Axalta Releases Second Quarter 2025 Results

Core Insights - Axalta Coating Systems Ltd. reported a decrease in net sales by 3% year over year to $1.3 billion for Q2 2025, primarily due to volume declines in Performance Coatings, despite contributions from the CoverFlexx acquisition and favorable currency translation [3][4] - The company achieved a record Adjusted EBITDA of $292 million, reflecting a slight year-over-year increase, and an Adjusted EBITDA margin expansion of 90 basis points to 22.4% [4][8] - Axalta's net income decreased by 3% year over year to $110 million, resulting in a net income margin of 8.4%, influenced by restructuring costs [4][8] Financial Performance - Net sales for Q2 2025 were $1.3 billion, down from $1.35 billion in the prior year [8] - Adjusted net income improved by $4 million year over year to $139 million, driven by lower operating expenses and reduced interest expense [4][33] - Diluted earnings per share decreased by 2% to $0.50, while adjusted diluted earnings per share increased by 5% to $0.64 [4][33] Cash Flow and Capital Management - Cash provided by operating activities increased by 25% year over year to $142 million, reflecting the company's focus on margin expansion [5][36] - Free cash flow for the quarter was $101 million, up from $95 million in the prior year, supported by stronger operating performance [5][36] - The company executed $65 million in share repurchases during the quarter [8] Segment Performance - Performance Coatings segment net sales were $836 million, down from $887 million in the prior year, with a 6% decline in Refinish net sales [6][7] - Mobility Coatings segment net sales increased by 1% year over year to $469 million, with light vehicle net sales up 2% [9][10] - The Mobility Coatings segment achieved an Adjusted EBITDA of $92 million, significantly up from $68 million in the prior year, with an Adjusted EBITDA margin expansion to 19.8% [10] Outlook - For Q3 2025, Axalta projects low single-digit percentage growth in net sales, with full-year net sales expected to be between $5.2 billion and $5.275 billion [11] - Adjusted EBITDA for Q3 is projected to be between $290 million and $300 million, with full-year expectations of $1.14 billion to $1.165 billion [11]