansion of our operations abroad is important to our long-term success, and our limited experience in the operation of our business outside Korea increases the risk that our international expansion efforts will not be successful. We conduct steel, international trading, construction and energy operations abroad, and our business relies on a global trading network comprised of overseas subsidiaries, branches and representative offices. Although many of our subsidiaries and overseas branches are located in developed countries, we also operate in numerous countries with developing economies. In addition, 10 Table of Contents we intend to continue to expand our production operations internationally by carefully seeking out investment opportunities in regions that we believe offer promising growth prospects, including the United States and India. For example, we plan to (1) make investments alongside Hyundai Motor Group for the joint development and construction of an electric arc furnace steel mill in Louisiana, United States, (2) make investments alongside JSW Steel Limited to jointly construct an integrated steel mill in Odisha, India and (3) acquire a 30% equity interest in joint venture that will hold interests in certain lithium mining assets of Mineral Resources Ltd. in Australia. We may enter into additional joint ventures with foreign companies that would enable us to rely on these businesses to conduct our operations, establish local networks and coordinate our sales and marketing efforts abroad. To the extent that we enter into these arrangements, our success will depend in part on the willingness of our partner companies to dedicate sufficient resources to their partnership with us, as well as our financial capacity to support such arrangements. In other situations, we may decide to establish manufacturing facilities by ourselves instead of relying on partners. The demand and market acceptance for our products produced abroad are subject to a high level of uncertainty and are substantially dependent upon global market conditions. We cannot assure you that our international expansion plan will be profitable or that we can recoup the costs related to such investments. Expansion of our operations abroad requires management attention and resources. In addition, we face additional risks associated with our expansion outside Korea, including: • changes in international and domestic political and economic conditions as well as social conditions; • challenges caused by distance, language, local business customs and cultural differences; • local labor relation issues which could lead to significant work stoppages and labor unrest; • higher costs associated with doing business internationally; • legal and regulatory restrictions, including foreign exchange controls that might prevent us from repatriating cash earned in countries outside Korea; • longer payment cycles in some countries; • credit risk and higher levels of payment fraud; • currency exchange risks; • potentially adverse tax consequences; and • seasonal reductions in business activity during the summer months in some countries. We have limited insurance coverage and may incur significant losses resulting from operating hazards, product liability claims from customers or business interruptions. The normal operation of our manufacturing facilities may be interrupted by accidents caused by operating hazards, power supply disruptions and equipment failures, as well as natural disasters. For example, we experienced significant losses related to flooding caused by Typhoon Hinnamnor in September 2022. See “— Earthquakes, tsunamis, floods, severe health epidemics (including the occurrence of widespread infectious diseases such as the global COVID-19 pandemic) and other natural calamities could materially and adversely affect our business, results of operations or financial condition.” As with other industrial companies, our operations involve the use, handling, generation, processing, storage, transportation and disposal of hazardous materials, which may result in fires, explosions, spills and other unexpected or dangerous accidents causing property damage as well as personal injuries or death. We are also exposed to risks associated with product liability claims in the 11 Table of Contents event that the use of the products we sell results in injury. We maintain property insurance for our property, plant and equipment that we believe to be consistent with market practice. However, we may not have adequate resources to satisfy a judgment in excess of our insurance coverage in the event of a successful claim against us. Any occurrence of accidents or other events affecting our operations could result in potentially significant monetary damages, diversion of resources, production disruption and delay in delivery of our products, which may have a material adverse effect on our business, financial condition and results of operations. Impositions of anti-dumping duties, safeguard duties, countervailing duties, quotas or tariffs may have an adverse impact on our export sales. Our subsidiaries sell a significant portion of their products outside Korea as well as engage in trading activities worldwide, and, from time to time, we are involved in trade remedy proceedings in various jurisdictions. We actively participate in such proceedings to minimize adverse effects and related risks. Although trade remedy actions and regulatory scrutiny have increased in recent years, such cases have historically been limited in scope relative to our overall global sales and operations. Through our trade affairs office, we continue to closely monitor developments in trade remedy policies, including anti-dumping duties, safeguard duties, countervailing duties, quotas and tariffs, in all major markets in which we operate, and seek to mitigate related risks by adjusting supply chains, production and export arrangements and, where necessary, defend our interests. However, there can be no assurance that free trade agreements between Korea and its major trading partners will remain unchanged, or that new or increased anti-dumping duties, safeguard duties, countervailing duties, quotas or tariffs will not be imposed on our products in the future. The occurrence of any such events, including those described below, may have a material adverse effect on our business, financial condition and results of operations. In February 2025, the President of the United States removed certain country-specific exemptions, including those applicable to the Republic of Korea, reinstating a 25% tariff on steel imports and increasing tariffs on aluminum imports to 25%, effective March 2025. In June 2025, these tariffs were further increased from 25% to 50%. U.S. tariff policies remain subject to change, and tariffs applicable to Korean-origin products have fluctuated over time and may be increased or decreased in the future. Furthermore, other countries have implemented, and may continue to implement, retaliatory tariffs or other trade restrictions in response to U.S. trade actions. For a discussion of our export sales and overseas sales to customers in North America, which includes the United States and Canada, see “Item 4. Information on the Company — Item 4.B. Business Overview — Steel Segment – Markets – Exports.” While our direct exports to customers in the United States represent a limited portion of our total sales, such measures may materially affect our downstream customers that manufacture finished products using our products in countries subject to such tariffs and export those products to the United States or other markets subject to similar trade measures. Increases in tariffs or other trade barriers applicable to products manufactured by our downstream customers may lead to higher prices, reduced competitiveness or lower end-market demand, which may in turn adversely affect demand for our products. Historically, tariffs have led to increased trade and political tensions. In response to the recent tariffs imposed by the U.S. government, various countries have implemented, or have announced plans to implement, retaliatory tariffs on goods produced in the United States. These retaliatory measures, along with the broader trend of unilateral trade actions, could trigger a cycle of trade disputes. Such political and economic tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Consequently, there can be no assurance that our proactive mitigation measures will be sufficient to offset the risks of evolving trade policies. If further tariffs are imposed on 12 Table of Contents a broader range of our exports or our customers’ exports, or if further retaliatory trade measures are adopted by affected countries, we or our customers may be required to adjust pricing, modify supply or sourcing arrangements or incur additional costs, any of which may have a material adverse impact on our business, financial condition and results of operations. Our rechargeable battery materials business is affected by market conditions in the highly cyclical rechargeable battery industry, and the key customers of such business are substantially affected by government incentives. Significant decrease in such incentives has and will likely continue to have a material adverse effect on our rechargeable battery materials business. POSCO Future M engages in the manufacturing and sale of cathode and anode materials, which are two of the main components of rechargeable batteries. In addition, we engage in natural resources development and production of lithium hydroxide and lithium carbonate. We sell our rechargeable battery materials primarily to electric vehicle battery manufacturers in Korea and abroad. Accordingly, our rechargeable battery materials business is affected by market conditions in the highly cyclical rechargeable battery industry. The industry’s cyclicality results primarily from fluctuations in demand for the end products that use rechargeable batteries, particularly from the electric vehicle industry, which are sensitive to general conditions in the global economy and the level of incentives provided to the purchasers of electric vehicles. Key customers of our rechargeable battery materials business are also impacted by certain government incentives, including grants, subsidies and tax credits. For example, in July 2025, the United States enacted legislation commonly referred to as the One Big Beautiful Bill Act (“OBBBA”), which repealed or curtailed certain consumer-facing electric vehicle incentives that had been previously available while preserving other incentives, including the advanced manufacturing production credit (“AMPC”) available for battery production and sale in the United States and investment tax credits available to purchasers of certain energy storage technology in the United States. In particular, the legislation eliminated consumer-facing electric vehicle tax credits for vehicles acquired after September 30, 2025, which may adversely affect demand for electric vehicles in the United States, which could in turn reduce demand for our rechargeable battery products. In addition, the AMPC, while currently available, is scheduled to begin phasing down from 2030 and will be progressively reduced through its expiration in 2032. Furthermore, the OBBBA introduced the “prohibited foreign entity” framework, which disallows the AMPC and other tax credits to battery manufacturers who are prohibited foreign entities or who receive “material assistance” from prohibited foreign entities. Compliance with these expanded restrictions may require us to restructure supply chains, replace or diversify suppliers, or incur additional capital expenditures and operating costs. If the AMPC is further reduced or subject to more restrictive eligibility conditions during its phase-down period, or if we are unable to satisfy applicable requirements on a cost-effective basis, our profitability and financial stability could be materially and adversely affected. There can be no assurance that we will continue to qualify for the AMPC or other governmental incentives, or that the level of benefits available to us will not be further reduced or otherwise adversely modified. Moreover, government incentive programs, including grants, subsidies and tax credits, remain subject to significant political, regulatory and interpretive uncertainty. Future changes in U.S. trade, industrial or energy policies could further limit the availability of tax credits, impose additional compliance burdens or result in increased costs, reduced operational flexibility or lower overall demand for electric vehicles or battery products. If government incentives applicable to our products or manufacturing activities are further reduced, eliminated, become subject to more restrictive conditions or otherwise become less favorable, or if we are unable to satisfy applicable eligibility requirements on a timely or cost-effective basis, our business, financial condition and results of operations could be materially and adversely affected. 13 Table of Contents Any such event may have a material adverse effect on the business, results of operations and financial condition of the Rechargeable Battery Materials Segment and us. An actual or anticipated deterioration in market conditions may result in a decline in demand for our rechargeable battery materials that may have a negative impact on the prices at which they can be sold. In such a case, we will likely face pressure to reduce prices and may need to rationalize our production capacity and reduce fixed costs. In addition, there can be no assurance that the IRA or other similar government measures will not be terminated or further amended to reduce the incentives provided to our key customers. A decrease, expiration or termination of such incentives could, if significant, have a material adverse effect on the key customers of our rechargeable battery materials business, which in turn may decrease demand for our products. The occurrence of any such events may have a material adverse impact on the business, results of operations and financial condition of the Rechargeable Battery Materials Segment. We participate in overseas natural resources exploration, development and production projects, which expose us to various risks. As part of our efforts to diversify our operations, we carefully seek out promising overseas natural resources exploration, development and production opportunities. We also participate in natural resources projects as part of consortia or through acquisitions of minority interests. We may also selectively acquire or invest in companies or businesses that engage in such activities. To the extent that we enter into these arrangements, our success in these endeavors will depend in part on the willingness of our partner companies to dedicate sufficient resources to their partnership with us, as well as our ability to finance such investments. The demand and market acceptance for such activities abroad are subject to a substantially higher level of uncertainty than our traditional steel business and are substantially dependent upon the market condition of the global natural resources industry as well as the political and social environment of the target countries. The performance of projects in which we participate may be adversely affected by the occurrence of military hostility, political unrest, acts of terrorism, natural disaster or fire. For example, in connection with our 22.1% investment in NCR LLC in the United States, we recognized an impairment loss of Won 220 billion in 2024 related to a mine fire. In addition, some of our current exploration, development and production projects involve drilling exploratory wells on properties with no proven amount of natural resource reserves. Although all drilling, whether developmental or exploratory, involves risks, exploratory drilling involves greater risks of dry holes or failure to find commercial quantities of natural resources. Other risks to which such activities are subject include obtaining required regulatory approvals and licenses, securing and maintaining adequate property rights to land and natural resources, and managing local opposition to project development. A decrease in the market price of raw materials may also adversely impact the value of our investments related to natural resources projects, potentially resulting in impairment losses. We have limited experience in this industry, and we cannot assure you that our overseas natural resources exploration, development and production projects will be profitable, that we will be able to meet the financing requirements for such projects, or that we can recoup the costs related to such investments, which in turn could materially and adversely affect our business, financial condition and results of operations. We may encounter problems with joint overseas natural resources exploration, development and production projects and large-scale infrastructure projects, which may materially and adversely affect our business. We typically pursue our natural resources exploration, development and production projects jointly with consortium partners or through acquisition of minority interests in such projects, and we expect to be involved in other joint projects in the future. We sometimes hold a majority interest in the projects among the consortium partners, but we often lack a controlling interest in the joint projects. Therefore, we may not be able to require that our joint ventures sell assets or return invested capital, 14 Table of Contents make additional capital contributions or take any other action without the vote of at least a majority of our consortium partners. If there are disagreements between our consortium partners and us regarding the business and operations of the joint projects, we cannot assure you that we will be able to resolve them in a manner that will be in our best interests. Certain major decisions, such as selling a stake in the joint project, may require the consent of all other partners. These limitations may adversely affect our ability to obtain the economic and other benefits we seek from participating in these projects. In addition, our consortium partners may: • have economic or business interests or goals that are inconsistent with ours; • take actions contrary to our instructions, requests, policies or objectives; • be unable or unwilling to fulfill their obligations; • have financial difficulties; or • have disputes with us as to their rights, responsibilities and obligations. Any of these and other factors may have a material adverse effect on the performance of our joint projects and expose us to a number of risks, including the risk that the partners may be incapable of providing the required financial support to the partnerships and the risk that the partners may not be able to fulfill their other obligations, resulting in disputes not only between our partners and us, but also between the joint ventures and their customers. Such a material adverse effect on the performance of our joint projects may in turn materially and adversely affect our business, results of operations and financial condition. Earthquakes, tsunamis, floods, severe health epidemics (including the occurrence of widespread infectious diseases such as the global COVID-19 pandemic) and other natural calamities could materially and adversely affect our business, results of operations or financial condition. If earthquakes, tsunamis, floods, severe health epidemics or any other natural calamities were to occur in the future in any area where any of our assets, suppliers or customers are located, our business, results of operations or financial condition could be adversely affected. For example, Typhoon Hinnamnor, a powerful tropical cyclone that landed in South Gyeongsang Province, Korea in September 2022, caused substantial flooding and property damage in cities located near the coastline, including Pohang. The typhoon caused electricity blackouts and flooded some of the Pohang Works’ facilities located adjacent to Youngil Bay on the southeastern coast of Korea, causing disruptions to our downstream production activities, which adversely impacted our sales in the fourth quarter of 2022 following the flood. A number of suppliers of our raw materials and customers of our products are also located in countries that have historically suffered natural calamities from time to time, such as Australia, China and Japan, as well as Korea. Any occurrence of such natural calamities in countries where our suppliers are located may lead to shortages or delays in the supply of raw materials. In addition, natural calamities in areas where our customers are located, including China, Southeast Asia, Japan, Europe, North America and Korea, may cause disruptions in their businesses, which in turn could adversely impact their demand for our products. In addition, if severe health epidemics were to occur in the future in any area where any of our assets, suppliers or customers are located, our business, results of operations or financial condition could be adversely affected. For example, COVID-19, an infectious disease caused by severe acute respiratory syndrome coronavirus 2, was declared a “pandemic” by the World Health Organization in March 2020. The global outbreak of COVID-19 had led to global economic and financial disruptions and had adversely affected our business operations. 15 Table of Contents Risks associated with COVID-19 or other types of widespread infectious diseases include: • an increase in unemployment among, and/or decrease in disposable income of, consumers who purchase the products manufactured by our customers and a decline in overall consumer confidence and spending levels, which in turn may decrease demand for our products; • disruption in the normal operations of the businesses of our customers, which in turn may decrease demand for our products; • disruption in the supply of raw materials from our suppliers and vendors; • disruption in the delivery of our products to our customers; • disruption in the normal operations of our business resulting from contraction of infectious diseases by our employees or quarantine measures imposed by governments, which may necessitate our employees to be quarantined and/or our manufacturing facilities or offices to be temporarily shut down; • disruption resulting from the necessity for social distancing, including implementation of temporary adjustment of work arrangements requiring employees to work remotely, which may lead to a reduction in labor productivity (for example, from time to time, we implemented staggered remote working arrangements for our employees at our headquarters); • depreciation of the Won against major foreign currencies, which in turn may increase the cost of imported raw materials; • unstable global and Korean financial markets, which may adversely affect our ability to meet our funding needs on a timely and cost-effective basis; and • impairments in the fair value of our investments in companies that may be adversely affected by the pandemic. In the event that a future recurrence of COVID-19 or an occurrence of other types of widespread infectious diseases cannot be effectively and timely contained, our business, financial condition and results of operations may be materially and adversely affected. The Korean electric power industry is heavily regulated by the Government, whose policies may have a material adverse impact on POSCO INTERNATIONAL’s power generation business. The Korean electric power industry is heavily regulated by the Government, which seeks to ensure balanced overall electricity supply and demand in Korea at affordable rates to end users while taking into consideration various other factors, including economic conditions, national standard of living, long-term energy supply and demand plans and seasonality. To achieve such objectives, the Government has, from time to time, adopted various policy initiatives to foster efficiency in the Korean electric power industry, and has also adopted policy measures that affect electricity tariff rates in order to ease the burden on certain consumers. In addition, these policy initiatives have not always been fully implemented as originally planned and in some cases have been amended or replaced by new initiatives, among others, due to economic or policy considerations or a change in administration. No assurance can be provided that such policies, as well as changes therein, will not have a material adverse effect on POSCO INTERNATIONAL’s power generation business, results of operations or financial condition. Cyclical fluctuations based on macroeconomic factors may adversely affect POSCO E&C’s business and performance. We engage in engineering and construction activities through POSCO E&C. The Construction Segment of our Infrastructure Business is highly cyclical and tends to fluctuate based on 16 Table of Contents macroeconomic factors, such as consumer confidence and income, employment levels, interest rates, inflation rates, demographic trends and policies of the Government. From time to time, the construction industry has experienced significant and sometimes prolonged downturns, and our construction revenues have fluctuated in the past depending on the level of public and private sector construction activities in Korea and abroad. In addition, the performance of POSCO E&C’s domestic residential property business is highly dependent on the general condition of the real estate market in Korea. The overall prospects for Korean construction companies remain uncertain, and a prolonged general downturn in the construction market resulting in weaker demand may adversely affect our business, results of operations or financial condition. Many of POSCO E&C’s domestic and overseas construction projects are on a fixed-price basis, which could result in losses for us in the event that unforeseen additional expenses arise with respect to the project. Many of POSCO E&C’s domestic and overseas construction projects are carried out on a fixed-price basis according to a predetermined timetable, pursuant to the terms of a fixed-price contract. Under such fixed-price contracts, POSCO E&C retains all cost savings on completed contracts but is also liable for the full amount of all cost overruns and may be required to pay damages for late delivery. The pricing of fixed-price contracts is crucial to POSCO E&C’s profitability, as is its ability to quantify risks to be borne by it and to provide for contingencies in the contract accordingly. POSCO E&C attempts to anticipate costs of labor, raw materials, parts and components in its bids on fixed-price contracts. However, the costs incurred and gross profits realized on a fixed-price contract may vary from its estimates due to factors such as: • unanticipated variations in labor and equipment productivity over the term of a contract; • unanticipated increases in labor, raw material, parts and components, subcontracting and overhead costs, including as a result of bad weather; • delivery delays and corrective measures for poor workmanship; and • errors in estimates and bidding. For example, in April 2025, due to a collapse at the Sinansan Line project site of POSCO E&C, POSCO E&C incurred losses and may incur additional costs, including those related to construction delays, compensation claims, regulatory penalties and enhanced safety compliance measures. Furthermore, in response to such accident, POSCO E&C temporarily suspended construction at all of its domestic sites for approximately one month to conduct company-wide safety inspections, resulting in decreased revenue, subcontractor standby costs and increased indirect costs. If unforeseen additional expenses arise over the course of a construction project, such expenses are usually borne by POSCO E&C, and its profit from the project will be correspondingly reduced or eliminated. If POSCO E&C experiences significant unforeseen additional expenses with respect to its fixed price projects, it may incur losses on such projects, which could have a material adverse effect on its financial condition and results of operations. We may not succeed in implementing our strategy to take advantage of, or fail to realize the anticipated benefits of, our holding company structure and diversification strategy. We became a holding company on March 2, 2022, and one of our principal strategies is to take advantage of our holding company structure to invest in promising businesses. In part to prepare for the eventual maturation of the Korean steel market, we have made investments in the past decade to secure new growth engines by diversifying into new businesses related to our steel operations that we believe will offer greater potential returns, as well as entering into new businesses not related to our 17 Table of Contents steel operations such as the development and production of lithium, cathode and anode materials, energy solutions (particularly liquefied natural gas (“LNG”) trading) and specialty crop (particularly palm oil, the value chain of which may be expanded into biofuel). From time to time, we may selectively acquire or invest in companies to pursue such diversification strategy. The implementation of this strategy may require additional investments of capital, infrastructure, human resources and management attention. This strategy entails certain risks, including the possibility that we may face significant competition from other holding companies and operating companies in particular segments. If our strategy does not succeed, we may incur losses on our investments and our results of operations and financial condition may suffer. In order to streamline our diversification efforts, we are currently exploring avenues to divest from non-core underperforming projects and assets. As of December 31, 2025, we have divested from 73 non-core underperforming projects and assets. Although we will continue to streamline such non-core underperforming projects and assets, any potential transaction is dependent upon a number of factors that may be beyond our control, including, among other factors, market conditions, industry trends, the interests of third-parties and the availability of financing to potential buyers on reasonable terms. Furthermore, there can be no assurance that we will be able to consummate any such transaction on acceptable terms or at all. Our failure to successfully divest from non-core underperforming projects and assets or to reinvest the proceeds of any such divestment, each on acceptable terms, may have a material adverse effect on our financial condition and results of operations. Furthermore, our success under a holding company structure depends on our ability to realize the anticipated synergies, growth opportunities and cost savings from coordinating the businesses of our various subsidiaries. Although we may integrate certain aspects of our subsidiaries’ operations into our holding company structure, our subsidiaries will generally continue to operate as independent entities with separate management and staff, and our ability to direct our subsidiaries’ day-to-day operations may be limited. We may continue to increase our equity interest in our subsidiaries or investees and may also consider acquiring or merging with other companies to achieve more balanced growth and further diversify our revenue base. The integration of our new subsidiaries’ or investees’ separate businesses and operations, as well as those of any companies we may acquire or merge with in the future, under our holding company structure could require a significant amount of time, financial resources and management attention. Moreover, that process could disrupt our operations, reduce employee morale, produce unintended inconsistencies in our standards, controls, procedures or policies, and affect our relationships with customers and our ability to retain key personnel. The realization of the anticipated benefits of our holding company structure and any mergers or acquisitions we decide to pursue may be blocked, delayed or reduced as a result of many factors, some of which may be outside our control. These factors include: • unforeseen contingent risks, including lack of required capital resources or increased tax liabilities, relating to our holding company structure; • difficulties in integrating the diverse activities and operations of our subsidiaries or investees or any companies we may merge with or acquire; • unforeseen contingent risks or latent liabilities relating to the acquisition that may become apparent in the future; • difficulties in managing a larger business; • unexpected business disruptions; • loss of key management personnel or customers; and • labor unrest. 18 Table of Contents Accordingly, we may not be able to realize the anticipated benefits of our holding company structure, and our business, results of operations and financial condition may suffer as a result. We depend on limited forms of funding to fund our operations at the holding company level. We are a holding company with no significant assets other than the shares of our subsidiaries. We expect our primary sources of funding and liquidity to be dividends from our subsidiaries, direct borrowings and issuances of equity or debt securities at the holding company level. Our ability to meet our obligations to our direct creditors and employees and our other liquidity needs and regulatory requirements at the holding company level depends on timely and adequate distributions from our subsidiaries and our ability to sell our securities or obtain credit from our lenders. The ability of our subsidiaries to pay dividends to us depends on their financial condition and operating results. In the future, our subsidiaries may enter into agreements, such as credit agreements with lenders, that impose restrictions on their ability to make distributions to us, and the terms of future obligations and the operation of Korean law could prevent our subsidiaries from making sufficient distributions to us to allow us to make payments on our outstanding obligations. See “— As a holding company, we depend on receiving dividends from our subsidiaries to pay dividends on our common shares.” Any delay in receipt of or shortfall in payments to us from our subsidiaries could result in our inability to meet our liquidity needs, and may disrupt our operations at the holding company level. In addition, creditors of our subsidiaries will generally have claims that are prior to any claims of our creditors with respect to their assets. Furthermore, our inability to sell our securities or obtain funds from our lenders on favorable terms, or at all, could also result in our inability to meet our liquidity needs and may disrupt our operations at the holding company level. As a holding company, we depend on receiving dividends from our subsidiaries to pay dividends on our common shares. Since our principal assets at the holding company level are the shares of our subsidiaries, our ability to pay dividends on our common shares largely depends on dividend payments from those subsidiaries. Those dividend payments are subject to the Korean Commercial Code and regulatory limitations, generally based on capital levels and retained earnings. For example, under the Korean Commercial Code, dividends may only be paid out of distributable income, an amount which is calculated by subtracting the aggregate amount of a company’s paid-in capital and certain mandatory legal reserves as well as certain unrealized profits from its net assets, in each case as of the end of the prior fiscal period. Our subsidiaries may not continue to meet the applicable legal and regulatory requirements for the payment of dividends in the future. If they fail to do so, they may stop paying or reduce the amount of the dividends they pay to us, which would have an adverse effect on our ability to pay dividends on our common shares. POSCO HOLDINGS INC. and POSCO remain jointly and severally liable for each other’s liabilities existing prior to the spin-off. On March 1, 2022, we spun off our domestic steel production and sales business (through a vertical spin-off in accordance with Articles 530-2 through 530-12 of the Korean Commercial Code) to establish a wholly-owned subsidiary, and we converted into a holding company within the meaning of the Monopoly Regulation and Fair Trade Act (the “Spin-off”). The registration of the Spin-off occurred on March 2, 2022. As part of the Spin-off, we amended our name from POSCO to POSCO HOLDINGS INC., and the newly created wholly-owned subsidiary was named POSCO. Under the relevant provisions of the Commercial Act of Korea relating to spin-offs, both the operating company and the holding company remain jointly and severally liable after the corporate 19 Table of Contents spin-off for all of their liabilities existing prior to the corporate spin-off unless such joint and several liability has been successfully eliminated through a special resolution adopted at a general meeting of shareholders of the splitting company and consents of creditors of the affected debt, including consent by resolutions at bondholders’ meetings, which resolutions are approved by the court. POSCO HOLDINGS INC. and POSCO remain jointly and severally liable for each other’s debts and other liabilities that existed prior to March 1, 2022 that currently remain outstanding. POSCO is the successor-in-title to all the assets and liabilities and rights and obligations that were related to the domestic steel production and sales business transferred in the Spin-off, as well as all authorized licenses, employment relations, contracts and lawsuits that were directly related to such business, and POSCO HOLDINGS INC. remains jointly and severally liable for such liabilities. The remaining assets and liabilities and rights and obligations related to other business areas remain with POSCO HOLDINGS INC., and POSCO is jointly and severally liable for such liabilities. Defaults by POSCO of such liabilities, if significant, could have a material adverse effect on our results of operations and financial condition. We are subject to environmental regulations, and our operations could expose us to substantial liabilities. We are subject to national and local environmental laws and regulations, including increasing pressure to reduce emission of carbon dioxide relating to our manufacturing process, and our steel manufacturing and construction operations could expose us to risk of substantial liability relating to environmental or health and safety issues, such as those resulting from discharge of pollutants and carbon dioxide into the environment, the handling, storage and disposal of solid or hazardous materials or wastes and the investigation and remediation of contaminated sites. We may be responsible for the investigation and remediation of environmental conditions at currently and formerly operated manufacturing or construction sites. We may also be subject to associated liabilities, including liabilities for natural resource damage, third party property damage or personal injury resulting from lawsuits brought by the Government or private litigants. In the course of our operations, hazardous wastes may be generated at third party-owned or operated sites, and hazardous wastes may be disposed of or treated at third party-owned or operated disposal sites. If those sites become contaminated, we could also be held responsible for the cost of investigation and remediation of such sites, for any associated natural resource damage, and for civil or criminal fines or penalties. Furthermore, heightened global awareness and international and national commitments to reduce greenhouse gas emissions and counteract climate change (including increased activism by non-governmental and political organizations campaigning against fossil fuel extractions) may lead to increased costs for us. Investor preferences and sentiments are also influenced by environmental, social and corporate governance considerations including climate change and the transition to a lower carbon economy. Changes in such preferences and sentiment, including increased scrutiny from market participants, environmental organizations or the press, as well as compliance with such new and more stringent environmental obligations relating to greenhouse gas emissions may require additional capital expenditures or modifications in operating practices, as well as additional reporting obligations. In addition, we may also be subject to pressure and legal actions from environmental activists. For example, in February 2025, a group of ten individuals filed a lawsuit at the Daegu District Court against POSCO seeking an injunction to stop the refurbishment of the No. 2 blast furnace at Gwangyang Works alleging that such refurbishment violates their right to a healthy environment. POSCO intends to vigorously defend against such lawsuit. We are subject to safety regulations, and our operations could expose us to substantial liabilities. The Serious Accident Punishment Act (the “SAPA”) imposes criminal liability on individuals and entities responsible for “serious accidents.” Under SAPA, the term “serious accident” encompasses not 20 Table of Contents only accidents at industrial sites, such as factories or construction sites, but also “public” disasters caused by defects in the design, manufacture, installation and management of products, product ingredients or public facilities or transportation. The SAPA imposes criminal liability against (i) business owners or executives (as defined by the law) who fail to ensure the safety of their business operations and (ii) businesses or institutions that fail their supervisory duties. In case of willful misconduct or gross negligence, the SAPA also imposes punitive damages of up to five times the actual damages. Our operational activities involve inherent risks that may result in accidents involving serious injury or loss of life, environmental damage or property damage. Even though we plan to prioritize on-site safety management by engaging in communications with different stakeholders and investing more in safe environments, there is no guarantee that there will not be accidents due to our inherent operating risks. Although we have analyzed the potential impacts of the SAPA on us and aligned our policies, internal regulations and manuals in preparation for the implementation of the SAPA, there is no guarantee that the SAPA would not adversely affect our business, financial condition and results of operations. For example, in April 2025, there was a collapse at the Sinansan Line project site of POSCO E&C and in November 2025, there were two incidents involving toxic chemicals at Pohang Steelworks, the first incident resulting in one fatality and three injured during repair work and the second incident resulting in two fatalities and four injured during sludge cleaning operations. These incidents are currently being investigated by the relevant authorities and we are fully cooperating with such investigations. While the outcome of such investigations remains uncertain, there can be no assurance that penalties or other disciplinary actions may not be imposed. There can be no assurance that any such penalties or disciplinary actions may not have a material adverse effect on our results of operations and financial condition. Under the SAPA, businesses may avoid punishment if it is found that they duly performed their duties to ensure the safety and health of the participants in their business operations. However, we cannot assure you that, despite all precautionary and preventative measures undertaken by us, these measures will prove to be fully effective at all times or that an incident that could cause harm to our reputation and operation will not happen in the future, including due to factors beyond our control. Significant breaches of information security could lead to legal and financial exposure, damage to our reputation and a loss of confidence by our customers. Our business relies heavily on mission-critical, complex and interdependent information technology systems that support our business processes. It involves the storage and transmission of confidential information relating to us as well as our customers and suppliers. Any significant breach in our information security could expose us to a risk of loss, improper use or disclosure of such information, and could give rise to significant liability or litigation, any of which could harm our reputation and adversely affect our business. We believe that there has been no instance of a material breach in our information security to date that resulted in significant disruption of our operations and had a significant adverse effect on our operational results, or on third parties, including our customers and suppliers. However, there can be no assurance that we will be able to continue to prevent security incidents or other breaches in our information security from having a material adverse effect on our business, results of operations, financial viability or reputation. In addition, our information security measures may fail due to external and internal security threats, outages, malicious intrusions and attacks, programming or human errors and malfeasance, or other similar events. Instituting appropriate access controls and safeguards across our information technology infrastructure is challenging. For a discussion of our cybersecurity risk management and strategy, see “Item 16.K. Cybersecurity.” Furthermore, outside parties may attempt to fraudulently induce employees to divulge sensitive information to gain access to our data or our customers’ data or access credentials. Because the techniques used to obtain unauthorized access, disable or degrade services or sabotage systems change frequently and often are not recognized until attacks are launched against a target, we 21 Table of Contents may be unable to anticipate these techniques or implement adequate preventative measures. If an actual or perceived breach of our cybersecurity occurs or the market perception of the effectiveness of our information security measures is compromised, this may lead to significant legal and financial exposure, including legal claims and regulatory fines and penalties, reputational harm and a loss of confidence of our customers, which could have an adverse effect on our business, financial condition and results of operations. Failure to protect our intellectual property rights could impair our competitiveness and harm our business and future prospects. We believe that developing new steel manufacturing technologies that can be differentiated from those of our competitors, such as FINEX, automotive steel manufacturing technology and high-manganese steel manufacturing technology, is critical to the success of our business. We take active measures to obtain protection of our intellectual property by obtaining patents and undertaking monitoring activities in our major markets. However, we cannot assure you that the measures we take will effectively deter competitors from improper use of our proprietary technologies. Our competitors may misappropriate our intellectual property, disputes as to ownership of intellectual property may arise and our intellectual property may otherwise become known or independently developed by our competitors. Any failure to protect our intellectual property could impair our competitiveness and harm our business and future prospects. We rely on trade secrets and other unpatented proprietary know-how to maintain our competitive position, and unauthorized disclosure of our trade secrets or other unpatented proprietary know-how could negatively affect our business. We rely on trade secrets and unpatented proprietary know-how and information. We enter into confidentiality agreements with each of our employees and consultants upon the commencement of an employment or consulting relationship. These agreements generally provide that all inventions, ideas, discoveries, improvements and patentable material made or conceived by the individual arising out of the employment or consulting relationship and all confidential information developed or made known to the individual during the term of the relationship are our exclusive property. We cannot assure the enforceability of these types of agreements, or that they will not be breached. We also cannot be certain that we will have adequate remedies for any breach. The disclosure of our trade secrets or other know-how as a result of such a breach could adversely affect our business. We face the risk of litigation proceedings relating to infringement of intellectual property rights of third parties, which, if determined adversely to us, could cause us to lose significant rights, pay significant damage awards or suspend the sale of certain products. Our success depends largely on our ability to develop and use our technology and know-how in a proprietary manner without infringing the intellectual property rights of third parties. The validity and scope of claims relating to technology and patents involve complex scientific, legal and factual questions and analysis and, therefore, may be highly uncertain. In addition, because patent applications in many jurisdictions are kept confidential for an extended period before they are published, we may be unaware of other persons’ pending patent applications that relate to our products or manufacturing processes. Accordingly, we face the risk of litigation proceedings relating to infringement of intellectual property rights of third parties. The plaintiffs in actions relating to infringement of intellectual property rights typically seek injunctions and substantial damages. Although patent and other intellectual property disputes are often settled through licensing or similar arrangements, there can be no assurance that such licenses can be obtained on acceptable terms or at all. Accordingly, regardless of the scope or validity of disputed patents or the merits of any patent infringement claims by potential or actual litigants, we may have to 22 Table of Contents engage in protracted litigation. The defense and prosecution of intellectual property suits, patent opposition proceedings and related legal and administrative proceedings can be both costly and time-consuming and may significantly divert the efforts and resources of our technical and management personnel. An adverse determination in any such litigation or proceedings could subject us to pay substantial damages to third parties, require us to seek licenses from third parties and pay ongoing royalties or redesign certain products, or subject us to injunctions prohibiting the manufacture and sale of our products or the use of technologies in certain jurisdictions. The occurrence of any of the foregoing could have a material adverse effect on our reputation, business, financial condition and results of operations. Labor laws and a recent Supreme Court decision on contract-based workers dispatched by third-party contractors could restrict flexibility in our labor management and result in an increase in our labor-related costs. In July 2022, the Supreme Court of Korea held that 59 workers employed by our third-party contractors and dispatched to our production facilities who brought a claim under the Dispatched Worker Protection Act (“DWPA”) of Korea were in a direct employment relationship with us. The DWPA limits the maximum period that a worker may be dispatched to a company to two years. Under the DWPA, worker dispatch exceeding such period may result in a company’s obligation to directly hire such dispatched workers in certain situations, including where such workers were directly supervised by the company rather than the third-party contractor. Pursuant to such judgment, we hired 55 of such workers that met our working age criteria as our full-time direct employees. In October 2022, all 59 original plaintiffs collectively filed a complaint at the Gwangju District Court claiming an aggregate amount of Won 3.0 billion as unpaid wages for the three-year period that they should have been recognized as our full-time direct employees. Furthermore, in July 2025, the 55 employees directly hired by us collectively filed a claim at the Gwangju District Court, alleging wage discrimination compared to certain other full-time direct employees. Both such lawsuits are still in progress, and we intend to vigorously defend against such lawsuits. In addition to the decision rendered by the Supreme Court in July 2022, in April 2026, the Supreme Court issued rulings in employment status lawsuits brought by 331 workers who had been dispatched to our production facilities, ruling partially against us. The Supreme Court determined that 303 of these workers were in a direct employment relationship with us, and we have hired them as full-time direct employees in accordance with the rulings. Of the remaining eight workers, one claim was dismissed due to the plaintiff exceeding the mandatory retirement age, and the cases involving the remaining seven workers have been remanded to the Gwangju High Court, where they remain pending. The plaintiffs have also jointly filed lawsuits in the Gwangju and Daegu district courts seeking unpaid wages for periods during which they claim they should have been recognized as our full-time direct employees, and these cases remain pending. As of April 21, 2026, 25 lawsuits involving approximately 4,337 workers employed by our third-party contractors who worked at our production facilities remain pending, all relating to the confirmation of employment status with us. Many of these cases also include claims for unpaid wages. In two of these cases, involving 241 and 138 workers, respectively, the district courts ruled against us, and the appellate court ruled against us in one case and partially in our favor in the other. We appealed both decisions to the Supreme Court in March 2026, and they remain pending. The plaintiffs in these cases have also filed separate lawsuits in February 2024 at the Suncheon Branch of the Gwangju District Court seeking unpaid wages, which remain pending. The remaining 23 lawsuits are pending at the district court level. We intend to vigorously defend against these claims. We cannot provide any assurance that there will not be additional lawsuits related to the employment status of workers employed by our third-party contractors who worked at our production facilities, and we have not made any provisions related to any of the pending proceedings. The application of the applicable labor law will be based on the specific facts of the cases, and the general 23 Table of Contents applicability of the July 2022 Supreme Court ruling cannot be determined with certainty at this time. However, if similar judgments were to be rendered against us, they could restrict our ability to manage our labor force flexibly and significantly increase our labor-related costs, which in turn may have a material adverse effect on our results of operations. We may be exposed to potential claims for unpaid wages and become subject to additional labor costs arising from the Supreme Court of Korea’s interpretation of ordinary wages. Under the Labor Standards Act, an employee’s “ordinary wage” is used as the basis for calculating various statutory benefits. In December 2013, the Supreme Court of Korea ruled that regularly paid bonuses, including those that are paid other than on a monthly basis, are included in the scope of employees’ ordinary wages if these bonuses are paid (i) “regularly,” (ii) “uniformly” and (iii) on a “fixed basis,” notwithstanding differential amounts based on seniority. However, in December 2024, the Supreme Court of Korea reversed its prior ruling and excluded “fixed basis” from the attributes of ordinary wage and redefined the concept and judgment criteria of what constitutes ordinary wage. According to the Supreme Court of Korea’s decision in December 2024, a wage determined to be paid regularly and uniformly in exchange for prescribed work constitutes ordinary wage regardless of the existence or fulfillment of conditions attached to it. According to such decision, wages based on tenure or on the number of working days, where payment is made only when an employee satisfies a required number of working days within the prescribed working period, are recognized as ordinary wages. However, wages conditioned on working days that exceed the prescribed working period are not regarded as ordinary wages, as they are not paid solely for performing the prescribed work but rather constitute compensation for additional work beyond the prescribed working hours. In order to minimize confusion resulting from this change, the Supreme Court of Korea also ruled that the revised legal principle will apply to ordinary wage calculations starting from the date of the ruling, which is December 19, 2024. Under this decision, any provision of a collective bargaining agreement or other agreements that attempt to exclude such regular bonuses from employees’ ordinary wages will be deemed void for violation of the mandatory provisions of Korean law. The Ministry of Employment and Labor subsequently revised the ‘Guidelines for Labor-Management Guidance on Ordinary Wage’ in February 2025 (the “Guidelines”). The new legal principle on ordinary wages is effective for ordinary wage calculations starting from December 19, 2024. While we are currently assessing the impact of the Supreme Court of Korea’s decision and the Guidelines on our regular bonuses paid in the past, if we are nonetheless determined to have underpaid employees by under-calculating their ordinary wages over the past three years or in the future, we may be liable for additional payments reflecting the expanded scope of employees’ ordinary wages. Any such additional payments may have an adverse effect on our financial condition and results of operations. Escalations in tensions with North Korea could have an adverse effect on us and the market value of our common shares and ADSs. Relations between Korea and North Korea have been tense throughout Korea’s modern history. The level of tension between Korea and North Korea has fluctuated and may increase abruptly as a result of current and future events. In particular, there have been heightened security concerns in recent years stemming from North Korea’s nuclear weapon, ballistic missile and satellite programs as well as its hostile military actions against Korea. North Korea renounced its obligations under the Nuclear Non-Proliferation Treaty in January 2003 and has conducted six rounds of nuclear tests since October 2006, including claimed detonations of hydrogen bombs, and warheads that can be mounted on ballistic missiles. Over the years, North Korea has continued to conduct a series of ballistic missile tests, including missiles launched from 24 Table of Contents submarines and intercontinental ballistic missiles that it claims can reach the United States mainland. North Korea has increased the frequency of such activities since the beginning of 2022, firing numerous ballistic missiles, including intercontinental ballistic missiles, and in November 2023, successfully launched its first spy satellite. In response, the Government has repeatedly condemned North Korea’s provocations and flagrant violations of relevant United Nations Security Council resolutions. Over the years, the United Nations Security Council has passed a series of resolutions condemning North Korea’s actions and significantly expanding the scope of sanctions applicable to North Korea, as did the United States and the European Union. North Korea’s economy also faces severe challenges, which may further aggravate social and political pressures within North Korea. Although bilateral summit meetings between Korea and North Korea were held in April, May and September 2018 and between North Korea and the United States in June 2018, February 2019 and June 2019, there can be no assurance that the level of tensions affecting the Korean peninsula will not escalate in the future. Any increase in tensions, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between Korea and North Korea or between the United States and North Korea break down or military hostilities occur, could have a material adverse effect on the Korean economy and on our business, financial condition and results of operations and the market value of our common shares and ADSs. If you surrender your ADRs to withdraw shares of our common stock, you may not be allowed to deposit the shares again to obtain ADRs. Under the deposit agreement, holders of shares of our common stock may deposit those shares with the ADR depositary’s custodian in Korea and obtain ADRs, and holders of ADRs may surrender ADRs to the ADR depositary and receive shares of our common stock. However, under current Korean laws and regulations, the depositary bank is required to obtain our prior consent for the number of shares to be deposited in any given proposed deposit that exceeds the difference between (i) the aggregate number of shares deposited by us for the issuance of ADSs (including deposits in connection with the initial and all subsequent offerings of ADSs and stock dividends or other distributions related to these ADSs) and (ii) the number of shares on deposit with the depositary bank at the time of such proposed deposit. It is possible that we may not give the consent. As a result, if you surrender ADRs and withdraw shares of common stock, you may not be able to deposit the shares again to obtain ADRs. See “Item 10. Additional Information — Item 10.D. Exchange Controls.” You may not be able to exercise preemptive rights for additional shares of common stock and may suffer dilution of your equity interest in us. The Commercial Code and our articles of incorporation require us, with some exceptions, to offer shareholders the right to subscribe for new shares in proportion to their existing ownership percentage whenever new shares are issued. If we issue new shares to persons other than our shareholders (See “Item 10.B. Memorandum and Articles of Association — Preemptive Rights and Issuance of Additional Shares”), a holder of our ADSs will experience dilution of such holding. If none of these exceptions is available, we will be required to grant preemptive rights when issuing additional common shares under Korean law. Under the deposit agreement governing the ADSs, if we offer any rights to subscribe for additional shares of our common stock or any rights of any other nature, the ADR depositary, after consultation with us, may make the rights available to you or use reasonable efforts to dispose of the rights on your behalf and make the net proceeds available to you. The ADR depositary, however, is not required to make available to you any rights to purchase any additional shares unless it deems that doing so is lawful and feasible and: • a registration statement filed by us under the Securities Act is in effect with respect to those shares; or • the offering and sale of those shares is exempt from or is not subject to the registration requirements of the Securities Act. 25 Table of Contents We are under no obligation to file any registration statement under the Securities Act to enable you to exercise preemptive rights in respect of the common shares underlying the ADSs, and we cannot assure you that any registration statement would be filed or that an exemption from the registration requirement under the Securities Act would be available. Accordingly, if a registration statement is required for you to exercise preemptive rights but is not filed by us, you will not be able to exercise your preemptive rights for additional shares and may suffer dilution of your equity interest in us. U.S. investors may have difficulty enforcing civil liabilities against us and our directors and senior management. We are incorporated in Korea with our principal executive offices located in Seoul. The majority of our directors and senior management are residents of jurisdictions outside the United States, and the majority of our assets and the assets of such persons are located outside the United States. As a result, U.S. investors may find it difficult to effect service of process within the United States upon us or such persons or to enforce outside the United States judgments obtained against us or such persons in U.S. courts, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for an investor to enforce in U.S. courts judgments obtained against us or such persons in courts in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for a U.S. investor to bring an action in a Korean court predicated upon the civil liability provisions of the U.S. federal securities laws against our directors and senior management and non-U.S. experts named in this Annual Report on Form 20-F. We engage in activities relating to countries targeted by United States, European Union and United Kingdom economic sanctions. The U.S. Department of the Treasury’s Office of Foreign Assets Control, or “OFAC,” enforces certain laws and regulations (“U.S. Sanctions”) that impose prohibitions or restrictions on U.S. persons and, in some instances, foreign entities owned or controlled by U.S. persons, with respect to activities or transactions with or involving certain countries, governments, entities and individuals that are the subject of U.S. Sanctions, including countries and territories subject to a comprehensive embargo (currently Cuba, Iran, North Korea, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, and the Crimea regions of Ukraine), as well as parties that are subject to, or are majority owned by one or more parties subject to, so-called blocking sanctions. U.S. persons are also generally prohibited from facilitating such activities or transactions. Similarly, the European Union enforces certain laws and regulations (“E.U. Sanctions”) that impose restrictions on nationals of E.U. member states, persons located within E.U. member states, entities incorporated or constituted under the law of an E.U. member state, or business conducted in whole or in part in E.U. member states with respect to activities or transactions with certain countries, governments, entities and individuals that are the subject of E.U. Sanctions. E.U. persons are also generally prohibited from activities that promote such activities or transactions. The United Kingdom also enforces certain laws and regulations (“UK Sanctions”) that impose restrictions upon UK persons with respect to activities or transactions with parties that are the subject of UK Sanctions. In light of recent international developments, particularly the ongoing war in Ukraine, the United States, European Union, United Kingdom and other jurisdictions have imposed enhanced sanctions targeting Russia. We and our subsidiaries engage in limited business activities in Russia. In particular, we purchase raw materials from non-Russian third parties that are sourced from mines in Russia. We believe that such activities do not involve any U.S. goods or services and otherwise do not implicate or violate U.S. Sanctions, E.U. Sanctions or UK Sanctions. To our knowledge, none of our business in Russia involves parties subject to U.S. Sanctions. Our activities in Russia accounted for 0.03% of our consolidated revenue in 2023. We did not recognize any revenue from business operations in Russia 26 Table of Contents in 2024 and 2025. In addition, we did not recognize any revenue from business operations in Iran in 2023, 2024 and 2025, and we currently do not have any plans to engage in business operations in Iran in the foreseeable future, other than collecting outstanding receivables. POSCO Steeleon Co., Ltd. (“POSCO Steeleon”), a subsidiary of POSCO, holds a 70% interest in Myanmar POSCO C&C Co., Ltd. (“Myanmar POSCO C&C”), a joint venture with Myanmar Economic Holdings Public Company Limited (“MEHL”). MEHL was designated for U.S. Sanctions on March 25, 2021. Myanmar POSCO C&C engages in the production and sale of coated steel roofing sheets in Myanmar, and its sales accounted for 0.03% of our consolidated revenue in 2023, 0.05% in 2024 and 0.05% in 2025. POSCO Steeleon is monitoring changes in Myanmar’s business environment and assessing its shareholding arrangement. U.S. Sanctions that apply to MEHL do not apply to us, POSCO, POSCO Steeleon or Myanmar POSCO C&C. POSCO INTERNATIONAL holds a 51.0% interest in a gas field project in Myanmar. Myanmar Oil and Gas Enterprise (“MOGE”) holds a 15.0% interest in the project and the remaining interests are held by non-sanctioned persons. On February 21, 2022, MOGE was designated for E.U. Sanctions, and certain managers of MOGE have been subsequently designated for U.S. Sanctions. Such sanctions do not extend to POSCO INTERNATIONAL, POSCO or, to our knowledge, the gas field project. On October 31, 2023, OFAC issued Burma-related Directive 1 under Executive Order 14014, which prohibits U.S. persons from providing, exporting or re-exporting, directly or indirectly, financial services to, or for the benefit of, MOGE, regardless of the currency in which any prohibited transaction is denominated.POSCO INTERNATIONAL is operating the Myanmar gas field project in compliance with such directive. Our revenue recognized from the gas field project accounted for 0.80% of our consolidated revenue in 2023, 0.83% in 2024 and 0.94% in 2025. We expect to continue to engage in business activities and make investments in countries or territories on which comprehensive U.S. Sanctions have been imposed and also plan to continue to engage in business in Russia. Although we believe that U.S. Sanctions, E.U. Sanctions and UK Sanctions under their current terms are not applicable to our current activities, the relevant authorities may take a different view, our reputation may be adversely affected, and some of our investors may be required to divest their investments in us, including under the laws of certain U.S. states or under internal investment policies or may decide for reputational reasons to divest such investments. We are aware of initiatives by U.S. governmental entities and U.S. institutional investors, such as pension funds, to adopt or consider adopting laws, regulations or policies prohibiting transactions with or investment in, or requiring divestment from, entities doing business with countries identified as state sponsors of terrorism. There can be no assurance that the foregoing will not occur, that sanctions regimes around the world will not change in a way that impacts our business, or that such occurrences will not have a material adverse effect on the value of our securities. U.S. investors could be subject to adverse U.S. federal income tax consequences if we are treated as a passive foreign investment company (“PFIC”) for any taxable year during which they hold our common stock of ADSs. We will be classified as a PFIC for U.S. federal income tax purposes if, for any taxable year, either (i) 75 percent or more of our gross income for the taxable year is passive income or (ii) at least 50 percent of the value of our assets (generally determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income. The determination of whether we are a PFIC must be made annually based on the facts and circumstances at the relevant time, some of which may be beyond our control, including the valuation of our assets as implied by the market price for our common stock or ADSs. Accordingly, we could be classified as a PFIC in the current or a future taxable year, and that possibility may be increased significantly by market volatility or a decline in the price of our common stock or ADSs. If we were to be classified as a PFIC in any taxable year during which a U.S. holder (as defined in “Item 10.E. Taxation — United States Taxation”) holds our common stock or ADSs, such U.S. holder 27 Table of Contents could be subject to a special tax at ordinary income rates on “excess distributions,” including certain distributions by us and gain that the U.S. holder recognizes on the sale of our common stock or ADSs. The amount of income tax on any excess distributions would be increased by an interest charge to compensate for tax deferral, calculated as if the excess distributions were earned ratably over the period the U.S. holder held the common stock or ADSs. See “Item 10.E. Taxation — United States Taxation — Shares of Common Stock and ADSs — Passive Foreign Investment Company Rules.” This annual report contains “forward-looking statements” that are subject to various risks and uncertainties. This annual report contains “forward-looking statements” that are based on our current expectations, assumptions, estimates and projections about our company and our industry. The forward-looking statements are subject to various risks and uncertainties. These forward-looking statements include, but are not limited to, those statements using words such as “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” “project,” “aim,” “plan,” “likely to,” “target,” “contemplate,” “predict,” “potential” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions generally intended to identify forward-looking statements. Those statements include, among other things, the discussions of our business strategy and expectations concerning our market position, future operations, margins, profitability, liquidity and capital resources. We caution you that reliance on any forward-looking statement involves risks and uncertainties, and that although we believe that the assumptions on which our forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and, as a result, the forward-looking statements based on those assumptions could be incorrect. The uncertainties in this regard include, but are not limited to, those identified in the risk factors discussed above. In light of these and other uncertainties, you should not conclude that we will necessarily achieve any plans and objectives or projected financial results referred to in any of the forward-looking statements. We do not undertake to release the results of any revisions of these forward-looking statements to reflect future events or circumstances. Item 4. Information on the Company