Axalta Coating Systems Ltd. (NYSE:AXTA) reported stronger-than-expected second-quarter results on Tuesday, with earnings and revenue both exceeding Wall Street forecasts as the coatings manufacturer delivered record profitability and healthy cash generation.
Shares of the company rose 2.13% in pre-market trading following the earnings announcement.
Adjusted earnings per share came in at $0.72, comfortably ahead of the analyst consensus of $0.65. Revenue increased 3% year over year to $1.35 billion, beating expectations of $1.31 billion.
Record Profitability Driven by Margin Expansion
Axalta posted record adjusted EBITDA of $305 million during the quarter, representing an adjusted EBITDA margin of 22.7%, an improvement of 30 basis points compared with the same period last year.
“We delivered an excellent second quarter with record Adjusted EBITDA and Adjusted Diluted EPS, expanded margins and strong free cash flow generation demonstrating the earnings power of our business model,” said Chris Villavarayan, Chief Executive Officer and President of Axalta.
Performance Coatings generated revenue of $872 million, up 4% from a year earlier, while Mobility Coatings delivered record quarterly revenue of $474 million, an increase of 1%.
Within the portfolio, Refinish sales rose 6% year over year to $545 million.
Cash Flow Strength Offsets Cautious Quarterly Outlook
Cash generated from operating activities increased 7% to $152 million during the quarter, while free cash flow rose 6% to $107 million.
Looking ahead, Axalta expects adjusted diluted earnings per share of approximately $0.70 for the third quarter of 2026, slightly below the analyst consensus estimate of $0.72.
The company also forecasts third-quarter adjusted EBITDA of between $295 million and $305 million.
Full-Year Guidance Remains Ahead of Expectations
For full-year 2026, Axalta reaffirmed confidence in its outlook, projecting adjusted diluted earnings per share between $2.55 and $2.70. The midpoint of $2.63 is slightly above the analyst consensus estimate of $2.61.
The company expects full-year adjusted EBITDA to range from $1.14 billion to $1.17 billion.
Axalta also reported that its net leverage ratio declined to 2.2x, the lowest level in the company’s history.
Separately, shareholders are scheduled to vote on the proposed merger with AkzoNobel at a special general meeting on August 5.
Axalta Coating Systems stock price
