PPG Industries 2025-26: Adj EPS $7.58, Aerospace Record, $50M Costs
FY25 revenue $15.88B (+0%, +2% organic); op income $2.17B (-5%); NI $1.58B (+41%); EPS $6.92. Adj EPS $7.58. Q4 +5% net sales / +3% organic. Aerospace + Protective & Marine + Packaging double-digit organic. Architectural Coatings +8% Q4 (+2% organic). Industrial +5% Q4 organic. Cash from ops $1.9B (+$500M YoY). $1.4B returned. FY26: organic flat to LSD; EPS flat to LSD H1 / HSD H2; $50M cost reduction.
Key takeaways
- Aerospace + Marine + Packaging double-digit growth. Q4 aerospace at record levels; protective & marine 11 consecutive quarters of volume growth; packaging double-digit organic. The structural growth engines compounding.
- Architectural Coatings Q4 +8% net sales / +2% organic. Latin America driving (Mexico high single-digit organic). EMEA + N America strong. EBITDA margin +nearly 100bp Q4. Margin recovery underway.
- Cash from ops $1.9B (+$500M YoY). $1.4B returned to shareholders ($790M buyback + $628M dividends). Operating cash flow inflection. $2.2B cash + $5.1B net debt year-end.
- Capex moderating; $780M FY25; pacing back to historical levels by 2027. Heavy capex cycle complete; FY26+ moderating. Operating leverage tailwind.
- FY26 organic sales flat to LSD; EPS flat to LSD H1 / HSD H2. $50M additional cost reduction FY26; $100M industrial coatings share gains. Conservative H1 / accelerating H2.
Business
PPG Industries is the global #1 paints + coatings + specialty materials company. Three reportable segments:
- Industrial Coatings (~40% of revenue). Automotive OEM + packaging + general industrial. Q4 +3% net sales / +5% organic volume. Auto OEM +6%; packaging double-digit organic. Q4 EBITDA +6%, margin +30bp. FY26 expecting share gains $100M.
- Performance Coatings (~33%). Aerospace + automotive refinish + protective & marine + traffic solutions. Q4 +5% / aerospace double-digit + protective & marine 11 consecutive quarters of volume growth. Refinish HSD organic decrease (distributor order patterns).
- Global Architectural Coatings (~27%). Q4 +8% net sales / +2% organic. Latin America HSD organic growth. EMEA + Eastern Europe strong. EBITDA margin +100bp Q4.
Strategic moves FY25:
- $790M buyback executed ($150M+ Q3)
- 4% dividend increase
- $50M operational excellence cost reduction (FY26)
- $100M industrial coatings share gains target FY26
- Aerospace Q4 record
- Protective & marine 11 consecutive quarters volume growth
FY25 financial performance
| Metric (FY) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue ($B) | 15.61 | 16.24 | 15.85 | 15.88 |
| Revenue YoY | n/a | +4% | -2% | 0% |
| Op income ($B) | 1.67 | 2.04 | 2.29 | 2.17 |
| Op margin | 10.7% | 12.5% | 14.4% | 13.7% |
| Net income ($B) | 1.03 | 1.27 | 1.12 | 1.58 |
| Diluted EPS ($) | 4.32 | 5.35 | 4.75 | 6.92 |
| Adj EPS ($) | n/a | n/a | ~$7.65 | 7.58 |
| FCF ($B) | 0.48 | 1.90 | 0.70 | 1.16 |
| Capex ($M) | -486 | -516 | -721 | -778 |
| Total debt ($B) | 7.64 | 6.60 | 6.40 | 7.45 |
| Dividends ($M) | -570 | -598 | -622 | -628 |
| Buyback ($M) | -190 | -86 | -752 | -790 |
The earnings progression: revenue flat YoY (FY24-25); op margin moderated to 13.7%; EPS $6.92 GAAP / adj EPS $7.58. Cash from operations $1.9B (+$500M YoY) the cleanest cash flow signal. Total debt $7.45B (+16% YoY) reflects buyback + capex.
Capital allocation
- Capex: $-778M FY25 (5% of revenue). Pacing back to historical levels by 2027.
- Dividends: $-628M FY25 (+1% YoY); 4% Q2 increase.
- Buybacks: $-790M FY25 (+5%).
- M&A: Selective.
- Debt: $7.45B (+16% YoY).
- Cash: $2.2B year-end.
- Net debt: $5.1B.
- FCF: $1.16B (+66%).
FY26 outlook (per Q4 2025 call, 2026-01-28)
| FY26 framework | Detail |
|---|---|
| Organic sales growth | Flat to LSD (positive) |
| EPS H1 | Flat to LSD |
| EPS H2 | HSD |
| Pricing | Positive in Performance + Architectural; flat in Industrial |
| Volume growth | Aerospace + PMC + Packaging; modest Architectural / Auto OEM |
| Cost reduction | $50M additional |
| Capex | Moderating |
The FY26 H1/H2 acceleration reflects volume recovery + cost benefits coming through.
Key risks
- Macroeconomic uncertainties. End markets mixed; Industrial demand softness in some regions.
- Refinish destocking. Affecting margins H1 FY26 due to distributor order patterns.
- Raw material costs. Tariffs affecting epoxy, specialty pigments, metal packaging. Raw material basket favorable overall.
- Tariff uncertainties. Industrial demand + customer confidence in some regions.
- Architectural Coatings cyclicality. Latin America growing but Europe + North America weather-dependent.
- Refinish market normalization. Q3 noted taking longer than expected.
Bottom line
PPG FY25 is the diversified paints + coatings cycle compounding year: revenue flat / +2% organic, adj EPS $7.58, aerospace record, protective & marine 11 consecutive quarters of growth, packaging double-digit, architectural margin recovery. FY26 guide of flat-to-LSD organic + flat-to-LSD EPS H1 / HSD H2 + $50M cost reduction reflects continued execution. Risks are macro / refinish destocking / tariffs / architectural cyclicality. Quality global paints + coatings compounder mid-cycle.
Citations
- PPG Industries, Inc. FY25 Form 10-K (filed February 2026, SEC EDGAR).
- PPG Q4 2025 earnings call, 2026-01-28 — FY revenue $15.9B / +2% organic; adj EPS $7.58; aerospace record; cash from ops $1.9B (+$500M); $1.4B returned; FY26 guide (flat-to-LSD organic, EPS flat-to-LSD H1 / HSD H2, $50M cost reduction).
- PPG Q3 2025 earnings call, 2025-10-29 — record Q3 EPS; FY guide $7.60-$7.70.
- PPG Q2 2025 earnings call, 2025-07-30 — record Performance Coatings; FY guide reiterated $7.75-$8.05; +6% organic Performance Coatings.
- PPG Q1 2025 earnings call, 2025-04-30 — Q1 adj EPS $1.72; FY guide $7.75-$8.05.
- Internal financial_statements view (consolidated annual + cash flow + capital structure).