Corteva, Inc. [CTVA] Filings

10-Q 1 ctva-20240930.htm 10-Q ctva-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission File Number 001-38710

Corteva, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware

82-4979096

(State or other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

9330 Zionsville Road,

Indianapolis,

Indiana

46268

(833)

267-8382

974 Centre Road,

Wilmington,

Delaware

19805

(Address of Principal Executive Offices) (Zip Code)

(Registrant’s Telephone Number, including area code)

Commission File Number 1-815

EIDP, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

51-0014090

(State or other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

9330 Zionsville Road,

Indianapolis,

Indiana

46268

(833)

267-8382

974 Centre Road,

Wilmington,

Delaware

19805

(Address of Principal Executive Offices) (Zip Code)

(Registrant’s Telephone Number, including area code)

Securities registered pursuant to Section 12(b) of the Act for Corteva, Inc.:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	CTVA	New York Stock Exchange

Securities registered pursuant to Section 12(b) of the Act for EIDP, Inc.:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
$3.50 Series Preferred Stock	CTAPrA	New York Stock Exchange
$4.50 Series Preferred Stock	CTAPrB	New York Stock Exchange

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Corteva, Inc.

Yes

EIDP, Inc.

Yes

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Corteva, Inc.

Yes

EIDP, Inc.

Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Corteva, Inc.

Large Accelerated Filer

Accelerated Filer o

Non-Accelerated Filer

Smaller reporting company o

Emerging growth company o

EIDP, Inc.

Large Accelerated Filer

Accelerated Filer o

Non-Accelerated Filer

Smaller reporting company o

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


Corteva, Inc.			o
EIDP, Inc.			o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Corteva, Inc.

Yes

EIDP, Inc.

Yes

Corteva, Inc. had 687,293,000 shares of common stock, par value $0.01 per share, outstanding at October 31, 2024.

EIDP, Inc. had 200 shares of common stock, par value $0.30 per share, outstanding at October 31, 2024, all of which are held by Corteva, Inc.

EIDP, Inc. meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q (as modified by a grant of no-action relief dated February 12, 2018) and is therefore filing this form with reduced disclosure format.

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Corteva, Inc.

EIDP, Inc.

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		Page
Explanatory Note
Part I	Financial Information

Item 1.	Consolidated Financial Statements (Unaudited)
	Consolidated Statements of Operations	3
	Consolidated Statements of Comprehensive Income (Loss)	4
	Consolidated Balance Sheets	5
	Consolidated Statements of Cash Flows	6
	Consolidated Statements of Equity	7
	Notes to the Interim Consolidated Financial Statements (Unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	41
	Cautionary Statements About Forward-Looking Statements	41
	Recent Developments	42
	Overview	42
	Results of Operations	43

	Recent Accounting Pronouncements	48
	Segment Reviews	48
	Non-GAAP Financial Measures	51
	Liquidity & Capital Resources	53

	Contractual Obligations	56

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	56
Item 4.	Controls and Procedures	57

Part II	Other Information

Item 1.	Legal Proceedings	58
Item 1A.	Risk Factors	60
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	60
Item 3.	Defaults Upon Senior Securities	61
Item 5.	Other Information	61
Item 6.	Exhibits	62
Exhibit Index		62
Signature		63
Consolidated Financial Statements of EIDP, Inc. (Unaudited)		64

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Explanatory Note

Corteva owns 100% of the outstanding common stock of EIDP (defined below). EIDP is a subsidiary of Corteva, Inc. and continues to be a reporting company, subject to the requirements of the Securities Exchange Act of 1934, as amended.

Unless otherwise indicated or the context otherwise requires, references in this Quarterly Report on Form 10-Q to:

• "Corteva" or "the company" refers to Corteva, Inc. and its consolidated subsidiaries (including EIDP);

• "EIDP" refers to EIDP, Inc. (formerly known as E. I. du Pont de Nemours and Company) and its consolidated subsidiaries or EIDP excluding its consolidated subsidiaries, as the context may indicate;

• "DowDuPont" refers to DowDuPont Inc. and its subsidiaries prior to the Separation of Corteva (defined below);

• "Historical Dow" refers to The Dow Chemical Company and its consolidated subsidiaries prior to the Internal Reorganization (defined below);

• "Historical DuPont" refers to EIDP prior to the Internal Reorganization (defined below);

• "Internal Reorganizations" refers to the series of internal reorganization and realignment steps undertaken by Historical DuPont and Historical Dow to realign its business into three groups: agriculture, materials science and specialty products. Refer to the company’s Annual Report on Form 10-K for the year ended December 31, 2023 for further information.

• "Dow Distribution" refers to the separation of DowDuPont's materials science business into a separate and independent public company on April 1, 2019 by way of a distribution of Dow Inc. through a pro rata dividend in-kind of all of the then-issued and outstanding shares of Dow Inc.’s common stock;

• "Merger” refers to the all-stock merger of equals strategic combination between Historical Dow and Historical DuPont on August 31, 2017;

• "Dow" refers to Dow Inc. after the Dow Distribution;

• "DuPont" refers to DuPont de Nemours, Inc. after the Separation of Corteva (on June 1, 2019, DowDuPont Inc. changed its registered name to DuPont de Nemours, Inc.);

• "Separation" or "Separation of Corteva" refers to June 1, 2019, when Corteva, Inc. became an independent, publicly
traded company;

• "Corteva Distribution" refers to the pro rata distribution of all of the then-issued and outstanding shares of Corteva, Inc.'s common stock on June 1, 2019, which was then a wholly-owned subsidiary of DowDuPont, to holders of DowDuPont's common stock as of the close of business on May 24, 2019;

• "Distributions" refers to the Dow Distribution and the Corteva Distribution; and

• “Letter Agreement” refers to the Letter Agreement executed by DuPont and Corteva on June 1, 2019, which sets forth certain additional terms and conditions related to the Separation, including certain limitations on each party’s ability to transfer certain businesses and assets to third parties without assigning certain of such party’s indemnification obligations under the Corteva Separation Agreement to the other party to the transferee of such businesses and assets or meeting certain other alternative conditions.

This Quarterly Report on Form 10-Q is a combined report being filed separately by Corteva, Inc. and EIDP. The information in this Quarterly Report on Form 10-Q is equally applicable to Corteva, Inc. and EIDP, except where otherwise indicated.

The separate EIDP financial statements and footnotes for areas that differ from Corteva, are included within this Quarterly Report on Form 10-Q and begin on page 64. Footnotes of EIDP that are identical to that of Corteva are cross-referenced accordingly.

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PART I. FINANCIAL INFORMATION

Item 1.CONSOLIDATED FINANCIAL STATEMENTS

Corteva, Inc.

Consolidated Statements of Operations (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions, except per share amounts)	2024		2023		2024		2023
Net sales	$	2,326	$	2,590	$	12,930	$	13,519
Cost of goods sold	1,565		1,646		7,033		7,554
Research and development expense	348		335		1,037		980
Selling, general and administrative expenses	671		670		2,461		2,441
Amortization of intangibles	170		174		521		508
Restructuring and asset related charges - net	32		2		199		95
Other income (expense) - net	(107)		(149)		(319)		(354)
Interest expense	66		58		173		171
Income (loss) from continuing operations before income taxes	(633)		(444)		1,187		1,416
Provision for (benefit from) income taxes on continuing operations	(114)		(129)		274		244
Income (loss) from continuing operations after income taxes	(519)		(315)		913		1,172
Income (loss) from discontinued operations after income taxes	(2)		(3)		45		(174)
Net income (loss)	(521)		(318)		958		998
Net income (loss) attributable to noncontrolling interests	3		3		10		10
Net income (loss) attributable to Corteva	$	(524)	$	(321)	$	948	$	988
Basic earnings (loss) per share of common stock:
Basic earnings (loss) per share of common stock from continuing operations	$	(0.76)	$	(0.45)	$	1.30	$	1.64
Basic earnings (loss) per share of common stock from discontinued operations	—		—		0.06		(0.24)
Basic earnings (loss) per share of common stock	$	(0.76)	$	(0.45)	$	1.36	$	1.40
Diluted earnings (loss) per share of common stock:
Diluted earnings (loss) per share of common stock from continuing operations	$	(0.76)	$	(0.45)	$	1.29	$	1.63
Diluted earnings (loss) per share of common stock from discontinued operations	—		—		0.06		(0.24)
Diluted earnings (loss) per share of common stock	$	(0.76)	$	(0.45)	$	1.35	$	1.39

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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Corteva, Inc.

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2024		2023		2024		2023
Net income (loss)	$	(521)	$	(318)	$	958	$	998
Other comprehensive income (loss) - net of tax:
Cumulative translation adjustments	424		(323)		(206)		(41)
Adjustments to pension benefit plans	—		3		1		6
Adjustments to other benefit plans	(2)		(2)		(7)		(6)
Unrealized gain (loss) on investments	9		—		(14)		—
Derivative instruments	7		(2)		17		(154)
Total other comprehensive income (loss)	438		(324)		(209)		(195)
Comprehensive income (loss)	(83)		(642)		749		803
Comprehensive income (loss) attributable to noncontrolling interests - net of tax	3		3		10		10
Comprehensive income (loss) attributable to Corteva	$	(86)	$	(645)	$	739	$	793

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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Corteva, Inc.

Consolidated Balance Sheets (Unaudited)


(In millions, except share amounts)	September 30, 2024		December 31, 2023		September 30, 2023
Assets
Current assets
Cash and cash equivalents	$	2,421	$	2,644	$	2,254
Marketable securities	72		98		108
Accounts and notes receivable - net	6,651		5,488		6,581
Inventories	5,674		6,899		6,320
Other current assets	831		1,131		1,070

Total current assets	15,649		16,260		16,333
Investment in nonconsolidated affiliates	128		115		106
Property, plant and equipment	9,235		8,956		8,892
Less: Accumulated depreciation	5,025		4,669		4,572
Net property, plant and equipment	4,210		4,287		4,320
Goodwill	10,629		10,605		10,441
Other intangible assets	9,084		9,626		9,795
Deferred income taxes	564		584		554
Other assets	1,644		1,519		1,561

Total Assets	$	41,908	$	42,996	$	43,110
Liabilities and Equity
Current liabilities
Short-term borrowings and finance lease obligations	$	3,741	$	198	$	3,609
Accounts payable	3,753		4,280		3,678
Income taxes payable	313		174		236
Deferred revenue	429		3,406		552
Accrued and other current liabilities	2,188		2,351		2,273

Total current liabilities	10,424		10,409		10,348
Long-term debt	1,975		2,291		2,290
Other noncurrent liabilities
Deferred income tax liabilities	496		899		1,070
Pension and other post employment benefits - noncurrent	2,473		2,467		2,228
Other noncurrent obligations	1,561		1,651		1,707

Total noncurrent liabilities	6,505		7,308		7,295
Commitments and contingent liabilities
Stockholders’ equity
Common stock, $0.01 par value; 1,666,667,000 shares authorized; issued at September 30, 2024 - 689,170,000; December 31, 2023 - 701,260,000; and September 30, 2023 - 704,880,000	7		7		7
Additional paid-in capital	27,518		27,748		27,895

Retained earnings (accumulated deficit)	98		(41)		325
Accumulated other comprehensive income (loss)	(2,886)		(2,677)		(3,001)
Total Corteva stockholders’ equity	24,737		25,037		25,226
Noncontrolling interests	242		242		241
Total equity	24,979		25,279		25,467
Total Liabilities and Equity	$	41,908	$	42,996	$	43,110

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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Corteva, Inc.

Consolidated Statements of Cash Flows (Unaudited)


(In millions)	Nine Months Ended September 30,
	2024		2023
Operating activities
Net income (loss)	$	958	$	998
(Income) loss from discontinued operations after income taxes	(45)		174
Adjustments to reconcile net income (loss) to cash provided by (used for) operating activities:
Depreciation and amortization	925		899
Provision for (benefit from) deferred income tax	(422)		(268)
Net periodic pension and OPEB (credits) costs	121		105
Pension and OPEB contributions	(123)		(123)
Net (gain) loss on sales of property, businesses, consolidated companies and investments	(17)		(12)
Restructuring and asset related charges - net	199		95
Other net loss	377		342
Changes in assets and liabilities, net
Accounts and notes receivable	(1,450)		(773)
Inventories	1,060		492
Accounts payable	(518)		(1,218)
Deferred revenue	(2,974)		(2,840)
Other assets and liabilities	38		(445)
Cash provided by (used for) operating activities - continuing operations	(1,871)		(2,574)
Cash provided by (used for) operating activities - discontinued operations	(157)		(30)
Cash provided by (used for) operating activities	(2,028)		(2,604)
Investing activities
Capital expenditures	(416)		(412)
Proceeds from sales of property, businesses and consolidated companies - net of cash divested	2		42
Acquisitions of businesses - net of cash acquired	—		(1,456)
Investments in and loans to nonconsolidated affiliates	(7)		(31)

Purchases of investments	(137)		(83)
Proceeds from sales and maturities of investments	115		127
Proceeds from settlement of net investment hedge	15		42
Other investing activities, net	(38)		(2)
Cash provided by (used for) investing activities	(466)		(1,773)
Financing activities
Net change in borrowings (less than 90 days)	1,715		2,419
Proceeds from debt	3,047		3,427
Payments on debt	(1,529)		(1,314)
Repurchase of common stock	(757)		(585)
Proceeds from exercise of stock options	30		28
Dividends paid to stockholders	(340)		(327)


Other financing activities, net	(29)		(45)
Cash provided by (used for) financing activities	2,137		3,603
Effect of exchange rate changes on cash, cash equivalents and restricted cash equivalents	(45)		(68)
Increase (decrease) in cash, cash equivalents and restricted cash equivalents	(402)		(842)
Cash, cash equivalents and restricted cash equivalents at beginning of period	3,158		3,618
Cash, cash equivalents and restricted cash equivalents at end of period1	$	2,756	$	2,776

1. See page 15 for reconciliation of cash and cash equivalents and restricted cash equivalents presented in interim Consolidated Balance Sheets to total cash, cash equivalents and restricted cash equivalents presented in the interim Consolidated Statements of Cash Flows.

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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Corteva, Inc.

Consolidated Statements of Equity (Unaudited)


(In millions, except per share amounts)	Common Stock		Additional Paid-in Capital		Retained Earnings (Accum. Deficit)		Accumulated Other Comp. Income (Loss)		Non-Controlling Interests		Total Equity
2023
Balance at January 1, 2023	$	7	$	27,851	$	250	$	(2,806)	$	239	$	25,541
Net income (loss)					595				4		599
Other comprehensive income (loss)							67				67
Share-based compensation			(14)								(14)
Common dividends ($0.15 per share)					(107)						(107)
Issuance of Corteva stock			7								7
Repurchase of common stock					(252)						(252)
Other - net					1				(3)		(2)
Balance at March 31, 2023	$	7	$	27,844	$	487	$	(2,739)	$	240	$	25,839
Net income (loss)					714				3		717
Other comprehensive income (loss)							62				62
Share-based compensation			14		(1)						13
Common dividends ($0.15 per share)					(107)						(107)
Issuance of Corteva stock			19								19
Repurchase of common stock					(81)						(81)
Other - net					1				(2)		(1)
Balance at June 30, 2023	$	7	$	27,877	$	1,013	$	(2,677)	$	241	$	26,461
Net income (loss)					(321)				3		(318)
Other comprehensive income (loss)							(324)				(324)
Share-based compensation			16		(1)						15
Common dividends ($0.16 per share)					(113)						(113)
Issuance of Corteva stock			2								2
Repurchase of common stock					(252)						(252)
Other - net					(1)				(3)		(4)
Balance at September 30, 2023	$	7	$	27,895	$	325	$	(3,001)	$	241	$	25,467

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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(In millions, except per share amounts)	Common Stock		Additional Paid-in Capital		Retained Earnings (Accum. Deficit)		Accumulated Other Comp. Income (Loss)		Non-Controlling Interests		Total Equity
2024
Balance at January 1, 2024	$	7	$	27,748	$	(41)	$	(2,677)	$	242	$	25,279
Net income (loss)					419				4		423
Other comprehensive income (loss)							(333)				(333)
Share-based compensation			3		(1)						2
Common dividends ($0.16 per share)			(112)								(112)
Issuance of Corteva stock			8								8
Repurchase of common stock			(178)		(74)						(252)
Other - net			(1)		(1)				(5)		(7)
Balance at March 31, 2024	$	7	$	27,468	$	302	$	(3,010)	$	241	$	25,008
Net income (loss)					1,053				3		1,056
Other comprehensive income (loss)							(314)				(314)
Share-based compensation			15								15
Common dividends ($0.16 per share)					(111)						(111)
Issuance of Corteva stock			20								20
Repurchase of common stock					(252)						(252)
Other - net			1						(2)		(1)
Balance at June 30, 2024	$	7	$	27,504	$	992	$	(3,324)	$	242	$	25,421
Net income (loss)					(524)				3		(521)
Other comprehensive income (loss)							438				438
Share-based compensation			13								13
Common dividends ($0.17 per share)					(117)						(117)
Issuance of Corteva stock			2								2
Repurchase of common stock					(253)						(253)
Other - net			(1)						(3)		(4)
Balance at September 30, 2024	$	7	$	27,518	$	98	$	(2,886)	$	242	$	24,979

See Notes to the Interim Consolidated Financial Statements beginning on page 9.

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


			Corteva, Inc.
			Notes to the Interim Consolidated Financial Statements (Unaudited)

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Note		Page
1	Summary of Significant Accounting Policies	10
2	Recent Accounting Guidance	10
3	Business Combinations	11
4	Revenue	11
5	Restructuring and Asset Related Charges - Net	12
6	Supplementary Information	14
7	Income Taxes	16
8	Earnings Per Share of Common Stock	17
9	Accounts and Notes Receivable - Net	18
10	Inventories	19
11	Other Intangible Assets	19
12	Short-Term Borrowings, Long-Term Debt and Available Credit Facilities	19
13	Commitments and Contingent Liabilities	21
14	Stockholders' Equity	30
15	Pension Plans and Other Post Employment Benefits	32
16	Financial Instruments	33
17	Fair Value Measurements	38
18	Segment Information	38

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the results for interim periods have been included. Results for interim periods should not be considered indicative of results for a full year. These interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto contained in the company’s Annual Report on Form 10-K for the year ended December 31, 2023, collectively referred to as the “2023 Annual Report.” The interim Consolidated Financial Statements include the accounts of the company and all of its subsidiaries in which a controlling interest is maintained. The interim Consolidated Financial Statements and other financial information included in this Form 10-Q, unless otherwise specified, have been presented to separately show the effects of discontinued operations.

During the fourth quarter of 2023, the company made the decision, which was retrospectively applied, to adjust the presentation of the interim Consolidated Statement of Cash Flows to separately present the cash provided by (used for) operating activities – discontinued operations, which was previously presented within cash provided by (used for) operating activities. See Note 13 – Commitments and Contingent Liabilities, to the interim Consolidated Financial Statements, for additional information on discontinued operations activities.

Since 2018, Argentina has been considered a hyper-inflationary economy under U.S. GAAP and therefore the U.S. Dollar (“USD”) is the functional currency for our related subsidiaries. Argentina contributes approximately 4 percent to the company's annual net sales and less than 4 percent to each of the company's annual Seed and Crop Protection segment operating EBITDA. The company remeasures net monetary assets utilizing the official Argentine Peso (“Peso”) to USD exchange rate. The ability to draw down Peso cash balances is limited at this time due to government restrictions and market availability of U.S. Dollars. The devaluation of the Peso relative to the USD over the last several years has resulted in the recognition of exchange losses (refer to Note 6 – Supplementary Information, to the interim Consolidated Financial Statements, and Note 7 – Supplementary Information, to the Consolidated Financial Statements, in the company's 2023 Annual Report). The Argentina government has offered USD-denominated bonds to importers, the proceeds from which could be used to pay off outstanding intercompany payables. During the first quarter of 2024, the company purchased $125 million of these foreign government bonds as part of its strategy to manage its net monetary asset exposure in Argentina. Refer to the “Debt Securities” section in Note 16 - Financial Instruments, to the interim Consolidated Financial Statements, for additional information. As of September 30, 2024, a further 10 percent deterioration in the official Peso to USD exchange rate would not have a significant impact on the USD value of our net monetary assets or pre-tax earnings. The company will continue to assess the implications to our operations and financial reporting.

NOTE 2 - RECENT ACCOUNTING GUIDANCE

Recently Adopted Accounting Guidance

In August 2023, the FASB issued ASU 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement. The amendments in this ASU are intended to facilitate consistency in the application of accounting guidance upon the formation of entities qualifying as joint ventures. It generally requires the use of business combinations accounting at the joint venture formation date, which would result in the contributed assets/liabilities being revalued to fair value and potentially result in the recognition of goodwill and other intangible assets on the joint venture’s financial statements. It does not alter the ongoing accounting for the joint venture’s operations. This guidance is effective for joint ventures with formation dates on or after January 1, 2025. Prospective application is required, with early adoption permitted. Retrospective application can be elected for joint ventures formed before January 1, 2025. Beginning in the third quarter of 2024, newly-formed joint ventures have applied this guidance.

Accounting Guidance Issued But Not Adopted as of September 30, 2024

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU requires that an entity disclose specific categories in the effective tax rate reconciliation as well as reconciling items that meet a quantitative threshold. Further, the ASU requires additional disclosures on income tax expense and taxes paid, net of refunds received, by jurisdiction. The new standard is effective for annual periods beginning after December 15, 2024 on a prospective basis with the option to apply it retrospectively. Early adoption is permitted. The adoption of this guidance will result in the company being required to include enhanced income tax related disclosures.

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU includes amendments that expand the existing reportable segment disclosure requirements and requires disclosure of (i) significant expense categories and amounts by reportable segment as well as the segment’s profit or loss measure(s) that are regularly provided to the chief operating decision maker (the “CODM”) to allocate resources and assess performance; (ii) how the CODM uses each reported segment profit or loss measure to allocate resources and assess performance; (iii) the nature of other segment balances contributing to reported segment profit or loss that are not captured within segment revenues or expenses; and (iv) the title and position of the individual or name of the group or committee identified as the CODM. This guidance requires retrospective application to all prior periods presented in the financial statements and is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The company will adopt this guidance upon its effective date and will include enhanced disclosures relating to its reportable segments for all subsequent annual and interim periods.

NOTE 3 - BUSINESS COMBINATIONS

On March 1, 2023 ("Acquisition Date"), Corteva completed the acquisitions of all the outstanding equity interests in Stoller Group, Inc. (“Stoller”), one of the largest independent companies in the Biologicals industry, and Quorum Vital Investment, S.L. and its affiliates (“Symborg”), an expert in microbiological technologies. The purchase price for Stoller and Symborg was $1,220 million, inclusive of a working capital adjustment, and $370 million, respectively. These acquisitions supplement the Crop Protection business with additional biological tools that complement evolving farming practices.

The company finalized the purchase price allocation and assessment of the fair value of the assets acquired and liabilities assumed as of the Acquisition Date in the first quarter of 2024. There were no material adjustments recognized during the measurement period. For additional information regarding the acquisition of Stoller and Symborg, see Note 4 - Business Combinations, to the Consolidated Financial Statements, in the company's 2023 Annual Report.

NOTE 4 - REVENUE

Remaining Performance Obligations

Remaining performance obligations represent the transaction price allocated to unsatisfied or partially unsatisfied performance obligations. The company applies the practical expedient to disclose the transaction price allocated to the remaining performance obligations for only those contracts with an original duration of more than one year. The transaction price allocated to remaining performance obligations with an original duration of more than one year related to material rights granted to customers for contract renewal options were $140 million, $134 million and $135 million at September 30, 2024, December 31, 2023 and September 30, 2023, respectively. The company expects revenue to be recognized for the remaining performance obligations evenly over the period of one year to six years.

Contract Balances

Contract liabilities primarily reflect deferred revenue from prepayments under contracts with customers where the company receives advance payments for products to be delivered in future periods. Corteva classifies deferred revenue as current or noncurrent based on the timing of when the company expects to recognize revenue. Contract assets primarily include amounts related to conditional rights to consideration for completed performance not yet invoiced. Accounts receivable are recorded when the right to consideration becomes unconditional.


Contract Balances	September 30, 2024		December 31, 2023		September 30, 2023
(In millions)	September 30, 2024		December 31, 2023		September 30, 2023
Accounts and notes receivable - trade1	$	5,501	$	4,329	$	5,320
Contract assets - current2	$	29	$	27	$	27
Contract assets - noncurrent3	$	73	$	67	$	67
Deferred revenue - current	$	429	$	3,406	$	552
Deferred revenue - noncurrent4	$	115	$	108	$	109

1.Included in accounts and notes receivable - net in the interim Consolidated Balance Sheets.

2.Included in other current assets in the interim Consolidated Balance Sheets.

3.Included in other assets in the interim Consolidated Balance Sheets.

4.Included in other noncurrent obligations in the interim Consolidated Balance Sheets.

Revenue recognized during the nine months ended September 30, 2024 and 2023 from amounts included in deferred revenue at the beginning of the period was $3,314 million and $3,287 million, respectively.

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Disaggregation of Revenue

Corteva's operations are classified into two reportable segments: Seed and Crop Protection. The company disaggregates its revenue by major product line and geographic region, as the company believes it best depicts the nature, amount and timing of its revenue and cash flows. Net sales by major product line are included below:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2024		2023		2024		2023
Corn	$	315	$	487	$	5,085	$	5,139
Soybean	164		189		1,773		1,713
Other oilseeds	135		142		566		637
Other	77		60		349		348
Seed	691		878		7,773		7,837
Herbicides	736		815		2,568		3,043
Insecticides	437		416		1,225		1,156
Fungicides	216		226		761		837
Other	246		255		603		646
Crop Protection	1,635		1,712		5,157		5,682
Total	$	2,326	$	2,590	$	12,930	$	13,519

Sales are attributed to geographic regions based on customer location. Net sales by geographic region and segment are included below:


Seed	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2024		2023		2024		2023
North America1	$	170	$	173	$	5,394	$	5,192
EMEA2	196		198		1,365		1,441
Latin America	218		380		696		847
Asia Pacific	107		127		318		357
Total	$	691	$	878	$	7,773	$	7,837


Crop Protection	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2024		2023		2024		2023
North America1	$	440	$	399	$	1,703	$	1,901
EMEA2	219		271		1,311		1,555
Latin America	771		844		1,458		1,537
Asia Pacific	205		198		685		689
Total	$	1,635	$	1,712	$	5,157	$	5,682

1.Represents U.S. & Canada.

2.Europe, Middle East and Africa ("EMEA").

NOTE 5 - RESTRUCTURING AND ASSET RELATED CHARGES - NET

Crop Protection Operations Strategy Restructuring Program

On November 5, 2023, management of the company approved a plan to further optimize its Crop Protection network of manufacturing and external partners (the "Crop Protection Operations Strategy Restructuring Program"). In October 2024, management of the company amended the Crop Protection Operations Strategy Restructuring Program to include revisions to its previous estimates and decommissioning and demolition costs associated with the ceasing of operations, primarily at the Pittsburg, California site.

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The company expects to record aggregate pre-tax restructuring and asset related charges of $650 million to $700 million, comprised of $85 million to $105 million of severance and related benefit costs, $320 million to $340 million of asset-related and impairment charges and $245 million to $255 million of costs related to exiting the company’s production activities and ceasing operations (inclusive of contract terminations and decommissioning and demolition costs). Decommissioning and demolition costs will be expensed on an as-incurred basis. Reductions in workforce are subject to local regulatory requirements. Through the third quarter of 2024, the company recorded net pre-tax restructuring and asset related charges of $372 million, comprised of $60 million of severance and related benefit costs, $309 million of asset-related and impairment charges and $3 million of costs related to contract terminations. The pre-tax restructuring and asset related charges noted above includes charges relating to spare parts write-offs recognized during the fourth quarter of 2023, which impacted the Crop Protection segment, and were included in cost of goods sold, in the company’s Consolidated Statement of Operations for the year ended December 31, 2023. See Note 23 – Segment Information, to the Consolidated Financial Statements, in the company’s 2023 Annual Report for additional information.

Cash payments related to these charges are anticipated to be $330 million to $360 million, which primarily relate to the payment of severance and related benefits, contract terminations and decommissioning and demolition. Through the third quarter of 2024, the company paid $10 million associated with these charges. The restructuring actions associated with these charges are expected to be substantially complete by the end of 2026.

The following table is a summary of charges incurred related to the Crop Protection Operations Strategy Restructuring Program for the three and nine months ended September 30, 2024.


(In millions)	Three Months Ended September 30, 2024		Nine Months Ended September 30, 2024
Severance and related benefit costs1	$	19	$	60
Asset related charges2, 3	10		83

Total restructuring and asset related charges - net	$	29	$	143

1.Reflects corporate-related charges.

2.Reflects charges associated with the Crop Protection segment.

3.The three and nine months ended September 30, 2024 include charges of $4 million for decommissioning costs associated with the exit of the company’s production activities at its site in Pittsburg, California.

A reconciliation of the December 31, 2023 to the September 30, 2024 liability balances related to the Crop Protection Operations Strategy Restructuring Program is summarized below:


(In millions)	Severance and Related Benefit Costs		Asset Related Charges1		Total
Balance at December 31, 2023	$	—	$	—	$	—
Charges to income from continuing operations	60		83		143
Payments	(3)		(4)		(7)
Asset write-offs	—		(79)		(79)
Balance at September 30, 2024	$	57	$	—	$	57

1. Includes charges of $4 million for decommissioning costs associated with the exit of the company’s production activities at its site in Pittsburg, California.

2022 Restructuring Actions

In connection with the company’s shift to a global business unit model during 2022, the company assessed its business priorities and operational structure to maximize the customer experience and deliver on growth and earnings potential. As a result of this assessment, the company committed to restructuring actions during the second quarter of 2022, which included the company’s separate announcement to withdraw from Russia (“Russia Exit”) (collectively the “2022 Restructuring Actions”). The company does not anticipate any additional material charges from the 2022 Restructuring Actions as actions associated with this charge are substantially complete.

The remaining cash payments related to these charges is $36 million, and primarily relate to the payment of severance and related benefits and contract terminations.

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NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table is a summary of charges incurred related to the 2022 Restructuring Actions for the three and nine months ended September 30, 2024 and 2023.


	Three Months Ended September 30,			Nine Months Ended September 30,
(In millions)	2024		2023	2024	2023
Severance and related benefit costs1	$	—