prodchem
Aug 10, 2026
Michigan-based Dow delivered a significantly stronger second-quarter performance in 2026, combining higher selling prices, improved margins and aggressive cost-reduction measures to strengthen its financial position.
The results came shortly after Karen S. Carter became Dow’s Chief Executive Officer on July 1, 2026, succeeding Jim Fitterling, who moved into the role of Executive Chair. Carter previously served as Dow’s Chief Operating Officer and has been with the company since 1994.
Dow reported Q2 net sales of $12.1 billion, up 20% year over year, while operating EPS reached $1.44, compared with a loss of $0.42 in Q2 2025. Operating EBIT increased to $1.6 billion from a loss of $21 million a year earlier.
The strong quarter provides an encouraging starting point for Carter's tenure, although Dow continues to operate in a challenging global chemical market.
Dow's second-quarter financial performance improved substantially compared with the same period last year.
The company reported:
Net sales: $12.1 billion
Operating EBIT: $1.6 billion
Operating EBITDA: $2.3 billion
Operating EPS: $1.44
GAAP net income: $802 million
Operating cash flow: $1.3 billion
Net sales increased by approximately $2 billion year over year, supported primarily by higher prices across all operating segments and regions. Local pricing increased 20%, while currency provided another 1% benefit. Volumes declined 1%.
The improvement was especially significant because Dow reported an operating loss in the comparable quarter of 2025.
Packaging & Specialty Plastics was the strongest contributor to Dow's Q2 performance.
The segment generated $6.4 billion in sales, an increase of 27% from Q2 2025. Local prices increased 30%, primarily because polyethylene prices were higher across all regions.
Operating EBIT increased to $1.28 billion, compared with $71 million in the year-ago quarter.
Higher polyethylene prices were the primary driver, although volumes declined 4%.
The results demonstrate how quickly producer profitability can improve when polymer pricing strengthens, even when physical demand remains uneven.
For polyethylene buyers, however, the same pricing strength translates into higher procurement costs and increased pressure on packaging margins.
Dow's Industrial Intermediates & Infrastructure segment reported $3.2 billion in sales, up 14% year over year.
Local pricing increased 15%, while volumes declined 2%. Operating EBIT reached $246 million, compared with a loss of $185 million in Q2 2025.
Higher margins, cost-saving measures and lower planned maintenance activity contributed to the improvement.
Industrial Solutions also benefited from increased demand related to data center applications, demonstrating how emerging infrastructure investment is creating new pockets of chemical demand even while traditional industrial markets remain uncertain.
Performance Materials & Coatings generated $2.36 billion in Q2 sales, an 11% increase year over year.
Unlike the other major segments, however, its operating EBIT declined to $133 million, compared with $152 million in Q2 2025.
Volumes increased 6%, driven by stronger demand for downstream silicones, particularly in consumer, electronics and home-care applications.
However, higher fixed costs, turnaround activity and the shutdown of Dow's Barry, UK upstream siloxanes plant weighed on profitability.
This illustrates that stronger sales volumes do not automatically translate into higher earnings when operating costs are increasing.
Karen Carter's arrival as CEO comes at a critical point for Dow.
The company is continuing its "Transform to Outperform" program, which focuses on simplifying operations, improving productivity and creating a leaner cost structure.
Dow now expects the program to deliver approximately $200 million more in benefits during 2026, bringing total in-year self-help benefits to more than $1.3 billion.
For Carter, the challenge will be to maintain this cost discipline while also investing in growth markets and strengthening Dow's portfolio.
Her previous experience as COO provides continuity because she was already closely involved in Dow's operational transformation before becoming CEO.
Dow's strong Q2 results cannot be separated from the geopolitical environment.
Disruptions associated with the Middle East conflict and the Strait of Hormuz affected global oil and petrochemical flows, tightening supplies and contributing to higher prices for plastics and polymers.
For producers such as Dow, tighter supply can support selling prices.
For chemical buyers, however, the situation creates additional uncertainty around:
Polymer availability
Feedstock costs
Freight rates
Delivery schedules
Regional price differences
Inventory requirements
This makes procurement planning more difficult, particularly for companies dependent on imported polymers and petrochemical feedstocks.
Dow's Q2 performance provides several important signals for procurement teams.
The 30% year-over-year local price increase in Packaging & Specialty Plastics demonstrates the strength of polyethylene pricing during Q2.
Buyers should monitor regional PE benchmarks rather than relying solely on historical contract prices.
Dow's results show that producers can generate stronger financial performance even when volumes decline if pricing and margins improve.
Therefore, weaker demand does not necessarily guarantee lower chemical prices.
Dow's productivity program is designed to improve competitiveness and offset market pressures.
Procurement teams should monitor whether future efficiency gains translate into greater pricing flexibility or simply support producer margins.
Geopolitical disruptions demonstrate the importance of comparing suppliers across multiple regions.
Buyers should evaluate North American, European, Middle Eastern and Asian supply options based on total landed cost and reliability.
Dow expects the benefits of its transformation program to increase throughout the remainder of 2026 and into 2027.
At the same time, the company expects some Q3 pressure from June price declines in the Americas, higher maintenance activity at US Gulf Coast facilities, and seasonal weakness in coatings and construction markets. These factors are expected to be partially offset by approximately $130 million of cost-program support.
The company therefore enters the second half of the year with stronger earnings momentum but continued exposure to geopolitical and market volatility.
Dow's Q2 2026 results represent a significant improvement from the previous year and provide an encouraging opening quarter for new CEO Karen S. Carter.
The company's $12.1 billion in sales, stronger polyethylene pricing, improved operating earnings and more than $1.3 billion of expected 2026 self-help benefits demonstrate the impact of pricing discipline and cost reduction.
For chemical procurement teams, the results highlight a more complex market environment. Higher producer prices can coexist with weak volumes, while geopolitical disruptions can simultaneously affect feedstocks, freight and availability.
As Dow moves forward under new leadership, buyers should closely monitor polyethylene pricing, regional supply conditions, producer cost initiatives and Middle East-related logistics risks.
The key procurement lesson is clear: supplier performance and market conditions must be evaluated together to understand the true direction of chemical costs.
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