Axalta Coating Systems Ltd., a leading global coatings company, announced its financial results for the fourth quarter and full year ended December 31, 2025.

“We delivered record earnings in 2025, demonstrating the resilience of our business and the successful execution of our 2026 A Plan in the midst of a challenging macro environment,” said Chris Villavarayan, Chief Executive Officer and President of Axalta. “We are building top line momentum, and our 2025 Adjusted EBITDA margin was 22%—one of the highest in the company’s history and 100 basis points above our A Plan target.

“Looking ahead, we will continue to leverage the strong foundation we’ve established to drive further improvement in our financial performance. Axalta’s balance sheet is strong, and we believe our proven portfolio and ability to navigate any operating environment will enable us to deliver meaningful value to shareholders as we prepare for our next chapter with AkzoNobel.”

Fourth Quarter 2025 Highlights

• Fourth quarter net sales of $1,262 million
• Net income of $60 million with net income margin of 4.8%
• Adjusted EBITDA of $272 million
• Adjusted EBITDA margin of 21.5%, a 50 basis point increase year over year
• Diluted EPS of $0.28 and Adjusted Diluted EPS of $0.59
• Record fourth quarter cash provided by operating activities of $344 million
• Record fourth quarter free cash flow of $290 million

Fiscal Year 2025 Highlights

• Full year net sales of $5,117 million
• Net income of $379 million with net income margin of 7.4%
• Record full year Adjusted EBITDA of $1,128 million
• Adjusted EBITDA margin of 22.0%
• Diluted EPS of $1.74
• Record Adjusted Diluted EPS of $2.49
• Record cash provided by operating activities of $649 million
• Free cash flow of $466 million

Fourth Quarter 2025 Consolidated Financial Results

Fourth quarter 2025 net sales decreased 4% year over year to $1,262 million primarily reflecting lower volumes from a challenging economic environment, partially offset by favorable foreign currency translation and positive price-mix in Mobility Coatings.

Net income was $60 million, resulting in a net income margin of 4.8% compared to $137 million in the prior year period. The decrease was driven primarily by higher income tax expense, lower net sales, and increased merger and acquisition related costs. These increased expenses were partially mitigated by reduced selling, general and administrative (SG&A) expenses and lower interest expense. Income tax expense was $57 million higher this year due to a one-time deferred tax benefit recognized in the fourth quarter of last year and an increase in a valuation allowance in the fourth quarter of this year.

Adjusted net income was $128 million, down slightly from the prior year. Adjusted EBITDA was $272 million and Adjusted EBITDA margin expanded by 50 basis points year over year to 21.5%. Diluted EPS was $0.28 compared to $0.63 in the prior year period. Adjusted Diluted EPS was $0.59 compared to $0.60 in the prior year period.

Cash provided by operating activities was a fourth quarter record of $344 million, an increase of $110 million when compared to the same period last year. Free cash flow was also a fourth quarter record totaling $290 million, an increase of $113 million year over year. The year-over-year increase in free cash flow was driven primarily by improved working capital led by strong cash collections and lower interest and tax payments.