“Including the impact of tariffs, we expect margin to be near the bottom of the target range.”

In context

“ter, which aligns with our normal seasonal pattern. On Enterprise adjusted operating profit margin, excluding the impact of tariff costs, we expect to be in the top half of the target range at our anticipated sales level, supported by favorable price realization and volume. Specific to volume growth, we anticipated the attributable profit pull-through or incremental margin to reflect our recent operational performance, which has been impacted by tariffs. In contrast to prior years, we are committed to investing for long-term profitable growth, which includes capacity investments, will impact depreciation expense, and higher technology and digital spend. We believe these investments will support future absolute dot OPEC dollar generation, which I'll remind you is our definition of winning. Including the impact of tariffs, we expect margin to be near the bottom of the target range. I'll provide some perspective, but let me explain how we intend to report to you about tariffs as we move forward. The absolute dollar value of new tariffs imposed in 2025 was $1.8 billion. Mitigating actions can come in two forms. First, those that reduce the direct tariff exposure bill, which will include actions like sourcing changes. These reduce the actual dollar value of tariffs paid. And second, there are cost control actions and pricing, which help reduce the impact on our profitability. Most of the actions taken in 2025 related to cost controls, which could be specifically attributed to tariff mitigation, and these amounted to around $100 million, resulting in a net incremental tariff impact of $1.7 billion. Looking forward, it will become increasingly challenging to pass out and”