Solstice Advanced Materials Inc.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 4 November 2026: press release. Guidance figures: 2 raised, 1 narrowed, 4 new, 1 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Net sales rose 8% year over year: Net sales were $1,046 million, up 8% from $969 million, reflecting 6% higher Refrigerants & Applied Solutions sales and 13% higher Electronic & Specialty Materials sales. Source
• Adjusted EBITDA rose 13%: Adjusted EBITDA was $265 million. Margin was 25.3%, up 109 basis points, which the company attributed to sales growth and operational leverage. Source
• Adjusted diluted EPS reached $0.80: Adjusted diluted EPS was $0.80, a non-GAAP measure, against GAAP diluted EPS of $0.50. Adjustments include transaction-related costs and bridge loan fee write-offs. Source
• Electronic Materials sales rose 31%: Electronic Materials sales rose 31% to $135 million on demand for sputtering targets and thermal solutions in memory and AI-related applications. Source
• RAS margin fell 82 basis points: RAS segment adjusted EBITDA margin was 34.5%, down 82 basis points from 35.4%, with the segment's adjusted EBITDA up 3% to $251 million. Source
• Element Solutions merger terminated: The July 2026 agreement to acquire Element Solutions is described in this release as terminated. The release does not state a reason. Source
• Share repurchases totaled $100 million: The company repurchased 1.7 million shares in the quarter under the $500 million program. Repurchases for the nine months were $100 million. Source

“Solstice delivered strong third-quarter results, demonstrating the value of our differentiated portfolio and consistent execution,”

David Sewell, President and Chief Executive Officer

Guidance

What changed from last quarter

• Guidance raised: Full-year 2026 net sales guidance was raised to $4,195 - $4,220 million from $4,125 - $4,185 million. Source
• Guidance raised: Full-year 2026 Adjusted EBITDA guidance was raised to $1,050 - $1,060 million from $1,035 - $1,055 million. Source
• Guidance raised: Full-year 2026 adjusted diluted EPS guidance was raised to $2.90 - $2.95 from $2.75 - $2.95. Source
• New guidance: Fourth-quarter 2026 guidance for net sales, Adjusted EBITDA and adjusted diluted EPS was given for the first time in this release. Source
• Guidance kept: Full-year 2026 capital expenditures guidance of $420 - $440 million was kept unchanged. Source
• New: The Board approved a share repurchase program of up to $500 million of common stock on August 27, 2026. Source
• Ended: The Element Solutions acquisition, announced in July 2026, is described in this release as a terminated merger. Source

Results and growth drivers

• Net sales rose 8% year over year: Net sales were $1,046 million, up 8% from $969 million, reflecting 6% higher Refrigerants & Applied Solutions sales and 13% higher Electronic & Specialty Materials sales. Source
• Net income swung to a profit: Net income attributable to Solstice was $80 million, against a $35 million loss a year earlier. Diluted EPS was $0.50 versus $(0.22). Lower taxes and higher sales drove the change, partly offset by interest. Source
• Adjusted EBITDA rose 13%: Adjusted EBITDA was $265 million. Margin was 25.3%, up 109 basis points, which the company attributed to sales growth and operational leverage. Source
• Adjusted diluted EPS reached $0.80: Adjusted diluted EPS was $0.80, a non-GAAP measure, against GAAP diluted EPS of $0.50. Adjustments include transaction-related costs and bridge loan fee write-offs. Source
• Nine-month net sales reached $3,185 million: Net sales for the nine months ended September 30, 2026 were $3,185 million, against $2,899 million a year earlier, a 9.9% increase. Source

Refrigerants & Applied Solutions

• Refrigerants sales rose 8%: Refrigerants sales were $433 million, up 8%, with demand across automotive and data center applications. Segment net sales rose 6% to $726 million. Source
• Healthcare Packaging rose 24%: Healthcare Packaging sales rose 24% to $61 million on higher volume and pricing, after destocking in the second half of 2025. Source
• Nuclear sales rose 4%: Nuclear revenues rose 4% to $66 million from $63 million a year earlier. Source
• Product loan returns of about $30 million: About $30 million of previously communicated product loan returns were completed in the quarter. The release gives this figure as estimated sales value. Source
• Building Solutions sales fell 5%: Building Solutions & Intermediates sales fell 5% to $167 million, the release says, as construction-related end markets remained soft. Source

“Our businesses are well positioned to benefit from key secular growth trends including nuclear energy, thermal management, AI and data centers, and we continue to invest to support that growth.”

David Sewell, President and Chief Executive Officer

Electronic & Specialty Materials

• Electronic Materials sales rose 31%: Electronic Materials sales rose 31% to $135 million on demand for sputtering targets and thermal solutions in memory and AI-related applications. Source
• ESM net sales reached a record: ESM segment net sales rose 13% to $320 million from $282 million in the prior-year quarter. Source
• Research and safety lines grew: Research & Performance Chemicals rose 4% to $131 million on specialty additives. Safety & Defense Solutions rose 3% to $54 million on improved volumes. Source
• ESM segment adjusted EBITDA rose 44%: ESM segment adjusted EBITDA rose 44% to $68 million. Margin was 21.2%, up 453 basis points, reflecting sales growth and improved operating leverage. Source

Costs, margins and tax

• RAS margin fell 82 basis points: RAS segment adjusted EBITDA margin was 34.5%, down 82 basis points from 35.4%, with the segment's adjusted EBITDA up 3% to $251 million. Source
• RAS margin recovered from second quarter: The RAS margin rose 160 basis points from the second quarter, which management said was consistent with previously communicated expectations. Source
• Corporate expenses slightly lower: Corporate expenses were $53 million, against $54 million a year earlier. No standalone cost adjustments were made this quarter, versus $1 million in the prior-year quarter. Source
• Tax expense fell on prior-year items: Income tax expense was $24 million, down $158 million. The company tied the prior-year figure to frictional taxes from the Honeywell spin-off. Effective tax rates were 22% and 105%. Source
• Interest charges rose on bridge fees: Interest and other financial charges were $60 million, against $2 million a year earlier. The release attributes $34 million to bridge loan and backstop fee amortization and write-off. Source

“Our strong business performance year-to-date gives us confidence to raise our full-year outlook for the second consecutive quarter,”

David Sewell, President and Chief Executive Officer

Demand, strategy and order book

• Organic sales rose 8%: Organic net sales rose 8% in the quarter, driven by both volume and price. The organic sales percentage for the nine months was 9.0%. Source
• Nuclear backlog stood at $2.6 billion: Management cited continuing demand for conversion services, and the Nuclear backlog was $2.6 billion at quarter end. Source
• Secular trends cited as positioning: Management named nuclear energy, thermal management, AI and data centers as secular growth trends that its businesses are positioned to benefit from. Source
• Element Solutions merger terminated: The July 2026 agreement to acquire Element Solutions is described in this release as terminated. The release does not state a reason. Source

Cash, debt and capital returns

• Share repurchases totaled $100 million: The company repurchased 1.7 million shares in the quarter under the $500 million program. Repurchases for the nine months were $100 million. Source
• Nine-month operating cash flow $693 million: Operating cash flow was $693 million for the nine months, against $289 million a year earlier. Free cash flow was $368 million after capital expenditures. Source
• Capital spending rose 31%: Nine-month capital expenditures were $325 million, up 31%, which management attributed to planned increases intended to drive long-term growth. Source
• Net leverage about 1.3x: Long-term debt was $2.0 billion and cash about $714 million. Total liquidity was about $1.7 billion, including $1.0 billion of revolver availability. Source

Coming up, as management said on 4 November 2026

• Dividend payable December 10: The quarterly dividend of $0.075 per share is payable December 10, 2026, to shareowners of record as of November 25, 2026. Source
• Guidance changes only by announcement: Guidance in this release is effective as of its date and will not be updated or affirmed unless the company publicly announces updated guidance. Source

In management's words

“Our cash generation and balance sheet strength also enable us to return capital to shareowners, including through our $500 million share repurchase authorization, which we intend to substantially complete by the end of the first quarter of 2027.”

David Sewell, President and Chief Executive Officer

Figures management reported

Risks management discussed

• Demand: Building Solutions & Intermediates sales fell 5%, which management tied to soft construction-related end markets. Source
• Operational: The release says higher R&D investment contributed to the year-over-year decline in the RAS segment adjusted EBITDA margin. Source

Earlier plans management reported on

• Consistent with previously communicated expectations: The RAS margin rose 160 basis points from the second quarter, which management said was consistent with its previously communicated expectations. Source
• Not stated: The second-quarter release said the company continued to expect RAS to generate mid-30% Adjusted EBITDA margins in the second half of 2026. This release does not restate that expectation.
• Not stated: The second-quarter release expected the Element Solutions transaction to close in the first half of 2027. This release describes that merger as terminated.

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.