Eastman Chemical Third-Quarter Adjusted EPS Jumps to $1.84 on Price Increases

Eastman Chemical's third-quarter adjusted earnings jumped to $1.84 a share from $1.14 a year earlier as higher selling prices and better plant utilization lifted profit, and the specialty materials maker projected full-year adjusted earnings of $6.00 to $6.20 a share, according to the earnings release it filed with an 8-K on Thursday.

Sales rose 8% to $2.39 billion from $2.20 billion, driven by 7% higher selling prices and 1% higher volume and mix. Earnings before interest and taxes climbed to $305 million from $188 million.

Net earnings attributable to Eastman rose to $252 million, or $2.19 a share, from $69 million, or 60 cents. The reported figure included a $4 million income tax benefit, compared with a $65 million tax provision a year earlier.

"Eastman delivered solid results amid ongoing global macroeconomic uncertainty and escalation of the Middle East conflict," Board Chair and CEO Mark Costa said in the release. "Input costs continued to elevate, and the Eastman team successfully implemented higher sequential price increases in our specialties."

Middle East conflict cuts both ways

Costa said Eastman remains on track to put through about $500 million of selling price increases in 2026 compared with what it expected before the Middle East conflict began. The company said higher prices across its businesses mainly reflected higher raw material and distribution costs.

The conflict also tightened markets for chemical intermediates. That segment's sales rose 16%, on 12% higher prices and 4% higher volume and mix, and its EBIT jumped to $35 million from $1 million on higher spreads.

Additives and Functional Products grew sales 9% to $784 million, and EBIT rose to $154 million from $128 million. Advanced Materials sales rose 5% to $762 million, and EBIT climbed to $103 million from $41 million on substantially improved asset utilization and lower planned maintenance costs.

Fibers was the soft spot. Sales were flat at $255 million as lower acetate tow contract pricing offset higher volume, and EBIT fell to $52 million from $67 million.

Demand softening into year-end

Compared with the second quarter, sales fell 5%, with volume and mix down 7%. Costa cited seasonal declines and "softening underlying demand in automotive and consumer durables."

For the fourth quarter, Eastman expects sequential demand declines with normal seasonality "and some additional customer caution." It plans further price actions because raw material and distribution costs accelerated through the third quarter, and it expects higher planned shutdown costs, partly offset by cost actions. The company said it remains on track to cut costs by $125 million to $150 million, net of inflation, in 2026.

Cash flow and circular platform

Operating cash flow fell to $290 million in the quarter from $402 million a year earlier. Eastman returned $96 million to stockholders through dividends and expects about $850 million of operating cash flow for the full year, with working capital released in the fourth quarter.

The company also highlighted the reinstatement of a $375 million U.S. Department of Energy award supporting the scale-up of its circular platform, which it said is on track to drive significant revenue growth in 2026 and 2027.

Eastman will hold a conference call with analysts at 8 a.m. ET on Friday.

Sources

1. Eastman Chemical Form 8-K with third-quarter 2026 earnings release (Exhibit 99.1), filed Oct. 29, 2026 (accession 0000915389-26-000167)

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