Dow Beats on Earnings, Misses Slightly on Revenue

Dow Inc. (NYSE: DOW) shares jumped 6.7% in premarket trading Thursday after posting better-than-expected third-quarter results that showed sequential improvement in profitability despite a challenging global chemicals environment.

The company reported an adjusted net loss of $0.19 per share, narrower than the consensus estimate of a $0.30 loss, while revenue of $9.97 billion came in slightly below expectations of $10.23 billion, reflecting softer demand and lower pricing across operating segments.

Earnings and Operating Highlights

Adjusted EPS: –$0.19 vs. –$0.30 expected
GAAP EPS: $0.08 vs. $0.30 a year ago
Revenue: $9.97B (–8% Y/Y)
Operating EBIT: $180M (vs. $641M last year; improved from Q2 loss of $21M)

CEO Jim Fitterling highlighted sequential improvement driven by cost control and higher output from new polyethylene and alkoxylation facilities on the U.S. Gulf Coast.

“Our performance demonstrates the strength of Dow’s competitive advantages and our disciplined focus on key value drivers within our control,” Fitterling said.

Industry Headwinds

Dow continues to face challenges from a global petrochemical supply glut, particularly from China, which has weighed heavily on polyethylene prices.
Additionally:

Weak industrial production has curbed chemical demand
Soft housing activity has hurt construction material sales
Macroeconomic uncertainty continues to dampen volume recovery

Segment Performance

Packaging & Specialty Plastics:
Revenue fell 11% to $4.89B, while operating EBIT dropped to $199M (from $618M). Sequential margins improved due to lower costs and increased output from new U.S. plants.
Industrial Intermediates & Infrastructure:
Sales declined 4% to $2.83B, while EBIT loss narrowed to $47M (from $53M), helped by reduced maintenance costs and capacity expansions.
Performance Materials & Coatings:
Revenue dropped 6% to $2.08B, with EBIT down to $80M (from $140M), reflecting lower prices and seasonal weakness in coatings.

Cash Flow and Financial Outlook

Dow generated $1.1 billion in operating cash flow, up $330 million year-over-year, supported by working capital improvements and advance payments from long-term supply contracts.
The company returned $249 million to shareholders through dividends during the quarter.

Looking ahead, management reaffirmed its commitment to:

Deliver $6.5B+ in near-term cash support, including
- $1B in capex cuts (2025)
- $1B in cost savings by 2026
Continue asset optimization in Europe
Maintain financial flexibility to navigate cyclical headwinds

Despite subdued market conditions, Dow expects continued progress through cost discipline, operational efficiency, and focus on resilient portfolio segments.