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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K


☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended	DECEMBER 31, 2025
		OR
☐	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 1-6402-1

SERVICE CORPORATION INTERNATIONAL

(Exact name of registrant as specified in its charter)

Texas

74-1488375

(State or other jurisdiction of incorporation or organization)

(I.R.S. employer identification no.)

1929 Allen Parkway

Houston

Texas

77019

(Address of principal executive offices)

(Zip code)

Registrant’s telephone number, including area code: (713) 522-5141

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol (s)

Name of Each Exchange on Which Registered

Common Stock ($1 par value)

SCI

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes

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.

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).

Yes

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

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

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.

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

☑

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

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

Yes

☐

The aggregate market value of the common stock held by non-affiliates of the registrant (assuming that the registrant’s only affiliates are its executive officers and directors) was $11,126,104,381 based upon a closing market price of $81.40 on June 30, 2025 of a share of common stock as reported on the New York Stock Exchange.

The number of shares outstanding of the registrant’s common stock as of February 10, 2026 was 139,223,665 (net of treasury shares).

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Proxy Statement in connection with its 2026 Annual Meeting of Stockholders (Part III).




			Page
PART I
	Item 1.	Business	5
	Item 1A.	Risk Factors	14
	Item 1B.	Unresolved Staff Comments	21
	Item 1C.	Cybersecurity	21
	Item 2.	Properties	22
	Item 3.	Legal Proceedings	22
	Item 4.	Mine Safety Disclosures	22

PART II
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	23
	Item 6.	[Reserved]	24
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
	Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	38
	Item 8.	Financial Statements and Supplementary Data	40
	Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	85
	Item 9A.	Controls and Procedures	85
	Item 9B.	Other Information	86
	Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	86
PART III
	Item 10.	Directors, Executive Officers, and Corporate Governance	87
	Item 11.	Executive Compensation	87
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	87
	Item 13.	Certain Relationships and Related Transactions and Director Independence	87
	Item 14.	Principal Accountant Fees and Services	87
PART IV
	Item 15.	Exhibits and Financial Statement Schedules	88
	Item 16.	Form 10-K Summary	90
	Signatures		91

2 Service Corporation International

Glossary

The following terms are common to the deathcare industry, are used throughout this report, and have the following meanings:

Atneed — Funeral, including cremation, and cemetery arrangements sold once death has occurred.

Average Revenue per Service — Average revenue per funeral service performed, excluding the impact of non-funeral home preneed sales revenue, core general agency revenue, and certain other revenue.

Cancellation — Termination of a preneed contract, which relieves us of the obligation to provide the goods and services included in the contract. Cancellations may be requested by the customer or be initiated by us if the customer fails to comply with the contractual terms of payment. State or provincial laws govern the amount of refund, if any, owed to the customer.

Care Trusts' Corpus — The deposits and net realized capital gains included in the cemetery perpetual care trusts that may not be withdrawable. In certain states, some or all of the net realized capital gains can be distributed to us. Additionally, some states allow a total return distribution that may contain elements of income, capital appreciation, and principal.

Cemetery Marker — An item used to identify the deceased person in a particular burial space, crypt, niche, or cremation memorialization property. Permanent burial and cremation memorialization cemetery markers are usually made of bronze or stone.

Cemetery Merchandise and Services — Merchandise and services used in connection with a cemetery interment, including stone and bronze memorials, cemetery markers, outer burial containers, floral placement, graveside services, merchandise installations, urns, and interments.

Cemetery Perpetual Care Trust or Endowment Care Fund (ECF) — A trust fund established for the purpose of maintaining cemetery grounds and property into perpetuity. For these trusts, the corpus generally remains in the trust in perpetuity and the investment earnings or elected distributions are withdrawn regularly and are intended to defray our expenses incurred to maintain the cemetery. In certain states, some or all of the net realized capital gains can also be distributed. Additionally, some states generally allow a total return distribution that may contain elements of income, capital appreciation, and principal.

Cemetery Property — Developed lots, lawn crypts, mausoleum spaces, cremation niches, and cremation memorialization property items (constructed and ready to accept interments) and undeveloped land we intend to develop for the sale of interment rights. Includes the construction-in-progress balance during the pre-construction and construction phases of projects creating new developed property items.

Cemetery Property Amortization or Amortization of Cemetery Property — The non-cash recognized expenses of cemetery property interment rights, which are recorded by specific identification with the cemetery property revenue for each contract.

Cemetery Property Interment Rights — The exclusive right to determine the human remains that will be interred in a specific cemetery property space. See also Cemetery Property Revenue below.

Cemetery Property Revenue — Recognized sales of interment rights in cemetery property when the receivable is deemed collectible and the property is fully constructed and available for interment.

Combination Location (Combos) — Locations where a funeral service location is physically located within or adjoining a SCI-owned cemetery location.

Cremation — The reduction of human remains to bone fragments by intense heat.

Cremation Memorialization — Products specifically designed to commemorate and honor the life of an individual who has been cremated. These products include cemetery property items that provide for the disposition of cremated remains within our cemeteries such as benches, boulders, statues, cremation niches, etc. They also include memorial walls and books where the name of the individual is inscribed but the remains have been scattered or kept by the family.

Cremation Niche — An aboveground burial space, in which a decedent's urn, containing their cremated remains and other keepsakes, is placed and sometimes sealed.

Funeral Merchandise and Services — Merchandise such as burial caskets and related accessories, outer burial containers, urns and other cremation receptacles, casket and cremation memorialization products, flowers, and professional services relating to funerals including arranging and directing services, use of funeral facilities and motor vehicles, removal, preparation, embalming, cremations, memorialization, visitations, travel protection, and catering.

Funeral Services Performed — The number of funeral services, including cremations, provided after the date of death, sometimes referred to as funeral volume.

General Agency (GA) Revenue — Commissions we receive from third-party life insurance companies for life insurance policies sold to preneed customers for the purpose of funding preneed funeral arrangements. The commission rate paid is determined based on the product type sold, the length of payment terms, and the health and age of the insured/annuitant.

Interment — The burial or final placement of human remains in the ground (interment), in mausoleums (entombment), or in cremation niches or cremation memorialization property (inurnment).

FORM 10-K 3

Lawn Crypt — Cemetery property in which an underground outer burial receptacle constructed of concrete and reinforced steel has been pre-installed in designated areas.

Maturity — When the underlying contracted merchandise is delivered or service is performed, typically at death. This is the point at which preneed funeral contracts are converted to atneed contracts (note — delivery of certain merchandise and services can occur prior to death).

Mausoleum — An above ground structure that is designed to house caskets and/or cremation urns.

Merchandise and Service Trust — A trust account established in accordance with state or provincial law into which we deposit the required percentage of customers’ payments for preneed funeral, cremation, or cemetery merchandise and services to be delivered or performed by us in the future. The amounts deposited can be withdrawn only after we have completed our obligations under the preneed contract or upon the cancellation of the contract. Also referred to as a preneed trust.

Non-Funeral Home Preneed Sales Revenue — Non-funeral home general agency revenue and merchandise and travel protection revenue, net, sold to a preneed customer and delivered before a death has occurred.

Outer Burial Container — A reinforced container intended to inhibit the subsidence of the earth and house the casket after it is placed in the ground, also known as a burial vault.

Preneed — Purchase of cemetery property interment rights or any funeral or cemetery merchandise and services prior to death occurring or prior to delivery of products and services.

Preneed Backlog or Backlog of Preneed Revenue — Future revenue from unfulfilled preneed funeral, cremation, and cemetery contractual arrangements.

Preneed Cemetery Sales Production — Sales of preneed cemetery contracts. These sales are recorded in Deferred revenue, net until the merchandise is delivered, the service is performed, or the property has been constructed and is available for interment.

Preneed Funeral Sales Production — Sales of preneed funeral trust-funded and insurance-funded contracts. Preneed funeral trust-funded contracts are recorded in Deferred revenue, net until the merchandise is delivered or the service is performed. We do not reflect the unfulfilled insurance-funded preneed funeral contract amounts in our Consolidated Balance Sheet as the contract is between the customer and the insurance provider. Revenue from these policies is recognized when we perform the services and deliver the merchandise. The proceeds of the life insurance policies will be received upon maturity via death benefit claims.

Preneed Receivables, Net — Amounts due from customers when we have delivered the merchandise, performed the service, or transferred control of the cemetery property interment rights prior to a death occurring and amounts due from customers on irrevocable preneed contracts.

Travel Protection — A service provided by a third-party that provides shipment of remains to the servicing funeral home of choice if the purchaser passes away outside of a certain radius of their residence.

Trust Fund Income — Recognized investment earnings from our merchandise, service, and perpetual care trust investments.

As used herein, “SCI,” “Company,” “we,” “our,” and “us” refer to Service Corporation International and companies owned directly or indirectly by Service Corporation International, unless the context requires otherwise. Management has published a white paper on the corporate website for further understanding of accounting for preneed sales. You can view the white paper at http://investors.sci-corp.com under Featured Documents. Documents and information on our website are not incorporated by reference herein.

4 Service Corporation International

Item 1. Business

General

We are well known for our Dignity Memorial® brand, North America's first transcontinental brand of deathcare products and services. Our other brands include Dignity Planning™, National Cremation Society®, Advantage® Funeral and Cremation Services, Funeraria del Angel™, Making Everlasting Memories®, Neptune Society™ and Trident Society™. Our funeral service and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis.

Human Capital Management

At December 31, 2025, we employed 17,869 full-time individuals and 7,318 part-time individuals. Of the full-time associates, 16,556 were employed in the funeral and cemetery operations and 1,313 were employed in corporate areas of our business. Approximately 2.2% of our associates are represented by unions. Although labor disputes occur from time to time, relations with associates are generally considered favorable. We reach out to our associates for feedback throughout their employment at SCI using a variety of voluntary employee surveys in an effort to determine if we are meeting the needs and expectations of our workforce. In 2025, building on our past workplace surveys, we launched our We Listen Survey, which measures engagement across areas including recognition, growth, communication, and leadership. This employee survey will help drive company-wide initiatives and improvements.

Associate Benefits

Eligible associates in the United States may elect coverage under our group health and life insurance plans. Associates covered by a collective bargaining agreement are typically covered by union health plans and, therefore, do not participate in our health insurance plan. At December 31, 2025 and 2024, there were 9,526 and 9,462 associates, respectively, who had elected to participate in our group health insurance plans.

Eligible associates in the United States are covered by retirement plans of SCI or various subsidiaries, while Canadian associates are covered by other SCI (or SCI subsidiary) defined contribution or government-mandated benefit plans. We have an employee savings plan that qualifies under Section 401(k) of the Internal Revenue Code for the exclusive benefit of our United States employees. We contribute a matching contribution based on the employee's contribution and years of vesting service. For more information about our retirement plans, see Note 12 of Part II, Item 8. Financial Statements and Supplementary Data.

We understand the importance of work-life balance and provide other benefits such as baby bonding time, paid time-off for various reasons, and financial planning support for our associates. Additionally, we offer an employee assistance program that offers free and confidential counseling by masters level counselors for associates who may be facing mental health challenges.

We believe in the power of inclusion and respecting our fellow associates’ work, ideas, beliefs, and lifestyles. To further promote this inclusion, we have developed programs such as our Associate Resource Communities (ARCs). The ARCs, which are available to all associates, allow colleagues with similar backgrounds or interests to connect for networking, provide opportunities for mentorship, and support the communities and customers we serve. Our leadership team embraces the many backgrounds and perspectives that make each of us unique.

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Training and Development

We also believe in creating a culture of opportunity and career growth for all our associates and supporting the personal and professional goals of our associates is a priority for us. Our associates have access to development programs and a robust online training portal offering thousands of courses, books, audiobooks, and videos. Additionally, associates can participate in mentoring programs and take advantage of discounts and tuition reimbursement through our many partnerships. We are also proud to offer scholarship and apprentice programs to those interested in joining our profession.

Regulation

Our funeral operations are regulated by the Federal Trade Commission (the “FTC”) under the FTC’s Trade Regulation Rule on Funeral Industry Practices (the “Funeral Rule”), which went into effect in 1984. The Funeral Rule defines certain acts or practices as unfair or deceptive and contains certain requirements to prevent these acts or practices. The preventive measures require a funeral provider to give consumers accurate, itemized price information as well as various other disclosures about funeral merchandise and services and prohibit a funeral provider from making misrepresentations and engaging in deceptive or unfair practices.

Our operations are also subject to regulation, supervision, and licensing under numerous federal, state, and local laws and regulations as well as Canadian provincial laws and regulations. For example, state laws impose licensing requirements for funeral service locations and funeral directors and regulate preneed sales including our preneed trust activities. Our facilities are subject to environmental, health, and safety regulations. We take various measures to comply with the Funeral Rule and all laws and regulations. For example, we have established and maintain policies and procedures around our business practices; we provide training to our personnel; and we perform ongoing reviews of our compliance efforts. We believe we are currently in substantial compliance with the Funeral Rule and all laws and regulations.

Federal, state, and local legislative bodies and regulatory agencies (including Canadian legislative bodies and agencies) frequently propose new laws and regulations, some of which could have a material effect on our operations and on the deathcare industry in general. We cannot accurately predict the outcome of any proposed legislation or regulation or the effect that any such legislation or regulation might have on us.

History

We were incorporated in Texas in July of 1962. Our original business plan was based on efficiencies of scale, specifically reducing overhead costs by sharing resources such as preparation services, back office administration support, transportation, and personnel among funeral service locations in a business “cluster.” We set out to apply this operating strategy through the acquisition of deathcare businesses in other markets over the next three decades. Beginning in 1993, we expanded beyond North America, acquiring major deathcare companies internationally.

During the mid to late 1990s, acquisitions of deathcare facilities became extremely competitive, resulting in increased prices for acquisitions and substantially reduced returns on invested capital. In 1999, we significantly reduced our level of acquisition activity and divested certain of our international businesses and many North American funeral service locations and cemeteries. At the same time, we began to capitalize on the strength of our network by introducing to North America the first transcontinental brand of deathcare services and products — Dignity Memorial® (see www.dignitymemorial.com). Information contained on our website is not part of this report.

In late 2006, we began a series of strategic acquisitions through 2013 by acquiring Alderwoods Group, Keystone North America, The Neptune Society, Inc. (Neptune), also now known as SCI Direct, and Stewart Enterprises, Inc. (Stewart). We continue to pursue strategic acquisitions with a focus on returns on invested capital and complete divestitures of non-strategic funeral homes and cemeteries. See Strategies for Growth within Part I, Item 1. Business for more information on how we invest capital to grow our business.

Funeral and Cemetery Operations

Our funeral service and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses. See Note 13 in Part II, Item 8. Financial Statements and Supplementary Data, for financial information about our business segments and geographic areas.

We have the largest number of combination locations in North America. Funeral service/cemetery combination locations are businesses in which a funeral service location is physically located within or adjoining a cemetery that we own. Combination locations allow certain facility, personnel, and equipment costs to be shared between the funeral service location and a cemetery location. These locations also create synergies between funeral and cemetery sales personnel and give families added convenience to purchase both funeral and cemetery merchandise and services at a single location. Combination facilities typically are more cost competitive and have a higher gross margin than funeral and cemetery operations that are operated separately.

Funeral service locations provide all professional services related to funerals and cremations, including the use of funeral home facilities and motor vehicles, arranging and directing services, removal, preparation, embalming, cremations, memorialization, and catering. Funeral merchandise, including burial caskets and related accessories, urns and other cremation receptacles,

6 Service Corporation International

PART I

outer burial containers, flowers, online and video tributes, stationery products, casket and cremation memorialization products, and other ancillary merchandise, is sold at funeral service locations.

Our cemeteries provide cemetery property interment rights, including developed lots, lawn crypts, mausoleum spaces, cremation niches, and custom inventory, including private mausoleums, family estates, and exclusive cremation memorialization options. Cemetery merchandise and services, including memorial cemetery markers and bases, outer burial containers, flowers and floral placement, other ancillary merchandise, graveside services, merchandise installation, and interments, are sold at our cemeteries.

We also sell cemetery property interment rights and funeral and cemetery merchandise and services whereby a customer contractually agrees to the terms of certain products and services to be delivered and performed in the future. We define these sales as preneed sales. As a result of such preneed sales, our preneed backlog of unfulfilled funeral and cemetery contracts was $17.0 billion and $16.0 billion at December 31, 2025 and 2024, respectively.

The following table at December 31, 2025 provides the number of our funeral service locations and cemeteries by country, and by state, territory, or province:


Country, State/Territory/Province	Number of Funeral Service Locations	Number of Cemeteries	Total
United States
Alabama	35	13	48
Arizona	39	13	52
Arkansas	11	3	14
California	166	43	209
Colorado	29	11	40
Connecticut	21	—	21
Delaware	—	1	1
District of Columbia	2	—	2
Florida	137	64	201
Georgia	30	18	48
Hawaii	8	3	11
Idaho	1	—	1
Illinois	42	27	69
Indiana	50	14	64
Iowa	6	2	8
Kansas	8	5	13
Kentucky	14	5	19
Louisiana	33	11	44
Maine	7	—	7
Maryland	16	13	29
Massachusetts	27	—	27
Michigan	40	—	40
Minnesota	8	2	10
Mississippi	12	3	15
Missouri	23	10	33
Nebraska	8	2	10
Nevada	15	6	21
New Hampshire	4	—	4
New Jersey	21	—	21
New Mexico	1	1	2

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PART I


Country, State/Territory/Province	Number of Funeral Service Locations	Number of Cemeteries	Total
New York	54	—	54
North Carolina	51	17	68
Ohio	45	14	59
Oklahoma	11	7	18
Oregon	14	4	18
Pennsylvania	25	16	41
Puerto Rico	6	9	15
Rhode Island	6	—	6
South Carolina	12	9	21
Tennessee	42	18	60
Texas	164	65	229
Utah	4	3	7

Virginia	38	24	62
Washington	33	15	48
West Virginia	5	6	11
Wisconsin	—	7	7
Canada
Alberta	9	—	9
British Columbia	37	11	48
Manitoba	4	3	7
New Brunswick	6	—	6
Nova Scotia	12	—	12
Ontario	45	—	45
Quebec	36	2	38
Saskatchewan	12	—	12
Total funeral service locations and cemeteries	1,485	500	1,985

We believe we have satisfactory title to the properties owned and used in our business, subject to various liens, encumbrances, and easements that are incidental to ownership rights and uses and do not materially detract from the value of the property. At December 31, 2025, we owned approximately 90% of the real estate and buildings used at our facilities, and the remainder of the facilities were leased under both financing and operating leases. At December 31, 2025, our 500 cemeteries contained a total of approximately 36,000 acres, of which approximately 66% was developed. Interment rights for approximately 2,000 acres of the developed acreage are unsold.

Our corporate headquarters are located at 1929 Allen Parkway, Houston, Texas 77019. The property consists of approximately 160,000 square feet of office space and 185,000 square feet of parking space on approximately seven acres. Adjacent to this site on land owned by the Company, we are developing a new corporate headquarters building comprising approximately 250,000 square feet of office space. The facility is designed to support collaboration, innovation, and productivity. Upon completion of the new headquarters, the Company expects to monetize the existing corporate buildings, parking garage, and other land adjacent to the old headquarters buildings. We also own a building in Jefferson, Louisiana with approximately 96,200 square feet of office space that we use, in part, for corporate activities.

8 Service Corporation International

PART I

A map of our locations in North America is presented below:

FORM 10-K 9

PART I

Competition

Although there are several public companies that own funeral service locations and cemeteries, the majority of deathcare businesses in North America are locally-owned, independent operations. We estimate that our funeral and cemetery market share in North America is approximately 18% based on estimated total industry revenue. Our funeral business has low to moderate barriers to entry, whereas the cemetery business barriers to entry are high due to land requirements and permitting along with sufficient capital needed to develop cemetery property. The success of a single funeral service location or cemetery in any community is a function of the name, reputation, and location of that funeral service location or cemetery. Competitive pricing, professional service, attention to detail, and well-maintained locations are also important.

We have an unparalleled network of funeral service locations and cemeteries that offers high quality products and services at prices that are competitive with local competing funeral service locations, cemeteries, and retail locations. Within this network, our funeral service locations and cemeteries operate under various names as most operations were acquired as existing businesses. We have co-branded the majority of our operations under the name Dignity Memorial®. Our branding strategy gives us a strategic advantage and identity in the industry. While this branding is intended to emphasize our seamless national network of funeral service locations and cemeteries, the original names associated with acquired operations, and their inherent goodwill and heritage, generally remain the same. For example, Geo. H. Lewis & Sons Funeral Directors is now Geo. H. Lewis & Sons Funeral Directors, a Dignity Memorial® provider.

Strategies for Growth

We are the largest consolidated deathcare company in North America and are well positioned for long-term profitable growth. Over the next several years, our industry will be largely shaped by the aging of the Baby Boomer generation in the deathcare space which we are poised to benefit from. In each stage of life, Baby Boomers have set new trends, transformed society, and redefined norms, and we are already seeing the impact on our industry. Over the last several years, we have seen the impact of the Baby Boomers through the growth in both our preneed cemetery sales and our preneed funeral production. We expect to see a similar impact on our atneed results as these preneed contracts mature in the future. In every aspect of our business, we are listening and responding to our customer’s changing needs and preferences, and leveraging our scale to deliver unparalleled experiences - both digitally and in person - to meet those changing needs.

The following strategies remain the core of our foundation: 1) grow revenue, 2) leverage our unparalleled scale, and 3) invest capital.

Grow Revenue

In addition to expected revenue growth as Baby Boomers begin impacting our atneed results, we plan to remain relevant to our customers as their preferences evolve through a combination of price, product, and service differentiation strategies to facilitate further growth. We also expect that continued growth in our preneed sales will drive future revenue expansion.

Remaining Relevant to the Customer

Remaining relevant to our customer is key to generating revenue growth in a changing customer environment. We are constantly evolving to meet the varying preferences and needs of our customers. Whether choosing burial or cremation, many Baby Boomers are redefining the traditional funeral by transitioning away from solemnly mourning a death to a more personalized celebration of life ceremony. We responded to this trend by spending capital to repurpose traditional casket selection rooms to event rooms that can accommodate a celebration, while also updating existing locations to more contemporary, uplifting spaces. During the arrangement, we offer a contemporary and customer-friendly digital presentation of options that allows the customer to choose merchandise and services including unique celebration, catering, and celebrant services.

In our funeral segment, we focus on merchandise and services that are meaningful to both our burial and cremation customers. The growing trend of cremation has resulted in new product and service offerings, including cremation-specific service packages, which may or may not include memorialization. In addition, we have focused on making the entire cremation experience more meaningful for families, from the first point of contact to the return of a loved one’s ashes to the family.

In our cemetery segment, we continue to grow revenue by responding to the customer’s desire for personalized and unique options by expanding our tiered product and cemetery property options. Over the past several years, we have substantially increased our property options to offer unique choices. From private high-end family estates, many of which capture incredible views and custom architectural features, to nicely landscaped hedge estates, we continue to develop property selections that resonate with our customers. For cemetery merchandise and services, we have developed relevant products such as customized cemetery property offerings, and specialized graveside service options. We continue to place strategic emphasis on cremation offerings for customers in our cemetery segment offering an increased variety of cremation property options, including glass-front cremation niches and cremation gardens.

As we evolve to meet ever-changing customer preferences, we will continue to serve the numerous religious, ethnic, and cultural traditions important to many of our customers. We remain flexible to meet the varying needs of customers, demonstrating our resolve to remain relevant to changing customer preferences.

10 Service Corporation International

PART I

Growing Preneed Sales

Our preneed sales program drives current and future revenue growth. Baby Boomers have been influencing both our funeral and cemetery preneed sales for several years and are beginning to positively affect the growth of our preneed funeral sales programs. Our highly trained sales force of approximately 3,800 counselors provide customers with informed guidance about various service and merchandise options tailored for today’s consumers. Utilizing our scale, our counselors are reaching out to consumers through multiple lead channels, including growing digital lead channels, securing future revenue growth. We sponsor community events and seminars to educate and provide guidance around preplanning both funeral and cemetery services and merchandise. We have adopted a more sophisticated and targeted marketing approach, and we continue increasing our digital presence through search engine optimization and other marketing channels. We have a unique competitive advantage to continue growing preneed sales benefiting from our size and scale. Our preneed program provides us with an opportunity to develop greater brand awareness, gives consumers peace of mind about their end of life arrangements, and secures future market share. In addition, our increased digital presence has provided significant growth in our digital lead channels over the last several years.

Leverage Our Unparalleled Scale

As the largest deathcare company in North America, we leverage our unparalleled scale by developing our sales organization and optimizing and responsibly deploying digital innovation throughout our network. As our preneed backlog grows from the development of our sales organization, the backlog also realizes scale benefits from the ability to grow trust portfolios and from our preferred preneed insurance provider agreement. In addition, scale also enables cost efficiencies through purchasing power and utilizing economies of scale through our supply chain channel.

Developing Our Sales Organization

Over the last several years, we have continued to invest significantly in the development of our sales organization with best in class tools and technologies. These investments include a customer relationship management system, which drives improvements in productivity and sales production by leveraging data analytics, rigorous lead tracking, and effective follow-up campaigns. We continue to diversify our sales force to understand and serve the numerous religious, ethnic, and cultural traditions important to our customers. Our premier combination locations and other large and recognizable cemeteries and funeral homes, along with the contemporary selling tools we have available, attract high-quality sales talent. Our scale allows us to operate and expand our sales organization in an efficient manner to bolster preneed sales growth.

Preneed Backlog Scale Benefits

Our preneed backlog, which includes both insurance and trust-funded merchandise and service products, allows us to grow future revenue in a more efficient manner than selling at the time of need. The scale of our multi-billion dollar trust portfolios allows us to leverage access to preeminent money managers with favorable fee structures generating above average returns to help offset inflation. In July 2024, we finalized an agreement to change our preferred preneed insurance provider in the United States, which allows us to further utilize our scale and streamline our processes across our network. Our blended funding approach between insurance and trust-funded merchandise and service products allows us to combine the positive cash flow and predictability of the insurance product with the potential upside of higher returns from our trusted merchandise and service products. This blended approach also helps our ability to grow our preneed backlog in a cash flow neutral manner as general agency commissions on our preneed insurance sales offset associated selling compensation for combined preneed trust and insurance sales.

Scale-Enabled Procurement and Supply Chain Efficiencies

Our scale enables us to leverage purchasing power across merchandise and services driving more favorable pricing. Centralized procurement and long-standing supplier relationships allow us to capture economies of scale while maintaining high standards of quality.

Advancing Customer-Facing Technology and Enhancing the User Experience

Throughout the year, we invested in customer-facing technology initiatives designed to improve engagement while supporting operational efficiency and consistency at scale. These investments focused on streamlining digital interactions, improving access to information, and enabling customers to complete transactions more efficiently.

We enhanced key digital touchpoints, including websites and customer portals, to improve usability, content visibility, and payment flow. In addition, we expanded technology capabilities that support both at-need and preneed sales across funeral and cemetery operations, improving consistency of tools and processes while supporting revenue-generating activities.

Together, these initiatives are intended to reduce complexity, support more efficient service delivery, and strengthen the customer experience in a way that is scalable and aligned with long-term financial performance.

Digital Innovation and AI Governance

As technology continues to evolve, the Company is thoughtfully adopting digital tools, including artificial intelligence (AI), to support its funeral, cremation, and cemetery operations, enhance service quality, and improve efficiency across both field

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locations and corporate functions. SCI’s approach to AI is grounded in responsible innovation, with a focus on deploying practical use cases while maintaining strong governance, risk management, and associate education to guide adoption.

SCI believes AI-enabled tools will improve operational effectiveness, particularly in areas where technology can help associates focus more fully on care, compassion, and service. Central to this approach is preparing our workforce to understand, use, and oversee AI responsibly and ethically, consistent with the Company’s values and commitment to Service Excellence.

To support responsible use of AI by associates, SCI’s Employee Artificial Intelligence Use Policy outlines expectations for ethical, secure and appropriate use of AI-enabled tools. Oversight of AI use is provided through SCI’s AI Governance and Advisory Committee, which supports Company leadership by establishing governance practices and setting strategic guidance for the use of AI. The Committee helps identify and mitigate legal, ethical, data privacy, and cybersecurity risks, and facilitates the sharing of insights and learnings as AI initiatives are implemented.

As AI technologies and regulatory expectations continue to evolve, SCI will regularly review and enhance its governance practices, policies, and workforce training efforts to support innovation while maintaining the trust of the families, communities, and associates we serve.

Capital Allocation

We consistently evaluate the best uses of our cash flow that will yield the highest value and return on capital. Our strong liquidity, favorable debt maturity profile, and robust cash flow generation enables us to continue our long-standing commitment to allocate capital to opportunistically grow our business and enhance shareholder value. Typically, our highest relative return opportunities come from acquisitions and the construction of funeral service and cemetery locations.

Investing in Acquisitions and Building New Funeral Service and Cemetery Locations

We manage our footprint by focusing on strategic acquisitions and building new funeral service and cemetery locations where the expected returns are attractive and meaningfully exceed our weighted average cost of capital. We target businesses with favorable customer dynamics and locations where we can benefit from additional economies of scale. Over the last several years, we have deployed significant growth capital spend on new funeral service and cemetery locations and related real estate, enlarging our footprint into new communities as well as expanding existing locations to remain relevant to our customers. For our cemetery businesses, we plan to pursue strategic acquisitions to create more opportunities to serve consumers through our tiered cemetery options. Additionally, we look for opportunities to acquire land for future cemetery development in certain of our largest markets. This investment in our future will allow us to continue creating cemetery offerings that appeal to varying preferences in those markets for many years to come. In 2025, we invested $101.3 million in acquiring 22 funeral service locations and 2 cemeteries, which included 2 combination locations. In addition, we spent $18.5 million for several real estate acquisitions that will be utilized for new funeral service or cemetery locations during 2025.

Return Excess Cash to Shareholders

In addition to any strategic acquisitions or new build opportunities, we continue to return cash to shareholders through dividends and our share repurchase program. Our quarterly dividend rate has steadily grown from $0.025 per common share in 2005 to $0.34 per common share at the end of 2025. We target a dividend payout ratio of 30% to 40% of after-tax earnings excluding special items and intend to grow our cash dividend commensurate with the growth in our business. We also expect to continue to repurchase shares of our common stock in the open market or through privately negotiated transactions, subject to market conditions, debt covenants, and normal trading restrictions. There can be no assurance that we will buy our common stock under our repurchase program in the future. In 2025, we repurchased 5,864,563 shares of our common stock at an aggregate cost of $464.2 million, which is an average cost per share of $79.15. In 2024, we repurchased 3,439,551 shares of our common stock at an aggregate cost of $249.8 million, which is an average cost per share of $72.63. Subsequent to December 31, 2025, we repurchased 552,313 shares for $44.4 million at an average cost per share of $80.48.

Managing Debt

Foundational to our capital allocation strategy, we continue to focus on maintaining optimal levels of liquidity and financial flexibility. Our flexible capital strategy allows us to manage our debt maturity profile by making open market debt repurchases when it is opportunistic to do so. We generate a relatively consistent annual cash flow stream that is generally resistant to down economic cycles. This cash flow stream and our significant liquidity allow us to substantially reduce our long-term debt maturities should we choose to do so. In November 2025, we entered into a new bank credit agreement due November 2030 consisting of a $750.0 million term loan, which is funded debt, and a revolving credit facility providing for borrowings of up to $1.75 billion. Proceeds from this new bank credit agreement were used to settle our existing Term Loan and Bank Credit Facility, which were both due January 2028. In addition to more favorable pricing, the new bank credit agreement provides us flexibility with incremental liquidity for capital investment, working capital, and other general corporate purposes.

Other

We make available free of charge, on or through our website, our annual, quarterly, and current reports and any amendments to those reports, as soon as reasonably practicable after electronically filing such reports with the Securities and Exchange Commission (SEC). Our website is http://www.sci-corp.com and our telephone number is (713) 522-5141. We also post announcements, updates, events, recent news releases and investor information and presentations on our website. We may

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use the Investors section of our website to communicate with investors. It is possible that the financial and other information posted there could be deemed material information. Each of our Board of Directors’ standing committee charters, our Corporate Governance Guidelines, our Code of Ethics for Board Members, and our Code of Conduct for Officers and Employees are available, free of charge, through our website or, upon request, in print. We will post on our internet website all waivers to, or amendments of, our Code of Conduct for Officers and Employees, which are required to be disclosed by applicable law and New York Stock Exchange listing standards. Information contained on our website is not part of this report. In addition, the SEC also maintains a website that contains reports, proxy and information statements, and other information regarding issuers where you may obtain a copy of all of the material we file publicly with the SEC. The SEC website address is http://www.sec.gov.

Executive Officers of the Company

The following table sets forth, as of February 12, 2026, the name and age of each executive officer of the Company, the office held, and the year first elected an officer.


Officer Name	Age	Position	Year First Became Officer
Thomas L. Ryan	60	Chairman of the Board and Chief Executive Officer	1999
Sumner J. Waring, III	57	President	2002
Eric D. Tanzberger	57	Executive Vice President, Chief Financial Officer	2000
Lori Spilde	55	Senior Vice President, General Counsel and Secretary	2019
Elisabeth G. Nash	64	Senior Vice President, Operations Services	2004
John H. Faulk	50	Senior Vice President, Chief Operating Officer	2010

Tammy R. Moore	58	Vice President and Chief Accounting Officer	2010

Mr. Ryan was elected Chairman of the Board of SCI effective in January 2016, appointed Chief Executive Officer in February 2005, and President in 2002. He joined the Company in 1996 and served in a variety of financial management roles until November 2000, when he was asked to serve as Chief Executive Officer of European Operations based in Paris, France. In July 2002, Mr. Ryan returned to the United States where he was appointed President and Chief Operating Officer of SCI. Before joining SCI, Mr. Ryan was a certified public accountant with Coopers & Lybrand LLP for eight years. He holds a bachelor's degree in business administration from the University of Texas at Austin. Mr. Ryan serves as a member of the University of Texas McCombs Business School Advisory Council and is a senior member of the University of Texas MD Anderson Cancer Center Board of Visitors.

Mr. Waring was named President in 2024, maintaining indirect oversight of operations and assuming responsibility for sales and marketing. He joined SCI in 1996 as Area Vice President of Operations when SCI acquired his family's funeral business. He was appointed President of the Northeast Region in 1999 and President of the Pacific Region in September 2001. In September 2002, Mr. Waring was appointed Vice President, Western Operations, a position he held until May 2004 when he was appointed Vice President, Major Market Operations. He was promoted to Senior Vice President in 2006 and in July 2008, Mr. Waring's responsibilities were expanded to include business development. In 2015, he was named Senior Vice President, North American Operations and in 2019, he was named Senior Vice President, Chief Operating Officer. Mr. Waring holds a bachelor's degree in business administration from Stetson University, a degree in mortuary science from Mount Ida College, and a master's degree in business administration from the University of Massachusetts Dartmouth. Mr. Waring serves on the Board of Directors of BankFive and the Greater Houston Partnership.

Mr. Tanzberger was named Executive Vice President and Chief Financial Officer in 2024. He oversees all finance and accounting functions, business and real estate development, revenue management and information technology. He was appointed Senior Vice President and Chief Financial Officer in June 2006 and also served as Treasurer from July 2007 to February 2017. Mr. Tanzberger joined the Company in August 1996 and held various management positions prior to being promoted to Corporate Controller in August 2002. In 2022, his responsibilities were expanded to include information technology. Before joining SCI, Mr. Tanzberger began his financial career at Coopers and Lybrand LLP. Mr. Tanzberger holds a Bachelor of Business Administration degree from the University of Notre Dame. Mr. Tanzberger is currently a member of the Board of Directors and Chair of the Audit Committee of Sanara MedTech Inc. (NASDAQ: SMTI). He is also a current member of the Executive Committee and the Audit Committee Chair of the United Way of Greater Houston. Mr. Tanzberger is a former member of the Board of Trustees of Junior Achievement of Southeast Texas and the National Funeral Directors Association Funeral Service Foundation.

Ms. Spilde was named Senior Vice President, General Counsel and Secretary in 2023. She joined SCI in 2000 with the acquisition of American Memorial Life Insurance Company. She began her tenure with the Company in operations. In 2006, she was promoted and her role shifted to managing legal affairs for Mergers & Acquisitions, Antitrust, and Real Estate. In 2018, her role was expanded to include oversight of Company SEC filings and responsibility for the corporate secretarial function. She was promoted to her previous role as Vice President and Deputy General Counsel in 2019. Ms. Spilde holds a master's degree in business administration from The University of Texas. She also earned Juris Doctor, Master of Arts, and bachelor's degrees from the University of South Dakota.

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Ms. Nash was named Senior Vice President of Operations Services in 2010 and is currently responsible for a variety of support functions, including human resources, supply chain, centralized operations and program management. Prior to that she was Vice President of Process Improvement and Technology, where she led the redefinition of our field and home office processes and systems. Before joining SCI, Ms. Nash served in various senior management accounting and financial positions with Pennzoil Corp. She holds a bachelor's degree in business administration in accounting from Texas A&M University. Ms. Nash serves on the Board of Directors of Genesys Works Houston and on the UpSkill Committee of Greater Houston Partnership.

Mr. Faulk was named Senior Vice President and Chief Operating Officer in 2024 and oversees SCI’s funeral and cemetery operations. He joined SCI in March 2010 as Vice President, Business Development, to oversee the Company's strategic growth, including mergers and acquisitions, real estate, and construction. In 2018, he was named Senior Vice President of Revenue and Business Development. His promotion expanded his role to include setting direction for the company’s pricing and cemetery development functions. Prior to joining the Company, Mr. Faulk worked for Bain & Company, Inc. where he helped Fortune 500 Companies and specialty retailers identify profit growth opportunities and achieve strong operating results. He holds a master's degree in business administration from the Darden Graduate School of Business at the University of Virginia and a bachelor's degree in electrical engineering from the University of Virginia.

Mrs. Moore was named Vice President and Chief Accounting Officer in 2010 and oversees general accounting, trust and technical accounting, internal and external reporting, and customer service. She joined the Company in August 2002 as Manager of Financial Reporting and was promoted to Director of Financial Reporting in 2004 and Managing Director and Assistant Controller in June 2006. Prior to joining the Company, Mrs. Moore was a certified public accountant with PricewaterhouseCoopers LLP. She holds a bachelor's degree in business administration in accounting from the University of Texas at San Antonio and a Master of Accounting degree from the Kenan-Flagler Business School at the University of North Carolina. Since 2019, Mrs. Moore serves on the Board of Regents of Commonwealth Institute of Funeral Service and serves as a member of the University of North Carolina's Master of Accounting Advisory Council.

Item 1A. Risk Factors

Cautionary Statement on Forward-Looking Statements

The statements in this Form 10-K that are not historical facts are forward-looking statements made in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. These statements may be accompanied by words such as “believe”, “estimate”, “project”, “expect”, “anticipate”, or “predict” that convey the uncertainty of future events or outcomes. These statements are based on assumptions that we believe are reasonable; however, many important factors could cause our actual consolidated results in the future to differ materially from the forward-looking statements made herein and in any other documents or oral presentations made by, or on behalf of, the Company. These factors are discussed below. We assume no obligation and make no undertaking to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the Company, whether as a result of new information, future events, or otherwise.

Risks Related to Our Business

Our affiliated trust funds own investments in securities, which are affected by market conditions that are beyond our control.

In connection with our preneed merchandise and service sales and our cemetery property sales, most affiliated trust funds own investments in equity securities, fixed income securities, commingled funds, money market funds, and mutual funds. The fair value of these investments and our earnings and investment gains and losses on these securities and funds are affected by financial market conditions that are beyond our control. Additionally, we may not choose the optimal mix of securities for any particular market condition.

The following table summarizes our investment returns (realized and unrealized), excluding certain fees, on our trust funds:


	Years Ended December 31,
	2025		2024		2023
Preneed funeral merchandise and service trust funds	14.7	%	12.3	%	16.5	%
Preneed cemetery merchandise and service trust funds	15.6	%	12.5	%	16.9	%
Cemetery perpetual care trust funds	14.7	%	11.9	%	15.3	%
Combined trust funds	15.1	%	12.3	%	16.3	%

Generally, earnings or gains and losses on our trust investments are recognized and we withdraw cash when the underlying merchandise is delivered, service is performed, or upon contract cancellation. Our cemetery perpetual care trusts recognize earnings, and in certain states, capital gains and losses or fixed percentage distributions. We withdraw allowable cash when we incur qualifying cemetery maintenance costs.

If the investments in our trust funds experience significant declines in 2026 or subsequent years or in a high inflation environment, there could be insufficient funds in the trusts to cover the costs of delivering merchandise and services or

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maintaining our cemeteries in the future. We may be required to cover any shortfall with cash flows from operations, which could have a material adverse effect on our financial condition, results of operations, and cash flows. For more information related to our trust investments, see Note 3 in Part II, Item 8. Financial Statements and Supplementary Data.

If the fair value of these trusts, plus any other amount due to us upon delivery of the associated contracts, were to decline below the estimated costs to deliver the underlying products and services, we would record a charge to earnings to record a liability for the expected losses on the delivery of the associated contracts. As of December 31, 2025, no such charge was required in any reported period.

We may be required to replenish our affiliated funeral and cemetery trust funds to meet minimum funding requirements, which would have a negative effect on our earnings and cash flow.

In certain states and provinces, we have withdrawn allowable distributable earnings, including unrealized gains, from our trust funds prior to the maturity or cancellation of the related contract. Additionally, some states have laws that either require replenishment of investment losses under certain circumstances or impose various restrictions on withdrawals of future earnings when trust fund values drop below certain prescribed amounts. In the event of market declines that result in a severe decrease in trust fund value, we may be required to replenish amounts in the respective trusts in some future period. As of December 31, 2025, we had unrealized losses of $0.6 million in the various trusts within these states, but no such replenishment is currently expected to be required.

Our ability to execute our strategic plan depends on many factors, some of which are beyond our control.

Our strategic plan is focused on growing our revenue, leveraging our scale, and investing our capital. Many of the factors that impact our ability to execute our strategic plan, such as the number of deaths and general economic conditions, are beyond our control. Changes in operating conditions, such as supply disruptions and labor disputes, could negatively impact our operations. Our inability to leverage scale to drive cost savings, productivity improvements, preneed production, or earnings growth anticipated by management could affect our financial performance. Our inability to identify acquisition targets and to complete acquisitions, divestitures, or strategic alliances as planned or to successfully integrate acquired businesses and realize expected synergies and strategic benefits could impact our financial performance. Our inability to allocate capital to maximize shareholder value could impact our financial performance. We cannot give assurance that we will be able to execute any or all of our strategic plan. Failure to execute any or all of our strategic plan could have a material adverse effect on our financial condition, results of operations, and cash flows.

We may be adversely affected by the effects of inflation.

Inflation has the potential to adversely affect our liquidity, business, financial condition and results of operations by increasing our overall cost structure or by reducing the amount of discretionary income consumers have available to spend on our merchandise and services. Higher inflation in the economy may result in higher interest rates and capital costs, supply shortages, increased costs of labor, components, manufacturing and shipping, as well as weakening exchange rates and other similar effects. As a result of inflation, we may experience modest cost increases from certain vendors and suppliers on merchandise and goods. Although we may take measures to mitigate the effects of inflation, if these measures are not effective, our business, financial condition, results of operations and liquidity could be materially adversely affected. Even if such measures are effective, there could be a difference between the timing of when these beneficial actions impact our results of operations and when the cost of inflation is incurred.

Our results may be adversely affected by significant weather events, natural disasters, catastrophic events or public health crises.

Three of our largest states by total revenue are California, Texas, and Florida, areas where natural disasters may be prevalent. Significant weather events in these states or other key areas where our operations are concentrated, natural or other disasters, wildfires, and unforeseen public health crises, such as pandemics and epidemics, could disrupt our business through injury or illness to our associates or client families, physical damage, closure or destruction of one or more of our locations, data centers or office facilities, disrupt access to scarce resources such as water supply or disrupt the delivery of goods or services by one or more of our vendors, any or all of which could adversely impact our operations or increase our costs, which would adversely affect our financial results.

Our credit agreements contain covenants that may prevent us from engaging in certain transactions.

Our Bank Credit Facilities contain, among other things, various affirmative and negative covenants that may prevent us from engaging in certain transactions that might otherwise be considered beneficial to us. The covenants limit, among other things, our and our subsidiaries’ ability to:

•Incur additional indebtedness (including guarantee obligations);

•Create liens on assets;

•Engage in certain transactions with affiliates;

•Enter into sale-leaseback transactions;

•Engage in mergers, acquisitions, liquidations, and dissolutions;

•Sell assets;

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•Pay dividends, distributions, and other payments in respect of our capital stock;

•Purchase our capital stock in the open market;

•Make investments, loans, or advances;

•Repay indebtedness or amend the agreements relating thereto;

•Create restrictions on our ability to receive distributions from subsidiaries; and

•Change our lines of business.

Our Bank Credit Facilities require us not to exceed a maximum leverage ratio. This covenant may require us to take actions to reduce our indebtedness or act in a manner contrary to our strategic plan and business objectives. In addition, events beyond our control, including changes in general economic and business conditions, may affect our ability to satisfy this covenant. A breach of this covenant could result in a default of our indebtedness. If we breach certain affirmative covenants or the negative covenant contained in our Bank Credit Facilities, then, immediately upon notice from the applicable administrative agent, an event of default will have occurred and the lenders could elect to declare all amounts outstanding thereunder, together with accrued interest, immediately due and payable. If we breach any of the other affirmative covenants contained in our Bank Credit Facilities, and such breach continues unremedied for 30 days after receipt of notice thereof, then an event of default will have occurred and the lenders party thereto could elect to declare all amounts outstanding thereunder, together with accrued interest, immediately due and payable. Any such declaration would also result in an event of default under our Senior Indenture governing our various senior notes. For additional information, see Financial Condition, Liquidity and Capital Resources in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 6 in Part II, Item 8. Financial Statements and Supplementary Data.

If we lost the ability to use surety bonding to support our preneed activities, we may be required to make material cash payments to fund certain trust funds.

We have entered into arrangements with certain surety companies whereby such companies agree to issue surety bonds on our behalf as financial assurance or as required by existing state and local regulations. The surety bonds are used for various business purposes; however, the majority of the surety bonds issued and outstanding have been issued to support our preneed funeral and cemetery activities. In the event all of the surety companies canceled or did not renew our surety bonds, which generally have twelve-month renewal periods, we would be required to either obtain replacement coverage or fund approximately $258.7 million into state-mandated trust accounts as of December 31, 2025. There can be no assurance that we would be able to obtain replacement coverage at a similar cost or at all.

The financial condition of third-party insurance companies that fund our preneed contracts may impact our future revenue.

Where permitted by state law, customers may arrange their preneed contract by purchasing a life insurance or annuity policy from third-party insurance companies. The customer/policy holder assigns the policy benefits to us as payment for their preneed contract at the time of need. If the financial condition of the third-party insurance companies were to deteriorate materially because of market conditions, strategic transactions, or otherwise, there could be an adverse effect on our ability to collect all or part of the proceeds of the life insurance policy, if we fulfill the preneed contract at the time of need. Failure to collect such proceeds could have a material adverse effect on our financial condition, results of operations, and cash flows.

Unfavorable publicity could affect our reputation and business.

Since our operations relate to life events involving emotional stress for our client families, our business is dependent on customer trust and confidence. Unfavorable publicity about our business generally or in relation to any specific location could affect our reputation and customers’ trust and confidence in our products and services, thereby having an adverse impact upon our sales and financial results.

Our failure to attract and retain qualified sales personnel and licensed funeral professionals could have an adverse effect on our business and financial condition.

Our ability to attract and retain a qualified sales force, licensed funeral professionals and other personnel is an important factor in achieving future success. Buying cemetery and funeral home products and services, especially at-need products and services, is very emotional for most customers, so our sales force and licensed funeral professionals must be particularly sensitive to our customers’ needs. We cannot give assurance that we will be successful in our efforts to attract and retain a skilled sales force and licensed funeral professionals. Furthermore, the stringent licensing standards required for funeral professionals under various state regulations create a significant barrier to entry and make it especially challenging to find qualified talent. If we are unable to maintain a qualified and productive sales force and team of licensed funeral professionals, our revenues may decline and our cash available for distribution may decrease.

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We use a combination of insurance, self-insurance, and large deductibles in managing our exposure to certain inherent risks; therefore, we could be exposed to unexpected costs that could negatively affect our financial performance.

Our insurance coverage is subject to deductibles, self-insured retentions, limits of liability, and similar provisions that we believe are prudent based on our operations. Because we self-insure a significant portion of expected losses under our workers' compensation, auto, and general and professional liability insurance programs, unanticipated changes in any applicable actuarial assumptions, trends and interpretations, or management estimates underlying our recorded liabilities for these losses, including potential increases in costs, could result in materially different amounts of expense than expected under these programs. These unanticipated changes could have a material adverse effect on our financial condition, results of operations, and cash flows.

Declines in overall economic conditions beyond our control could reduce future potential earnings and cash flows and could result in future impairments to goodwill and/or other intangible assets.

In addition to an annual review, we assess the impairment of goodwill and/or other intangible assets whenever events or changes in circumstances indicate that the carrying value may be greater than fair value. Factors that could trigger an interim impairment review include, but are not limited to, a significant decline in our stock price, significant underperformance relative to historical or projected future operating results, and significant negative industry or economic trends. If any of these factors occur, we may have a triggering event, which could result in an impairment of our goodwill and/or other intangible assets. If economic conditions worsen causing deterioration in our operating revenue, operating margins, and cash flows, we may have a triggering event that could result in an impairment of our goodwill and/or other intangible assets. Our cemetery segment, which has a goodwill balance of $406.8 million as of December 31, 2025, is more sensitive to market conditions and goodwill impairments because it is more reliant on preneed sales, which are impacted by customer discretionary spending. For additional information, see Critical Accounting Policies, Recent Accounting Pronouncements, and Accounting Changes in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Any failure to protect personal information relating to our customers, their loved ones, our associates, and our vendors could damage our reputation, could cause us to incur substantial additional costs and to become subject to litigation, and could adversely affect our operating results, financial condition, or cash flow.

In the ordinary course of our business, we and our vendors receive and retain personal information about our customers, their loved ones, our associates, and our vendors, in both physical and electronic formats, with the expectation that we will adequately protect that information. In addition, our online website operations depend upon the secure transmission of confidential information over public networks, including information permitting electronic payments. New laws and regulations governing data privacy, security, cybersecurity, and information security, including legislation in several U.S. states and Canadian provinces, pose increasingly complex compliance challenges and potentially elevate our costs. Any failure by us to comply with these laws and regulations, including as a result of a security or privacy breach, could result in significant penalties and liabilities. A significant theft, loss, or fraudulent use of the personally identifiable information we maintain or failure of our vendors to use or maintain such data in accordance with contractual provisions could result in significant costs, fines, litigation, and reputational damage. Additionally, if we acquire a company that is not in compliance with applicable data protection laws, we may incur significant liabilities and penalties.

We maintain substantial security measures and data backup systems to protect, store, and prevent unauthorized access to such information. Nevertheless, it is possible that increasingly sophisticated cyberattacks might defeat our security measures in the future and obtain the personal information of customers, their loved ones, our associates, and our vendors that we hold. The rapid advancement and widespread adoption of artificial intelligence technologies, combined with emerging innovations and the increasing frequency and sophistication of cyberattacks, could substantially elevate cybersecurity risks for us and our vendors, associates, contractors or third parties with whom we do business. Further, our associates, contractors, or third parties with whom we do business may attempt to circumvent our security measures to misappropriate such information and may purposefully or inadvertently cause a breach, corruption, or data loss involving such information. A breach of our security measures or failure in our backup systems could adversely affect our reputation with our customers and their loved ones, our associates, and our vendors; as well as our operations, results of operations, financial condition, and cash flows; and could result in litigation or penalties.

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A failure of a key information technology system or process could disrupt and adversely affect our business.

We rely extensively on information technology systems, some of which are managed or provided by third-party service providers, to analyze, process, store, manage, and protect transactions and data. In managing our business, we also rely heavily on the integrity of, security of, and consistent access to this data for information such as sales, merchandise ordering, inventory replenishment, and order fulfillment. For these information technology systems and processes to operate effectively, we or our service providers must periodically maintain and update them. Our systems and the third-party systems on which we rely are subject to damage or interruption from a number of causes, including power outages; computer and telecommunications failures; computer viruses; security breaches; cyber-attacks, including the use of ransomware; catastrophic events such as fires, floods, earthquakes, tornadoes, or hurricanes; acts of war or terrorism; and design or usage errors by our associates, contractors, or third-party service providers. Although we and our third-party service providers seek to maintain our respective systems effectively and to successfully address the risk of compromise of the integrity, security, and consistent operations of these systems, such efforts may not be successful. As a result, we or our service providers could experience errors, interruptions, delays, or cessations of service in key portions of our information technology infrastructure, which could significantly disrupt our operations and be costly, time consuming, and resource-intensive to remedy.

We may use artificial intelligence (“AI”) technologies in limited aspects of our operations and information technology systems. AI technologies are evolving and may give rise to operational, legal, regulatory, data security, and privacy risks. Such technologies may produce inaccurate, misleading, or biased outputs or be improperly used by employees, which could adversely affect our business, reputation, financial condition, or results of operations. In addition, increased governmental or regulatory scrutiny or legal claims related to AI could result in additional costs or liabilities, even where our use of AI is limited in our information technology systems and processes.

Our Canadian business exposes us to operational, economic, and currency risks.

Our Canadian operations represent approximately 5% of our revenue. Our ability to successfully conduct operations in Canada is affected by many of the same risks we face in our U.S. operations, as well as unique costs and difficulties of managing Canadian operations. Our Canadian operations may be adversely affected by local laws, customs, and regulations, as well as political and economic conditions. Significant fluctuations in exchange rates between the U.S. dollar and the Canadian dollar may adversely affect our results of operations and cash flows.

Our level of indebtedness could adversely affect our cash flows, our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and may prevent us from fulfilling our obligations under our indebtedness.

We have a significant amount of indebtedness, which could have important consequences, including the following:

•It may limit our ability to obtain additional debt or equity financing for working capital, capital expenditures, acquisitions, debt service requirements, and general corporate or other purposes.

•A portion of our cash flows from operations will be dedicated to the payment of principal and interest on our indebtedness, including indebtedness we may incur in the future, and may not be available for other purposes, including to finance our working capital, capital expenditures, acquisitions, and general corporate costs or other purposes.

•It could limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate and place us at a competitive disadvantage compared to our competitors that have less debt.

•It could make us more vulnerable to downturns in general economic or industry conditions or in our business, or prevent us from carrying out activities that are important to our growth.

•It could increase our interest expense if interest rates in general increase because a portion of our indebtedness, including all of our indebtedness under our Bank Credit Facilities, bears interest at floating rates.

•It could make it more difficult for us to satisfy our obligations with respect to our indebtedness, and any failure to comply with the obligations of any of our debt instruments, including any financial and other restrictive covenants, could result in an event of default under the agreements governing our other indebtedness which, if not cured or waived, could result in the acceleration of our indebtedness.

Any of the above listed factors could materially affect our business, financial condition, results of operations, and cash flows.

In addition to our high level of indebtedness, we also have significant rental and other obligations under our operating and finance leases for funeral service locations, cemetery operating and maintenance equipment, and transportation equipment. These obligations could further increase the risks described above.

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Risks Related to Our Industry

The funeral and cemetery industry is competitive.

In North America, the funeral and cemetery industry is characterized by a large number of locally-owned, independent operations. To compete successfully, our funeral service locations and cemeteries must maintain good reputations and high professional standards, as well as offer attractive products and services at competitive prices. In addition, we must market ourselves in such a manner as to distinguish us from our competitors. We have historically experienced price competition from independent funeral service location and cemetery operators, monument dealers, casket retailers, low-cost funeral providers, and other nontraditional providers of merchandise and services. If we are unable to successfully compete, our financial condition, results of operations, and cash flows could be materially adversely affected.

If the number of deaths in our markets declines, our cash flows and revenue may decrease. Changes in the number of deaths are not predictable from market to market or over the short term.

If the number of deaths in our markets declines, the number of funeral services and interments performed by us could decrease and our financial condition, results of operations, and cash flows could be materially adversely affected. Changes in the number of deaths may vary from quarter to quarter and across local markets, and those variations are not predictable. Variations in the death rate and seasonality of deaths throughout each year may also cause revenue to fluctuate between quarters or years.

If we are not able to respond effectively to changing consumer preferences, our market share, revenue, and/or profitability could decrease.

Future market share, revenue, and profit will depend in part on our ability to anticipate, identify, and respond to changing consumer preferences. We may not correctly anticipate or identify trends in consumer preferences, or we may identify them later than our competitors do. In addition, any strategies we may implement to address these trends may prove incorrect or ineffective.

The continuing upward trend in life expectancy and the number of cremations performed in North America could result in lower revenue, operating profit, and cash flows.

Generally, life expectancy in North America has increased steadily and is expected to continue to do so in the future, absent events related to pandemics or similar outbreaks. Additionally, there is a continuing upward trend in the number of cremations performed in North America as an alternative to traditional funeral service dispositions. In our operations during 2025, 64.4% of the comparable services we performed were cremation cases compared to 63.9% and 63.1% performed in 2024 and 2023, respectively. Our average revenue for cremations is lower than that for traditional burials. If we are unable to continue to expand our cremation memorialization products and services, and cremations increase as a significant percentage of our services, our financial condition, results of operations, and cash flows could be materially adversely affected.

Our funeral and cemetery businesses are high fixed-cost businesses.

The majority of our operations are managed in groups we call “markets”. Markets are geographical groups of funeral service locations and cemeteries that share common resources such as operating personnel, preparation services, clerical staff, motor vehicles, and preneed sales personnel. We must incur many of these costs, which may be impacted by many factors, including inflation, regardless of the number of services or interments performed. Because we cannot immediately decrease these costs when we experience lower sales volumes, a sales decline may cause our margin percentages to decline at a greater rate than the decline in revenue.

Risks associated with our supply chain, such as tariffs, could materially adversely affect our financial performance.

We are dependent on our supply chain to supply merchandise to our funeral home and cemetery locations. If our fulfillment network does not operate properly, if a supplier fails to deliver on its commitments, or if delivery networks have difficulty providing capacity to meet demands for their services, we could experience merchandise delivery delays or increased delivery costs, which could lead to lost sales and decreased customer confidence, and adversely affect our results of operations. Changes in the costs of procuring commodities used in our merchandise or the costs related to our supply chain, due to inflation, natural disasters, pandemics, changes to trade policy or other matters, could adversely affect our results of operations. We cannot predict how changes to trade policy may affect trade agreements or tariffs, nor can we predict the effects that any such changes would have on our supply chain.

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Regulatory and Legal Risks

Regulation and compliance could have a material adverse impact on our financial results.

Our operations are subject to regulation, supervision, and licensing requirements under numerous foreign, federal, state, and local laws, ordinances, and regulations, including extensive regulations concerning trust funds, preneed sales of funeral and cemetery merchandise and services, and various other aspects of our business. The funeral industry is regulated at the federal level by the FTC, which has been under review by the FTC since 2020. We are also subject to financial and compliance audits of preneed sales practices and state trust funds. Our facilities are also subject to stringent health, safety, and environmental regulations. In particular, cremation and embalming facilities are subject to stringent health and environmental regulations and there are associated risks of investigations from regulatory authorities or incidental non-compliance with such regulations. Our pay practices, including wage and hour overtime pay, are subject to federal and state regulations. Violations of applicable laws could result in fines or sanctions against us.

In addition, from time to time, amended, added or reinterpreted regulations could increase costs and decrease cash flows. For example, foreign, federal, state, local, and other regulatory agencies have considered and may enact additional legislation or regulations that could affect the deathcare industry. These include regulations that require more liberal refund and cancellation policies for preneed sales of products and services, limit or eliminate our ability to use surety bonding, require the escheatment of trust funds, increase trust requirements, require the deposit of funds or collateral to offset unrealized losses of trusts, and/or prohibit the common ownership of funeral service locations and cemeteries in the same market. Similarly, more stringent permitting or other environmental regulations, if adopted, could increase our costs. If adopted by the regulatory authorities of the jurisdictions in which we operate, these and other possible proposals could have a material adverse effect on our financial condition, results of operations, and cash flows.

Compliance with laws, regulations, industry standards, and customs concerning burial procedures and the handling and care of human remains is critical to the continued success of our business and any operations we may acquire. Litigation and regulatory proceedings regarding these issues could have a material adverse effect on our financial condition, results of operations, and cash flows.

Unfavorable results of litigation could have a material adverse impact on our financial statements.

As discussed in Note 9 of Part II, Item 8. Financial Statements and Supplementary Data, we are subject to a variety of claims and lawsuits in the ordinary course of our business. Adverse outcomes in some or all of the pending cases may result in significant monetary damages or injunctive relief against us, as litigation and other claims are subject to inherent uncertainties. Any such adverse outcomes, in pending cases or other lawsuits that may arise in the future, could have a material adverse impact on our financial position, results of operations, and cash flows.

Cemetery burial practice claims could have a material adverse impact on our financial results.

Most of our cemeteries have been operating for decades and, therefore, may have used practices and procedures that are outdated in comparison to today's standards. When cemetery disputes occur, we may be subjected to litigation and liability for improper burial practices, including (1) burial practices of a different era that are judged today in hindsight as being outdated and (2) alleged violations of our practices and procedures by one or more of our associates. In addition, since most of our cemeteries were acquired through various acquisitions, we may be subject to litigation and liability based upon actions or events that occurred before we acquired or managed the cemeteries. Claims or litigation based upon our cemetery burial practices could have a material adverse impact on our financial condition, results of operations, and cash flows.

The application of unclaimed property laws by certain states to our preneed funeral and cemetery backlog could have a material adverse impact on our liquidity, cash flows, and financial results.

In the ordinary course, our businesses have sold preneed funeral and cemetery contracts for decades. To the extent these contracts will not be funded with the assignment of the proceeds of life insurance policies, depending on applicable state laws, we could be responsible for escheatment of the portion of the funds paid that relate to contracts which we are unlikely to fulfill. For additional information, see Unclaimed Property Audit in Note 9 in Part II, Item 8. Financial Statements and Supplementary Data of this Form 10-K. The application of unclaimed property laws could have a material adverse effect on our liquidity, cash flows, and financial results.

Changes in taxation, or the interpretation of tax laws or regulations, as well as the inherent difficulty in quantifying potential tax effects of business decisions could have a material adverse effect on the results of our operations, financial condition, or cash flows.

We make judgments regarding the utilization of existing income tax credits and the potential tax effects of various financial transactions and results of operations to estimate our obligations to taxing authorities. We are also subject to regular reviews, examinations, and audits by taxing authorities with respect to our taxes. Our tax obligations include income, franchise, real estate, sales and use, and employment-related taxes and the judgments we make include reserves for potential adverse outcomes regarding tax positions that have been taken. Changes in federal, state, or local tax laws, adverse tax audit results, or adverse tax rulings on positions taken could have a material adverse effect on the results of our operations, financial condition, or cash flows.

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Item 1B. Unresolved Staff Comments

None.

Item 1C. Cybersecurity

Risk Management and Strategy

We recognize the necessity of a flexible and dynamic cybersecurity risk management strategy to defend against threats in a fast-changing digital world. For this purpose, we have invested in building a cybersecurity infrastructure to protect our information systems and secure our data from cyberattacks. Our information security program features risk management strategies, security awareness training, security operations, incident response, security governance, third-party risk management, IT security risk management, security architecture, and vulnerability management.

Managing Material Risks & Integrated Overall Risk Management

Cybersecurity risk management is integrated into our broader enterprise risk management system, and cybersecurity risk is strategically reviewed, monitored and managed alongside other enterprise risks on a regular basis. Our information security program is designed to evaluate, identify, and manage risks from cybersecurity threats and vulnerabilities, including malware, phishing, hacking, social engineering, data breaches, and emerging risks associated with artificial intelligence. Assessment of risks may include tabletop exercises, control gap analyses, threat modeling, internal or external audits, vulnerability scans, and penetration tests. Our program is regularly assessed using the NIST Cybersecurity Framework, and our policies are reviewed periodically to align with current regulatory requirements and the evolving threat landscape. Our employees are required to take mandatory information security training.

Our information security team is empowered to assess and address cybersecurity risks in close collaboration with the operational teams. This forward-thinking strategy ensures that cybersecurity risk management awareness informs each stage of the business decision-making process.

Engage External Experts on Risk Management

To effectively target emerging cybersecurity threats, our information security program engages with a diverse group of third-party external experts, including cybersecurity assessors, consultants, and auditors for cybersecurity risk management. Our partnerships with these third party professionals feature regular audits, assessments, and simulated testing.

Oversee Third-Party Risk

Risk assessments are conducted when we onboard new services and new vendors, including third-party vendors, applications, and other technology services, when there are significant changes to IT or security architecture, and when systems handle sensitive data. Third-party risks are documented as part of a risk management process that follows an industry standard framework with a goal of remediation or mitigation.

Cybersecurity Threat Risks

We have not experienced a cybersecurity incident or data breach that has had a material impact on our operations or financial standing.

Governance

The Board of Directors recognizes that an encompassing, effective cybersecurity risk management strategy is essential to sustaining business operations and investor confidence. Our management assumes executive responsibility for assessing, identifying, and managing cybersecurity risks and incidents.

Board of Directors Oversight

Certain members of the Board of Directors have experience conducting oversight of cybersecurity risk management across different industries, including technology and finance. The Audit Committee is the primary committee responsible for overseeing the company’s cybersecurity risks with the Board receiving updates on at least an annual basis.

Management’s Role in Managing Cybersecurity Risk

The Assistant Vice President, Information Technology Security (AVP, IT Security), who also functions as the company's data protection officer, reports to the Vice President of Information Technology and is responsible for briefing the Audit Committee on information security risks. The AVP, IT Security provides comprehensive briefings to the Audit Committee on a quarterly basis. These briefings highlight various cybersecurity topics, including new cybersecurity threats, incidents, risks, risk management solutions, strategy pivots, or proposed governance changes.

Risk Management Expertise

With over 24 years of experience working on information technology and cybersecurity teams, the AVP, IT Security is the lead architect of the company’s security infrastructure. In his role, the AVP, IT Security has built and developed effective and

FORM 10-K 21

PART I

lasting information security solutions, establishing a robust framework of technical, administrative and physical controls while providing stakeholders such as executive management, operations leadership and legal counsel clear and constant visibility into rapidly evolving business threats. The AVP, IT Security is responsible for detecting known and potential cybersecurity incidents, leading cybersecurity incident investigations, and ensuring that cybersecurity incidents are reported timely, promptly escalated and resolved in accordance with the Company cybersecurity incident response plan. The AVP, IT Security is a Certified Information Security Manager and his cybersecurity expertise is a valuable resource for Company executive leadership and the Board.

Monitoring Cybersecurity Incidents

The AVP, IT Security manages the information security program responsible for the regular monitoring of our information systems for cybersecurity risks. The monitoring process is led by an experienced team of information security professionals. Advanced security software preemptively detects threats and regular system scans are conducted to identify potential vulnerabilities. The AVP, IT Security regularly receives updates about potential cybersecurity threats and remains informed about the latest threat detection software technologies and new risk management solutions. In the event of a cybersecurity incident, the AVP, IT Security is supported by the cyber security incident response team and the crisis response team. The Cyber Security Incident Response Plan guides the AVP, IT Security and includes immediate actions to escalate an incident based on its seriousness, to mitigate the impact, and to enact long-term strategies for remediation and prevention of future incidents.

Reporting Cybersecurity Risk

The AVP, IT Security is responsible for informing executive management of cybersecurity risks and incidents. The AVP, IT Security presents quarterly briefings to the Cyber Security and Data Governance Executive Steering Committee on all issues related to cybersecurity risks and incidents. The Cyber Security and Data Governance Executive Steering Committee includes members from the senior leadership team, such as the Chief Financial Officer, the Senior Vice President of Operations Services and the General Counsel. Our highest levels of management are actively aware and involved in shaping the company’s cybersecurity position and analyzing potential risks. Any cybersecurity incident or data breach that is determined to be material will be reported to the Audit Committee and the Board of Directors.

Item 2. Properties

Information regarding properties is set forth in Part I, Item 1. Business.

Item 3. Legal Proceedings

Information regarding legal proceedings is set forth in Note 9 of Part II, Item 8. Financial Statements and Supplementary Data.

Item 4. Mine Safety Disclosures

Not applicable.

22 Service Corporation International

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities

Our common stock has been traded on the New York Stock Exchange since May 14, 1974. On December 31, 2025, there were 2,807 holders of record of our common stock. In calculating the number of stockholders, we consider clearing agencies and security position listings as one stockholder for each agency or listing. At December 31, 2025, we had 139,678,199 shares outstanding, net of 2,278,805 treasury shares.

Our common stock is traded on the New York Stock Exchange under the symbol SCI.

The following graph assumes the total return on $100 invested on December 31, 2020, in SCI Common Stock, the S&P 500 Index, the S&P MidCap 400 Index, and a peer group selected by the Company (the “Peer Group”). The Peer Group comprises Carriage Services, Inc. and Matthews International Corp. Total return data assumes reinvestment of dividends.

For equity compensation plan information, see Part III of this Form 10-K.

FORM 10-K 23

PART II

The following table summarizes our share repurchases during the three months ended December 31, 2025:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs	Approximate Dollar Value of Shares That May Yet be Purchased Under the Program (4)
October 1, 2025 — October 31, 2025 (1)	69,704	$	82.24	55,859	$	409,832,213
November 1, 2025 — November 30, 2025 (2)	98,113	$	79.43	97,955	402,051,423
December 1, 2025 — December 31, 2025 (3)	582,546	$	77.92	582,027	356,699,395
	750,363			735,841

(1) Includes 13,845 shares purchased in October 2025 in connection with the surrender of shares by associates to satisfy certain tax withholding obligations under compensation plans.

(2) Includes 158 shares purchased in November 2025 in connection with the surrender of shares by associates to satisfy certain tax withholding obligations under compensation plans.

(3) Includes 519 shares purchased in December 2025 in connection with the surrender of shares by associates to satisfy certain tax withholding obligations under compensation plans.

(4) In May 2025, we announced an increase in our share repurchase authorization to $600.0 million. The share repurchase authorization does not obligate us to acquire a minimum amount of shares. Under the share repurchase authorization, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.

Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The Company

We are North America’s largest provider of deathcare products and services, with a network of funeral service locations and cemeteries unequaled in geographic scale and reach. At December 31, 2025, we operated 1,485 funeral service locations and 500 cemeteries (including 312 funeral service/cemetery combination locations), which are geographically diversified across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. Our funeral and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. We strive to offer families exceptional service in planning life celebrations and personalized remembrances. Our Dignity Memorial® brand serves approximately 700,000 families each year with professionalism, compassion, and attention to detail.

Our financial position is enhanced by our $17.0 billion backlog of future revenue from both trust and insurance-funded preneed sales at December 31, 2025. Preneed selling provides us with a strategic opportunity to gain future market share. We also believe it adds to the stability and predictability of our revenue and cash flows. While revenue on the majority of preneed merchandise and service sales is deferred until the time of need, sales of preneed cemetery property provide opportunities for full current revenue recognition to the extent that the property is developed and available for use.

We have adequate liquidity and a favorable debt maturity profile, which allow us to reinvest and grow our business as well as return capital to shareholders through share repurchases and dividends.

Factors affecting our operating results include: demographic trends in terms of population growth and average age, which impact death rates and number of deaths; establishing and maintaining leading market share positions supported by strong local heritage and relationships; effectively responding to increasing cremation trends by selling complementary services and merchandise; controlling salary and merchandise costs; and exercising pricing leverage related to our atneed revenue. The average revenue per funeral contract is influenced by the mix of traditional and cremation services as our average revenue for cremations is lower than that for traditional burials. To further enhance revenue opportunities, we continue to focus on our cremation customers' preferences and remaining relevant by developing additional memorialization merchandise and services that specifically appeal to cremation customers. We believe the presentation of these additional merchandise and services through our customer-facing technology improves our customers' experience by reducing administrative burdens and allowing them to visualize the enhanced product and service offerings, which we believe will help drive increases in the average revenue for a cremation in future periods. While economic conditions, inflation, and consumer confidence may affect the timing or mix of customer purchases, demand is generally deferred rather than lost. Accordingly, demand for these products and services has historically been less sensitive to economic cycles than other discretionary consumer purchases.

For further discussion of our key operating metrics, see our "Cash Flow" and “Results of Operations” sections below. For a discussion of our results of operations and liquidity and capital resources for the fiscal year ended December 31, 2024, see

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PART II

Management’s Discussion and Analysis of Financial Condition, Liquidity and Capital Resources and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year December 31, 2024, filed with the Securities and Exchange Commission on February 13, 2025.

FORM 10-K 25

PART II

Financial Condition, Liquidity, and Capital Resources

Capital Allocation Considerations

We rely on cash flow from operations as a significant source of liquidity. Our cash flow from operating activities provided $942.8 million in 2025. In addition, as of December 31, 2025, we have $1,448.0 million in borrowing capacity under our revolving credit facility. As of December 31, 2025, we had $56.8 million in current maturities of long-term debt, which primarily consist of the current amounts due on our term loan, mortgage notes and other debt, and finance leases.

Our Bank Credit Facility requires us to maintain a certain leverage ratio with which we were in compliance at December 31, 2025. We target a leverage ratio of 3.5x to 4.0x.

Our financial covenant requirements and actual ratio as of December 31, 2025 are as follows:


	Per Credit Agreement	Actual
Leverage ratio	5.00 (Max)	3.67

We have the financial strength and flexibility to reward shareholders with dividends while maintaining a prudent capital structure and pursuing new opportunities for profitable growth.

Our unencumbered cash on hand, future operating cash flows, and the available capacity under our Bank Credit Facilities gives us adequate liquidity to meet our short-term needs as well as our long-term financial obligations. Due to cash balances residing in Canada and minimum operating cash requirements, a portion of our cash on hand is encumbered.

We consistently evaluate the best uses of our cash flow that will yield the highest value and return on capital. Our capital investment strategy is prioritized as follows:

Investing in Acquisitions and Building New Funeral Service and Cemetery Locations. We manage our footprint by focusing on strategic acquisitions and building new funeral service locations where the expected returns are attractive and exceed our weighted average cost of capital. We target businesses with favorable customer dynamics and/or where we can achieve the benefits of economies of scale. We continue to pursue strategic acquisitions and build new funeral service locations in areas that provide us with the potential for additional scale. In 2025, we invested $101.3 million in acquiring 22 funeral service locations and 2 cemeteries, which included 2 combination locations.

Return Excess Cash to Shareholders. In addition to any strategic acquisitions or new build opportunities, we continue to return cash to shareholders through dividends and our share repurchase program. Our quarterly dividend rate has steadily grown from $0.025 per common share in 2005 to $0.34 per common share at the end of 2025. We target a dividend payout ratio of 30% to 40% of after tax earnings excluding special items and intend to grow our cash dividend commensurate with the growth in our business. While we intend to pay regular quarterly cash dividends for the foreseeable future, all future dividends are subject to limitations in our debt covenants and final determination by our Board of Directors each quarter upon review of our financial performance. We also expect to continue to repurchase shares of our common stock in the open market or through privately negotiated transactions, subject to market conditions, debt covenants, and normal trading restrictions. There can be no assurance that we will buy our common stock under our repurchase program in the future. In 2025, we repurchased 5,864,563 shares of our common stock at an aggregate cost of $464.2 million, which is an average cost per share of $79.15. In 2024, we repurchased 3,439,551 shares of our common stock at an aggregate cost of $249.8 million, which is an average cost per share of $72.63. Subsequent to December 31, 2025, we repurchased 552,313 shares for $44.4 million at an average cost per share of $80.48.

Managing Debt. We continue to focus on maintaining optimal levels of liquidity and financial flexibility. Our recent $325.0 million increase in availability under our bank credit facility bolsters our flexible capital strategy and allows us to further manage our debt maturity profile by making open market debt repurchases when it is opportunistic to do so. We generate a relatively consistent annual cash flow stream that is generally resistant to down economic cycles. This cash flow stream and our significant liquidity allow us to substantially reduce our long-term debt maturities should we choose to do so. In November 2025, we entered into a new bank credit agreement due November 2030 consisting of a $750.0 million term loan, which is funded debt, and a revolving credit facility providing for borrowings of up to $1.75 billion. Proceeds from this new bank credit agreement were used to settle our existing Term Loan and Bank Credit Facility, which were both due January 2028. In addition to more favorable pricing, the new bank credit agreement provides us flexibility with incremental liquidity for capital investment, working capital, and other general corporate purposes.

Cash Flow

Our ability to generate strong operating cash flow is one of our fundamental financial strengths and provides us with substantial flexibility in meeting operating and investing needs.

Operating Activities

Net cash provided by operating activities was $942.8 million and $944.9 million for the years ended December 31, 2025, and 2024, respectively.

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PART II

The $2.1 million decrease in operating cash flow during 2025 comprises:

•a $119.2 million increase in cash tax payments,

•a $20.2 million increase in employee compensation payments,

•a $19.3 million increase in restructuring payments,

•a $12.2 million increase in net trust deposits,

•a $11.2 million increase in cash interest payments, and

•a $3.9 million increase in vendor and other payments, partially offset by

•a $116.9 million increase in cash receipts from customers,

•a $38.6 million increase in General Agency (GA) commission and other receipts, and

•a $28.4 million decrease in payments for certain legal matters.

Investing Activities

Cash flows from investing activities used $548.3 million and $620.9 million, in 2025, and 2024, respectively. The $72.6 million decreased outflow from 2025 over 2024 is primarily due to the following:

•a $79.9 million decrease in cash spent on business acquisitions,

•a $43.6 million decrease in cash spent on real estate acquisitions,

•a $10.3 million increase in net proceeds for Company-owned life insurance policies,

•a $6.0 million increase in cash receipts from divestitures and asset sales, and

•a $2.2 million decrease in other investing activities primarily for investments in renewable energy tax credits, partially offset by

•a $54.5 million increase in capital expenditures related to construction of our new corporate headquarters which is financed through a separate construction loan facility,

•a $14.9 million increase in total capital expenditures, which includes:

•an $18.8 million increase for growth capital expenditures/construction of new funeral service locations, partially offset by

• a $3.9 million decrease in maintenance capital expenditures, consisting of:

•an $8.6 million decrease in expenditures for digital investments and corporate, partially offset by

•a $3.1 million increase in expenditures for cemetery property development, and

•a $1.6 million increase in expenditures for capital improvements at existing field locations.

Financing Activities

Financing activities used $374.7 million in 2025 compared to $319.6 million in 2024. The $55.1 million increased outflow from 2025 over 2024 is primarily due to the following:

•a $207.3 million increase in purchase of Company common stock,

•a $27.3 million decrease in proceeds from exercises of stock options, and

•a $9.3 million increase in payments of dividends, partially offset by

•a $132.4 million increase in debt proceeds, net of repayments,

•a $54.8 million increase in borrowings from our corporate headquarters debt facility, and

•a $1.6 million decrease in bank overdrafts and other.

Material Cash Requirements

Our material cash requirements include the following contractual and other obligations.

Debt & Finance Leases

As of December 31, 2025, we had $5.1 billion in aggregate principal outstanding on our notes, term loan, revolving credit facility, finance leases, mortgage notes, and other debt (collectively "debt and finance leases"), of which $56.8 million is payable in the next twelve months. The aggregate principal excludes $38.1 million in unamortized non-cash debt issuance costs and original issuance discounts and premiums. Future interest payments associated with the debt and finance leases

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PART II

total $1.2 billion, of which $249.1 million is payable in the next twelve months. For further information on our debt and finance leases see Note 6 and Note 8 of Part II, Item 8. Financial Statements and Supplementary Data.

Operating Leases

We have operating lease agreements for funeral service real estate and office equipment for funeral service locations, cemetery locations, and administrative offices. As of December 31, 2025, we had fixed lease payment obligations of $65.6 million, of which $10.4 million is due in the next twelve months. See Note 8 in Part II, Item 8. Financial Statements and Supplementary Data for additional details related to our leases.

Financial Assurances

In support of our operations, we have entered into arrangements with certain surety companies whereby such companies agree to issue surety bonds on our behalf as financial assurance and/or as required by existing state and local regulations. The surety bonds are used for various business purposes; however, the majority of the surety bonds issued and outstanding have been used to support our preneed sales activities. The obligations underlying these surety bonds are recorded on our Consolidated Balance Sheet as Deferred revenue, net. The breakdown of surety bonds between funeral and cemetery preneed arrangements, as well as surety bonds for other activities, is described below.


	Years Ended December 31,
	2025		2024
	(In millions)
Preneed funeral	$	209.2	$	226.8
Preneed cemetery:
Merchandise and services	134.9		135.6
Pre-construction	64.5		56.4
Bonds supporting preneed funeral and cemetery obligations	408.6		418.8
Bonds supporting preneed business permits	8.7		8.1
Other bonds	76.5		27.5
Total surety bonds outstanding	$	493.8	$	454.4

When selling preneed contracts, we may post surety bonds where allowed by state law. We post the surety bonds in lieu of trusting a certain amount of funds received from the customer. The amount of the bond posted is generally determined by the total amount of the preneed contract that would otherwise be required to be trusted, in accordance with applicable state law.

Surety bond premiums are paid annually and the bonds are automatically renewable until maturity of the underlying preneed contracts, unless we are given prior notice of cancellation.

Except for cemetery pre-construction bonds (which are irrevocable), the surety companies generally have the right to cancel the surety bonds at any time with appropriate notice. In the event a surety company were to cancel the surety bond, we are required to obtain replacement surety assurance from another surety company or fund a trust for an amount generally less than the posted bond amount. Management does not expect that we will be required to fund material future amounts related to these surety bonds due to a lack of surety capacity or surety company non-performance.

During the second quarter of 2025, we replaced our then-existing letters of credit under the Bank Credit Facility with a $46.0 million surety bond and a related indemnity obligation with a large insurance company, which is included in Other bonds in the table above.

Preneed Activities and Backlog of Contracts

In addition to selling our products and services to client families at the time of need, we enter into price-guaranteed preneed contracts, which provide for future funeral or cemetery merchandise and services. Because preneed funeral and cemetery merchandise or services will generally not be provided until sometime in the future, most states and provinces require that all or a portion of the funds collected from customers on preneed contracts be deposited into merchandise and service trusts until the merchandise is delivered or the service is performed. In certain situations, as described above, where permitted by state or provincial laws, we may post a surety bond as financial assurance for a certain amount of the preneed contract in lieu of placing funds into trust accounts. Alternatively, we may sell a life insurance or annuity policy from third-party insurance companies or use other non-insurance funded third-party providers.

Insurance- and Other Funded Preneed Contracts

Where permitted by state or provincial law, we may sell a life insurance or annuity policy from third-party insurance companies, for which we earn a commission as a general sales agent for the insurance company. These general agency commissions (GA revenue) are based on a percentage per contract sold and are recognized as funeral revenue when the insurance purchase transaction between the preneed purchaser and third-party insurance provider is completed. All selling costs incurred pursuant to the sale of insurance-funded preneed contracts are expensed as incurred. We do not reflect the

28 Service Corporation International

PART II

unfulfilled insurance- and other funded preneed contract amounts in our Consolidated Balance Sheet. The proceeds of the life insurance policies or annuity contracts will be reflected in funeral revenue as we perform these funerals. In early July 2024, we finalized our agreement to change our preferred preneed insurance provider in the United States, which has allowed us to further utilize our scale and streamline our processes across our network. In addition, we have shifted our non-funeral home preneed sales production from trust to insurance-funded contracts.

The table below details our results of insurance-funded and other non-insurance funded third-party preneed production and maturities.


	Years Ended December 31,
	2025		2024
	(Dollars in millions)
Preneed insurance-funded:
Sales production(1)	$	816.9	$	681.4
Sales production (number of contracts) (1)	160,342		115,853
General agency revenue	$	292.1	$	230.9
Maturities	$	404.9	$	380.1
Maturities (number of contracts)	65,452		62,138

Other non-insurance funded third-party:
Sales production(1)	$	41.5	$	43.6
Sales production (number of contracts)(1)	4,249		4,581
Maturities	$	30.7	$	27.9
Maturities (number of contracts)	3,079		3,064

(1) Amounts are not included in our Consolidated Balance Sheet.

Trust-Funded Preneed Contracts

The funds collected from customers are deposited into trusts as required by state or provincial law. We retain any funds above the amounts required to be deposited into trust accounts and use them for working capital purposes, generally to offset the selling and administrative costs of our preneed programs. Although this represents cash flow to us, the associated revenues are deferred until the merchandise is delivered or services are performed (typically at maturity). The funds in trust are then invested by professional money managers with oversight by independent trustees in accordance with state and provincial laws. As discussed above in Insurance- and Other Funded Preneed Contracts, we have shifted our non-funeral home preneed sales production from trust to insurance-funded contracts.

The tables below detail our results of preneed production and maturities, excluding insurance contracts, for the years ended December 31, 2025 and 2024.

FORM 10-K 29

PART II


	Years Ended December 31,
	2025		2024
	(Dollars in millions)
Funeral:
Preneed trust-funded (including bonded):
Sales production	$	339.7	$	480.0
Sales production (number of contracts)	57,295		113,686
Maturities	$	403.6	$	378.0
Maturities (number of contracts)	84,699		84,373
Cemetery:
Sales production:
Preneed	$	1,421.0	$	1,356.3
Atneed	429.9		425.9
Total sales production	$	1,850.9	$	1,782.2
Sales production deferred to backlog:
Preneed	$	713.9	$	636.7
Atneed	299.7		301.1
Total sales production deferred to backlog	$	1,013.6	$	937.8
Revenue recognized from backlog:
Preneed	$	496.4	$	485.8
Atneed	303.0		304.5
Total revenue recognized from backlog	$	799.4	$	790.3

Backlog of Preneed Contracts

The following table reflects our backlog of trust-funded deferred preneed contract revenue, including amounts related to Deferred receipts held in trust at December 31, 2025 and 2024. Additionally, the table reflects our backlog of unfulfilled insurance-funded contracts and other non-insurance funded third-party contracts (which are not included in our Consolidated Balance Sheet) at December 31, 2025 and 2024. The backlog amounts presented include amounts due from customers for undelivered performance obligations on cancelable preneed contracts to arrive at our total backlog of deferred revenue. The table does not include the backlog associated with businesses that are held for sale.

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PART II

The table also reflects our preneed receivables and trust investments associated with the backlog of deferred preneed contract revenue including the amounts due from customers for undelivered performance obligations on cancelable preneed contracts. The table below is meaningful because it sets forth the aggregate amount of future revenue we expect to recognize as a result of preneed sales, as well as the amount of funds associated with this revenue. Because the future revenue exceeds the assets, future revenue will exceed the cash distributions actually received from the associated trusts and future collections from the customer.


	December 31, 2025				December 31, 2024
	Fair Value		Cost		Fair Value		Cost
	(In billions)
Deferred revenue, net	$	1.78	$	1.78	$	1.76	$	1.76
Amounts due from customers for unfulfilled performance obligations on cancelable preneed contracts	1.01		1.01		0.99		0.99
Deferred receipts held in trust	5.78		4.83		5.16		4.50
Allowance for cancellation on trust investments	(0.29)		(0.24)		(0.27)		(0.24)
Backlog of trust-funded deferred revenue, net of estimated allowance for cancellation	8.28		7.38		7.64		7.01
Backlog of insurance- and other funded deferred revenue (1)	8.73		8.73		8.37		8.37
Total backlog of deferred revenue	$	17.01	$	16.11	$	16.01	$	15.38

Preneed receivables, net and trust investments	$	7.36	$	6.41	$	6.74	$	6.08
Amounts due from customers for unfulfilled performance obligations on cancelable preneed contracts	1.01		1.01		0.99		0.99
Allowance for cancellation on trust investments	(0.29)		(0.24)		(0.27)		(0.24)
Assets associated with backlog of trust-funded deferred revenue, net of estimated allowance for cancellation	8.08		7.18		7.46		6.83
Policies associated with insurance- and other funded deferred revenue (1)	8.73		8.73		8.37		8.37
Total assets associated with backlog of preneed revenue	$	16.81	$	15.91	$	15.83	$	15.20

(1) Amounts are not included in our Consolidated Balance Sheet.

The fair value of our trust investments was based on a combination of quoted market prices, observable inputs such as interest rates or yield curves, and appraisals. As of December 31, 2025, the difference between the backlog and total assets at fair value represents $0.17 billion related to contracts for which we have posted surety bonds as financial assurance in lieu of trusting, $1.39 billion collected from customers that were not required to be deposited into trusts, and $0.20 billion in allowable cash distributions from trust assets partially offset by $1.56 billion in amounts due on delivered property and merchandise. As of December 31, 2025, the fair value of the total backlog comprised $5.04 billion related to cemetery contracts and $11.97 billion related to funeral contracts. As of December 31, 2025, the fair value of the assets associated with the backlog of trust-funded deferred revenue comprised $5.10 billion related to cemetery contracts and $2.98 billion related to funeral contracts. As of December 31, 2025, the backlog of insurance-funded contracts of $8.73 billion was equal to the proceeds we expect to receive from the associated insurance policies when the corresponding contract is serviced by one of our operating locations.

Trust Investments

In addition to selling our products and services to client families at the time of need, we enter into price-guaranteed preneed funeral and cemetery contracts, which provide for future funeral or cemetery merchandise and services. Since preneed funeral and cemetery merchandise or services will generally not be provided until sometime in the future, most states and provinces require that all or a portion of the funds collected from customers on preneed funeral and cemetery contracts be paid into trusts and/or escrow accounts until the merchandise is delivered or the service is performed. Investment earnings associated with the trust investments are expected to mitigate the inflationary costs of providing the preneed funeral and cemetery merchandise and services in the future at the prices that were guaranteed at the time of sale. Also, we are required by state and provincial law to pay a portion of the proceeds from the preneed or atneed sale of cemetery property interment rights into perpetual care trusts. For these investments, the original corpus generally remains in the trust in perpetuity and the earnings or elected distributions are withdrawn as allowed to defray the expenses to maintain the cemetery property. While many states require that net capital gains or losses be retained and added to the corpus, certain states allow the net realized capital gains and losses to be included in the earnings that are distributed. Additionally, some states allow a total return distribution that may contain elements of income, capital appreciation, and principal.

Independent trustees manage and invest the majority of the funds deposited into the funeral and cemetery merchandise and service trusts as well as the cemetery perpetual care trusts. The majority of the trustees are selected based on their respective geographic footprint and qualifications per state and provincial regulations. These trustees, with input from SCI's

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wholly-owned registered investment advisor, establish an investment policy that serves as an operating document to guide the investment activities of the trusts including asset allocation and manager selection. The investments are also governed by state and provincial guidelines. All of the trusts are intended to control risk and volatility through a combination of asset classes, investment styles, and a diverse mix of investment managers.

Asset allocation is based on the liability structure of each funeral, cemetery, and perpetual care trust. Based on the various criteria set forth in the investment policy, the investment advisor recommends investment managers to the trustees. The primary investment objectives for the funeral and cemetery merchandise and service trusts include 1) preserving capital within acceptable levels of volatility and risk and 2) achieving growth of principal over time sufficient to preserve and increase the purchasing power of the assets. Preneed funeral and cemetery contracts generally take several years to mature; therefore, the funds associated with these contracts are often invested through several market cycles.

Where allowed by state and provincial regulations, the cemetery perpetual care trusts’ primary investment objectives are growth-oriented to provide for a fixed distribution rate from the trusts’ assets. Where such distributions are limited to ordinary income, the cemetery perpetual care trusts’ investment objectives emphasize providing a steady stream of current investment income with some capital appreciation. Both types of distributions are used to provide for the current and future maintenance and beautification of the cemetery properties.

As of December 31, 2025, approximately 95% of our trusts were under the control and custody of five large financial institutions. The U.S. trustees primarily use four managed limited liability companies (LLCs), one for each merchandise and service trust type and two for the cemetery perpetual care trust type, each with an independent trustee as custodian. Each financial institution acting as trustee manages its allocation of trust assets in accordance with the investment policy through the purchase of the appropriate LLCs' units. For those accounts not eligible for participation in the LLCs or where a particular state's regulations contain other investment restrictions, the trustee utilizes institutional mutual funds that comply with our investment policy or with such state restrictions. The U.S. trusts include a modest allocation to alternative investments. These alternative investments are held in vehicles structured as LLCs and are managed by certain trustees. The trusts that are eligible to allocate a portion of their investments to alternative investments purchase units of the respective alternative investment LLCs.

Investment Structures

The managed LLCs use the following structures for investments:

Commingled funds allow the trusts to access, at a reduced cost, some of the same investment managers and strategies used elsewhere in the portfolios.

Separately managed accounts are trusts that utilize separately managed accounts, where appropriate, to reduce the costs to the investment portfolios.

Mutual funds employ institutional share class mutual funds where operationally or economically efficient. These mutual funds are utilized to invest in various asset classes including U.S. equities, non-U.S. equities, corporate bonds, government bonds, high yield bonds, and commodities, all of which are governed by guidelines outlined in their individual prospectuses.

Asset Classes

Equity investments have historically provided long-term capital appreciation in excess of inflation. The trusts have direct investments in individual equity securities primarily in domestic equity portfolios that include large, mid, and small capitalization companies of different investment styles (i.e., growth and value). The majority of the equity allocation is managed by institutional investment managers that specialize in an objective-specific area of expertise. Our equity securities are exposed to market risk; however, we believe these securities are well-diversified. As of December 31, 2025, the largest single equity position represented approximately 1% of the total securities portfolio.

Fixed income investments are intended to preserve principal, provide a source of current income, and reduce overall portfolio volatility. The majority of the fixed income allocation for the trusts is invested in institutional share class mutual funds. Where the trusts have direct investments in individual fixed income securities, these are primarily in government and corporate instruments.

Canadian government fixed income securities are investments in Canadian federal and provincial government instruments. In many cases, regulatory restrictions mandate that the funds from the sales of preneed funeral and cemetery contracts sold in certain Canadian jurisdictions must be invested in these instruments.

Alternative investments serve to provide high rates of return with reduced volatility and lower correlation to publicly-traded securities. These investments are typically longer term in duration and are diversified by strategy, sector, manager, geography, and vintage year. The investments consist of numerous limited partnerships invested in private equity, private market real estate, energy and natural resources, infrastructure, transportation, and private debt including both distressed debt and mezzanine financing. The trustees that have oversight of their respective alternative LLCs work closely with the investment advisor in making all investment decisions.

32 Service Corporation International

PART II

Trust Performance

During the year ended December 31, 2025, the Standard and Poor’s 500 Index increased 17.9% and the Bloomberg’s US Aggregate Bond Index increased 7.3%. This compares to the SCI trusts that increased 15.1% during the same year-end period, which exceeded our internal custom benchmarks. The SCI trusts have a diversified allocation of approximately 60% equities, 26% fixed income securities, 10% alternative and other investments with the remaining 4% in money market funds.

Recognized trust fund income (realized and unrealized) related to our preneed trust investments was $202.2 million and $185.7 million for the years ended December 31, 2025 and 2024, respectively. Recognized trust fund income (realized and unrealized) related to our cemetery perpetual care trust investments was $111.1 million and $96.4 million for the years ended December 31, 2025 and 2024, respectively.

SCI, the trustees, and the investment advisor monitor the capital markets and the trusts on an on-going basis. The trustees, with input from the investment advisor, take prudent action as needed to achieve the investment goals and objectives of the trusts.

Results of Operations — Years Ended December 31, 2025 and 2024

Management Summary

In 2025, we reported consolidated net income attributable to common stockholders of $542.6 million ($3.80 per diluted share) compared to net income attributable to common stockholders in 2024 of $518.6 million ($3.53 per diluted share). These results were impacted by certain significant items including:


	Years Ended December 31,
	2025		2024
	(In millions)
Pre-tax gain (loss) on divestitures and impairment charges, net	$	6.2	$	(12.5)
Pre-tax loss on early extinguishment of debt, net	$	(0.5)	$	—



Pre-tax estimate of (growth) reduction in legal reserve (1)	$	(6.4)	$	20.3
Pre-tax estimate of restructuring charge	$	(2.0)	$	(11.5)
Tax effect from significant items	$	0.4	$	0.4

Change in uncertain tax reserves and other (2)	$	(3.9)	$	4.0

(1) Corporate general and administrative expenses in the fourth quarter of 2024, includes a reduction of our California legal reserve of $20.3 million as the primary claims period expired

(2) See Note 5 in Part II, Item 8. Financial Statements and Supplementary Data, for additional information related to change in uncertain tax reserves and other.

In addition to the above items, the increase over the prior year is due to higher funeral gross profit driven by an increase in funeral average revenue per service and higher cemetery gross profit. Additionally, the higher tax rate was partially offset by lower interest expense and a lower share count.

FORM 10-K 33

PART II

Funeral Results


	Years Ended December 31,
	2025		2024
	(Dollars in millions, except average revenue per service)
Consolidated funeral revenue	$	2,405.5	$	2,324.2
Less: revenue associated with acquisitions/new construction	62.7		17.3
Less: revenue associated with divestitures	2.8		7.1
Comparable(1) funeral revenue	2,340.0		2,299.8
Less: non-funeral home preneed sales revenue	92.2		103.8
Less: core general agency and other revenue	223.2		212.1
Adjusted comparable funeral revenue	$	2,024.6	$	1,983.9
Comparable services performed	347,696		350,607
Comparable average revenue per service(2)	$	5,823	$	5,658

Consolidated funeral gross profit	495.8		465.3
Less: gross profit associated with acquisitions/new construction	9.3		1.7
Less: gross loss associated with divestitures	(2.3)		(2.6)
Comparable(1) funeral gross profit	$	488.8	$	466.2

(1) We define comparable (or same store) operations as those funeral locations owned by us for the entire period beginning January 1, 2024 and ending December 31, 2025.

(2) We calculate comparable average revenue per service by dividing comparable funeral revenue, excluding general agency revenue, non-funeral home preneed sales revenue, and other revenue to avoid distorting our average of normal funeral services revenue, by the comparable number of funeral services performed during the period.

Funeral Revenue

Consolidated revenue from funeral operations was $2,405.5 million for the year ended December 31, 2025, compared to $2,324.2 million in 2024. This $81.3 million, or 3.5%, increase in revenue is primarily attributable to a $45.4 million increase in revenue contributed by newly constructed and acquired properties, and a $40.2 million increase in comparable funeral revenue.

Comparable revenue from funeral operations was $2,340.0 million for the year ended December 31, 2025 compared to $2,299.8 million in 2024. The $40.2 million, or 1.7%, increase was due to a $40.7 million increase in adjusted comparable funeral revenue and a $11.1 million increase in core general agency and other revenue, partially offset by a $11.6 million decrease in non-funeral home preneed sales revenue.

Adjusted comparable funeral revenue increased $40.7 million, or 2.1%, primarily due to a 2.9% growth in total average revenue per service, partially offset by a 0.8% decrease in total services performed. Our total comparable cremation rate increased 50 basis points over prior year to 64.4%.

Core general agency and other revenue increased $11.1 million, primarily due to growth in general agency revenue from higher commission rates as a result of the change in our preferred preneed insurance provider in mid-2024.

Non-funeral home preneed sales revenue decreased $11.6 million primarily due to an operational shift to defer the delivery of urns on preneed contracts to the time of need. This decrease is partially offset by an increase in general agency revenue as we shifted more production from trust to insurance-funded contracts.

Funeral Gross Profit

Consolidated funeral gross profit increased $30.5 million, or 6.6%, in 2025 compared to 2024. This increase is primarily attributable to a $22.6 million, or 4.8%, increase in comparable funeral gross profit and a $7.6 million increase in gross profit contributed by acquired and newly constructed properties. Comparable funeral gross profit increased $22.6 million to $488.8 million and the comparable gross profit percentage increased 60 basis points from 20.3% to 20.9%. This increase in gross profit is due to the higher revenue mentioned above and effectively managing fixed costs, partially offset by a $13.0 million increase in selling compensation costs. Higher selling compensation costs resulted primarily from a $121.2 million increase in funeral preneed insurance sales production coupled with an operational shift from variable to fixed compensation for core preneed funeral sales counselors. Fixed selling compensation is expensed as incurred.

34 Service Corporation International

PART II

Cemetery Results


	Years Ended December 31,
	2025		2024
	(In millions)
Consolidated cemetery revenue	$	1,903.7	$	1,862.2
Less: revenue associated with acquisitions/new construction	13.7		2.1
Less: revenue associated with divestitures	0.1		(0.1)
Comparable(1) cemetery revenue	$	1,889.9	$	1,860.2

Consolidated cemetery gross profit	$	644.3	$	625.4
Less: gross profit (loss) associated with acquisitions/new construction	6.1		0.6
Less: gross (loss) profit associated with divestitures	0.1		(0.2)
Comparable(1) cemetery gross profit	$	638.1	$	625.0

(1) We define comparable (or same store) operations as those cemetery locations owned by us for the entire period beginning January 1, 2024 and ending December 31, 2025.

Cemetery Revenue

Consolidated revenue from our cemetery operations increased $41.5 million, or 2.2%, in 2025 compared to 2024 primarily due to a $29.7 million, or 1.6%, increase in comparable cemetery revenue and a $11.6 million increase in revenue contributed by acquired and newly constructed properties.

The $29.7 million increase in comparable cemetery revenue was primarily attributable to a $14.6 million increase in comparable cemetery core revenue. This increase was primarily a result of a $12.7 million increase in recognized preneed revenue, which benefited from growth in comparable preneed sales production and higher trust fund income. Additionally, comparable other revenue increased $15.0 million, primarily from higher endowment care trust fund income.

Cemetery Gross Profit

Consolidated cemetery gross profit increased $18.9 million, or 3.0%, in 2025 compared to 2024. This increase is primarily attributable to a $13.1 million increase in comparable cemetery gross profit and a $5.5 million increase in gross profit contributed by acquired and newly constructed properties. Comparable cemetery gross profit increased $13.1 million to $638.1 million, and the gross profit percentage increased 20 basis points from 33.6% to 33.8% primarily due to the higher revenue mentioned above coupled with effective cost management, partially offset by higher selling compensation on higher sales production.

Other Financial Statement Items

Corporate General and Administrative Expenses

Corporate general and administrative expenses were $166.2 million in 2025 compared to $139.0 million in 2024. In the prior year, we recognized a $20.3 million reduction in our California legal reserve. Additionally, we recognized a $6.4 million settlement of certain legal matters in the current year. Adjusting for the $26.7 million in legal matters, corporate general and administrative expenses increased $0.5 million.

Gain and Loss on Divestitures and Impairment Charges, Net

We recognized a $6.2 million net pre-tax gain and a $12.5 million net pre-tax loss on asset divestitures and impairments in 2025 and 2024, respectively, which includes the net impact from the sale of non-essential real estate and businesses as well as impairment of long-lived assets and intangibles.

Interest Expense

Interest expense decreased $2.4 million to $255.4 million in 2025 primarily due to lower interest rates on our floating rate debt partially offset by higher average debt balances outstanding.

Provision for Income Taxes

The 2025 consolidated effective tax rate was 25.6%, compared to 23.2% in 2024. The increase in the effective tax rate in 2025 was primarily due to a decrease in excess tax benefits recognized on the settlement of employee share-based awards. The effective tax rate for the year ended December 31, 2025 was higher than the federal statutory tax rate of 21% primarily due to state and foreign income taxes.

FORM 10-K 35

PART II

Critical Accounting Policies, Recent Accounting Pronouncements, and Accounting Changes

Our consolidated financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. See Note 2 in Part II, Item 8. Financial Statements and Supplementary Data, for more information. Estimates and assumptions affect the carrying values of assets and liabilities and disclosures of contingent assets and liabilities at the balance sheet date. Actual results could differ from such estimates due to uncertainties associated with the methods and assumptions underlying our critical accounting measurements. The following is a discussion of our critical accounting policies pertaining to revenue recognition, valuation of goodwill, valuation of intangible assets, fair value measurements, and the use of estimates.

Revenue Recognition

Revenue is recognized when control of the merchandise or services is transferred to the customer. Our performance obligations include the delivery of funeral and cemetery merchandise and services and cemetery property interment rights. Control transfers when merchandise is delivered or services are performed. For cemetery property interment rights, control transfers to the customer when the property is developed and the interment right has been sold and can no longer be marketed or sold to another customer.

On our atneed contracts, we generally deliver the merchandise and perform the services at the time of need. Personalized marker merchandise and marker installation services sold on atneed contracts are recognized when control is transferred to the customer, generally when the marker is delivered and installed in the cemetery.

We also sell price-guaranteed preneed contracts through various programs providing for future merchandise and services at prices prevailing when the agreements are signed. Revenue associated with sales of preneed contracts is deferred until control of the merchandise or the services is transferred to the customer, which is upon delivery of the merchandise or as services are performed, generally at the time of need. On certain preneed contracts, we historically sold memorialization merchandise, which consists of urns and urn-related products, that we delivered to the customer at the time of sale. In 2024, we began a transition and operational shift to defer the delivery of urns on preneed contracts to the time of need. Revenue is recognized at the time of delivery as control of the memorialization merchandise is transferred to the customer.

For personalized marker merchandise sold on a preneed contract, we will:

•purchase the merchandise from vendors,

•personalize such merchandise in accordance with the customer's specific written instructions,

•either store the merchandise at a third-party bonded storage facility or install the merchandise, based on the customer's instructions, and

•transfer title to the customer.

We recognize revenue and record the cost of sales when control of the merchandise is transferred, which occurs upon delivery to the third-party storage facility or installation of the merchandise at the cemetery.

Pursuant to state or provincial law, all or a portion of the proceeds from funeral and cemetery merchandise or services sold on a preneed basis may be required to be paid into trust funds. We defer investment earnings related to these merchandise and service trusts until the associated merchandise is delivered or services are performed. Fees charged by our wholly-owned registered investment advisor are also included in revenue in the period in which they are earned.

A portion of the proceeds from the sale of cemetery property interment rights is required by state or provincial law to be paid by us into perpetual care trust funds to maintain the cemetery. This portion of the proceeds is not recognized as revenue. Investment earnings from these trusts are distributed to us regularly and recognized in current cemetery revenue.

For more information related to revenue, see Notes 2, 3, and 13 in Part II, Item 8. Financial Statements and Supplementary Data.

Valuation of Goodwill

We record the excess of purchase price over the fair value of identifiable net assets acquired in business combinations as goodwill. Goodwill is tested annually during the fourth quarter for impairment by assessing the fair value of each of our reporting units.

36 Service Corporation International

PART II

Our goodwill impairment test involves estimates and management judgment. In order to perform our goodwill impairment test, we perform either a qualitative or quantitative assessment. If we choose to perform a qualitative assessment, we evaluate economic, industry and company-specific factors in assessing the fair value of the related reporting unit. If we determine that it is more likely than not that the fair value of the reporting unit is less that its carrying value, a quantitative test is the performed. For those reporting units tested using a quantitative approach, we compare the fair value of a reporting unit to its carrying amount, including goodwill. We determine fair value of each reporting unit using an income approach. The income approach, which is a discounted cash flow method, uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows. We do not record an impairment of goodwill in instances where the fair value of a reporting unit exceeds its carrying amount. If the aggregate fair value is less than the related carrying amount for a reporting unit, we compare the implied fair value of goodwill to the carrying amount of goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess.

For more information related to goodwill, see Notes 2 and 4 in Part II, Item 8. Financial Statements and Supplementary Data.

Valuation of Intangible Assets

Our intangible assets include covenants-not-to-compete, customer relationships, trademarks and tradenames, and other intangible assets primarily resulting from acquisitions. Certain of our trademark and tradenames and other intangible assets are considered to have an indefinite life and are not subject to amortization. We test for impairment of intangible assets annually during the fourth quarter.

Our intangible asset impairment tests involve estimates and management judgment. For trademark and tradenames, our test uses the relief from royalty method whereby we determine the fair value of the assets by discounting the cash flows that represent a savings over having to pay a royalty fee for use of the trademark and tradenames. The discounted cash flow valuation uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows.

For more information related to intangible assets, see Notes 2 and 4 in Part II, Item 8. Financial Statements and Supplementary Data.

Fair Value Measurements

We measure the securities held by our funeral merchandise and service, cemetery merchandise and service, and cemetery perpetual care trusts at fair value on a recurring basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We utilize a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:

•Where quoted prices are available in an active market, securities held by the trusts are classified as Level 1 investments.

•Where quoted market prices are not available for the specific security, fair values are estimated by using either quoted prices of securities with similar characteristics or an income approach fair value model with observable inputs that include a combination of interest rates, yield curves, credit risks, prepayment speeds, ratings, and tax-exempt status. These securities are classified as Level 2 investments.

•The valuation of other investments requires management judgment due to the absence of quoted market prices, inherent lack of liquidity, and the long-term nature of such assets. These securities are classified as Level 3 investments.

Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Certain securities held by our funeral merchandise and service, cemetery merchandise and service, and cemetery perpetual care trusts have been classified as Level 3 of the hierarchy due to the significant management judgment required because of the absence of quoted market prices, inherent lack of liquidity, or the long-term nature of the securities. For more information related to our fair value measurements, see Notes 2, 3, and 7 in Part II, Item 8. Financial Statements and Supplementary Data.

Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles in the United States (GAAP) requires management to make certain estimates and assumptions. These estimates and assumptions affect the carrying values of assets and liabilities and disclosures of contingent assets and liabilities at the balance sheet date. Actual results could differ from such estimates due to uncertainties associated with the methods and assumptions underlying our critical accounting measurements. Critical estimates used by management include:

Reserves and Allowances

We provide reserves for credit losses on our receivables. These reserves are based on an analysis of historical trends of collection activity adjusted for current conditions and forecasts. We also record an estimate of general agency revenue that may be canceled in its first year and revenue would be charged back by the insurance company. These estimates are impacted by a number of factors, including changes in the economy and demographic or competitive changes in our areas of operation.

FORM 10-K 37

PART II

Valuation of Trust Investments

When available, we use quoted market prices for specific securities. When quoted market prices are not available for the specific security, fair values are estimated by using either quoted market prices for securities with similar characteristics or a fair value model with observable inputs that include a combination of interest rates, yield curves, credit risks, prepayment terms, rating, and tax exempt status. The valuation of certain investments requires significant management judgment due to the absence of quoted market prices, inherent lack of liquidity, and the long-term nature of such assets.

Legal Liability Reserves

Contingent liabilities, principally for legal matters, are recorded when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Liabilities accrued for legal matters require judgments regarding projected outcomes and a range of loss based on historical experience and recommendations of legal counsel. However, litigation is inherently unpredictable and excessive verdicts do occur. As disclosed in Note 9 in Part II, Item 8. Financial Statements and Supplementary Data, our legal exposures and the ultimate outcome of these legal proceedings could be material to operating results or cash flows in any given quarter or year.

Income Taxes

We compute income taxes using the liability method. Our ability to realize the benefit of our deferred tax assets requires us to achieve certain future earnings levels. We have established a valuation allowance against a portion of our deferred tax assets in certain jurisdictions, and we could be required to further adjust that valuation allowance in the near term if market conditions change materially and future earnings are, or are projected to be, significantly different than our current estimates. An increase in the valuation allowance would result in additional income tax expense in such period.

As of December 31, 2025, foreign withholding taxes have not been provided on the estimated $306.5 million of undistributed earnings and profits ("E&P") of our foreign subsidiaries as we intend to permanently reinvest these foreign E&P in the respective businesses outside the United States. However, if we were to repatriate such foreign E&P, the foreign withholding tax liability is estimated to be $15.8 million. Additionally, if we were to repatriate E&P in excess of our previously taxed income under the Tax Cuts and Jobs Act of 2017, such excess repatriation may cause us to incur an additional U.S. federal income tax of approximately $7.7 million related to our hybrid debt structure between Canada and the United States that was eliminated in 2022.

We file income tax returns, including tax returns for our subsidiaries, with federal, state, local, and foreign jurisdictions. We consider the United States to be our most significant jurisdiction; however, all tax returns are subject to routine compliance review by the taxing authorities in the jurisdictions in which we file tax returns in the ordinary course of business.

The federal statutes of limitations have expired for all tax years prior to 2022. Our 2022 federal income tax return is currently under audit by the IRS. Various state and foreign jurisdictions are auditing years 2020 through 2023. The outcome of each of these audits cannot be predicted at this time.

Insurance Loss Reserves

We purchase comprehensive general liability, morticians and cemetery professional liability, automobile liability, and workers’ compensation insurance coverages structured with high deductibles. This high-deductible insurance program means we are primarily self-insured for claims and associated costs and losses covered by these policies. Historical insurance industry experience indicates a high degree of inherent variability in assessing the ultimate amount of losses associated with casualty insurance claims. This is especially true with respect to liability and workers’ compensation exposures due to the extended period of time that transpires between the time claim occurs and the full settlement of such claim, which may be many years. We continually evaluate loss estimates associated with claims and losses related to these insurance coverages falling within the deductible of each coverage. Assumptions based on factors such as claim settlement patterns, claim development trends, claim frequency, severity patterns, inflationary trends, and data reasonableness will generally affect the analysis and determination of the “best estimate” of the projected ultimate claim losses. The results of these evaluations are used to both analyze and adjust our insurance loss reserves. As of December 31, 2025, insurance loss reserves were $108.4 million.

Recent Accounting Pronouncements and Accounting Changes

For discussion of recent accounting pronouncements and accounting changes, see Note 2 in Part II, Item 8. Financial Statements and Supplementary Data.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

The market risk inherent in our financial instruments and positions includes the price risk associated with the marketable equity and debt securities included in our portfolio of trust investments, the interest rate risk associated with our floating rate debt, and the currency risk associated with our Canadian operations. Our exposure to market risk as discussed below includes forward-looking statements and represents an estimate of possible changes in fair value or future earnings that might occur, assuming hypothetical changes in equity markets, interest rates, and currencies. Our views on market risk are not necessarily indicative of actual results that may occur, and they do not represent the maximum possible gains or losses that may occur. Actual fair value movements related to changes in equity markets, interest rates, and currencies, along with the timing of such movements, may differ from those estimated.

38 Service Corporation International

PART II

Marketable Equity and Debt Securities — Price Risk

In connection with our preneed funeral operations and preneed cemetery merchandise and service sales, the related funeral and cemetery trust funds own investments in equity and debt securities and mutual funds, which are sensitive to current market prices.

Cost and market values as of December 31, 2025 are presented in Note 3 in Part II, Item 8, Financial Statements and Supplementary Data. Also see "Trust Investments" in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, Financial Conditions, Liquidity, and Capital Resources, for discussion of trust investments.

Market-Rate Sensitive Instruments — Interest Rate Risk

At December 31, 2025 and 2024, approximately 79% and 84%, respectively, of our total debt consisted of fixed rate debt at a weighted average rate of 4.67% and 4.64%, respectively. A hypothetical increase in interest rates by 10% of the rates associated with our floating rate debt would increase our interest expense by $5.9 million. See N otes 6 and 7 in Part II, Item 8. Financial Statements and Supplementary Data, for additional information.

Market-Rate Sensitive Instruments — Currency Risk

At December 31, 2025 and 2024, our foreign currency exposure was primarily associated with the Canadian dollar. At December 31, 2025, approximately 7% of our stockholders’ equity and debt and 6% of our operating income was denominated in the Canadian dollar. Approximately 6% of our stockholders’ equity and debt and 6% of our operating income was denominated in the Canadian dollar at December 31, 2024. We do not have any investments in foreign operations considered to be in highly inflationary economies.

FORM 10-K 39

PART II

Item 8. Financial Statements and Supplementary Data

Index to Financial Statements and Related Schedule


			Page
Financial Statements:
Report of Independent Registered Public Accounting Firm (PCAOB ID 238)			41
Consolidated Statement of Operations for the years ended December 31, 2025, 2024, and 2023			43
Consolidated Statement of Comprehensive Income for the years ended December 31, 202 5 , 202 4 , and 2023			44
Consolidated Balance Sheet as of December 31, 2025 and 2024			45
Consolidated Statement of Cash Flows for the years ended December 31, 2025, 2024, and 2023			46
Consolidated Statement of Equity for the years ended December 31, 2025, 2024, and 2023			47
Notes to Consolidated Financial Statements			48
1. Nature of Operations			48
2. Summary of Significant Accounting Policies			48
3. Preneed Activities			56
4. Goodwill and Intangible Assets			61
5. Income Taxes			62
6. Debt			66
7. Credit Risk and Fair Value of Financial Instruments			68
8. Leases			69
9. Commitments and Contingencies			72
10. Equity			72
11. Share-Based Compensation			73
12. Retirement Plans			75
13. Segment Reporting			77
14. Supplementary Information			80
15. Earnings Per Share			82
16. Acquisitions and Divestiture-Related Activities			83


Financial Statement Schedule:
II — Valuation and Qualifying Accounts for the years ended December 31, 2025, 2024, and 2023			84

All other schedules have been omitted because the required information is not applicable or is not present in amounts sufficient to require submission or because the information required is included in the consolidated financial statements or the related notes thereto.

40 Service Corporation International

PART II

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Service Corporation International

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheet of Service Corporation International and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

FORM 10-K 41

PART II

Revenue Recognition – Funeral and Cemetery Merchandise and Services and Cemetery Property Interment Rights

As described in Note 2 to the consolidated financial statements, for the year ended December 31, 2025, the Company earned $4.3 billion in consolidated revenue, of which the majority was derived from the delivery of funeral and cemetery merchandise and services, as well as cemetery property interment rights. Revenue is recognized when control of the merchandise or services is transferred to the customer. Control transfers when merchandise is delivered or services are performed. For cemetery property interment rights, control transfers to the customer when the property is developed and the interment right has been sold and can no longer be marketed or sold to another customer. Total consideration received for contracts with customers represents the stated amount of the contract excluding any amounts collected on behalf of third parties. The total consideration received for contracts with customers is allocated to each performance obligation based on relative selling price. Relative selling prices are determined by the amount the Company sells the performance obligation for on a stand-alone basis or their best estimate of the amount they would sell it for based on an adjusted market assessment approach that is consistent with their historical pricing practices.

The principal consideration for our determination that performing procedures relating to revenue recognition is a critical audit matter is a high degree of auditor effort in performing procedures related the Company’s revenue recognition.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to Company’s funeral and cemetery merchandise and services and cemetery property interment rights. These procedures also included, among others, (i) testing, on a sample basis, revenue recognized by obtaining and inspecting source documents, such as contracts, proof of control transfer, and where applicable, cash receipts; (ii) testing, on a sample basis, cemetery property interment rights revenue transactions recorded near year end to evaluate whether they were recorded in the appropriate period; and (iii) testing the completeness of the contract listing provided by management.

/s/ PricewaterhouseCoopers LLP

Houston, Texas

February 12, 2026

We have served as the Company’s auditor since 1993.

42 Service Corporation International

PART II

Service Corporation International

Consolidated Statement of Operations


	Years Ended December 31,
	2025		2024		2023
	(In thousands, except per share amounts)
Revenue
Property and merchandise revenue	$	2,080,099	$	2,108,009	$	2,124,600
Service revenue	1,807,065		1,731,899		1,683,417
Other revenue	422,070		346,471		291,761
Total revenue	4,309,234		4,186,379		4,099,778
Costs of revenue
Cost of property and merchandise	(1,086,411)		(1,074,412)		(1,075,041)
Cost of service	(974,925)		(940,119)		(912,346)
Overhead and other expenses	(1,107,824)		(1,081,191)		(1,020,584)
Costs of revenue	(3,169,160)		(3,095,722)		(3,007,971)
Gross profit	1,140,074		1,090,657		1,091,807
Corporate general and administrative expenses	(166,158)		(139,019)		(157,368)
Restructuring charge	(1,980)		(11,470)		—
Gains (loss) on divestitures and impairment charges, net	6,151		(12,488)		9,816

Operating income	978,087		927,680		944,255
Interest expense	(255,372)		(257,771)		(239,447)
Losses on early extinguishment of debt, net	(523)		(25)		(1,114)
Other income, net	7,591		5,534		4,912
Income before income taxes	729,783		675,418		708,606
Provision for income taxes	(186,938)		(156,665)		(170,945)


Net income	542,845		518,753		537,661
Net income attributable to noncontrolling interests	(231)		(105)		(344)
Net income attributable to common stockholders	$	542,614	$	518,648	$	537,317
Basic earnings per share:
Net income attributable to common stockholders	$	3.83	$	3.57	$	3.57
Basic weighted average number of shares	141,603		145,271		150,565
Diluted earnings per share:
Net income attributable to common stockholders	$	3.80	$	3.53	$	3.53
Diluted weighted average number of shares	142,689		146,782		152,351

(See notes to consolidated financial statements)

FORM 10-K 43

PART II

Service Corporation International

Consolidated Statement of Comprehensive Income


	Years Ended December 31,
	2025		2024		2023
	(In thousands)
Net income	$	542,845	$	518,753	$	537,661
Other comprehensive income:
Foreign currency translation adjustments	19,648		(32,121)		8,353

Total comprehensive income	562,493		486,632		546,014
Total comprehensive income attributable to noncontrolling interests	(233)		(96)		(344)
Total comprehensive income attributable to common stockholders	$	562,260	$	486,536	$	545,670

(See notes to consolidated financial statements)

44 Service Corporation International

PART II

Service Corporation International

Consolidated Balance Sheet


	December 31,
	2025		2024
	(In thousands, except share amounts)

ASSETS
Current assets:
Cash and cash equivalents	$	243,581	$	218,766
Receivables, net of reserves of $3,944 and $4,040, respectively	100,415		94,341
Inventories	35,246		33,318

Other	32,551		30,905
Total current assets	411,793		377,330
Preneed receivables, net of reserves of $34,680 and $35,857, respectively, and trust investments	7,360,793		6,739,332
Cemetery property	2,201,967		2,129,404
Property and equipment, net	2,751,761		2,581,069
Goodwill	2,169,055		2,081,015
Deferred charges and other assets, net of reserves of $2,460 and $2,367, respectively	1,360,530		1,317,256
Cemetery perpetual care trust investments	2,398,613		2,154,032
Total assets	$	18,654,512	$	17,379,438

LIABILITIES & EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	685,156	$	639,274
Current maturities of long-term debt	56,847		83,850
Income taxes payable	3,701		715
Total current liabilities	745,704		723,839
Long-term debt	5,082,970		4,751,448
Deferred revenue, net	1,779,266		1,755,170
Deferred tax liability	691,033		649,195
Other liabilities	550,793		513,480
Deferred receipts held in trust	5,784,398		5,162,525
Care trusts’ corpus	2,381,507		2,145,112
Commitments and contingencies (Note 9)
Equity:
Common stock, $1 per share par value, 500,000,000 shares authorized, 141,957,004 and 146,668,589 shares issued, respectively, and 139,678,199 and 144,694,887 shares outstanding, respectively	139,678		144,695
Capital in excess of par value	987,210		986,830
Retained earnings	498,958		553,701
Accumulated other comprehensive income (loss)	12,425		(7,221)
Total common stockholders’ equity	1,638,271		1,678,005
Noncontrolling interests	570		664
Total equity	1,638,841		1,678,669
Total liabilities and equity	$	18,654,512	$	17,379,438

(See notes to consolidated financial statements)

FORM 10-K 45

PART II

Service Corporation International

Consolidated Statement of Cash Flows


	Years Ended December 31,
	2025		2024		2023
			(In thousands)
Cash flows from operating activities:
Net income	$	542,845	$	518,753	$	537,661
Adjustments to reconcile net income to net cash provided by operating activities:

Loss on early extinguishment of debt, net	523		25		1,114

Depreciation and amortization	219,654		208,211		191,272
Amortization of intangibles	16,370		17,222		18,736
Amortization of cemetery property	104,262		102,510		101,234
Amortization of loan costs	8,823		7,527		6,871
Provision for expected credit losses	8,894		11,542		11,245
Provision for deferred income taxes	41,017		7,541		191,516
(Gain) loss on divestitures and impairment charges, net	(6,151)		12,488		(9,816)

Share-based compensation	17,633		18,783		17,043

Change in assets and liabilities, net of effects from acquisitions and divestitures:
Increase in receivables	(9,723)		(1,481)		(3,810)
(Increase) decrease in other assets	(31,727)		65,043		(131,581)
Increase (decrease) in payables and other liabilities	12,434		21,100		(11,296)
Effect of preneed sales production and maturities:
Increase in preneed receivables, net and trust investments	(49,351)		(134,986)		(178,642)
Increase in deferred revenue, net	30,220		59,189		157,656
Increase (decrease) in deferred receipts held in trust	37,075		31,445		(30,160)



Net cash provided by operating activities	942,798		944,912		869,043
Cash flows from investing activities:
Capital expenditures	(388,553)		(373,659)		(361,793)
Business acquisitions, net of cash acquired	(101,291)		(181,210)		(72,535)
Real estate acquisitions	(18,504)		(62,061)		(56,409)
Corporate headquarters	(69,898)		(15,448)		—
Proceeds from divestitures and sales of property and equipment	30,405		24,403		25,888

Payments for Company-owned life insurance policies	(229)		(3,024)		(8,058)
Proceeds from Company-owned life insurance policies	11,433		3,914		10,119
Other investing activities	(11,647)		(13,864)		(6,598)


Net cash used in investing activities	(548,284)		(620,949)		(469,386)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	1,060,890		1,451,137		957,433
Debt issuance costs	(5,424)		(15,390)		(7,471)
Scheduled payments of debt	(21,233)		(24,447)		(22,230)
Early payments of debt	(804,600)		(1,315,524)		(580,973)
Principal payments on finance leases	(38,321)		(36,840)		(34,482)
Proceeds from exercise of stock options	29,401		56,683		24,181
Proceeds from corporate headquarters debt facility	54,766		—		—
Purchase of Company common stock	(461,015)		(253,733)		(544,844)
Payments of dividends	(183,571)		(174,282)		(167,983)

Bank overdrafts and other	(5,619)		(7,245)		(4,773)

Net cash used in financing activities	(374,726)		(319,641)		(381,142)






Effect of foreign currency	5,281		(7,684)		1,722
Net increase (decrease) in cash, cash equivalents, and restricted cash	25,069		(3,362)		20,237
Cash, cash equivalents, and restricted cash at beginning of period	221,399		224,761		204,524
Cash, cash equivalents, and restricted cash at end of period	$	246,468	$	221,399	$	224,761

(See notes to consolidated financial statements)

46 Service Corporation International

PART II

Service Corporation International

Consolidated Statement of Equity


	Common Stock		Treasury Stock, Par Value		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Income		Noncontrolling Interest		Total
	(In thousands, except per share amounts)
Balance at December 31, 2022	$	156,089	$	(2,149)	$	958,329	$	544,384	$	16,538	$	232	$	1,673,423

Comprehensive income	—		—		—		537,317		8,353		344		546,014
Dividends declared on common stock ($1.02 per share)	—		—		—		(167,983)		—		—		(167,983)
Share-based compensation earned	24		—		17,019		—		—		—		17,043
Stock option exercises	927		—		23,254		—		—		—		24,181
Restricted stock awards, net of forfeitures	132		1		(133)		—		—		—		—
Purchase of Company common stock	—		(8,701)		(59,603)		(481,264)		—		—		(549,568)
Noncontrolling interest payments	—		—		—		—		—		(367)		(367)
Retirement of treasury shares	(8,874)		8,874		—		—		—		—		—
Other	—		—		(1,270)		—		—		—		(1,270)
Balance at December 31, 2023	$	148,298	$	(1,975)	$	937,596	$	432,454	$	24,891	$	209	$	1,541,473

Comprehensive income	—		—		—		518,648		(32,112)		96		486,632
Dividends declared on common stock ($1.12 per share)	—		—		—		(174,282)		—		—		(174,282)
Share-based compensation earned	25		—		18,758		—		—		—		18,783
Stock option exercises	1,646		—		55,037		—		—		—		56,683
Restricted stock awards, net of forfeitures	141		—		(141)		—		—		—		—
Purchase of Company common stock	—		(3,440)		(23,206)		(223,119)		—		—		(249,765)
Noncontrolling interest payments	—		—		—		—		—		359		359
Retirement of treasury shares	(3,440)		3,440		—		—		—		—		—
Other	—		—		(1,214)		—		—		—		(1,214)
Balance at December 31, 2024	$	146,670	$	(1,975)	$	986,830	$	553,701	$	(7,221)	$	664	$	1,678,669

Comprehensive income	—		—		—		542,614		19,646		233		562,493
Dividends declared on common stock ($1.30 per share)	—		—		—		(183,571)		—		—		(183,571)
Share-based compensation earned	23		—		17,610		—		—		—		17,633
Stock option exercises	704		—		28,697		—		—		—		29,401
Restricted stock awards, net of forfeitures	121		—		(121)		—		—		—		—
Purchase of Company common stock	—		(5,865)		(44,520)		(413,787)		—		—		(464,172)
Noncontrolling interest payments	—		—		—		—		—		(327)		(327)
Retirement of treasury shares	(5,561)		5,561		—		—		—		—		—
Other	—		—		(1,286)		1		—		—		(1,285)
Balance at December 31, 2025	$	141,957	$	(2,279)	$	987,210	$	498,958	$	12,425	$	570	$	1,638,841

(See notes to consolidated financial statements)

FORM 10-K 47

PART II

Service Corporation International

Notes to Consolidated Financial Statements

1. Nature of Operations

Service Corporation International (SCI) is a holding company and all operations are conducted by its subsidiaries. We are North America’s largest provider of deathcare products and services, with a network of funeral service locations and cemeteries operating in the United States and Canada. Our funeral service and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria, and other related businesses, which enable us to serve a wide array of customer needs. We sell cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. We strive to offer families exceptional service in planning life celebrations and personalized remembrances.

Funeral service locations provide all professional services relating to funerals and cremations, including the use of funeral facilities and motor vehicles, arranging and directing services, removal, preparation, embalming, cremations, memorialization, travel protection, and catering. Funeral merchandise, including burial caskets and related accessories, urns and other cremation receptacles, outer burial containers, flowers, online and video tributes, stationery products, casket and cremation memorialization products, and other ancillary merchandise, is sold at funeral service locations.

2. Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

Our consolidated financial statements include the accounts of Service Corporation International (SCI) and all subsidiaries in which we hold a controlling financial interest. Intercompany balances and transactions have been eliminated in consolidation.

Our consolidated financial statements also include the accounts of the merchandise and service trusts and cemetery perpetual care trusts in which we have a variable interest and are the primary beneficiary. We have retained specialized industry accounting principles when consolidating the trusts. Our trusts are variable interest entities, for which we have determined that we are the primary beneficiary as we absorb a majority of the losses and returns associated with these trusts. Although we consolidate the trusts, it does not change the legal relationships among the trusts, us, or our customers. The customers are the legal beneficiaries of these trusts; therefore, their interests in these trusts represent a liability to us.

Certain reclassifications have been made to prior period amounts to conform to the current period disclosure presentation with no effect on our consolidated net income, cash flows, or equity.

Use of Estimates in the Preparation of Financial Statements

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. As a result, actual results could differ from these estimates.

Cash, Cash Equivalents, and Restricted Cash

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. The carrying amounts of our cash and cash equivalents approximate fair value due to the short-term nature of these instruments.

48 Service Corporation International

PART II

The components of cash, cash equivalents, and restricted cash were as follows:


	Years Ended December 31,
	2025		2024
	(In thousands)
Cash and cash equivalents	$	243,581	$	218,766
Restricted cash(1):
Included in Other current assets	2,231		2,000
Included in Deferred charges and other assets	656		633
Total restricted cash	2,887		2,633
Total cash, cash equivalents, and restricted cash	$	246,468	$	221,399

(1) Restricted cash in both periods primarily consists of proceeds from divestitures deposited into escrow accounts under IRS code section 1031 and collateralized obligations under certain insurance policies.

Receivables, Net

The components of Receivables, net in our Consolidated Balance Sheet were as follows:


	December 31, 2025
	Atneed Funeral		Atneed Cemetery		Miscellaneous		Current Portion of Notes		Total
	(In thousands)
Receivables	$	38,830	$	20,396	$	44,960	$	173	$	104,359
Reserve for credit losses	(1,866)		(1,799)		(170)		(109)		(3,944)
Receivables, net	$	36,964	$	18,597	$	44,790	$	64	$	100,415


	December 31, 2024
	Atneed Funeral		Atneed Cemetery		Miscellaneous		Current Portion of Notes		Total
	(In thousands)
Receivables	$	35,950	$	21,703	$	40,559	$	169	$	98,381
Reserve for credit losses	(1,558)		(2,048)		(320)		(114)		(4,040)
Receivables, net	$	34,392	$	19,655	$	40,239	$	55	$	94,341

Additionally, included in Deferred charges and other assets, net were notes receivable, net and long-term miscellaneous receivables, net as follows:


	December 31, 2025		December 31, 2024
	(In thousands)
Notes receivable	$	9,019	$	10,089
Reserve for credit losses	(1,952)		(1,796)

Notes receivable, net	$	7,067	$	8,293

Long-term miscellaneous receivables	$	7,900	$	8,484
Reserve for credit losses	(508)		(571)
Long-term miscellaneous receivables, net	$	7,392	$	7,913

We provide reserves for credit losses for our receivables. These reserves are based on an analysis of historical trends of collection activity adjusted for current conditions and forecasts. These estimates are impacted by a number of factors, including changes in the economy and demographic or competitive changes in our areas of operation.

Our atneed trade receivables primarily consist of amounts due for funeral and cemetery services already performed. Payment on atneed contracts is generally due at the time the merchandise is delivered or the services are performed.

FORM 10-K 49

PART II

We also have preneed receivables, as disclosed in Note 3, for which payment generally occurs prior to our fulfillment of the performance obligations. Cemetery preneed receivables are collateralized by cemetery property to the extent of the fair value of the property. Our preneed contracts may also have extended payment terms with associated financing charges. We do not accrue interest on preneed receivables if they are not paid in accordance with the contractual payment terms given the nature of our merchandise and services, the nature of our contracts with customers, and the timing of the delivery of our services. Generally, receivables are considered past due after thirty days. We do not consider preneed funeral receivables to be past due until the contract converts into an atneed contract at which time the preneed receivable is paid or reclassified as a trade receivable with payment terms of less than thirty days. Collections are generally managed by the locations or our in house collection team acting on behalf of the locations, until a receivable is one hundred eighty days delinquent, at which time trade receivables are fully reserved.

The following table summarizes the activity in our reserve for credit losses by portfolio segment, excluding preneed receivables which are presented in Note 3, for the year ended December 31, 2025:


	December 31, 2024		Provision for Expected Credit Losses		Write Offs		Recoveries		Effect of Foreign Currency		December 31, 2025
	(In thousands)
Trade receivables:
Funeral	$	(1,558)	$	(5,141)	$	7,420	$	(2,934)	$	347	$	(1,866)
Cemetery	(2,048)		(770)		1,665		(646)		—		(1,799)
Total reserve for credit losses on trade receivables	$	(3,606)	$	(5,911)	$	9,085	$	(3,580)	$	347	$	(3,665)

Miscellaneous receivables:
Current	$	(320)	$	115	$	—	$	—	$	35	$	(170)
Long-term	(571)		63		—		—		—		(508)
Total reserve for credit losses on miscellaneous receivables	$	(891)	$	178	$	—	$	—	$	35	$	(678)

Reserve for credit losses on notes receivable	$	(1,910)	$	(150)	$	—	$	—	$	(1)	$	(2,061)

At December 31, 2025, the amortized cost basis of our miscellaneous and notes receivables by year of origination was as follows:


	2025		2024		2023		2022		2021		Prior		Revolving Line of Credit		Total
	(In thousands)
Miscellaneous receivables:
Current	$	41,604	$	2,637	$	562	$	142	$	13	$	2	$	—	$	44,960
Long-term	3,283		2,814		1,366		372		57		8		—		7,900
Total miscellaneous receivables	$	44,887	$	5,451	$	1,928	$	514	$	70	$	10	$	—	$	52,860

Notes receivable	$	—	$	—	$	—	$	—	$	—	$	4,457	$	4,735	$	9,192

50 Service Corporation International

PART II

At December 31, 2025, the payment status of our miscellaneous and notes receivables was as follows:


	Past Due
	<30 Days		30-90 Days		90-180 Days		>180 Days		Total		Current		Total
	(In thousands)
Miscellaneous receivables:
Current	$	—	$	—	$	—	$	2,394	$	2,394	$	42,566	$	44,960
Long-term	—		—		—		—		—		7,900		7,900
Total miscellaneous receivables	$	—	$	—	$	—	$	2,394	$	2,394	$	50,466	$	52,860

Notes receivable	$	—	$	—	$	—	$	1,115	$	1,115	$	8,077	$	9,192

Inventories and Cemetery Property

Funeral and cemetery merchandise are stated at the lower of average cost or net realizable value. Cemetery property is recorded at cost. Inventory costs and cemetery property are relieved using specific identification upon fulfillment of performance obligations of our contracts. Cemetery property amortization was $104.3 million, $102.5 million, and $101.2 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Property and Equipment, Net

Property and equipment are recorded at cost. Maintenance and repairs are charged to expense, whereas renewals and major replacements that extend the useful lives of the assets are capitalized. Depreciation is recognized ratably over the estimated useful lives of the various classes of assets. Buildings and improvements are depreciated over a period ranging from ten years to forty years, equipment is depreciated over a period from three years to twelve years; and leasehold improvements are depreciated over the shorter of the lease term or twelve years. Depreciation and amortization expense related to property and equipment was $219.7 million, $208.2 million, and $191.3 million for the years ended December 31, 2025, 2024, and 2023, respectively. When property or equipment is sold or retired, the cost and related accumulated depreciation are removed from the Consolidated Balance Sheet and the resulting gains and losses are included in the Consolidated Statement of Operations in the period of sale or disposal.

Leases

We have both operating and finance leases. Our operating leases primarily include funeral service real estate and office equipment for funeral service locations, cemetery locations, and administrative offices. Our finance leases primarily include transportation equipment but also include real estate and office equipment. Lease terms related to real estate generally range from one year to forty years with options to renew at varying terms. Lease terms related to office and transportation equipment generally range from one year to eight years with options to renew at varying terms.

We determine whether an arrangement is or contains a lease at the inception of the arrangement based on the unique facts and circumstances present. Right-of-use (ROU) assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Leases with a term greater than one year are recognized on the balance sheet as ROU assets and lease liabilities. We have elected not to recognize on the balance sheet leases with terms of one year or less.

Lease liabilities and their corresponding ROU assets are recorded at commencement date based on the present value of lease payments over the expected lease term. For transportation equipment, we use the rate implicit in each lease to calculate the present value. For real estate and non-transportation equipment leases, the interest rate implicit in lease contracts is typically not readily determinable. Therefore, we use the appropriate collateralized incremental borrowing rate based on the information available at commencement date in determining the present value of future payments for real estate and non-transportation equipment leases. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received.

For a lessee, the discount rate for the lease is defined as the rate implicit in the lease unless that rate cannot be readily determined. In that case, the lessee is required to use its incremental borrowing rate, which is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term with an amount equal to the lease payments in a similar economic environment. We use the rate implicit in each lease for vehicles and other transportation equipment, which represents 59% of our total lease liability as of December 31, 2025 and which are substantially all finance leases. For leases of real estate and non-transportation equipment, which are primarily operating leases, we use our incremental borrowing rate since the rate implicit in these leases cannot be readily determined. To calculate the incremental borrowing rate, we utilize the yield-to-worst of our publicly traded debt securities, adjusted for the appropriate duration on a secured basis. As an accounting policy election, we include reasonably certain renewal periods when determining the rate to use as the incremental borrowing rate for each lease.

FORM 10-K 51

PART II

We calculate operating lease expense ratably over the lease term. We consider reasonably assured renewal options and fixed escalation provisions in our calculation. Generally, our leases do not include options to terminate the lease prior to the contractual lease expiration date, but future renewal periods are generally cancelable. The majority of our contractually available renewal periods for leases of buildings and land are considered reasonably certain of being exercised. This determination is made by our real estate team based on facts and circumstances surrounding each property. Leases with a term of 12 months or less are not recorded on the balance sheet. The majority of our lease arrangements contain options to (i) purchase the property at fair value on the exercise date, (ii) purchase the property for a value determined at the inception of the lease, or (iii) renew the lease for the fair rental value at the end of the primary lease term. The depreciable life of assets and leasehold improvements are generally limited by the expected lease term.

Certain of our lease agreements include variable rental payments based on a percentage of sales over base contractual levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We generally do not have sublease arrangements, sale-leaseback arrangements, or leveraged leases.

We have lease agreements with lease and non-lease components, which are generally accounted for separately. For leases commencing before January 1, 2019, we have elected the practical expedient to not separate lease and non-lease components on certain equipment leases, such as copiers where the cost-per-copy maintenance charges are included in the lease charge. On these leases, we have elected to account for the lease and non-lease components as a single component. For leases commencing on or after January 1, 2019, we account for the maintenance charges (non-lease components) separately from the lease components. For more information related to leases, see Note 8.

Goodwill

The excess of purchase price over the fair value of identifiable net assets acquired in business combinations is recorded as goodwill. Goodwill is evaluated annually during the fourth quarter for impairment by assessing the fair value of each of our reporting units.

Our goodwill impairment test involves estimates and management judgment. In order to perform our goodwill impairment test, we perform either a qualitative or quantitative assessment. If we choose to perform a qualitative assessment, we evaluate economic, industry and company-specific factors in assessing the fair value of the related reporting unit. If we determine that it is more likely than not that the fair value of the reporting unit is less that its carrying value, a quantitative test is then performed. For those reporting units tested using a quantitative approach, we compare the fair value of a reporting unit to its carrying amount, including goodwill. We determine fair value of each reporting unit using an income approach. The income approach, which is a discounted cash flow method, uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows. We do not record an impairment of goodwill in instances where the fair value of a reporting unit exceeds its carrying amount. If the carrying amount exceeds the fair value of a reporting unit, an impairment is recognized in an amount equal to the excess, up to the amount of goodwill in the reporting unit.

For our most recent annual impairment test performed in the fourth quarter, we performed a qualitative analysis for each of our reporting units. After evaluating economic, industry and company-specific factors for each of our reporting units, we determined it was more likely than not that the fair values of our reporting units exceeded their carrying values. Thus, no quantitative assessment was required.

In addition to our annual review, we may assess the impairment of goodwill whenever certain events or changes in circumstances indicate that the carrying value may be greater than fair value. Factors that could trigger an interim impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results and significant negative industry or economic trends. For more information related to goodwill, see Note 4.

Other Intangible Assets

Our intangible assets include covenants-not-to-compete, customer relationships, trademarks and tradenames, and other intangible assets primarily resulting from acquisitions. Certain of our trademark and tradenames and other intangible assets are considered to have an indefinite life and are not subject to amortization. We test for impairment of indefinite-lived intangible assets annually during the fourth quarter.

Our intangible asset impairment tests involve estimates and management judgment. For trademarks and tradenames, our test uses the relief from royalty method whereby we determine the fair value of the assets by discounting the cash flows that represent a savings over having to pay a royalty fee for use of the trademarks and tradenames. The discounted cash flow valuation uses projections of future cash flows and includes assumptions concerning future operating performance and economic conditions that may differ from actual future cash flows.

For our most recent annual impairment test performed in the fourth quarter, we estimated that the pre-tax savings would range from 2.0% to 5.0% (4.7% weighted average using carrying value) of the revenue associated with the trademarks and tradenames, based primarily on our research of intellectual property valuation and licensing databases. We also assumed a terminal growth rate of 2.0% and 2.5% for our funeral and cemetery segments, respectively, and discounted the cash flows at a 7.75% discount rate based on the relative risk of these assets to our overall business.

52 Service Corporation International

PART II

In addition to our annual review, we may assess the impairment of intangible assets whenever certain events or changes in circumstances indicate that the carrying value may be greater than the fair value. Factors that could trigger an interim impairment review include, but are not limited to, significant under-performance relative to historical or projected future operating results and significant negative industry or economic trends.

Certain of our intangible assets associated with prior acquisitions are relieved using specific identification in fulfillment of performance obligations on our contracts with customers. We amortize all other finite-lived intangible assets on a straight-line basis over their estimated useful lives, which range from five years to eighty-nine years. For more information related to intangible assets, see Note 4.

Fair Value Measurements

•Where quoted prices are available in an active market, securities held by the trusts are classified as Level 1 investments.

Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Fixed income commingled funds, money market funds, and private equity investments are measured at net asset value. Fixed income commingled funds and money market funds are redeemable for net asset value with two weeks' notice and immediately, respectively. Our private equity investments include several funds that invest in limited partnerships, distressed debt, real estate, and mezzanine financing. These investments can never be redeemed by the funds. Instead, due to the nature of the investments in this category, distributions are received through the liquidation of the underlying assets of the funds.

Valuation policies and procedures are determined by our Trust Services department, which reports to our Chief Financial Officer. Additionally, valuations are reviewed quarterly by the Investment Committee of the Board of Directors.

Treasury Stock

We make treasury stock purchases in the open market or through privately negotiated transactions subject to market conditions and normal trading restrictions. We account for the repurchase of our common stock under the par value method. We canceled 5.6 million, 3.4 million, and 8.9 million shares of our common stock held in our treasury in 2025, 2024, and 2023, respectively. These retired treasury shares were changed to authorized but unissued status.

Foreign Currency Translation

All assets and liabilities of Canadian subsidiaries are translated into U.S. dollars at exchange rates in effect as of the end of the reporting period. Revenue and expense items are translated at the average exchange rates for the reporting period. The resulting translation adjustments are included as a component of Accumulated other comprehensive income in the Consolidated Statement of Equity and Consolidated Balance Sheet.

The functional currency of SCI and its subsidiaries is the respective local currency. The transactional currency gains and losses that arise from transactions denominated in currencies other than the functional currencies of our operations are recorded in Other income, net in the Consolidated Statement of Operations. We do not have any investments in foreign operations considered to be in highly inflationary economies.

Funeral and Cemetery Operations

FORM 10-K 53

PART II

For personalized marker merchandise sold on a preneed contract, we will:

•purchase the merchandise from vendors,

•personalize such merchandise in accordance with the customer's specific written instructions,

•either store the merchandise at a third-party bonded storage facility or install the merchandise, based on the customer's instructions, and

•transfer title to the customer.

There is no general right of return for delivered items.

We also sell travel protection as an agent of a third party. Travel protection is a service that provides shipment of remains to the servicing funeral home or cemetery of choice if the purchaser passes away outside of a certain radius of their residence, without any additional expense to the family. We do not provide these travel protection services, and we are not primarily obligated to provide such services under these arrangements. Therefore, we record revenue, net of amounts due to the third-party, at the time of sale.

Total consideration received for price-guaranteed preneed and for atneed contracts with customers represents the stated amount of the contract excluding any amounts collected on behalf of third parties, such as sales taxes. Additionally, pursuant to state or provincial law, all or a portion of the proceeds from merchandise or services sold on a preneed basis may be required to be deposited into trust funds. Earnings on these trust funds, which are specifically identifiable for each performance obligation, are also included in total consideration.

The total consideration received for contracts with customers is allocated to each performance obligation based on relative selling price. Relative selling prices are determined by either the amount we sell the performance obligation for on a stand-alone basis or our best estimate of the amount we would sell it for based on an adjusted market assessment approach that is consistent with our historical pricing practices.

Payment on atneed contracts is generally due at the time the merchandise is delivered or the services are performed. For preneed contracts, payment generally occurs prior to our fulfillment of the performance obligations. Our preneed contracts may also have extended payment terms with associated financing charges. We do not accrue interest on preneed receivables if they are not paid in accordance with the contractual payment terms given the nature of our merchandise and services, the nature of our contracts with customers, and the timing of the delivery of our services. We do not consider preneed receivables to be past due until the merchandise or services are required to be delivered at which time the preneed receivable is paid or reclassified as a trade receivable with payment terms of less than thirty days. For unfulfilled performance obligations on cancelable preneed contracts, our Consolidated Balance Sheet reflects the net contract liability, which represents the amount we have collected from customers, in Deferred revenue, net.

Pursuant to state or provincial law, all or a portion of the proceeds from merchandise or services sold on a preneed basis may be required to be deposited into trust funds. When we receive payments from the customer, we deposit the amount required by law into the merchandise and service trusts and reclassify the corresponding amount from Deferred revenue, net into Deferred receipts held in trust. Amounts are withdrawn from the merchandise and service trusts when we fulfill the performance obligations. Fixed income securities held by these trust funds are classified as trading securities. Earnings on these trust funds, which are specifically identifiable for each performance obligation, are also included in total consideration. We defer these investment earnings related to the merchandise and service trusts until the associated merchandise is delivered or services are performed. Fees charged by our wholly-owned registered investment advisor are also included in revenue in the period in which they are earned.

If a preneed contract is canceled prior to delivery, state or provincial law determines the amount of the refund owed to the customer, if any, including the amount of the attributed investment earnings. Upon cancellation, we receive the amount of principal deposited to the trust and previously undistributed net investment earnings and, where required, issue a refund to the customer. In addition, we are entitled to retain, in certain jurisdictions, a portion of collected customer payments when a customer cancels a preneed contract. We recognize these retained funds, if any, and the attributed investment earnings (net of any investment earnings payable to the customer) as revenue in the Consolidated Statement of Operations. In certain jurisdictions, we may be obligated to fund any shortfall if the amount refundable to the customer exceeds the funds in trust.

A portion of the proceeds from the sale of cemetery property interment rights is required by state or provincial law to be paid into perpetual care trust funds by us to maintain the cemetery. This portion of the proceeds is not recognized as revenue.

54 Service Corporation International

PART II

Fixed income securities held by these trust funds are classified as trading securities. Investment earnings from these trusts are distributed to us regularly and recognized in current cemetery revenue. These distributions are intended to defray cemetery maintenance costs incurred by us for our cemetery properties, which are expensed as incurred. The principal of such perpetual care trust funds generally cannot be withdrawn; however, in lieu of the distribution of realized income, certain states allow a total return distribution, which may contain elements of income, capital appreciation, and principal.

Costs related to delivery or performance of merchandise and services are charged to expense when merchandise is delivered or services are performed. Costs related to property interment rights include the property and construction costs specifically identified by each project. Property and construction costs are charged to expense when the revenue is recognized by specific identification in the fulfillment of the performance obligation. Incremental direct selling costs are deferred until fulfillment of the performance obligations. These deferred costs are classified as long-term on our Consolidated Balance Sheet because we do not control the timing of the delivery of the merchandise or performance of the services as they are generally provided at the time of need. For the years ended December 31, 2025, 2024, and 2023, we recognized $230.9 million, $239.8 million, and $247.4 million, respectively, of incremental selling costs. All other selling costs are expensed as incurred.

The components of Cost of revenue in our Consolidated Statement of Operations are:

•Cost of property and merchandise, which includes cemetery property amortization, the direct cost of merchandise, labor-related costs for merchandise handling and delivery, cemetery maintenance expenses, depreciation, and selling costs;

•Cost of services, which includes the direct cost of providing the services (including labor-related costs), cemetery maintenance expenses and depreciation, vehicle operating costs and depreciation, and selling costs; and

•Overhead and other expenses, which includes labor-related costs, facility expenses and depreciation, and other general and administrative expenses incurred in our funeral and cemetery operations.

Corporate general and administrative expenses include labor-related costs, corporate asset depreciation and amortization, public company costs, and other general and administrative expenses incurred by our corporate functions.

Insurance-Funded Preneed Contracts

Where permitted by state or provincial law, we may sell a life insurance or annuity policy from third-party insurance companies, for which we earn a commission as general sales agent for the insurance company. These general agency commissions (GA revenue) are based on a percentage per contract sold and are recognized as funeral revenue when the insurance purchase transaction between the preneed purchaser and third-party insurance provider is completed. All selling costs incurred pursuant to the sale of insurance-funded preneed contracts are expensed as incurred. GA revenue recognized in 2025, 2024, and 2023 was $292.1 million, $230.9 million, and $185.6 million, respectively.

We do not reflect the unfulfilled insurance-funded preneed contract amounts in our Consolidated Balance Sheet. The policy amount of the insurance contract between the customer and the third-party insurance company generally equals the amount of the preneed contract. The policyholder has made a revocable commitment to assign the proceeds from the policy to us at the time of need. The proceeds of the life insurance policies or annuity contracts will be reflected in funeral revenue as we perform these funerals.

Income Taxes

We compute income taxes using the liability method. Our ability to realize the benefit of our deferred tax assets requires us to achieve certain future earnings levels. We have established a valuation allowance against a portion of our deferred tax assets. We could be required to further adjust that valuation allowance in the near term if market conditions change materially and future earnings are, or are projected to be, significantly different than our current estimates. An increase in the valuation allowance would result in additional income tax expense in such period. All deferred tax assets and liabilities, along with any related valuation allowances are classified as non-current on our Consolidated Balance Sheet.

Restructuring Charge

In 2025, we recognized a restructuring charge of $2.0 million, primarily due to professional fees incurred in connection with the implementation and completion of restructuring actions. We paid $21.6 million of deferred compensation arrangements primarily associated with retired executives and other restructuring related charges during 2025. The restructuring charge is presented separately on our Consolidated Statement of Operations.

In 2024, we recognized a restructuring charge of $11.5 million, which included the retirements and position eliminations of various home office and corporate positions as part of ongoing cost management. We paid $2.3 million of the recognized charge during 2024. The restructuring charge is presented separately on our Consolidated Statement of Operations.

FORM 10-K 55

PART II

Accounting Standards Adopted in 2025

Income Tax

In December 2023, the FASB amended guidance that requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The Company adopted the new guidance for the year ended December 31, 2025 and applied the disclosure requirements retrospectively to all prior periods presented in the financial statements.

Recently Issued Accounting Standards

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued guidance that requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The guidance is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted, and it can be adopted either on a prospective or retrospective basis. Upon adoption, we will include the additional disclosures in our financial statements and related notes, however the guidance will not have a material effect on our financial position or results of operations.

Internal-Use Software

In September 2025, the FASB issued guidance to modernize the accounting for software costs that are accounted for under Subtopic 350-40, Intangibles-Goodwill and Other-Internal-Use Software. The new guidance is effective for us for the 2028 annual period, with early adoption permitted, and it can be adopted either on a prospective, modified or retrospective basis. We are currently assessing the impact of this guidance on our disclosures, and upon adoption, we will include the required disclosures in our financial statements and related notes.

3. Preneed Activities

Preneed Receivables, Net and Trust Investments

The components of Preneed receivables, net and trust investments in our Consolidated Balance Sheet were as follows:


	Years Ended December 31,
	2025		2024
	(In thousands)
Preneed receivables, net	$	1,561,836	$	1,570,773

Trust investments, at fair value	7,965,010		7,084,723

Insurance-backed fixed income securities and other	232,560		237,868
Trust investments	8,197,570		7,322,591
Less: Cemetery perpetual care trust investments	(2,398,613)		(2,154,032)
Preneed trust investments	5,798,957		5,168,559

Preneed receivables, net and trust investments	$	7,360,793	$	6,739,332

Preneed receivables, net comprised the following:


	December 31, 2025
	Funeral		Cemetery		Total
	(In thousands)
Preneed receivables	$	142,485	$	1,482,721	$	1,625,206
Unearned finance charges	(13,486)		(15,204)		(28,690)
Preneed receivables, at amortized cost	$	128,999	$	1,467,517	$	1,596,516
Reserve for credit losses	(20,632)		(14,048)		(34,680)
Preneed receivables, net	$	108,367	$	1,453,469	$	1,561,836

56 Service Corporation International

PART II


	December 31, 2024
	Funeral		Cemetery		Total
	(In thousands)
Preneed receivables	$	183,016	$	1,444,084	$	1,627,100
Unearned finance charges	(11,083)		(9,387)		(20,470)
Preneed receivables, at amortized cost	$	171,933	$	1,434,697	$	1,606,630
Reserve for credit losses	(20,132)		(15,725)		(35,857)
Preneed receivables, net	$	151,801	$	1,418,972	$	1,570,773

At December 31, 2025, the amortized cost basis of our preneed receivables by year of origination was as follows:


	2025		2024		2023		2022		2021		Prior		Total
	(In thousands)
Preneed receivables, at amortized cost:
Funeral	$	26,117	$	35,128	$	29,238	$	14,857	$	7,367	$	16,292	$	128,999
Cemetery	577,225		401,813		259,307		141,389		52,557		35,226		1,467,517
Total preneed receivables, at amortized cost	$	603,342	$	436,941	$	288,545	$	156,246	$	59,924	$	51,518	$	1,596,516

At December 31, 2025, the payment status of our preneed receivables was as follows:


	Past Due
	<30 Days		30-90 Days		90-180 Days		>180 Days		Total		Current		Total
	(In thousands)
Preneed receivables, at amortized cost:
Funeral	$	3,967	$	2,348	$	1,423	$	31,094	$	38,832	$	90,167	$	128,999
Cemetery	54,778		51,295		12,456		4,334		122,863		1,344,654		1,467,517
Total preneed receivables, at amortized cost	$	58,745	$	53,643	$	13,879	$	35,428	$	161,695	$	1,434,821	$	1,596,516

The following table summarizes the activity for the reserve for credit losses on preneed receivables for the twelve months ended December 31, 2025.


	December 31, 2024		Provision for Expected Credit Losses		Write Offs		Effect of Foreign Currency		December 31, 2025
	(In thousands)
Funeral	$	(20,132)	$	(4,051)	$	3,554	$	(3)	$	(20,632)
Cemetery	(15,725)		1,040		653		(16)		(14,048)
Total reserve for credit losses on preneed receivables	$	(35,857)	$	(3,011)	$	4,207	$	(19)	$	(34,680)

FORM 10-K 57

PART II

The table below sets forth certain investment-related activities associated with our trusts:


	Years Ended December 31,
	2025		2024		2023
	(In thousands)
Deposits	$	644,140	$	637,406	$	590,257
Withdrawals	$	600,900	$	608,251	$	591,591
Purchases of securities	$	2,333,514	$	2,227,515	$	2,070,313
Sales of securities	$	2,193,952	$	2,212,443	$	2,038,517
Realized gains from sales of securities(1)	$	538,513	$	509,982	$	281,168
Realized losses from sales of securities(1)	$	(131,685)	$	(183,620)	$	(227,075)

(1)All realized gains and losses are recognized in Other income, net for our trust investments and are offset by a corresponding reclassification in Other income, net to Deferred receipts held in trust and Care trusts’ corpus.

The activity in Preneed receivables, net and trust investments was as follows:


	Years Ended December 31,
	2025		2024		2023
	(In thousands)
Beginning balance - Preneed receivables, net and trust investments	$	6,739,332	$	6,191,912	$	5,577,499
Net preneed contract sales	1,878,217		1,946,232		1,973,012
Cash receipts from customers, net of refunds	(1,805,347)		(1,752,920)		(1,699,683)
Deposits to trust	562,614		557,398		515,866
Acquisitions of businesses, net	5,865		60,561		3,394
Net undistributed investment earnings (losses) (1)	576,106		424,543		527,264
Maturities and distributed earnings	(584,826)		(595,087)		(591,834)
Change in cancellation allowance	1,195		(3,430)		(5,160)
Change in amounts due on unfulfilled performance obligations	(19,758)		(43,547)		(93,473)
Effect of foreign currency and other	7,395		(46,330)		(14,973)
Ending balance - Preneed receivables, net and trust investments	$	7,360,793	$	6,739,332	$	6,191,912

(1) Includes both realized and unrealized investment earnings.

58 Service Corporation International

PART II

The cost and fair values associated with trust investments recorded at fair value at December 31, 2025 and 2024 are detailed below. Cost reflects the investment (net of redemptions) of control holders in the trusts. Fair value represents the value of the underlying securities held by the trusts.


		December 31, 2025
	Fair Value Hierarchy Level	Cost		Unrealized Gains		Unrealized Losses		Value
				(In thousands)
Fixed income securities:
U.S. Treasury	2	$	50,233	$	305	$	(488)	$	50,050
Canadian government	2	26,086		—		—		26,086
Corporate	2	10,352		310		(7)		10,655
Residential mortgage-backed	2	3,202		68		(28)		3,242
Asset-backed	2	279		—		(41)		238
Equity securities:
Preferred stock	2	13,831		2,428		—		16,259
Common stock:
United States	1	2,071,402		745,982		(95,511)		2,721,873
Canada	1	41,650		34,904		(1,219)		75,335
Other international	1	167,881		43,880		(5,910)		205,851
Mutual funds:
Equity	1	938,778		253,372		(5,546)		1,186,604
Fixed income	1	671,067		8,531		(27,280)		652,318

Trust investments, at fair value		3,994,761		1,089,780		(136,030)		4,948,511
Commingled funds
Fixed income		1,387,350		14,443		(50,208)		1,351,585
Equity		362,862		155,590		—		518,452
Money market funds		423,957		—		—		423,957
Alternative investments		503,898		228,320		(9,713)		722,505
Trust investments, at net asset value		2,678,067		398,353		(59,921)		3,016,499
Trust investments, at market		$	6,672,828	$	1,488,133	$	(195,951)	$	7,965,010

As of December 31, 2025, our unfunded commitment for our private equity investments was $435.7 million which, if called, would be funded by the assets of the trusts.

FORM 10-K 59

PART II


		December 31, 2024
	Fair Value Hierarchy Level	Cost		Unrealized Gains		Unrealized Losses		Value
				(In thousands)
Fixed income securities:
U.S. Treasury	2	$	43,699	$	178	$	(849)	$	43,028
Canadian government	2	25,979		—		—		25,979
Corporate	2	10,087		326		(11)		10,402
Residential mortgage-backed	2	3,811		39		(49)		3,801
Asset-backed	2	290		—		(47)		243
Equity securities:
Preferred stock	2	8,059		930		(25)		8,964
Common stock:
United States	1	1,887,854		617,695		(68,404)		2,437,145
Canada	1	41,362		20,164		(1,160)		60,366
Other international	1	120,605		34,414		(10,382)		144,637
Mutual funds:
Equity	1	950,990		121,006		(13,892)		1,058,104
Fixed income	1	1,028,622		4,183		(46,391)		986,414

Trust investments, at fair value		4,121,358		798,935		(141,210)		4,779,083
Commingled funds
Fixed income		862,350		2,597		(60,646)		804,301
Equity		346,553		99,647		(316)		445,884
Money market funds		432,821		—		—		432,821
Alternative investments		438,449		193,638		(9,453)		622,634
Trust investments, at net asset value		2,080,173		295,882		(70,415)		2,305,640
Trust investments, at market		$	6,201,531	$	1,094,817	$	(211,625)	$	7,084,723

Our alternative investments include funds invested in limited partnerships with interests in private equity, private market real estate, energy and natural resources, infrastructure, transportation, and private debt including both distressed debt and mezzanine financing. These investments can never be redeemed by the funds. Instead, due to the nature of the investments in this category, distributions are received through the liquidation of the underlying assets of the funds. The funds' managers have not communicated the timing of any liquidations.

Maturity dates of our fixed income securities range from 2025 to 2044. Maturities of fixed income securities (excluding mutual funds) at December 31, 2025 are estimated as follows:


	Fair Value
	(In thousands)
Due in one year or less	$	49,393
Due in one to five years	34,963
Due in five to ten years	5,886
Thereafter	29
Total estimated maturities of fixed income securities	$	90,271

Recognized trust fund income (realized and unrealized) related to our preneed trust investments was $202.2 million, $185.7 million, and $158.2 million for the years ended December 31, 2025, 2024, and 2023, respectively. Recognized trust fund income (realized and unrealized) related to our cemetery perpetual care trust investments was $111.1 million, $96.4 million, and $86.6 million for the years ended December 31, 2025, 2024, and 2023, respectively.

60 Service Corporation International

PART II

Deferred Revenue, Net

Deferred revenue, net represents future revenue, including distributed trust investment earnings associated with unperformed trust-funded preneed contracts that are not held in trust accounts. Future revenue and net trust investment earnings that are held in trust accounts are included in Deferred receipts held in trust.

The components of Deferred revenue, net in our Consolidated Balance Sheet were as follows:


	Years Ended December 31,
	2025		2024
	(In thousands)
Deferred revenue	$	2,790,149	$	2,745,104
Amounts due from customers for unfulfilled performance obligations on cancelable preneed contracts	(1,010,883)		(989,934)
Deferred revenue, net	$	1,779,266	$	1,755,170

The following table summarizes the activity for our contract liabilities, which are reflected in Deferred revenue, net and Deferred receipts held in trust:


	Years Ended December 31,
	2025		2024		2023
	(In thousands)
Beginning balance — Deferred revenue, net and Deferred receipts held in trust	$	6,917,695	$	6,374,393	$	5,787,548

Net preneed contract sales	1,321,645		1,386,108		1,451,833
Acquisitions (dispositions) of businesses, net	10,614		78,894		5,961
Net investment gains (losses) (1)	562,045		418,483		527,894
Recognized revenue from backlog(2)	(565,688)		(574,414)		(554,839)
Recognized revenue from current period sales	(671,862)		(677,475)		(730,436)
Change in amounts due on unfulfilled performance obligations	(19,609)		(43,547)		(93,473)
Change in cancellation reserve	975		2,332		87
Effect of foreign currency and other	7,849		(47,079)		(20,182)
Ending balance — Deferred revenue, net and Deferred receipts held in trust	$	7,563,664	$	6,917,695	$	6,374,393

(1)Includes both realized and unrealized investment gains (losses).

(2)Includes current year trust fund income through the date of performance.

4. Goodwill and Intangible Assets

The changes in the carrying amounts of goodwill for our funeral and cemetery reporting units are as follows:


	Years Ended December 31,
	2025						2024
	Funeral		Cemetery		Total		Funeral		Cemetery		Total
	(In thousands)
Beginning balance — Goodwill	$	1,685,033	$	395,982	$	2,081,015	$	1,618,370	$	358,816	$	1,977,186
Increase in goodwill related to acquisitions	72,501		10,810		83,311		75,734		37,167		112,901
Reduction of goodwill related to divestitures (1)	—		—		—		(996)		—		(996)

SERVICE CORP INTERNATIONAL 10-K