Solstice Advanced Materials (SOLS) Q2 2026 earnings summary

Executive summary

• Achieved strong top and bottom-line results in Q2 2026, with net sales up 11% year-over-year to $1,148 million and double-digit growth in Nuclear, Electronic Materials, Refrigerants, and Healthcare Packaging.

• Net income attributable to shareholders rose 23% to $119 million, with diluted EPS of $0.75 and adjusted diluted EPS of $0.88.

• Demonstrated resilience amid macroeconomic volatility, plant turnarounds, and transition service agreement exits.

• Announced definitive agreement to acquire Element Solutions in a cash-and-stock deal, expected to close in H1 2027, to accelerate growth in electronics, AI infrastructure, and advanced materials.

• Raised full-year 2026 guidance, reflecting robust demand and a resilient, diversified portfolio.

Financial highlights

• Q2 2026 net sales were $1,148 million, up 11% year-over-year; adjusted EBITDA was $290 million (25.3% margin), up 2% year-over-year.

• Net income attributable to shareholders was $119 million (up from $97 million YoY); adjusted diluted EPS was $0.88.

• Operating cash flow for the first half of 2026 was $461 million; free cash flow was $248 million.

• Adjusted EBITDA margin declined to 25.3% from 27.4% due to plant turnaround timing and prior-year credits.

• Capital expenditures for H1 2026 were $186 million (+32–35% YoY), with full-year CapEx guidance of $420–$440 million.

Outlook and guidance

• Raised full-year 2026 guidance: net sales $4,125–$4,185 million, adjusted EBITDA $1,035–$1,055 million, adjusted diluted EPS $2.75–$2.95.

• Q3 2026 net sales expected between $990 million and $1,030 million, with margins expected to remain around 25%.

• Capital expenditures for 2026 projected at $420–$440 million.

• Expects negative revenue impact of ~$30 million in H2 from nuclear product loan returns, skewed toward Q4.

• Element Solutions acquisition expected to close in H1 2027, subject to regulatory and shareholder approvals.