Timing clarification: PPG is scheduled to release second-quarter results after the market closes on Tuesday, July 28, 2026. The earnings call is scheduled for Wednesday, July 29, at 8:00 a.m. ET.
PPG enters the quarter with improving organic-growth momentum but a demanding price-cost test. Aerospace, architectural coatings in Mexico, protective and marine coatings, and packaging coatings have been strong. Those businesses must offset weak European architectural demand, uneven global industrial production, and another difficult comparison in automotive refinish.
The most important issue is not whether PPG can produce modest Q2 earnings growth. Management already framed the quarter that way. The larger question is whether pricing, mix improvement, and restructuring savings can absorb higher raw-material, energy, freight, and packaging costs quickly enough to preserve the full-year outlook.
At the end of Q1, PPG reiterated adjusted EPS guidance of $7.70-$8.10, versus $7.58 in 2025.
PPG did not provide a specific dollar EPS range for Q2, but guided both organic sales and adjusted EPS to a range of flat to low-single-digit growth year over year.
| Metric | 2Q25 actual | Management’s 2Q26 framework |
|---|---|---|
| Net sales | $4.20 billion | Reported sales should also benefit from currency and acquisitions |
| Organic sales | +2% | Flat to low-single-digit growth |
| Adjusted EPS | $2.22 | Approximately $2.22-$2.29 based on the growth framework |
| Segment EBITDA margin | 20.3% | Mix and pricing versus raw-material inflation will determine direction |
The EPS range above is a translation of management’s guidance, not a Street-consensus estimate.
This is the central earnings issue.
In April, management estimated that raw-material, energy, logistics, and packaging inflation would increase cost of goods sold by a mid-single-digit percentage for the remainder of 2026. PPG announced price increases of up to 20% on selected products, although the company said it only needed low-single-digit aggregate price realization to offset the expected cost increase.
Management argued that recovery should take months rather than the year or longer experienced in prior inflation cycles. Investors should focus on:
A clean quarter would show pricing improving sequentially without a meaningful deterioration in underlying volume. A cautionary result would show higher sales from pricing but weaker margins because input costs arrived sooner than recovery actions.
PPG earned adjusted EPS of $1.83 in Q1. If Q2 lands within management’s implied range, first-half adjusted EPS would be approximately $4.05-$4.12.
That would leave roughly $3.58-$4.05 of adjusted EPS required in the second half to achieve the full-year range. For comparison, PPG generated $3.64 in adjusted EPS during the second half of 2025.
This makes the range unusually wide from an operating standpoint:
A full-year guidance reiteration would be acceptable, but commentary on the midpoint will matter. Investors will want to know whether management still considers the midpoint achievable or is increasingly relying on the lower half of the range.
Performance Coatings remains PPG’s main growth engine. Q1 organic sales rose 1%, and segment EBITDA margin held near 24% despite a double-digit decline in automotive refinish sales.
Key components:
The comparison is demanding: Performance Coatings produced a 25.7% EBITDA margin in 2Q25. Even with aerospace strength, weak refinish volumes and growth investments could limit year-over-year margin expansion.
The forward-looking question is whether management still expects refinish volumes to turn positive in the second half. Because refinish carries attractive margins, even modest normalization could materially improve segment leverage.
This segment was the clearest Q1 margin positive:
Management expected Q2 organic-sales and margin momentum to continue. Investors should watch whether Mexico can sustain growth and whether Europe has stabilized near flat volumes.
PPG also plans to close four European manufacturing plants during the second half. Management expects about $25 million of annual fixed-cost savings from those closures, mostly visible in 2027. The call should clarify timing, execution risk, and whether additional European restructuring is likely.
Industrial Coatings was the main Q1 weakness:
The pressure came primarily from weak Chinese automotive production, unfavorable regional mix, and lower index-based pricing. Management expected Chinese automotive comparisons to improve and indicated that the deflationary roll-off in indexed contracts should largely finish during Q2.
Points to monitor:
This segment may provide the clearest evidence of whether PPG’s price-cost claims are working across the entire portfolio rather than only in businesses where price changes can be implemented quickly.
PPG has reported positive organic sales for five consecutive quarters, but Q1 growth came from pricing while total company volumes were roughly flat. A higher-quality result would include positive volume contributions outside aerospace and packaging, especially in industrial coatings or European architecture.
PPG expects approximately $50 million of incremental restructuring savings in 2026, followed by another $50 million in 2027. Investors should distinguish durable structural savings from discretionary spending reductions that may reverse when demand improves.
First-quarter operating cash flow was only $33 million, which is seasonally normal, while capital expenditures totaled $196 million. Management continues to use roughly 10% of annual sales as a cash-flow reference point.
Questions include:
This will be Jamie Beggs’ first quarterly call as CFO following Vince Morales’ retirement. Investors will be attentive to any changes in guidance philosophy, capital-allocation priorities, or disclosure around price-cost performance.
PPG closed at $118.50 on July 27, approximately:
The shares have recovered meaningfully but remain below their earlier-year peak. That suggests expectations have improved without fully pricing in flawless execution. A modest Q2 beat may therefore be less important than credible evidence that price-cost performance and second-half mix can support the midpoint of guidance.
The quarter should be judged on three questions:
A result near $2.22-$2.29 of adjusted EPS with reiterated guidance would broadly satisfy the prior framework. The more meaningful positive catalyst would be sequential Industrial Coatings margin improvement and evidence that price-cost neutrality remains achievable on management’s accelerated timetable.
Source basis: PPG’s 1Q26 earnings release, 1Q26 earnings call, 1Q26 Form 10-Q, 2Q25 and full-year 2025 results, the company’s June 30 earnings-schedule announcement, and stock-price data through July 27, 2026.