Axalta Coating Systems Ltd. announced its financial results for the first quarter ended March 31, 2026.

First Quarter 2026 Highlights:

• Exceeded guidance for first quarter net sales, Adjusted EBITDA and Adjusted Diluted EPS
• First quarter net sales of $1.25 billion
• Net income of $91 million with a net income margin of 7.3%
• Adjusted EBITDA of $259 million and Adjusted EBITDA margin of 20.6%
• Diluted EPS of $0.42 and Adjusted Diluted EPS of $0.56
• Record first quarter cash provided by operating activities of $68 million, up $42 million year over year
• Record first quarter free cash flow of $21 million, an increase of $35 million year over year
• Interest expense declined by 14%

“We delivered another quarter of excellent execution surpassing our expectations on revenue, Adjusted EBITDA and Adjusted Diluted EPS, while maintaining strong margins and improved cash flow generation,” said Chris Villavarayan, Chief Executive Officer and President of Axalta. “In the current environment of higher input costs, we are deploying pricing strategies and strong cost discipline to drive sustained financial performance.”

“We are also progressing through various workstreams associated with the proposed merger of equals with AkzoNobel as planned and are on track with the stated timeline. While implementing a disciplined joint integration plan, we are maintaining momentum to deliver our financial and operational priorities.”

First Quarter 2026 Consolidated Financial Results

First quarter 2026 net sales of $1.25 billion decreased $8 million year over year. Favorable foreign currency translation helped to mitigate anticipated declines in volume.

Net income decreased by $8 million year over year to $91 million resulting in a net income margin of 7.3%. The decrease was primarily driven by unfavorable volume and mix along with higher costs associated with the Proposed Merger and acquisitions partially offset by a one-time income tax benefit and lower interest expense. Adjusted net income was $120 million, compared to $129 million in the prior-year period.

Adjusted EBITDA was $259 million, a decrease of $11 million year over year, resulting in an Adjusted EBITDA margin of 20.6%, down from the prior year period but slightly above the Company’s first quarter guidance. Diluted EPS declined to $0.42 from $0.45 in the prior year period, while Adjusted Diluted EPS was $0.56, a decline of $0.03 from last year driven primarily by mix impacts.

Cash provided by operating activities was a first quarter record of $68 million, an increase of $42 million year over year primarily driven by improved working capital and lower interest payments. Free cash flow was also a first quarter record of $21 million, an increase of $35 million year over year, inclusive of higher capital expenditures.

Discussion of Segment Results

Performance Coatings’ net sales totaled $802 million in the first quarter of 2026, down from $822 million in the prior year period. The segment achieved year-over-year net sales growth in every region outside North America, highlighting the strength of the global business. Macroeconomic pressure in North America was partially offset by favorable foreign currency translation and positive contributions from acquisitions. Refinish net sales declined 3% year over year to $498 million, primarily due to lower volumes and unfavorable price mix primarily in North America. Industrial net sales decreased by 2% year over year to $304 million with positive volume growth in Europe and Asia helping to partially mitigate lower volumes in North America.

Performance Coatings Adjusted EBITDA was $180 million, down from $197 million in the prior year period primarily due to lower organic sales partially offset by reduced operating and variable expenses. Adjusted EBITDA margin was 22.4%, reflecting unfavorable mix from lower North America sales year over year.

Mobility Coatings achieved record first quarter net sales of $452 million, an increase of 3% year over year. Light Vehicle net sales increased year over year due to organic net sales growth in three out of four regions and favorable foreign currency. Commercial Vehicle net sales rose 3% year over year, led by positive price mix, volume growth in Europe and Asia and favorable foreign currency which mitigated the impact of lower volumes primarily resulting from a decline in Class 8 truck production.

Mobility Coatings delivered strong first‑quarter profitability, with Adjusted EBITDA of $79 million, an increase of 9% compared to the prior year period. The segment’s Adjusted EBITDA margin improved by 100 basis points to 17.5%, reflecting lower variable costs.

“Axalta’s first quarter results demonstrate our proven ability to navigate a dynamic macroeconomic environment while maintaining stable revenue and operational performance,” said Chris Villavarayan, Chief Executive Officer and President of Axalta. “We remain focused on driving operational efficiencies, executing our strategic initiatives, and positioning the company for success ahead of the proposed merger of equals with AkzoNobel.”

Axalta does not provide a reconciliation for non-GAAP estimates for Adjusted EBITDA, Adjusted Diluted EPS, Free Cash Flow or tax rate, as adjusted, on a forward-looking basis because the information necessary to calculate a meaningful or accurate estimation of reconciling items is not available without unreasonable effort. See “Non-GAAP Financial Measures” for more information.