Core Viewpoint - PPG has launched a new non-methanol hard coating for ophthalmic lenses, addressing regulatory changes while ensuring durability performance [1] Company Summary - PPG introduced the PPG HI-GARD® Non-Methanol hard coating specifically for 1.5 standard index ophthalmic lenses [1] - The new formulation serves as a drop-in replacement for traditional methanol-based coatings, allowing prescription lens manufacturers to comply with evolving regulations [1] - The PPG Hi-Gard Non-Methanol coating provides the same level of scratch-resistant protection for plastic lens materials as its predecessors [1]

Core Insights - PPG has been included in TIME Magazine's World's Best Companies list, which ranks the top 1,000 global employers [1] - The recognition highlights PPG's commitment to innovation in paints, coatings, and specialty products, aimed at protecting and beautifying the world [1] Company Overview - PPG employs approximately 43,000 individuals who contribute to the company's mission [1] - The acknowledgment from TIME Magazine reflects PPG's efforts in shaping a sustainable future through its product offerings [1]

PITTSBURGH--(BUSINESS WIRE)--PPG (NYSE:PPG) today announced Patrick O'Neill, PPG global synthesis and pilot director, was recognized with a Lifetime Achievement Award from Paints and Coatings Industry (PCI) Magazine. This award recognizes individuals for their outstanding contributions to the coatings industry and is presented at the Coatings Trends & Technologies Summit. "At PPG, we're proud to develop industry-leading scientists that are able to translate advanced innovations into custome. ...

Core Viewpoint - PPG Industries has shown a positive stock performance of approximately 5.5% since its last earnings report, outperforming the S&P 500, raising questions about the sustainability of this trend leading up to the next earnings release [1]. Financial Performance - PPG Industries reported Q2 2025 profit of $450 million, or $1.98 per share, a decrease from $493 million, or $2.09 per share, in the same quarter last year [2]. - Adjusted earnings per share, excluding one-time items, fell to $2.22 from $2.35 year-over-year, meeting the Zacks Consensus Estimate [2]. - Revenues for the quarter were approximately $4.19 billion, down 1% year-over-year, but exceeded the Zacks Consensus Estimate of $4.13 billion [3]. Segment Review - The Global Architectural Coatings segment experienced a 5% year-over-year decline in sales to $1.02 billion, surpassing estimates of $1 billion, primarily due to the divestiture of the architectural coatings business in Russia and lower sales volumes, partially offset by higher selling prices [4]. - The Performance Coatings segment saw a 7% year-over-year increase in sales to $1.51 billion, exceeding estimates of $1.44 billion, driven by a 6% rise in organic sales and increases in selling prices and volume [5]. - The Industrial Coatings segment's sales declined 5% year-over-year to $1.67 billion, surpassing estimates of $1.63 billion, mainly due to the divestiture of the silicas products business in late 2024 [6]. Financial Position - As of the end of the quarter, the company had $1.56 billion in cash and cash equivalents, with net debt increasing to $5.7 billion, up $479 million from the prior year [7]. Outlook - The company maintained its full-year 2025 adjusted earnings per share guidance of $7.75 to $8.05, supported by continued market share gains and internal improvement initiatives, while considering current global economic conditions and varied demand trends [8]. - Recent estimates for the stock have shown a downward trend, indicating a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [12]. Industry Comparison - PPG Industries operates within the Zacks Chemical - Specialty industry, where RPM International, a peer, has gained 6% over the past month, reporting revenues of $2.08 billion for the last quarter, reflecting a year-over-year increase of 3.7% [13].

Company Overview - PPG Industries is based in Pittsburgh and operates in the Basic Materials sector, with a year-to-date share price change of -4.34% [3] - The company currently pays a dividend of $0.71 per share, resulting in a dividend yield of 2.49%, which is significantly higher than the Chemical - Specialty industry's yield of 0.87% and the S&P 500's yield of 1.49% [3] Dividend Performance - PPG Industries has an annualized dividend of $2.84, reflecting a 6.8% increase from the previous year [4] - Over the past five years, the company has raised its dividend five times, achieving an average annual increase of 5.52% [4] - The current payout ratio for PPG Industries is 35%, indicating that it distributes 35% of its trailing 12-month earnings per share as dividends [4] Earnings Growth and Investment Appeal - The Zacks Consensus Estimate for PPG's earnings per share in 2025 is $7.88, which represents a year-over-year growth rate of 0.13% [5] - PPG is considered a compelling investment opportunity due to its strong dividend profile and current Zacks Rank of 3 (Hold) [6]

Core Insights - PPG Industries is experiencing challenges due to demand weakness, particularly in Europe, but is benefiting from cost discipline, acquisitions, and pricing actions [1][6][9] Financial Performance - PPG's second-quarter adjusted earnings were $2.22 per share, matching estimates but down from $2.35 a year earlier [1] - The company reported a roughly 1% decline in revenue, with higher sales in the Performance Coatings unit offset by declines in Global Architectural Coatings and Industrial Coatings segments [1] Cost Management and Restructuring - PPG is implementing a cost-cutting and restructuring strategy, realizing an additional $20 million in structural cost savings in Q2 2025, with expectations of around $60 million in total savings for the full year [2][9] - A comprehensive cost reduction program is expected to deliver annualized pre-tax savings of approximately $175 million once fully implemented, focusing on structural costs mainly in Europe [3] Acquisitions and Growth Strategy - The company is pursuing inorganic growth through acquisitions, including Tikkurila, Worwag, Cetelon, and Arsonsisi's powder coatings business, which are expected to contribute positively to its revenue [4][9] Shareholder Returns - PPG has a strong track record of returning cash to shareholders, having returned $1.4 billion in 2024 through dividends and share buybacks, with a quarterly dividend increase of 4% in July 2025 [5] Market Challenges - The company faces challenges from soft global industrial production, particularly affecting the Industrial Coatings segment, with lower automotive OEM build rates and weak consumer confidence in Europe [6][8] - Demand in the Global Architectural Coatings segment fell by 5% due to lower sales volumes and weaker consumer confidence in Europe [8] Future Outlook - PPG maintains its full-year 2025 adjusted earnings per share guidance of $7.75 to $8.05, supported by share gains and internal improvement initiatives despite current economic conditions [9]

Core Insights - PPG Industries Inc. has entered into a new authorized distributor partnership with GPA to expand the distribution of PPG TESLIN substrate for commercial printing and label applications [1][7] - The collaboration enhances the availability of PPG Teslin synthetic paper solutions, which are known for their durability and reduced plastic content [2][7] Company Developments - PPG Teslin substrates are designed for long-lasting performance in commercial printing and pressure-sensitive label applications, featuring strong bonding and high versatility [2][3] - The partnership with GPA aims to help clients achieve their business objectives by leveraging the unique performance qualities of Teslin substrates [3] Financial Performance - PPG's shares have decreased by 7.7% over the past year, contrasting with a 0.3% increase in its industry [5] - The company has maintained its full-year 2025 adjusted earnings per share guidance at $7.75 to $8.05, supported by market share gains and internal improvements [6]

Core Viewpoint - PPG Industries stock is currently viewed as unattractive, with a price around $105, due to multiple significant concerns regarding its valuation and operational performance [2][3]. Valuation Comparison - PPG stock is valued comparably to the broader market in terms of cost per dollar of sales or profit [4]. Revenue Performance - PPG Industries has experienced a decline in revenues over recent years, with a quarterly revenue drop of 4.3% to $3.7 billion from $3.8 billion year-over-year, contrasting with a 4.5% increase for the S&P 500 [5][6]. Profitability Metrics - PPG's profit margins are less favorable compared to most companies in the Trefis coverage universe, with a price-to-sales (P/S) ratio of 1.7 versus 3.1 for the S&P 500, and a price-to-free cash flow (P/FCF) ratio of 30.9 compared to 20.3 for the S&P 500 [7][8]. Operating Performance - The company's operating income over the last four quarters was $2.2 billion, resulting in an operating margin of 14.8%, which is lower than the S&P 500's 18.3% [8]. Financial Stability - PPG Industries has a moderate debt-to-equity ratio of 32.5%, with total debt of $7.9 billion against a market capitalization of $24 billion, indicating a decent balance sheet [9]. Downturn Resilience - PPG stock has underperformed the S&P 500 during recent downturns, including a 40.5% drop during the inflation shock of 2022, compared to a 25.4% decline for the S&P 500 [10][11]. Overall Performance Assessment - The overall performance of PPG Industries is categorized as very weak across growth, profitability, downturn resilience, and financial stability metrics, leading to the conclusion that it is a poor investment choice at this time [15].

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Unaudited statements show decreased net sales and net income for Q2 2025 compared to the prior year [Condensed Consolidated Statement of Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Income) Net sales and net income declined in the second quarter and first half of 2025 versus 2024 Condensed Consolidated Statement of Income (Unaudited) | ($ in millions, except per share) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $4,195 | $4,235 | $7,879 | $8,084 | | Income before income taxes | $598 | $651 | $1,100 | $1,193 | | **Net income (attributable to PPG)** | **$450** | **$528** | **$823** | **$928** | | **Earnings per common share - assuming dilution** | **$1.98** | **$2.24** | **$3.60** | **$3.93** | [Condensed Consolidated Balance Sheet](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) Total assets, liabilities, and shareholders' equity all increased as of June 30, 2025 Condensed Consolidated Balance Sheet (Unaudited) | ($ in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $8,190 | $6,557 | | **Total assets** | **$22,099** | **$19,433** | | **Total current liabilities** | $5,762 | $5,014 | | **Total liabilities** | **$14,355** | **$12,471** | | **Total PPG shareholders' equity** | **$7,577** | **$6,785** | [Condensed Consolidated Statement of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Cash from operations increased slightly, while proceeds from debt issuance drove a positive financing cash flow Condensed Consolidated Statement of Cash Flows (Unaudited) | ($ in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Cash from operating activities** | **$369** | **$305** | | Cash used for investing activities | ($288) | ($370) | | Cash from/(used for) financing activities | $37 | ($185) | | **Net increase/(decrease) in cash and cash equivalents** | **$291** | **($378)** | | Cash and cash equivalents, end of period | $1,561 | $1,115 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail divestitures, restructuring, new debt issuance, and a revised segment reporting structure - In December 2024, PPG completed the sale of its architectural coatings business in the U.S. and Canada, now presented as **discontinued operations**[23](index=23&type=chunk)[29](index=29&type=chunk) - The company completed the sale of its remaining Russian business in Q1 2025, following a **$146 million impairment charge** in Q4 2024[31](index=31&type=chunk) - In March 2025, PPG issued **€900 million in 3.250% Notes due 2032** and repaid **€300 million** of maturing notes in June 2025[45](index=45&type=chunk)[46](index=46&type=chunk) - Effective December 31, 2024, the company revised its reportable business segments to three: **Global Architectural Coatings, Performance Coatings, and Industrial Coatings**[113](index=113&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes a 1% Q2 sales decrease to divestitures, which offset volume and price gains [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Q2 net sales decreased slightly due to divestitures, while adjusted EPS fell 5.5% from the prior year Q2 2025 vs Q2 2024 Performance | ($ in millions) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | **Net sales** | $4,195 | $4,235 | (0.9)% | | Income before income taxes | $598 | $651 | (8.1)% | - Q2 2025 net sales change was driven by: **Divestiture-related sales (-3%)**, **higher selling prices (+1%)**, and **higher sales volumes (+1%)**[131](index=131&type=chunk)[134](index=134&type=chunk) Adjusted Earnings Per Diluted Share | | Three Months Ended June 30 | Six Months Ended June 30 | | :--- | :--- | :--- | | **2025** | $2.22 | $3.93 | | **2024** | $2.35 | $4.22 | | **% Change** | (5.5)% | (6.9)% | [Performance of Reportable Business Segments](index=34&type=section&id=Performance%20of%20Reportable%20Business%20Segments) Performance Coatings sales grew, while Global Architectural and Industrial Coatings sales declined in Q2 Q2 2025 Segment Performance vs Q2 2024 | Segment | Net Sales ($M) | % Change | Segment Income ($M) | % Change | | :--- | :--- | :--- | :--- | :--- | | **Global Architectural Coatings** | $1,018 | (4.9)% | $160 | (24.2)% | | **Performance Coatings** | $1,512 | 6.6% | $356 | 9.2% | | **Industrial Coatings** | $1,665 | (4.7)% | $227 | (12.4)% | - Performance Coatings growth was led by a **high single-digit increase in aerospace coatings** and a **double-digit increase in protective and marine coatings**[160](index=160&type=chunk)[161](index=161&type=chunk) - Industrial Coatings decline was driven by the divestiture of the global silicas business and lower automotive OEM coatings sales, partially offset by **high single-digit growth in packaging coatings**[170](index=170&type=chunk)[174](index=174&type=chunk)[175](index=175&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $1.6 billion in cash and projects capital spending up to $775 million - Cash and short-term investments totaled **$1.6 billion** at June 30, 2025[182](index=182&type=chunk) - Cash from operating activities for the first six months of 2025 was **$371 million**, up from $348 million in the prior year[183](index=183&type=chunk) - Total capital spending for 2025 is expected to be approximately **$725 million to $775 million**[187](index=187&type=chunk) - The company expects restructuring savings of approximately **$75 million in 2025**, with related cash outlays of about **$125 million**[194](index=194&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages foreign currency and interest rate risks using derivative instruments - The company is exposed to foreign currency transaction and translation risk; a hypothetical adverse change in exchange rates could reduce pre-tax income by **$495 million** as of June 30, 2025[207](index=207&type=chunk) - PPG manages interest rate risk by balancing fixed and variable rate debt, with interest rate swaps converting **$375 million** of fixed-rate debt to variable-rate[210](index=210&type=chunk) - A **10% increase in interest rates** would increase annual interest expense on variable rate debt by **$3 million**[210](index=210&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal controls over financial reporting were effective - Management concluded that the company's **disclosure controls and procedures are effective** as of the end of the reporting period[212](index=212&type=chunk) - **No material changes** to the company's internal control over financial reporting occurred during the second quarter of 2025[214](index=214&type=chunk) [Part II. Other Information](index=43&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) PPG is managing litigation related to a divested business and asbestos claims, believing its risk is remote - PPG is in a legal dispute with Westlake Corporation regarding the 'Di Gregório litigation', for which liability was transferred to a Westlake predecessor in 2013; a Brazilian court has entered an award against PPG, which could be between **$350 million and $700 million**[219](index=219&type=chunk)[220](index=220&type=chunk)[221](index=221&type=chunk) - PPG has filed a lawsuit against Westlake in Delaware to enforce Westlake's obligations to cover the award and all related costs; a decision is expected in Q3 2025 and PPG believes its **risk of loss is remote**[223](index=223&type=chunk)[224](index=224&type=chunk) - The company continues to be a defendant in lawsuits involving claims of personal injury from **asbestos exposure**[225](index=225&type=chunk) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors were reported since the 2024 Annual Report - **No material changes** in the Company's risk factors were reported compared to the 2024 Form 10-K[226](index=226&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased over 1.3 million shares of its common stock during the second quarter of 2025 Issuer Purchases of Equity Securities (Q2 2025) | Month | Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | — | $— | | May 2025 | 656,169 | $111.37 | | June 2025 | 689,305 | $111.60 | | **Total** | **1,345,474** | **$111.48** | - The board of directors authorized an additional **$2.5 billion for share repurchases** in April 2024, with no expiration date[227](index=227&type=chunk) [Other Information](index=45&type=section&id=Item%205.%20Other%20Information) The Chief Financial Officer adopted a Rule 10b5-1 trading plan in May 2025 - On May 2, 2025, CFO Vincent J. Morales adopted a **Rule 10b5-1 trading plan** for the potential sale of up to **34,872 shares** of common stock upon exercise of stock options[228](index=228&type=chunk) [Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the report, including officer certifications and XBRL data - Exhibits filed include **CEO and CFO certifications** pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[233](index=233&type=chunk) - The filing includes financial statements and notes formatted in **Inline XBRL**[235](index=235&type=chunk)

Core Insights - PPG Industries, Inc. reported a second-quarter 2025 profit of $450 million or $1.98 per share, a decrease from $493 million or $2.09 per share in the same quarter last year [1] - Adjusted earnings per share for the quarter were $2.22, down from $2.35 year-over-year, meeting the Zacks Consensus Estimate [1] - Revenues for the quarter were $4,195 million, a 1% decline year-over-year, but exceeded the Zacks Consensus Estimate of $4,131.6 million [1] Segment Review - The Global Architectural Coatings segment experienced a 5% year-over-year decline in sales to $1,018 million, surpassing estimates of $1,002.6 million, primarily due to the divestiture of the architectural coatings business in Russia and lower sales volumes, partially offset by higher selling prices [2] - The Performance Coatings segment saw a 7% year-over-year increase in sales to $1,512 million, exceeding estimates of $1,439.3 million, driven by a 6% rise in organic sales along with increases in selling prices and volume [3] - The Industrial Coatings segment's sales declined 5% year-over-year to $1,665 million, surpassing estimates of $1,632.2 million, mainly due to the divestiture of the silicas products business in late 2024 [4] Financials - As of the end of the quarter, the company had $1,561 million in cash and cash equivalents, with net debt increasing to $5.7 billion, up $479 million from the prior-year quarter [5] Outlook - The company maintained its full-year 2025 adjusted earnings per share guidance of $7.75 to $8.05, supported by continued share gains and internal improvement initiatives, while considering current global economic conditions and varied demand trends [6] Price Performance - PPG shares have declined by 11.6% over the past year, compared to a 3.3% decline in its industry [7]