PPG reported financial results for the fourth quarter and full-year 2025.

Fourth-quarter 2025 net sales were $3.9 billion, with organic sales growth of 3% year over year, due to higher selling prices and sales volume growth in all regions. Reported earnings per diluted share (EPS) were $1.34 and adjusted EPS of $1.51.

Full-year 2025 net sales were $15.9 billion, with organic sales increasing 2% year over year due to higher sales volumes and selling prices. PPG reported EPS of $6.92 and adjusted EPS of $7.58. Segment margin was 17% and segment EBITDA margin was 19%.

Operating cash flow was $1.9 billion, an increase of more than $500 million year over year. Net debt was $5.1 billion, approximately $630 million higher year over year.

Tim Knavish, PPG chairman and chief executive officer, commented on the quarter and year:

“In the fourth quarter, we accelerated our growth momentum by delivering 3% growth in organic sales, our highest performance in any quarter this year, with contributions from sales volume and selling prices, and all regions delivering sales volume growth.

“Results for our Global Architectural Coatings segment improved sequentially each quarter of 2025, with organic sales growth of 2% in the fourth quarter as project-related sales in Mexico recovered sequentially and retail sales were strong. Overall demand in Europe remained mixed.

“Performance Coatings segment organic sales grew 3% in the quarter as strong results in aerospace coatings and protective and marine coatings were partially offset by lower automotive refinish coatings demand, reflecting customer order patterns that were weighted toward the first half of the year. Fourth quarter pricing improved 4% year over year as a result of strong demand for our technology-advantaged products and services.

“Industrial Coatings segment organic sales grew 4% year over year due to share gains. This was evident as we outpaced industry production in automotive original equipment manufacturer (OEM) coatings, industrial coatings, and especially in packaging coatings where we delivered double-digit volume growth in the quarter.

“For the full year, we consistently delivered higher sales volumes and selling prices resulting in 2% organic sales growth. This strong performance was led by double-digit percentage growth in aerospace coatings and protective and marine coatings, and high single-digit percentage growth in packaging coatings. Additionally, our Performance Coatings segment delivered record sales and earnings.

“In 2025, the company’s decisive actions to reduce global structural costs have yielded benefits of $75 million, and we expect incremental restructuring savings of $50 million in 2026 as we execute our European manufacturing consolidation and other structural cost reductions.

“Fourth quarter adjusted EPS was $1.51, and full-year 2025 adjusted EPS was $7.58. During the quarter, we repurchased approximately $100 million of stock and $790 million for the full year, which represented approximately 3% of our outstanding shares. Combined with our dividend, we returned $1.4 billion to our shareholders in 2025. We generated $1.9 billion in operating cash flow during 2025 and ended the year with $2.2 billion of cash and short-term investments, which provides us with ongoing financial flexibility to create increased value for shareholders.

“Looking ahead, I am encouraged by our organic growth momentum and what we will achieve in 2026. We anticipate that demand in Europe and in global industrial end-use markets will remain challenged. Despite the macroeconomic environment, we expect growth will be driven by aerospace coatings and architectural coatings in Mexico as well as share gains in our Industrial Coatings segment, resulting in organic sales growth in the flat to a positive low single-digit percentage range and earnings per share growth of a mid-single-digit percentage for the year. This reflects the strength of our focused organization and our sharpened portfolio of technology-advantaged products and services.

“The meaningful progress we made this year would not be possible without the dedication of our employees. Thank you to our PPG team around the world who make it happen and deliver on our purpose every day: We protect and beautify the world®.”

Global Architectural Coatings segment net sales increased 8% to $951 million compared to the fourth quarter 2024, driven by higher selling prices and favorable foreign currency translation. This was partially offset by the divestiture of PPG’s architectural coatings business in Russia. Sales volume growth in Mexico was offset by declines in Europe.

Organic sales for architectural coatings Latin America and Asia Pacific increased by a high single-digit percentage compared to the prior-year fourth quarter driven by growth in Latin America. Organic sales for architectural coatings EMEA declined by a low single-digit percentage year over year, with higher selling prices more than offset by lower sales volumes. In Mexico, retail sales were strong in the quarter, and project-related sales continued to recover sequentially versus previous quarters this year. The company expects incremental improvements in the Mexican business and governmental project investment in the first quarter 2026.

Segment EBITDA increased by 14% versus the prior year, and segment EBITDA margin increased 90 basis points year over year primarily due to higher selling prices, favorable foreign currency translation driven by the Mexican peso, and cost-control actions partially offset by inflation.

Performance Coatings segment net sales increased 5% to $1,322 million, driven by higher selling prices and favorable foreign currency translation partially offset by lower sales volumes.

Organic sales improved 3% led by growth in aerospace coatings and protective and marine coatings. Aerospace coatings achieved record fourth quarter sales with double-digit percentage organic sales growth, while our order backlog increased to approximately $315 million despite higher year-over-year output. Organic sales in automotive refinish coatings decreased by a high single-digit percentage as sales volumes were lower, reflecting customer order patterns stemming from distributors weighting their purchases to the first half of 2025. Protective and marine coatings organic sales increased by a double-digit percentage compared to the prior year and achieved its 11th consecutive quarter of sales volume growth, including above-market marine sales volume growth in Asia Pacific. Traffic solutions organic sales declined a low single-digit percentage year over year in a seasonally slow quarter.

Segment EBITDA decreased by 4% versus the prior year, and segment EBITDA margin declined 200 basis points year over year to 21.1%, driven by lower automotive refinish coatings sales volumes and higher growth-related investment spending in aerospace coatings and protective and marine coatings partially offset by higher selling prices and improved manufacturing productivity.

Industrial Coatings segment 4Q net sales increased 3% to $1,641 million, compared to the fourth quarter 2024. Sales volumes improved 5%, reflecting the benefits from share gains. The impact of lower selling prices from certain index-based customer contracts was more than offset by favorable foreign currency translation. The divestiture of the silicas products business in late 2024 impacted the year-over-year sales comparison by 3%.

Automotive OEM coatings net sales increased 6% due to above-market sales volume growth as we outpaced the global automotive industry for the second consecutive quarter. Industrial coatings organic sales were flat as sales volume growth in Europe and the Asia-Pacific region offset lower indexed-based pricing. Packaging coatings organic sales increased by a double-digit percentage year over year, driven by technology-advantaged share gains.

Segment EBITDA increased 6%, and segment EBITDA margin improved by 30 basis points compared to the fourth quarter 2024 driven by higher sales volumes and improved productivity, partially offset by lower selling prices due to index-based contracts and the absence of earnings due to the divestiture of the silicas products business.

Full-year 2025 net sales were $15.9 billion, flat versus the prior year, with a 1% increase in sales volumes, a 1% increase in selling prices, and favorable foreign currency translation of 1%, while divestitures reduced net sales by 3%.

In a challenging macro environment, the company delivered adjusted EPS of $7.58, supported by sales of our technology-advantaged products and strong brands, as we delivered record results in several of our businesses, including aerospace coatings, protective and marine coatings, and packaging coatings.

In 2025, the company paid approximately $630 million in dividends. The company repurchased $790 million of stock in 2025 and ended the year with $2 billion remaining on its current share repurchase authorization. Capital expenditures totaled about $780 million.

Outlook

The company anticipates that adjusted earnings per share for the full-year 2026 will be in the range of $7.70 to $8.10, which at the mid-point represents EPS growth of a mid-single-digit percentage. This range is based on current global economic activity and foreign exchange rates, ongoing soft global industrial production, and mixed demand across the various regions where PPG operates.

The company anticipates organic sales to be in the range of flat to low single-digit percentage growth for the full year. EPS growth is expected to be weighted toward the second half of 2026, with the first half of the year flat to low single-digit percentage growth and increasing to high single-digit percentage growth in the second half of the year.