WLK's Q1 miss was driven by continued PEM weakness (operating loss widened to $194M) and a $67M PVC pipe litigation settlement. The stock will likely sell off on the large EPS miss and revenue shortfall. However, management's commentary about improving PEM margins from the Strait of Hormuz closure and declining US natural gas costs could provide a floor. Watch for Q2 guidance on the conference call — if PEM margins inflect as expected, the stock may recover. The 14% win rate on prior WLK calls suggests caution on timing.
Price Chart
Executive Summary
Westlake reported a Q1 2026 GAAP net loss of $169M (-$1.31/share) on net sales of $2.65B, compared to a net loss of $40M (-$0.31/share) in Q1 2025. Excluding $85M in identified items (a $67M PVC pipe litigation settlement and $18M in facility shutdown charges), the adjusted net loss was $100M (-$0.77/share), which missed the consensus estimate of -$0.24/share by 225%. Revenue of $2.65B also missed the $2.78B consensus by 4.7%.
Key Financial Metrics
Key Facts
- GAAP net loss of $169M vs. $40M loss in Q1 2025; diluted loss per share of $1.31 vs. $0.31
- Excl. identified items, net loss was $100M (-$0.77/share), missing consensus of -$0.24 by 225%
- Net sales of $2.65B declined 7% YoY from $2.85B, missing $2.78B consensus
- EBITDA excl. identified items fell 20% YoY to $235M from $295M
- PEM segment operating loss widened to $194M excl. items from $156M in Q1 2025
- HIP segment operating income excl. items fell 16% YoY to $124M from $148M
- Free cash flow was -$303M vs. -$325M in Q1 2025; operating cash flow -$94M
- Cash and equivalents fell to $2.27B from $2.72B at year-end 2025
- Management guided HIP 2026 revenue and EBITDA margin to lower ends of prior ranges ($4.4-$4.6B, 19%-21% margin)
- Company targets $600M EBITDA uplift in 2026 from profitability improvement plan; ~$150M realized in Q1
Financial Impact
Q1 2026 GAAP net loss of $169M vs. $40M loss in Q1 2025; adjusted EPS of -$0.77 missed consensus of -$0.24 by 225%; revenue of $2.65B missed $2.78B consensus by 4.7%
Risk Factors
- PEM segment remains deeply unprofitable with operating loss of $194M excl. items
- HIP segment guidance lowered to lower end of prior ranges due to slow housing and Middle East cost pressures
- Free cash flow deeply negative at -$303M; cash burn continues
- Litigation settlement of $67M adds to one-time costs
- Global macroeconomic weakness in Europe and Asia continues to pressure demand
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001262823-26-000019 |
| Exhibit: ex992_20260331wlkearning.htm | 0001262823-26-000019 |
| Document: wlk-20260505.htm | 0001262823-26-000019 |
| Document: 0001262823-26-000019-index-headers.html | 0001262823-26-000019 |
| Document: 0001262823-26-000019-index.html | 0001262823-26-000019 |
| Document: 0001262823-26-000019.txt | 0001262823-26-000019 |
| 8-K Data (Synthetic) | 0001262823-26-000019 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 31, 2026 4w ago | 8-K | $74.23 $62.31 | ▼ −16.06% | ▼ −16.38% | $63.50 (−14.46%) |
Aug 14, 2026 6w ago | Press Release | $78.21 $70.02 | ▼ −10.47% | ▼ −8.49% | $63.50 (−18.81%) |
Aug 4, 2026 8w ago | 8-K | $80.63 $74.23 | ▼ −7.94% | ▼ −6.70% | $63.50 (−21.25%) |
Jul 21, 2026 10w ago | Press Release | $76.22 $77.52 | ▼ −1.71% | ▲ +0.86% | $63.50 (+16.69%) |
Jun 15, 2026 15w ago | 8-K | $84.33 $77.04 | ▼ −8.64% | ▼ −8.84% | $63.50 (−24.70%) |
Jun 14, 2026 15w ago | Institutional Cluster | $87.45 $76.07 | ▼ −13.01% | ▼ −12.26% | $63.50 (−27.39%) |
May 5, 2026 21w ago | 8-K | $104.29 $86.83 | ▲ +16.74% | ▲ +21.70% | $63.50 (+39.11%) |
Apr 20, 2026 23w ago | 8-K | $115.44 $91.46 | ▼ −20.77% | ▼ −25.69% | $63.50 (−44.99%) |
Apr 14, 2026 24w ago | 8-K | $117.84 $97.56 | ▲ +17.21% | ▲ +23.51% | $63.50 (+46.11%) |
Apr 6, 2026 25w ago | 8-K | $119.51 $114.07 | ▼ −4.55% | ▼ −13.53% | $63.50 (−46.87%) |
US Market Status
Subscribe to SecBot
Get Real-Time SEC Filing Intelligence
Comprehensive SEC filing analysis delivered the moment filings hit EDGAR. Sentiment scoring, impact analysis, and actionable insights for every material event.
Try SecBot Free Coming soon: SecBot Pro with alerts, watchlists, and API access