PHILADELPHIA, PA — Axalta Coating Systems Ltd. (NYSE: AXTA) reported lower first-quarter 2026 profit as higher costs and weaker volumes offset relatively stable sales, while the company cited progress on its proposed merger with AkzoNobel.
Net sales for the quarter ended March 31 were $1.25 billion, down $8 million from a year earlier, with foreign currency gains partially offsetting lower volumes.
Net income declined to $91 million, or $0.42 per diluted share, from $99 million, or $0.45 per share, in the prior-year period. Adjusted net income was $120 million, down from $129 million, while adjusted diluted earnings per share were $0.56.
Adjusted EBITDA decreased to $259 million from $270 million a year earlier, with the margin at 20.6%.
The company said profit was affected by unfavorable volume and product mix, as well as higher costs tied to its proposed merger and acquisitions, partly offset by a one-time tax benefit and lower interest expense.
Cash provided by operating activities rose to $68 million from $26 million a year earlier, driven by improved working capital and lower interest payments. Free cash flow increased to $21 million from negative $14 million.
Performance Coatings sales fell to $802 million from $822 million, with declines in North America partly offset by growth in other regions. Refinish sales dropped 3% to $498 million, while industrial coatings sales decreased 2% to $304 million.
Performance Coatings adjusted EBITDA declined to $180 million from $197 million, with margin at 22.4%.
Mobility Coatings sales rose 3% to a first-quarter record of $452 million, supported by growth in light vehicle and commercial vehicle markets. Adjusted EBITDA increased 9% to $79 million, with margin improving to 17.5%.
Chief Executive Officer Chris Villavarayan said the company is “progressing through various workstreams” related to its planned merger with AkzoNobel and remains on track with its timeline.
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