Axalta Coating Systems Ltd. announces its financial results for the third quarter ended Sept. 30, 2025.

Third Quarter 2025 Highlights:

• Third quarter net sales of approximately $1.3 billion

• Net income of $110 million with a net income margin of 8.5%, an increase of 80 basis points year over year

• Record quarter for adjusted EBITDA of $294 million

• Adjusted EBITDA margin expanded 70 basis points year over year to 22.8%

• Diluted EPS increased 11% to $0.51

• Record quarter for adjusted diluted EPS of $0.67, an increase of 6%

“We executed another strong quarter delivering record adjusted EBITDA and adjusted diluted EPS. Our results reflect our focus on operational excellence while the team has done an exceptional job navigating the challenging macroeconomic environment,” said Chris Villavarayan, CEO and president of Axalta. “We have now delivered 12 consecutive quarters of adjusted EBITDA and adjusted EBITDA margin growth year-over-year and are well prepared for 2026.”

Third Quarter 2025 Consolidated Financial Results

Net sales decreased 2% year over year to $1.3 billion in the third quarter of 2025. Favorable foreign currency translation and organic net sales in Mobility partially offset declines in Performance Coatings, primarily in North America.

Net income increased by $8 million year over year to $110 million, resulting in a net income margin of 8.5%, an increase of 80 basis points compared to last year. The increase was primarily driven by a 7% reduction in selling, general, and administrative expenses and lower interest expense.

Adjusted net income was $144 million, compared to $139 million in the prior-year period. Adjusted EBITDA was a new quarterly record of $294 million, an increase of $3 million year over year, and adjusted EBITDA margin expanded by 70 basis points year over year to 22.8%.

Diluted EPS increased by 11% to $0.51 compared to $0.46 in the prior-year period, while adjusted diluted EPS improved by 6% to $0.67, primarily due to lower interest expense and a reduction in the number of shares outstanding.

Cash provided by operating activities was $137 million in the third quarter of 2025 compared to $194 million in the prior-year period. The decrease was primarily driven by higher working capital due to an increase in planned inventory levels this year. Free cash flow was $89 million compared to $164 million a year ago, reflecting lower cash provided by operating activities and higher capital expenditures for productivity and growth initiatives.

Discussion of Segment Results

Performance Coatings’ net sales totaled $828 million in the third quarter of 2025, down from $877 million in the prior-year period. Continued macroeconomic pressures in North America were partially mitigated by positive price-mix in Industrial and favorable foreign currency translation.

Refinish net sales declined 7% year over year to $517 million, predominantly driven by North America due to lower claims activity and shifts in customer order patterns. Industrial net sales decreased by 4% year over year to $311 million.

The Performance Coatings segment generated adjusted EBITDA of $211 million, down from $221 million in the prior-year period. Despite the decline in net sales, segment Adjusted EBITDA margin increased to 25.5%, representing a 20 basis point improvement year over year, underscoring resilient profitability amid softer demand.

Mobility Coatings third quarter 2025 net sales were $460 million, a third quarter record, increasing 4% from the prior year primarily due to positive price-mix in both end markets and favorable foreign currency translation, partially offset by volume softness.

Light Vehicle net sales were up 7% year over year due to organic net sales growth in Latin America and China and positive price mix. Commercial Vehicle net sales decreased by $7 million year over year to $96 million due to lower volumes primarily driven by a decline in Class 8 truck production, partially mitigated by new business wins, positive price-mix and favorable foreign currency translation.

Mobility Coatings posted strong third-quarter profitability, with adjusted EBITDA of $83 million, up 20% compared to the prior-year period. The segment’s adjusted EBITDA margin improved by 230 basis points to 18.0%, driven by a favorable price-mix and continued focus on cost discipline, marking another quarter of solid operational execution.