Air Products and Chemicals 2025 Q3 Earnings Strong Performance as Net Income Grows 2%

Air Products and Chemicals (APD) reported its fiscal 2025 Q3 earnings on July 31st, 2025. The company delivered better-than-expected results, exceeding analyst estimates for both EPS and sales. Adjusted EPS of $3.09 surpassed the $2.98 estimate, while sales of $3.02 billion exceeded the forecast of $2.96 billion. Air Products maintained its fiscal 2025 adjusted EPS guidance at $11.90 to $12.10, with the midpoint unchanged at $12. The company remains cautious in its outlook due to global economic uncertainties but reaffirmed its strong fundamentals, particularly in hydrogen and electronics sectors.

Revenue

Air Products and Chemicals experienced a 1.2% increase in total revenue, reaching $3.02 billion in Q3 2025 compared to $2.99 billion in Q3 2024. The on-site segment generated $1.54 billion, while the merchant segment contributed $1.34 billion. The sale of equipment added $142.90 million, collectively driving the total revenue growth.

Earnings/Net Income

Air Products and Chemicals saw its earnings per share (EPS) rise to $3.20 in Q3 2025 from $3.13 in Q3 2024, reflecting a 2.2% increase that underscores continued earnings growth. The company's net income strengthened, growing by 2.0% to $723.20 million from $708.90 million in the same quarter last year. Overall, the EPS performance indicates stable financial health.

Price Action

The stock price of Air Products and Chemicals decreased by 1.59% during the latest trading day, dropped 3.14% over the most recent week, and saw a modest increase of 2.06% month-to-date.

Post-Earnings Price Action Review

The strategy of purchasing APD shares following an earnings beat and holding them for 30 days resulted in no returns, with the strategy yielding a 0.00% return, while the benchmark achieved 9.59%. Despite maintaining a maximum drawdown and Sharpe ratio of 0.00%, the approach did not generate any returns or offer risk-adjusted benefits. This outcome reflects the strategy's inability to capitalize on positive earnings performance, highlighting the challenges in achieving gains through this specific post-earnings approach.

CEO Commentary

Eduardo F. Menezes, CEO & Director, emphasized Air Products' solid fiscal third-quarter performance, with adjusted EPS surpassing guidance. He cited positive base business outcomes amid global heating challenges and outlined a global cost reduction plan expected to yield annual savings of $185 million to $195 million. Menezes expressed confidence in the industrial gas sector, anticipating significant changes through grassroots projects and AI initiatives, while committing to capital discipline and targeting high single-digit adjusted EPS growth through 2030.

Guidance

Air Products has affirmed its fiscal 2025 adjusted EPS guidance at $11.90 to $12.10, maintaining a midpoint of $12. The company anticipates capital expenditures to remain approximately $5 billion for the year, acknowledging global economic uncertainties yet affirming strong project fundamentals, particularly in hydrogen and electronics.

Additional News

In recent developments, Air Products (APD) appointed Matthew Lepore as Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer, enhancing its leadership team. The company declared a quarterly dividend of $1.79 per share, payable on November 10, 2025, showcasing its commitment to shareholder returns. Furthermore, Air Products announced an exit from three U.S. projects, resulting in a pre-tax charge of up to $3.1 billion to streamline its project backlog, reflecting strategic adjustments to its portfolio.