The EPS beat and record cash flow provide near-term support, but the YoY revenue/earnings decline and merger uncertainty cap upside. Watch for AkzoNobel merger closing timeline and Q2 guidance delivery — a miss on the $280-290M EBITDA range would pressure the stock.
Price Chart
Executive Summary
Axalta reported Q1 2026 adjusted diluted EPS of $0.56, beating the $0.50 consensus by 12%, while net sales of $1.25B slightly exceeded the $1.21B estimate. However, YoY revenue declined $8M, net income fell $8M, and adjusted EBITDA dropped $11M, with management guiding Q2 adjusted EBITDA of $280-290M and FY 2026 adjusted EBITDA of $1.14-1.17B. The beat vs consensus is overshadowed by declining absolute fundamentals and ongoing merger costs related to the proposed AkzoNobel merger.
Key Financial Metrics
Key Facts
- Q1 2026 net sales $1.25B vs consensus $1.21B, down $8M YoY from $1.26B
- Adjusted diluted EPS $0.56 vs consensus $0.50, down from $0.59 YoY
- GAAP diluted EPS $0.42 vs $0.45 YoY; net income $91M vs $99M YoY
- Adjusted EBITDA $259M vs $270M YoY; margin 20.6% vs 21.4%
- Record Q1 operating cash flow $68M (up $42M YoY) and FCF $21M (up $35M YoY)
- Performance Coatings net sales $802M (-2.4% YoY); Mobility Coatings record $452M (+3% YoY)
- Q2 2026 guidance: adjusted EBITDA $280-290M; FY 2026: $1.14-1.17B, adjusted diluted EPS $2.55-2.70
- Proposed merger of equals with AkzoNobel progressing; merger costs $22M in Q1
- Interest expense declined 14% YoY; share count reduced to 214.6M diluted from 219.4M
Financial Impact
EPS beat of $0.06 (12%) vs consensus; revenue beat of ~$40M (3.3%); but YoY revenue down $8M, net income down $8M, adjusted EBITDA down $11M
Risk Factors
- Proposed AkzoNobel merger may face regulatory hurdles or fail to close, incurring additional costs
- North America macroeconomic pressure weighing on Performance Coatings volumes
- Higher input costs and unfavorable mix pressuring margins; adjusted EBITDA margin down 80bps YoY
- FY 2026 guidance implies H2 acceleration — execution risk if demand softens
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3284597 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 31, 2026 4w ago | 425 | $36.42 $35.53 | ▼ −2.44% | ▼ −2.30% | $31.99 (−12.16%) |
Aug 5, 2026 8w ago | 425 | $37.54 $37.05 | ▼ −1.31% | ▼ −2.52% | $31.99 (−14.78%) |
Aug 5, 2026 8w ago | 425 / 8-K | $37.54 $37.05 | ▼ −1.31% | ▼ −2.52% | $31.99 (−14.78%) |
Aug 5, 2026 8w ago | 425 | $38.07 $37.12 | ▼ −2.50% | ▼ −2.85% | $31.99 (−15.97%) |
Aug 5, 2026 8w ago | Press Release | $38.07 $37.12 | ▼ −2.50% | ▼ −2.85% | $31.99 (−15.97%) |
Jul 29, 2026 9w ago | 425 | $34.83 $38.07 | ▲ +9.30% | ▲ +3.77% | $31.99 (−8.15%) |
Jul 29, 2026 9w ago | 8-K | $34.83 $38.07 | ▲ +9.30% | ▲ +3.77% | $31.99 (−8.15%) |
Jul 23, 2026 10w ago | 425 / 8-K | $31.68 $36.03 | ▲ +13.73% | ▲ +13.26% | $31.99 (+0.98%) |
Jul 13, 2026 11w ago | 425 | $32.07 $32.34 | ▲ +0.84% | ▲ +1.63% | $31.99 (−0.25%) |
Jul 6, 2026 12w ago | Press Release | $35.01 $32.51 | ▲ +7.14% | ▲ +7.63% | $31.99 (+8.63%) |
US Market Status
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