PPG Industries 2025 Q2 Earnings Misses Targets as Net Income Falls 14.7%

PPG Industries reported its fiscal 2025 Q2 earnings on July 29th, 2025. The company's revenue and net income were below expectations. Revenue declined by 0.9% to $4.20 billion from $4.24 billion in 2024 Q2. The company reaffirmed its full-year adjusted earnings per share guidance range of $7.75 to $8.05, indicating strong anticipated year-over-year earnings growth. However, PPG's adjusted earnings per share of $2.22 missed analyst expectations. Despite the revenue and profit miss, PPG maintained its full-year guidance, reflecting confidence in its growth strategies and operational resilience amidst global economic challenges.

Revenue

PPG Industries experienced a revenue decline of 0.9% in the second quarter of 2025, with total revenue reaching $4.20 billion, down from $4.24 billion in the same quarter of the previous year. The Global Architectural Coatings segment contributed $1.02 billion, while the Performance Coatings segment reported $1.51 billion. Additionally, the Industrial Coatings segment generated $1.67 billion, contributing to the overall revenue figure.

Earnings/Net Income

PPG Industries saw a decline in its earnings per share (EPS) by 12.0%, dropping to $1.98 in 2025 Q2 from $2.25 in 2024 Q2. The company's net income also fell by 14.7%, totaling $458 million in 2025 Q2 compared to $537 million in the same period the previous year. The disappointing EPS reflects challenges in meeting market expectations.

Price Action

Post-Earnings Price Action Review

The investment strategy of purchasing PPG shares following an earnings beat and holding for 30 days yielded moderate returns, yet it underperformed the broader market. This approach resulted in a 12.53% return, significantly lower than the benchmark return of 87.35%. The strategy's Sharpe ratio stood at a low 0.09, indicating modest risk-adjusted returns. Despite experiencing a maximum drawdown of 0% and a volatility rate of 27.85%, the strategy presented minimal downside risk but lacked the potential for substantial gains. The outcome highlights the limitations of this earnings-driven strategy in capturing market opportunities and suggests the need for more diversified approaches to improve performance.

CEO Commentary

Guidance

Additional News

In recent weeks, PPG Industries has been involved in discussions about strategic mergers and acquisitions (M&A), focusing on expanding its market presence and enhancing its product offerings. The company is actively exploring potential targets that align with its long-term growth strategy, aiming to strengthen its competitive position in the coatings industry. Additionally, there have been no significant changes in the company's executive leadership, ensuring continuity in its strategic direction. PPG continues to focus on its share repurchase program, reflecting its commitment to returning value to shareholders. These steps underscore PPG's dedication to strategic growth and shareholder engagement amidst a dynamic market environment.