Celanese 2025 Q3 Earnings Massive Net Loss of $1.35B -1256% YoY

Celanese (CE) reported a sharp decline in profitability for Q3 2025, swinging to a $1.35 billion net loss (-1256.4% YoY) and a $12.39 EPS loss (-1302.9% YoY). The company provided 2026 guidance targeting $1–$2 EPS growth, driven by cost discipline and EM pipeline progress, while acknowledging near-term demand challenges.

Revenue

Celanese’s Q3 revenue fell 8.6% to $2.42 billion, driven by weaker demand in acetyl and engineered materials. Engineered Materials led with $1.38 billion in revenue, followed by the Acetyl Chain segment contributing $1.06 billion. Other activities showed no contribution, while intersegment eliminations reduced total revenue by $26 million. Consolidated results reflect a $2.42 billion total, down from $2.65 billion in 2024 Q3.

Earnings/Net Income

The company swung to a $12.39 per-share loss in Q3 2025, a dramatic shift from $1.03 profit in 2024 Q3. Net income deteriorated to -$1.35 billion (-1256.4% YoY), highlighting operational and market challenges. The sharp decline in EPS and net income underscores significant challenges, contrasting with the CEO’s optimistic outlook for 2026.

Post-Earnings Price Action Review

Celanese’s stock price surged 9.0% post-earnings, defying weak financial results, as investors focused on 2026 guidance and cost-reduction initiatives. The stock climbed 5.33% in the latest trading day, 7.44% for the week, and -3.12% month-to-date. Despite a $1.35 billion loss, market optimism centered on strategic moves like the Lanaken facility closure and Micromax divestiture, which are expected to improve margins and free cash flow.

CEO Commentary

Scott Richardson emphasized cost discipline and EM pipeline progress, targeting $1–$2 EPS growth in 2026. He highlighted $0.40–$0.50 in cost savings and EM volume recovery in high-performance sectors. Challenges include flattish demand in Europe and weaker acetyl markets, but leadership remains cautiously optimistic about long-term strategic execution.

Guidance

Celanese outlined 2026 targets: $1–$2 EPS growth (half from cost actions, half from EM innovation), $700–800 million free cash flow, and $30–40 million lower interest expenses. The company confirmed $1 billion in divestitures by 2027, with Micromax proceeds accelerating deleveraging. Richardson expects demand stability, leveraging low-cost asset utilization and EM growth in EVs and data centers.

Additional News

1. M&A Activity: Celanese sold its Micromax electronics materials business for $500 million, accelerating deleveraging and portfolio optimization.

2. C-Level Changes: CEO Scott Richardson reiterated 2026 priorities, focusing on $1–$2 EPS growth via cost actions and EM innovation.

3. Facility Closure: The company announced the closure of its Lanaken acetate tow facility by 2026, projected to yield $20–30 million in productivity savings by 2027.

Financial Health

Celanese’s Altman Z-Score of 1.29 signals financial distress, with a -16.3% net margin and 2.52 debt-to-equity ratio. However, liquidity remains adequate (current ratio: 2.05), and free cash flow of $375 million in Q3 supports near-term obligations.

Risks

• Sector Volatility: Regulatory changes and raw material price swings in the chemicals industry.

• Debt Load: High leverage (debt-to-equity: 2.52) despite deleveraging efforts.

• Demand Uncertainty: Flattish demand in Europe and weaker acetyl markets may delay recovery.

Valuation

Celanese’s P/S (0.41) and P/B (0.75) ratios near 10-year lows suggest undervaluation. Analysts project a $54.65 fair value, implying a 49% upside from current levels.

Conclusion

Celanese’s Q3 results reflect severe short-term challenges, but 2026 guidance and strategic cost actions position the company for potential recovery. Investors must weigh near-term risks against long-term operational improvements and market leadership in high-growth EM segments.