PPG Q3 2025 Earnings: A Deep Dive into Segment Performance

PPG Industries, a global leader in paints, coatings, and specialty materials, recently filed its financial results for the third quarter of 2025. This report offers a detailed look into the company's performance amidst a shifting economic landscape. Let's break down the key figures from their latest 10-Q filing to see what's driving their business.

A Modest Rise in Sales, but a Dip in Profit

For the three months ended September 30, 2025, PPG reported net sales of $4.08 billion, a slight 1.2% increase from the $4.03 billion recorded in the same period last year. This growth was a mixed bag, driven by:

• Favorable foreign currency translation (+2%)
• Higher selling prices (+1%)
• Increased sales volumes (+1%)

However, these gains were partially offset by a 3% negative impact from recent divestitures, indicating that organic growth was stronger than the headline number suggests.

Despite the rise in sales, net income attributable to PPG fell slightly to $453 million from $468 million in Q3 2024. This resulted in diluted earnings per share remaining flat at $2.00 for the quarter.

The following flow diagram visualizes how PPG's quarterly revenue was transformed into profit after accounting for various costs and expenses.

Segment Performance Highlights

PPG operates through three main business segments, and their individual performances reveal where the company is finding strength and facing challenges.

• Industrial Coatings: As the largest segment with $1.66 billion in sales, its revenue remained virtually flat compared to the prior year. Higher sales volumes were offset by the impact of divestitures and slightly lower selling prices. The real story here is profitability: segment income surged 16.5% to $233 million. This suggests successful cost control and an improved product mix, allowing the division to expand margins even without top-line growth.

• Performance Coatings: This segment, with sales of $1.41 billion, saw a 3% revenue increase driven by higher prices. However, its segment income dropped by 11% to $272 million. The company attributes this decline primarily to lower sales volumes in the automotive refinish business, highlighting margin pressure in a key market.

• Global Architectural Coatings: This segment, which includes paint for residential and commercial buildings, reported a modest 0.8% sales increase to $1.01 billion, with segment income holding steady at $184 million. The growth was primarily due to favorable currency effects and price hikes, which masked lower sales volumes.

Capital Strategy and Restructuring

PPG continues to actively manage its capital and streamline its operations. During the quarter, the company repurchased $152 million of its stock, returning capital to shareholders.

The company is also in the midst of restructuring efforts, which incurred $11 million in costs this quarter. While these actions create short-term expenses, they are designed to improve long-term efficiency and profitability. PPG maintains a strong liquidity position, ending the quarter with $1.9 billion in cash and short-term investments.

In conclusion, PPG's third-quarter results paint a picture of a resilient company navigating a complex global market. While the headline numbers are stable, the segment-level details show a divergence in performance. The impressive margin expansion in Industrial Coatings is a significant positive, but it was counterbalanced by profitability challenges in the Performance Coatings segment. As the company continues its restructuring and manages its portfolio through divestitures, investors will be watching to see if it can translate operational efficiencies into consistent, broad-based earnings growth.