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- **Q3 Financial Resilience**: Adjusted EPS of $0.70 maintained despite 8.5% revenue decline, driven by $40M productivity savings and 60bp margin expansion.
- **Segment Growth**: Defense, healthcare, and telecom grew high single-digits, offsetting consumer and packaging weakness.
- **2026 Strategy**: SEM innovation to drive growth, with cautious optimism for low single-digit Q4 sales recovery in defense/energy.
- **Risk Management**: $150M debt reduction and 2.5x debt target to strengthen balance sheet amid macro uncertainty.

**【CEO Summary Section】**
- Q3 adjusted EPS of $0.70, in line with expectations, despite 8.5% YoY revenue decline due to weaker-than-anticipated sales.
- Organic revenue growth of 4.1% year-to-date, driven by 7.7% adjusted EPS growth, supported by $40 million in productivity savings.
- Defense, healthcare, and telecommunications segments grew high single-digits, offsetting declines in consumer, packaging, and industrial markets.
- Gross margin expansion of 60 basis points to 16.5% through cost containment and portfolio prioritization.
- Cautious optimism for Q4, with potential for low single-digit sales growth in defense and energy, but risks from U.S. government shutdown and global macro uncertainty.

**【CFO Financial Commentary】**
- GAAP net income of $420 million, Non-GAAP EPS of $1.08, exceeding expectations.
- Adjusted EBITDA of $540-$550 million for the year, with $190-$210 million free cash flow.
- Debt reduction of $150 million year-to-date, targeting 2.5x net debt/EBITDA by mid-2026.
- Cost control initiatives, including Lean Six Sigma and plant footprint optimization, driving 40 basis points of margin expansion.

**【Q&A Key Highlights】**
- **Consumer Recovery**: September saw 1% YoY growth in consumer sales, driven by staples and SEM demand, but Q4 outlook remains cautious.
- **Packaging Trends**: Asia packaging growth (+1%) offset EMEA and U.S. declines, with semiconductor-driven demand in Asia.
- **Defense & Healthcare Growth**: SEM segment expected to grow in Q4, supported by new Dyneema products and defense spending.
- **Competitive Intensity**: Color business facing overcapacity, but margin expansion through solution-based sales and innovation.
- **2026 Outlook**: SEM growth to offset CAI headwinds, with productivity initiatives to mitigate wage inflation risks.

Avient Corporation (AVNT) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

AVNT

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