01—Abstract
Summary
Summary of the 10-Q filed April 29, 2026. Cited figures are marked; the original filing is the authoritative source.
PPG Industries, Inc. reported first-quarter 2026 net sales of $3,930 milliona, up from $3,684 million in the prior-year quarter, with income before income taxes of $517 million versus $502 million.
Net income attributable to PPG was $382 millionb, and diluted earnings per share from continuing operations were $1.70, compared with $1.64 a year earlier. The filing attributes the sales increase primarily to favorable foreign currency translation and higher selling prices, while higher net interest costs and higher depreciation partially offset the improvement in pre-tax income. Adjusted diluted EPS, a non-GAAP measure reconciled in the filing, was $1.83 versus $1.72.
Cash from operating activities was $33 millionc, compared with cash used of $18 million a year earlier, as higher income and smaller working capital increases offset the gap. Cash and short-term investments totaled $1.6 billion at March 31, 2026, down from $2.2 billion at December 31, 2025, reflected in the repayment of a $700 million 1.2% note at maturity and $279 million of investing outflows that included $79 million of business acquisitions. Commercial paper borrowings of $567 million were outstanding under the Credit Agreement at quarter-end, and total debt-to-capitalization was stated as 45% against a covenant maximum of 60%.
The filing also flags a Middle East conflict that has raised raw material, energy, logistics and packaging costs. PPG expects a mid-single-digit percentage increase in cost of goods sold for the rest of 2026 and has begun implementing price increases of up to 20% across product lines. In legal matters, the filing discloses a Brazilian judgment in the Di Gregório litigation that Westlake has said could total over $700 milliond with interest and fees, and that Westlake later estimated at about $350 million; PPG states it believes the risk of loss from its separate Delaware lawsuit against Westlake is remote and expects a trial court decision in 2026.
02—Key points
Key Highlights
- Net sales rose to $3,930 million from $3,684 million, with the filing citing favorable foreign currency translation (+6%) and higher selling prices (+1%) as the main drivers.
- Diluted EPS from continuing operations was $1.70 versus $1.64; adjusted diluted EPS was $1.83 versus $1.72 per the filing's Regulation G reconciliation.
- Segment income was $636 million in total: Global Architectural Coatings $155 million (up 31%), Performance Coatings $288 million (up 5%), and Industrial Coatings $193 million (down 10%).
- Operating cash flow turned positive at $33 million, compared with cash used of $18 million in the prior-year quarter.
- Cash and short-term investments fell to $1.6 billion from $2.2 billion after the $700 million 1.2% notes matured and were repaid in March 2026.
- The filing expects a mid-single-digit percentage increase in cost of goods sold for the remainder of 2026 due to Middle East conflict-related cost pressures, and PPG has begun price increases of up to 20%.
- Total capital spending is expected to be $650 million to $700 million in 2026, and the company repurchased 971,217 shares in March 2026 at an average price of $102.96.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, PPG Industries kept $0.10.
- Revenue$3.93B100.0%
- Cost of revenue−$2.27B57.9%
- Gross profit$1.66B42.1%
- Operating costs−$1.02B25.9%
- Operating income$636.0M16.2%
- Interest, other & tax−$254.0M6.5%
- Net income$382.0M9.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 29, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $3.93B$3.68B | +6.7% |
| Cost of Revenue | $2.27B$2.14B | +6.2% |
| Gross Profit | $1.66B$1.54B | +7.3% |
| SG&A Expenses | $885.00M$838.00M | +5.6% |
| Operating Income | $636.00M$607.00M | +4.8% |
| Interest Expense | $61.00M$56.00M | +8.9% |
| Net Income | $382.00M$373.00M | +2.4% |
| EPS (Basic) | $1.71$1.63 | +4.9% |
| EPS (Diluted) | $1.70$1.63 | +4.3% |
| Shares Outstanding (Basic) | 223.70M228.00M | −1.9% |
| Shares Outstanding (Diluted) | 224.40M228.90M | −2.0% |
05—Questions
Frequently Asked Questions
How did PPG's first-quarter 2026 earnings compare with the prior year?
Income before income taxes was $517 million versus $502 million, and net income attributable to PPG was $382 million versus $373 million. Diluted EPS from continuing operations was $1.70 versus $1.64. The filing attributes the pre-tax improvement mainly to higher selling prices, favorable currency translation and cost-control measures, partly offset by higher net interest costs and higher depreciation.
What is driving the expected cost pressure for the rest of 2026?
The filing says a military conflict in the Middle East involving the United States, Israel and Iran has caused significant volatility and supply constraints in petrochemical, energy and transportation markets, raising costs for raw materials, energy, logistics and packaging. Assuming petrochemical feedstock prices stay at spot levels in April and May, PPG expects a mid-single-digit percentage increase in cost of goods sold for the remainder of the year and has begun implementing price increases of up to 20%.
How is PPG's liquidity and debt position?
Cash and short-term investments totaled $1.6 billion at March 31, 2026, versus $2.2 billion at year-end 2025. Long-term debt was $6,407 million, with $567 million of commercial paper outstanding under the Credit Agreement, which had no amounts drawn on its revolving facility. Total Indebtedness to Total Capitalization was 45% as defined under the Credit Agreement, against a covenant maximum of 60%, and the company stated it was in full compliance with its restrictive covenants.
What is the status of the Di Gregório litigation and the dispute with Westlake?
The filing states that a Brazilian court entered an award against PPG, which remains the nominal defendant, that Westlake said would total over $700 million with prejudgment interest, fees and costs, and that Westlake later believes would be approximately $350 million under simple prejudgment interest. PPG has sued Westlake in Delaware for breach of the Separation and Contribution Agreements, a bench trial was held in May 2025, and PPG expects a final decision in 2026. PPG states it believes the risk of loss associated with this matter is remote.
What do segment results show about the business mix?
Global Architectural Coatings segment income rose to $155 million from $118 million, driven by higher selling prices, favorable currency and cost-control actions. Performance Coatings segment income increased to $288 million from $274 million on higher selling prices, partly offset by lower automotive refinish volumes. Industrial Coatings segment income declined to $193 million from $215 million, driven by lower index-based selling prices and unfavorable sales mix.
06—Continue