JPMorgan Chase Introduces Auto-Callable Notes Linked to S&P 500 and VanEck Semiconductor ETF with High Yield Potential

Structured Investment Design and Contingent Interest Payments

These notes are structured investments offering contingent interest payments only when specific performance criteria are met on designated review dates. If both the S&P 500 Index and VanEck Semiconductor ETF close at or above 70% of their initial values on any review date, holders receive a monthly contingent interest payment of at least $15.4167 per $1,000 principal, equating to an 18.50% annualized rate. Payments are made monthly at a minimum rate of 1.54167%, contingent on underlying asset performance. If either asset falls below the 70% barrier on a review date, no interest is paid for that period, introducing income variability for investors over multiple cycles.

The notes focus on the lesser-performing underlying rather than a basket approach, meaning the weaker asset dictates payment outcomes. This asymmetric payoff benefits investors only if both assets maintain price levels above set thresholds. The product spans from July 28, 2026 settlement through January 27, 2028 maturity, with nineteen monthly review dates providing frequent interest qualification opportunities.

Automatic Call Feature and Early Redemption

An automatic call feature triggers if both underlyings close at or above their initial values on any review date excluding the first, second, and final dates. Upon trigger, the notes are redeemed at par plus the contingent interest payment due, with settlement on the next interest payment date. The earliest call date is October 23, 2026, about three months post-settlement, offering potential early exit if market conditions improve.

This feature limits JPMorgan Chase’s exposure to rising markets and caps upside for note holders, who trade fixed interest and dividends for contingent payments. Once called, no further payments are made and notes terminate. The initial review dates of August 24 and September 23, 2026 do not trigger early calls, ensuring an initial holding period for investors.

Principal-at-Risk and Downside Exposure at Maturity

At maturity on January 27, 2028, if the notes are not called and both underlyings close at or above 50% of initial values, investors receive full principal plus any final contingent interest. If either closes below 50%, principal loss occurs, calculated by multiplying principal by the lesser-performing underlying’s return, potentially exceeding 50% loss and possibly total principal loss depending on severity.

This structure exposes investors to full downside risk without principal protection. The 50% trigger reflects a significant market decline, common in sector-specific volatility or broad corrections. No barrier resets or memory features are included, making final valuation critical for principal preservation.

Underlying Assets: S&P 500 Index and VanEck Semiconductor ETF

The notes reference two equity assets with distinct risk profiles: the broad-market S&P 500 Index (SPX) and the VanEck Semiconductor ETF (SMH), which focuses on semiconductor manufacturers. Linking to the lesser-performing underlying introduces correlation risk, where semiconductor sector volatility may dictate final payouts even if the broader market remains stable. Payments depend on individual asset performance rather than a basket, so the weaker asset’s decline directly impacts investor returns.

This dual-underlying design increases exposure to semiconductor sector downturns, which historically exhibit higher volatility than broad indices, raising the likelihood that SMH underperforms during market corrections. Investors should consider the heightened downside risk compared to single-index or diversified basket-linked notes.

Pricing, Valuation, and Distribution Details

The preliminary pricing supplement sets a $1,000 price per note with a minimum denomination of $1,000 and multiples thereof, making it accessible to retail and institutional investors. The estimated note value at announcement was approximately $960.40 per $1,000 principal, reflecting embedded hedging and structuring costs. Final pricing will guarantee a minimum value of $900 per $1,000 principal, implying a maximum 10% initial cost.

J.P. Morgan Securities LLC acts as distribution agent, paying selling commissions to affiliated and unaffiliated dealers capped at $22.25 per $1,000 principal (2.225%). This fee is included in the investor price. Final public offering price and issuer proceeds depend on market conditions at pricing.

Credit Quality and Issuer Guarantees

The notes are unsecured, unsubordinated obligations of JPMorgan Chase Financial Company LLC, fully and unconditionally guaranteed by JPMorgan Chase & Co. This provides recourse to the parent’s credit quality, enhancing credit assurance. However, payments remain subject to credit risk of both issuer and guarantor, with potential impairment in extreme financial distress.

These are not bank deposits, are uninsured by the FDIC, and are not bank obligations, classifying them as unsecured investment securities. Investors bear full counterparty risk linked to JPMorgan Chase’s financial health. The unsubordinated status suggests parity with other corporate debt issued by the parent.

Review Schedule and Interest Payment Timing

The notes have nineteen monthly review dates from August 24, 2026 through January 24, 2028, providing frequent assessment points for contingent interest and automatic call triggers. Interest payments occur typically three business days after each review date, ensuring a predictable monthly cash flow if conditions are met.

Initial review dates precede the earliest automatic call date, guaranteeing an observation period before potential early redemption. Valuation or payment dates may be postponed due to market disruptions or accelerated by specified events, with the disclosed schedule serving as the baseline timeline.

Risk Factors and Suitability

Investors must accept the risk of significant or total principal loss and the possibility of no contingent interest payments on some or all review dates. They relinquish traditional fixed interest and dividend income, facing opportunity costs. The complex payment structure includes "acceleration events" that may cause early redemption, detailed in separate product supplements.

Market disruption can delay valuation and payment, increasing uncertainty. Holding through multiple cycles involves income volatility as contingent payments depend on barrier tests. Comprehensive risk discussions are available in separate prospectus supplements, with this document providing summary information.

Settlement Timeline and Regulatory Status

Pricing is expected around July 23, 2026, with settlement by July 28, 2026, allowing time for syndicate confirmations and account setups. The settlement date marks the issue date and start of interest accrual, with the first review on August 24, 2026. This preliminary supplement is subject to completion, with final pricing and valuation details forthcoming.

The notes have not been approved or disapproved by the SEC or state securities commissions. Assigned CUSIP 46661KTW8 enables market trading and secondary settlement. They are registered under Registration Statement Nos. 333-293684 and 333-293684-01 per Rule 424(b)(2), forming part of the registration and prospectus framework.