PPG Industries, Inc. (PPG Quick QuotePPG - Free Report) is benefiting from cost discipline, acquisitions and pricing actions amid headwinds from demand weakness, especially in Europe. Its second-quarter adjusted earnings of $2.22 per share matched the Zacks Consensus Estimate but fell from $2.35 a year earlier. Higher sales in the Performance Coatings unit were offset by declines across Global Architectural Coatings and Industrial Coatings segments, leading to a roughly 1% decline in the top line.

PPG Industries, which is among the prominent players in the chemical space along with Dow Inc. (DOW Quick QuoteDOW - Free Report) , Eastman Chemical Company (EMN Quick QuoteEMN - Free Report) and Air Products and Chemicals, Inc. (APD Quick QuoteAPD - Free Report) , is implementing a cost-cutting and restructuring strategy and optimizing its working capital requirements. The cost savings generated by these restructuring initiatives will act as a tailwind for the company. It has undertaken extensive restructuring efforts to reduce its cost structure, primarily focusing on regions and end markets with weak business conditions. The company realized an additional $20 million in structural cost savings in second-quarter 2025. It expects around $60 million in restructuring savings (net of stranded costs) for full-year 2025.

PPG also announced a comprehensive cost reduction program, which is expected to deliver annualized pre-tax savings of around $175 million once fully implemented. The program includes the reduction of structural costs, mainly in Europe and in certain other global businesses. These efforts underscore PPG Industries' commitment to enhancing operational efficiency and ensuring sustained financial strength. PPG Industries is also raising selling prices across its business segments to offset the impact of cost inflation and drive profitability. 

The company is also undertaking measures to grow its business inorganically through value-creating acquisitions. Contributions from the acquisitions are expected to be reflected in its performance. Acquisitions, including Tikkurila, Worwag, Cetelon and Arsonsisi’s powder coatings manufacturing business, are likely to contribute to its top line.

PPG Industries remains committed to boosting shareholder returns with cash deployment. It has an impressive record of returning cash to shareholders through dividends and share buybacks. In 2024, the company returned $1.4 billion to shareholders through dividends and share repurchases. It paid dividends worth $620 million in 2024. PPG also bought back $750 million of shares in 2024. The company repurchased shares worth roughly $540 million in the first half of 2025. It has also raised its quarterly dividend by 4% in July 2025. PPG's robust financial performance is reflected in the substantial operating cash flow generation, which reached around $1.4 billion in 2024. Cash flow from operations was $369 million in the first half of 2025. 

However, PPG is being challenged by soft global industrial production, which is impacting demand in the Industrial Coatings segment. Lower automotive OEM build rates and softer industrial production in the United States and Europe are hurting volumes and sales in this segment. Weak consumer confidence is negatively impacting demand in Europe. Automotive industry build rates declined in Europe and the United States in the second quarter due to lower demand and are expected to be lower in the third quarter. Despite a slight improvement, global industrial production is expected to remain subdued in the third quarter with continued weakness in the United States and Europe.  

Overall organic growth is expected to be limited by lower automotive OEM build rates and still subdued industrial production. Industrial coatings demand is expected to remain under pressure in the third quarter.

PPG’s Global Architectural Coatings segment is also hamstrung by weaker demand. Sales from this unit fell 5% in the most recent quarter on lower sales volumes resulting from weaker demand in the architectural coatings EMEA business and business divestiture. The company is seeing weaker sales in Europe. Demand was lower as consumer confidence remains subdued in that region.

PPG maintained its full-year 2025 adjusted earnings per share guidance of $7.75 to $8.05. This outlook is backed by continued share gains and internal improvement initiatives, while factoring in current global economic conditions, currency exchange rates and varied demand trends across its regions and business segments.

Another prominent chemical maker, Dow expects its strategic initiatives to help it navigate the evolving challenges within the industry. DOW’s near-term growth projects, along with its long-term strategic investments, are expected to enhance its presence in high-value applications and attractive markets that are less affected by such anti-competitive pressures.

Eastman Chemical, on its second-quarter call, noted that it is seeing a challenging global macroeconomic environment entering the second half. The company expects to gain from the ramp-up of cost-reduction initiatives and higher revenues from its Kingsport methanolysis facility. EMN sees third-quarter adjusted earnings to be roughly $1.25 per share. 

Air Products updated its full-year adjusted earnings per share guidance for fiscal 2025 to a range of $11.90 to $12.10. For the fourth quarter of fiscal 2025, APD expects adjusted EPS to be between $3.27 and $3.47.