DOW Q4 Earnings Beat Estimates, Sales Miss on Lower Prices

Core Insights - Dow Inc. reported a significant loss of $1,543 million or $2.15 per share for Q4 2025, compared to a loss of $53 million or 8 cents per share in the same quarter last year, primarily due to lower prices and volumes [1] - On an adjusted basis, the loss was 34 cents, which was better than the Zacks Consensus Estimate of a loss of 46 cents [1] Financial Performance - Net sales for the quarter were $9,460 million, down 9% year over year, missing the Zacks Consensus Estimate of $9,487.1 million [2] - Volume decreased by 2% year over year, largely due to declines in the Packaging & Specialty Plastics unit, with local prices falling 8% year over year [2] - Cash flow from operating activities for continuing operations was $298 million, a decrease of $513 million from the same period last year, with full-year cash flow at $1.1 billion compared to $2.9 billion in 2024 [6] Segment Highlights - Packaging & Specialty Plastics: Sales fell 11% year over year to $4,744 million, missing the consensus estimate of $4,834 million, with volume down 2% and local prices down 9% [3] - Industrial Intermediates & Infrastructure: Sales decreased 9% year over year to $2,688 million, beating the consensus estimate of $2,653 million, with local prices down 9% and volume down 1% [4] - Performance Materials & Coatings: Revenues fell 6% year over year to $1,852 million, exceeding the consensus estimate of $1,836 million, with volume down 2% and local prices down 4% [5] Strategic Initiatives - Dow is committed to delivering near-term cost savings through the "Transform to Outperform" initiative, targeting at least $2 billion in near-term operating EBITDA improvement, with two-thirds expected from productivity enhancements [7] - This initiative is in addition to an earlier announced $1 billion cost savings program [7] Market Performance - Dow's shares have declined by 27.9% over the past year, compared to a 20.8% decline in the Zacks Chemicals Diversified industry [9]