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Image source: The Motley Fool. Tuesday, Aug. 4, 2026 at 8:00 a.m. ET Chief Executive Officer - Lori Koch Chief Financial Officer - Antonella Franzen Investor Relations - Ann Giancristoforo Operator: Hello, and thank you for standing by. My name is Lacey, and I will be your conference operator today. At this time, I would like to welcome everyone to the DuPont Second Quarter 2026 Earnings Call. [Operator Instructions] I would now like to turn the call over to Ann Giancristoforo, Investor Relations. Please go ahead. Ann Giancristoforo: Good morning, and thank you for joining us for DuPont's Second Quarter 2026 financial results conference call. Joining me today are Lori Koch, Chief Executive Officer; and Antonella Franzen, Chief Financial Officer. We have prepared slides to supplement our remarks, which are posted on DuPont's website under the Investor Relations tab and through the webcast link. Please read the forward-looking statement disclaimer contained in the slides. During this call, we will make forward-looking statements regarding our expectations or predictions about the future. Because these statements are based on current assumptions and factors that involve risks and uncertainties, our actual performance and results may differ materially from our forward-looking statements. Our Form 10-K, as updated by our current and periodic reports, includes detailed discussion of principal risks and uncertainties, which may cause such differences. Unless otherwise specified, all historical financial measures presented today are on a continuing operations basis and exclude significant items. We will also refer to other non-GAAP measures. A reconciliation to the most directly comparable GAAP financial measure is included in our press release and presentation materials and has been posted to DuPont's Investor Relations website. As a reminder, on the basis of presentation, our share and per share information has been retroactively adjusted for the reverse stock split that was completed in June 2026. I'll now turn the call over to Lori, who will begin on Slide 3. Lori Koch: Good morning, and thanks, everyone, for joining our call. Earlier today, we reported our second quarter financial results, which again exceeded our previously communicated guidance. Through our ongoing focus on excellence and productivity, we delivered organic sales growth of 4%, 80 basis points of margin expansion, double-digit adjusted EPS growth and robust free cash flow conversion in the quarter. As a result of our second quarter performance, we are again raising our full year 2026 financial guidance for organic sales growth, operating EBITDA and adjusted EPS. And we expect our free cash flow conversion to be ahead of our 90% target. Antonella will provide further details shortly. Additionally, we announced that in the third quarter, we expect to launch a $250 million share repurchase, which highlights our continued focus on driving a disciplined capital allocation model. We also completed the previously communicated reverse stock split, which aimed to align our key performance metrics with those of our industrial peer set. In addition, effective in July, our GICS code classification has been changed to Industrials, an important milestone that recognizes the significant transformation of DuPont over the past several years. This new classification better reflects our industrial portfolio and the long-term value creation opportunities we see ahead. Moving to Slide 4. We continue to make strong progress advancing our strategic priorities through a more robust and disciplined business system with a clear focus on organic growth, accountability, execution and continuous improvement across the company. The objective is straightforward: reinforce the operating culture required to deliver sustainable performance while building repeatable capabilities that drive growth, margin expansion and shareholder value over time. What is important is that these are not isolated initiatives: innovation, commercial excellence, operational excellence and 80/20 are increasingly connected through one operating system that helps us prioritize the highest value opportunities, execute with greater rigor and scale what works across the organization. Innovation excellence remains central to our value prop for both customers and shareholders. Our pipeline continues to deliver new wins across high-growth and emerging applications through differentiated products and application development. We are using the business system to sharpen the focus of our innovation pipeline, improve how we manage differentiated opportunities and support the continued expansion of our AI-ready labs initiative, leading to faster development cycles and a more robust front-end pipeline. You can see that in the quality and relevance of launches coming through the pipeline. In Water, we launched an integrated end-to-end solution for direct lithium extraction, including membranes and ion exchange resins, designed to improve lithium recovery and purity. In Healthcare, we continued the expansion of our Liveo portfolio to better serve the high-growth biopharma market. And in Diversified Industrials, we are bringing forward new solutions for electric vehicles and battery energy storage systems. Commercially, we are putting more rigor and scale behind growth. We have continued to see improvement in overall order trends, and we are rapidly scaling sales plays using AI to accelerate our impact. Here, we are moving from process deployment to operating discipline and the early demand generation momentum is encouraging. We have won about 150 opportunities, which represents a nearly 30% win rate. This sits firmly ahead of our historical percentage as well as above industry benchmarks. Overall, we are building a more systemic commercial engine: clear targeting, stronger data quality, accelerated demand generation and more disciplined execution from opportunity creation through conversion, leading to a strong pipeline. OpEx continues to be a key driver of value creation at DuPont. We are building a more disciplined operating culture that is translating into measurable improvements across productivity, quality, customer delivery and costs. In the quarter, we delivered a more than 100 basis point improvement in OTIF and net productivity with a continued reduction in cost of poor quality. Looking ahead, we see additional opportunities through both AI and automation, where early pilots in reliability, maintenance and quality are identifying significant improvement potential. Ultimately, OpEx is not simply a cost initiative. It's a growth enabler that improves customer experience, strengthens margins and enhances our competitive position over time. Lastly, our 80/20 work is increasing focus and simplifying complexity across the organization. We are developing a much clear understanding of where value is created, concentrating resources behind those opportunities and simplifying activities that consume resources without generating comparable returns. I noted earlier that we began by piloting the approach in 4 of our Diversified Industrials businesses. This work has identified meaningful opportunities to create value, which we have already begun to execute. The examples are clear. The team identified an opportunity to reallocate commercial, tech service and marketing resources towards geographies and market segments with the greatest growth potential, while simplifying the approach to smaller markets through stronger channel partnerships. Additionally, the team identified productivity initiatives to reduce manufacturing complexity, better sequence production and focus on the highest value product families to improve yields, asset utilization and capacity within the existing footprint. The common thread across all of this work is focus, discipline and repeatability. We are advancing innovation in the markets where application expertise is most differentiated, strengthening commercial execution with data, AI and more targeted sales plays, improving operational performance through kaizen, productivity, quality and OTIF and using 80/20 to simplify and concentrate resources where they create the most value. With that, I'll now turn the call over to Antonella to cover the financials and outlook in more detail. Antonella Franzen: Thanks, Lori, and good morning, everyone. Strong execution and market-driven growth in the second quarter delivered results ahead of our financial guidance. Organic growth and a continued focus on productivity drove solid operating EBITDA leverage, meaningful margin expansion and robust free cash flow generation in the quarter. Consistent with our first quarter call, I will provide comments on our results versus the prior year pro forma, which adjusts for our post-separation corporate costs, interest expense and income tax rate. This is consistent with the methodology and financial metrics that we provided at our 2025 Investor Day. In addition, all share and per share amounts have been retroactively adjusted as a result of the reverse stock split. Beginning with our second quarter financial highlights on Slide 5. Net sales of $1.8 billion were up 4% versus the year ago period on 4% organic sales growth. Top line growth was broad-based, led by continued strength in healthcare, aerospace and industrial water and semiconductor markets. In addition, we saw year-over-year growth in our Building Technologies business on strength in residential and nonresidential end markets. From a segment view, during the quarter, organic sales grew 4% in Healthcare & Water Technologies and 3% in Diversified Industrials. Second quarter operating EBITDA of $448 million increased 8% versus the year ago period on organic sales growth and productivity. This resulted in operating EBITDA margin of 24.6% in the quarter, an increase of 80 basis points year-over-year, including a 30 basis point headwind from price/cost dynamics. Turning to cash flow. We delivered transaction-adjusted free cash flow of $326 million and related conversion of 127%, underpinned by earnings growth and net working capital productivity. Given our strength in the quarter, we expect our full year free cash flow conversion to be ahead of our 90% target. Turning to Slide 6. Adjusted EPS for the quarter of $1.88 was up 21% versus the year ago period. The increase was driven by stronger operations of $0.17 and a $0.15 benefit from below-the-line items. Turning to our segment results on Slide 7. Healthcare & Water Technologies second quarter net sales of $856 million were up 5% versus the year ago period, on 4% organic growth and a 1% benefit from currency. For the second quarter, Healthcare sales were up mid-single-digit percent on an organic basis versus the year ago period. Organic growth was broad-based led by double-digit gains in personal protection and biopharma markets. Water sales were up low single-digits percent on an organic basis on double-digit gains in industrial water and semiconductor markets, partially offset by weakness in the Middle East. Outside of the Middle East, organic sales increased mid-single-digit percent in the quarter. Operating EBITDA for the segment during the quarter of $258 million was up 4% versus the year ago period on organic growth and productivity gains, partially offset by growth investments. Operating EBITDA margin of 30.1% decreased 30 basis points year-over-year as organic growth and productivity were more than offset by less favorable mix and growth investments. Turning to Diversified Industrials. Second quarter net sales of $963 million increased 3% versus the year ago period on 3% organic sales growth. At the line of business level, organic sales for Building Technologies were up low single-digits percent on growth in residential and nonresidential construction markets, led by Asia Pacific. Industrial Technologies organic sales were up mid-single digits percent on double-digit gains in aerospace and electric vehicle battery applications as well as mid-single-digit growth in printing applications. Operating EBITDA for Diversified Industrials of $213 million was up 7% versus the year ago period on organic growth, favorable mix and productivity. This translated to operating EBITDA margin in the quarter of 22.1%, an increase of 70 basis points versus the year ago period. Turning to Slide 8. We are again raising our full year 2026 financial guidance given our outperformance in the quarter as well as benefits from capital deployment. For the full year 2026, our net sales guidance now assumes organic growth to be slightly ahead of 4% on continued strength across most of our key end markets. We have adjusted our midpoint to $7.175 billion due to a lower expected currency benefit as the U.S. dollar continues to strengthen. Operating EBITDA at the midpoint has now increased to $1.760 billion, reflecting our stronger second quarter results and more than offsetting headwinds from currency. Operating EBITDA margins of 24.5% includes a 30 basis point headwind from oil and gas inflation. Our adjusted EPS at the midpoint of $7.24 is a $0.15 increase versus our prior guidance and represents an 18% increase compared to the prior year pro forma. For the second half, at the midpoint, our estimated net sales of $3.675 billion assumes organic growth of about 6% year-over-year, driven by continued strength in healthcare, industrial water and aerospace end markets as well as carryforward pricing from actions already taken. Operating EBITDA is expected to be $900 million, resulting in operating EBITDA margin of 24.5%, including a 50 basis point headwind from oil and gas inflation. Adjusted EPS at the midpoint is expected to be $3.73 per share. As a reminder, our third quarter 2025 benefited from a timing shift of approximately $30 million of sales due to system cutover activity in advance of the Qnity separation, which was a 2% organic growth shift from the fourth quarter to the third quarter. Our third quarter expectations include a sequential [ $15 million ] sales lift from Q2 related to pricing actions already taken and operating EBITDA at the same level as the second quarter. Therefore, for the third quarter 2026, we estimate net sales of $1.835 billion, operating EBITDA of $448 million and operating EBITDA margins of 24.4%, including a 50 basis point headwind from oil and gas inflation. Adjusted EPS is expected to be in the range of $1.80 to $1.90 per share. Our third quarter net sales guidance assumes about 5% organic growth year-over-year when adjusted for the prior year timing shift and about 3% organic growth year-over-year as reported. Currency is expected to be about a 1% headwind in the quarter. For the Healthcare & Water segment, we expect third quarter organic sales growth in the mid-single digits percent range, led by strength in medical device, biopharma and industrial water markets. For the Diversified Industrials segment, we expect third quarter organic sales growth in the low single-digit percent range, on continued strength in aerospace and electric vehicle battery applications. Before I close, I want to take a moment to thank our teams around the world. The strong results we've delivered to date are a direct reflection of their hard work, dedication and focus on serving our customers every day. We're proud of what we've accomplished together and even more excited about the momentum we're carrying into the second half of the year. With strong positions in attractive markets, a continued focus on execution and the talent of our people, we have a lot to look forward to as we finish the year strong. With that, we are pleased to take your questions, and let me turn it back to the operator to open the Q&A. Operator: [Operator Instructions] Your first question comes from the line of Jeff Sprague with Vertical Research Partners. Jeffrey Sprague: Two unrelated questions for me. First, Lori, where you kind of began today with the innovation and commercial and the like. Can you just give us something to anchor on in terms of thinking about contribution to sales or product vitality? And on the cost of poor quality and OTIF also, I'm just wondering if you could kind of anchor us on kind of your start point there where you're at on that progression. Lori Koch: Yes. Of course, I can. So on all of the fronts across the business system, I'm really happy with the results that we've driven so far across all the different frameworks, whether it's innovation, commercial or operational excellence. But to your question on the innovation, we have a really strong foundation that we're starting from with a vitality index of about 35%, and we'll continue to build on that. And our focus is on maintaining that strong balance as well as shifting the mix more towards growth versus replace that comprise that 35% vitality index. So we've seen benefits with respect to an improved front-end pipeline on the innovation front, also a reduction in the cycle speed with respect to getting new products to market and generating in the front-end pipeline. So while we are not quite sizing what the upside is with respect to innovation, we're firmly committed to the minimum 3% or 4% organic sales growth that we had put out at Investor Day where, in fact, if you look at our full year numbers running either in line or ahead on all of the metrics, whether it's organic growth, margin expansion or EPS growth with respect to those targets. So really nice lift and a lot of that's really coming from the implementation of the business system. On the -- one quick comment on the 80/20 work as well. So we've been engaged on a study with 4 of our businesses in the Diversified Industrials with respect to implementation of 80/20. We're through that initial exercise with respect to framing the opportunities and we're actually executing those opportunities now, and we have a few million of benefit in the second half from an EBITDA perspective around just simplifying the portfolios, driving yield, optimizing mix, making sure that the resources are targeted the highest growth opportunity. So nice performance there. On the cost of poor quality, to your question with the improvement that we're seeing, we're below benchmark. I think benchmark is right around 5% of sales. We're at about 4% of sales with respect to cost of poor quality, and we'll look to drive that lower as we implement the OpEx framework. Jeffrey Sprague: Great. And then maybe just for Antonella. On the oil and gas margin-related headwinds you shared with us for the quarter, the outlook in the year, do those all roughly reflect price/cost dollar neutrality? Or are you kind of above -- ahead or behind on an actual dollar versus cost basis? Antonella Franzen: It's price/cost dollar neutrality. So as we said on the last call as well, there's about $90 million of pricing that's in there on a full year basis. We have a little bit of that in Q2. As you would expect, the majority of that is sitting in the second half of the year, and that keeps us price/cost neutral from a dollar basis. Operator: Your next question comes from the line of Scott Davis with Melius Research. Scott Davis: I wanted to follow up a little bit on Jeff's question and there's a lot of changes going on at DuPont and net productivity goals is not something that we talked about in the old days. But can you talk about where you are today, kind of where you want to be and kind of a realistic time frame of where you can get to kind of best-in-class levels? Lori Koch: Yes. So our target for net productivity is 3%, so 3% of COGS annual reduction on a net basis. So that's a sizable improvement from where we've been in the past where the number was kind of flat at best. So we're making nice progress in the quarter. We saw about 200 basis points of a reduction on a COGS basis that contribute about 100 basis points of margin expansion as a percent of revenue. So a nice improvement. I think to get to like the 3% net productivity kind of core curriculum that we're driving across the organization that's probably within the next 18 months to be able to get to that 3% run rate across the organization. Scott Davis: Okay. That's helpful. And then when you're making these kind of operational changes and obviously trying to drive cultural change, there's a certain component that you probably need to change compensation plans and such to re-center around these new targets and goals. Are you -- have you done that already? Or is that in process? Kind of where do we stand in that perspective? Lori Koch: Yes. So on our compensation, we've changed this year with respect to the level at which we compensate for the short-term incentive or the cash bonus for every year. So in the past, it was done at the segment level, so it would have been Healthcare & Water or Diversified. But this year, we're doing it at the line of business level. So there are 6 lines of businesses, 3 under each segment and we're using that as the center point for the business performance to really drive enhanced accountability at that level. As we look into 2027, we are changing the compensation method for our sales force. And so we're in the midst of that right now of moving them to commission-based. So today, we've got small pockets of commission-based sales across the organization. But in general, the sales force is paid on the same bonus structure as what the rest of the organization is. So in order to be able to really drive that growth and drive that hunter mindset and business development expertise across the organization, it's really important to then incent the sales force to drive growth. So that change will be happening in 2027 for those individuals. Operator: Your next question comes from the line of Joe Ritchie with Goldman Sachs. Joseph Ritchie: So I wanted to start with the Middle East. I think last quarter, you guys were calling out some logistics constraints and then some delayed shipments also in project timing that was supposed to come through in the second half of the year. Can you just give us an update on where those projects stand and like whether you've seen any type of alleviation on the constraints that you saw last quarter? Lori Koch: Yes. So the $10 million shift that went from Q1 to Q2 happened. So that happened in April. It has already kind of been behind us by the time we did the Q1 call. We're still in the same bucket with respect to expectations for Middle East in the second half. So we see improved performance in the Middle East in the second half versus the first half, really driven by projects that are already on the books. And so we've got a few large projects in the Middle East and kind of in line with the expectations that we see for more global large projects second half versus first half. So we still got visibility to those. They're still on our books. We've continued to expect that most of that revenue hits in the fourth quarter versus the third quarter. So if you look at kind of the trajectory of organic growth that Antonella called out 3Q, 4Q, and you take out the timing shift with respect to last year, we'll see about 5% organic growth in Q3 and then 7% in Q4. Really, that step-up is really around these projects across the globe beyond just the Middle East in the Water business. Joseph Ritchie: Got it. That's helpful, Lori. And I guess, just maybe on margins for a second. Your Healthcare & Water Technologies segment saw 30 basis points of margin contraction despite the solid growth. I know that you guys were expecting some type of mix normalization. I think you also called out growth investments. Can you just maybe unpack the specific mix dynamics as well as the investments that you're making in those segments? Antonella Franzen: Joe, it's Antonella. Yes, so what we talked about in our first quarter, we had a much heavier component related to our healthcare sales in Q1 relative to the second quarter. So that was the mix shift that we had talked about last quarter. So we're just seeing the opposite side of that now. Overall, underlying margins in the Healthcare & Water business are very strong. We are making investments there. We're seeing the impact of those investments in our top line growth. Lori Koch: Yes. One of the areas that we'll highlight with respect to the return on the investments, we've invested in additional sales resources within our Tyvek business to be able to continue to fill up the assets. One of the large opportunities that we've seen is around sales plays in the garment space. So we introduced sales plays in the garment space towards the tail end of last year, called out nice performance in the prepared remarks with respect to building a robust pipeline, and we actually see about $5 million or $6 million of incremental garment sales in the full year 2026 expectation. So really already seeing nice contributions from those additional resources that we added. Operator: Your next question comes from the line of John McNulty with BMO Capital Markets. John McNulty: Maybe the first one on the Diversified side. So I guess when I look at the second half outlook for growth versus the second quarter, it looks like things accelerate a bit. I guess, can you help unpack that, what may be driving that? And then also thoughts on the incremental operating leverage that you have, especially with some of the 80/20 starting to kick in, how should we be thinking about that in the back half? Antonella Franzen: So overall, when you take a look at things from the growth side, I would say when you look at the first half versus the second half, what you're really seeing, if you kind of take Q2 as your starting point, it's really just the incremental pricing that's in the second half of the year. So as I noted earlier, we do have a majority of the pricing related to the oil and gas headwinds in the second half of the year. That adds about 2 points of pricing in the second half. So again, if you look where we landed in Q2 of around 4% organic growth, we have the extra 2 points of pricing that kind of gets you to the 6% organic growth that we see in the second half of the year. So no significant uplift needed there to achieve that target. When you look at the incrementals in the second half of the year, if you're kind of looking at things on a year-over-year basis and you adjust for the price/cost dynamic, our incrementals are around 40%. John McNulty: Got it. Okay. And then on the 80/20 program, I know it's a little bit on the early side. But I think the idea, at least when you set out, was to significantly improve the profitability, but there might be a bit of a drag on the top line over time. I guess, is that still how you're thinking about it? Or are you starting to see any potential positive offsets that may help that top line to maybe come in a little more robust than where you originally expected? Lori Koch: Yes. So we do see opportunities on both fronts. So the initial kind of few million dollars that I had mentioned that we expect in 2026 from the 80/20 work is really going to be more around the margin side. So kind of relooking at our org design and our op model and driving some yield improvement and making sure that we've got the resources focused on the 80% and moving away from 20% to be able to drive margin improvement. With respect to growth, there's also opportunities that we see around upgrading our market expertise, driving enhanced commercial excellence as well as further business development work that should drive growth. And so that will be a little bit longer in realization versus profitability work, but we don't see a material headwind to the top line. In fact, over time, ideally a benefit to the top line with respect to being able to really focus our resources on the value creation opportunity that resides in the 80s and doubling down on that. But right now, we don't see a material impact to the top line. It's more of an improvement on the bottom line from the 80/20 work. Operator: Your next question comes from the line of Chigusa Katoku with JPMorgan. Chigusa Katoku: I just wanted to follow up a little bit on the Water business. I think it came in at plus low single digit this quarter. Just curious specifically in Water, how you expect it to phase in the third and fourth quarter? And do you still expect high single digit in the back half and mid-single for the full year in Water? Lori Koch: Yes. So we've -- our expectations now for the full year are more in the low to mid-single-digit range, really with the slight revision being driven just by what's going on in the Middle East, nothing structurally changing in the business in the long term. So we still do expect to ramp first half, second half. So for the second half, we do see, on average, kind of that high single-digit growth leading to that low to mid-single digit for the year. I think it's important to note while we tempered down the Water expectations, we tempered up the Healthcare expectations, and we still see the same growth profile for the overall Healthcare & Water segment. We actually slightly raised the organic growth for the full year for the company from -- we were at 4% heading into the quarter, and now we're slightly above 4%, really just dropping that outperformance that we saw in Q2 to the year. Chigusa Katoku: Okay. That's really helpful. And then just looking at the margins, I think historically, your margins ramp in the second half versus the first half. Understanding this year, you have the oil inflation impact, but is there anything else that's going into the deceleration in margins in the second half mix or anything of that sort? Antonella Franzen: Yes. Actually, if you kind of take a look at our margin profile and you put the price/cost aside, if you look at our business segment margins, they're actually increasing an incremental like 50 basis points in the second half of the year versus the first half of the year. So we still have very nice margin momentum going into the year. And quite honestly, we had really strong margins last year second half as well. So I think that, that shows the continued margin expansion profile that we have. Team is continuing to do a really good job related to that. And to some of the points that Lori made, it's really being driven by our productivity as well as nice leverage on the growth. Operator: Your next question comes from the line of Christopher Parkinson with Wolfe Research. Harris Fein: This is Harris Fein on for Chris. I guess for my first one, can you just give us an update on the M&A pipeline? It seems like you have capacity for both buybacks and midsize M&A. I guess what are you seeing out there in terms of CDMO opportunities? Lori Koch: Yes. So we continue to have a nice M&A pipeline, and we're also taking a nice balanced approach to capital allocation. So to your point, we announced the $250 million share repurchase that we executed in the quarter. We still have sizable proceeds to be able to do M&A as well. So we still have well over $1 billion to be able to go out and do some M&A. So we continue to see a robust pipeline on both the Water side and the Healthcare side. On the Healthcare side, the opportunities span both the packaging front as well as the CDMO front, to your point. So we continue to do the work. We're going to be diligent about the returns that we expect with respect to the valuation. So we'll look to say kind of on a gross basis in a mid-teen valuation and getting that down into a lower teens on a net basis post synergies. So we've got an expectation as well that whatever asset that we acquire would be incremental to our overall growth algorithm as well. So I'm optimistic we're doing a lot of work, but we'll be prudent with respect to the returns that we expect on a deal. Harris Fein: Got it. And for my second one, just on pricing, with the ramp that you're seeing in the second half, just any thoughts on how sticky that might be depending, obviously, on how the situation in the Middle East plays out as we look ahead to '27. Antonella Franzen: Yes. I mean we'll always look at our pricing opportunities and the elasticity within each one of the lines of businesses as we move forward. For this year, as we noted, pricing in totality related to oil and gas is about 1 point for the full year. It's about 2 percentage points in the second half of the year. There is some other pricing that we also have that's in the top line as well. That's outside of oil and gas, and we'll clearly continue to look at that as we move forward going into '27 and beyond. Operator: Your next question comes from the line of John Roberts with Mizuho. John Ezekiel Roberts: Congrats on the reclassification. Could you talk a little bit about the Middle East reverse osmosis headwinds? Is that primarily logistics constraints or has something structurally changed there? Lori Koch: No, there's no structural change. It's primarily just the conflict that's happening in the Middle East. And so a lot of the desalination volumes that are a big chunk of RO are obviously in the Middle East, and those projects are moving around a bit. They're not getting pulled. They're just moving around a bit with respect to when we expect those to hit. So structurally no change in our expectations for nice mid-single-digit growth out of the Water business. There's just a little noise this year, ideally, some resolution coming with respect to what's going on in the Middle East so that we can return to a more normal growth profile. I think it's important to note, though, that the Water business continues to perform very well outside the Middle East conflict. And so we've seen really nice robust growth. Ex the Middle East in the second quarter, our organic growth was up in the mid-single-digit. So the rest of the world is performing quite well. And the Middle East is only about 10% of sales. John Ezekiel Roberts: And then the new lithium water opportunity, does that require incremental CapEx here to build out that business? Or are these existing products and services that you can actually just grow within your existing footprint? Lori Koch: Yes, no capital required. We introduced a new suite of products recently that we announced. And so we had to do some application development enhancement within an existing product portfolio across both RO and ion exchange. So a nice opportunity for us. We saw the DLE market around $200 million, and we're well positioned to be able to take advantage of the growth in that space. Operator: Your next question comes from the line of Josh Spector with UBS. Joshua Spector: I just wanted to ask on the updated organic growth outlook. I mean it's a small tweak up, but it's still a tweak up. Your comments on pricing sound exactly the same as last quarter. So does that mean volumes are coming in a little bit better overall? And just curious where you'd attribute that to? It sounds like Healthcare, but I don't know if Diversified Industrials is playing a role in that at all or not? Antonella Franzen: Yes. As Lori mentioned earlier, Healthcare is driving that, and you did see really nice growth in Diversified Industrials as well, which we've also added that to the full year as well. So both of those 2 areas are helping to offset the little bit of weakness that we're seeing in Water related to the Middle East. Lori Koch: Yes. I mean in DI, we have a very strong order book on the industrial side within DI. So we cited that kind of all year and it continues to drive kind of low double-digit order gains across that portfolio. And we're seeing nice positions within shelter as well. So while shelter still continues to be about net neutral on a full year basis from an end market perspective, we see outperformance in the space on the resi side. So even though it's a little bit tempered, but we're seeing outperformance there. And so incrementally, optimistic on the shelter business. And maybe just one more comment on the Diversified side, optimistic on the EV battery space. And so we saw a really nice growth in the EV battery space in 2Q, especially in the European markets. We're really seeing that pipeline come to fruition there and driving nice results for us. Joshua Spector: Let me follow up on that specifically then. And just -- I mean, how big is that EV battery? And is that primarily adhesives? Are there other separator or thermal materials that you guys are selling? Lori Koch: Yes, it's primarily adhesives. So the EV battery space alone today is around $70 million of revenue. We see it going nicely into the triple digits in '26 and '27. And more broadly, the whole EV opportunity for us is a few hundred million. So of our whole $900 million automotive portfolio, that EV portion is nicely getting up to almost 50% of it. And so we had a lot of wins in the pipeline on the battery space across all the regions, and we're seeing those come to realization as those automotive OEMs start to introduce the newer models. Operator: Your next question comes from the line of David Begleiter with Deutsche Bank. David Begleiter: Lori, just on construction, you noted some improvement in those markets. Is that mainly data centers or other areas are expanding as well? Lori Koch: No, not data centers. It's more on the [ HHEP ], so kind of the healthcare, education, retail market. And so there's a lot of growth in the healthcare space with respect to new hospital builds. I think in the education space, there's a lot of investments still going on at the university level that's driving our optimism there. So we've got a tiny little bit in data centers that we're looking hard to be able to see how we can continue to grow that. But a lot of our growth is outside data centers in the non-res space. David Begleiter: Very good. And just back on pricing of the $90 million you're targeting for this year, if we do see raws go back to pre-conflict levels, how much of that should you or could you retain? Antonella Franzen: So obviously, we'll take a look at that if and when it happens. I know there was a period of time like earlier in the quarter where everybody thought kind of that was behind us, but it quickly all came back. So obviously, we're watching it closely on a day-by-day and week-by-week basis, and we'll stay close with our customers relative to that. As I mentioned earlier, that $90 million of pricing is related to the oil and gas headwinds. We clearly do have pricing in other areas of our portfolio as well. That's really related to the value of our products, which clearly we will continue to look at and continue to have the ability to have pricing to be part of our growth as we move forward. Operator: Your next question comes from the line of Matthew DeYoe with Bank of America. Matthew DeYoe: R&D expense continues to be managed lower. Like where is the right landing zone? And how have you shifted the framework for R&D spend and hurdle rates? Maybe -- I don't know, Lori, if you want to tap on your experience here at DuPont or maybe comparing where you are now to the DuPont of old. Lori Koch: Yes. So we target R&D expense at about 2.5% of sales. I think we're still generally in that ballpark. So anything that you're seeing with respect to moves are really more around changes in how we allocate the space the R&D labs operate in versus any kind of fundamental change in our level of investments in R&D and application development across the organization. My focus now is making sure that, that 2.5% is spread in a differential manner across the businesses. And so we've got opportunity to better do differential management with respect to R&D and making sure that we're getting more of the R&D into the areas that drive the outsized growth. And so that's where we're focused now. With respect to the portfolio, making sure that we're driving a really robust front-end work to be able to speed up the development cycle and get those new introductions to market more quickly. I would say with respect to the DuPont of the past, we're materially different with respect to where we're placing our bets. And so all of our bets are primarily within the application development space. They are working with our customers, understanding their key technological challenges and making sure that we're addressing those. They're not kind of presupposing large opportunities that don't exist today and doubling down on that. So all of the investment is really aimed at customer pipeline and working side-by-side with our customers to be able to solve those challenges. Matthew DeYoe: And then just quickly for the second quarter, can you give us a quick breakdown on where price versus volumes fell across the 2 segments? Antonella Franzen: Yes. So overall, I would say, of our 4% organic growth, there was about 1 point of price, and I would say that was pretty equally split between the 2 segments. Operator: Your next question comes from the line of Vincent Andrews with Morgan Stanley. Vincent Andrews: I wanted to ask on the cash flow. Obviously, very strong performance, looked across all the buckets of working capital, looked like it was very well done. So just curious how you're thinking about that into the back half of the year. Is there any reversal of that? Or where you think overall conversion might be for the full year? Antonella Franzen: Yes. So starting with the second part of your question first. So I would clearly expect that on a full year basis, we're much closer to 100% than we are to the 90% in terms of conversion. To your point, a lot of that is working capital. We have a large focus on that in the organization, whether that's in our DSO or DPO or our inventory days, that's what helped drive the Q2 free cash flow conversion. I mean, typically, when you look at our free cash flow, the first quarter is usually the lowest quarter. Things typically get better in the second quarter. We also have our interest payment in the second quarter. And typically, the second half is better than the first half. Sometimes there's some timing of certain tax payments and things like that, that skew it, but that's the overall kind of, I would call it, seasonality of our cash flow. So we expect to have a really strong cash flow year. Vincent Andrews: Certainly looks like it. As a follow-up, on Slide 4 in the commercial bucket there, with the AI initiatives, you talked about the 50 sales plays, 150 opportunities and the 30% win rate. I guess my question would just be, is AI making that win rate? I mean, clearly, you were going out on commercial exercises in the past. But is the win rate now higher with AI? Or is it about the same? Or what are you seeing there? Lori Koch: So the win rate of the 30% that we mentioned on the AI sales plays, those were primarily in the garment business. Our typical win rate is more in the high teens. So you can see kind of the outperformance. I wouldn't say the win rate was driven by the AI work. It was -- the AI work really just helped our speed to market. And so in the past, when we would run a sales play, it would take a couple of months to be able to get ready to launch. Now we did it in 4 weeks. And so the AI is really helping on the pace. I would say the win rate piece is enabled by the enhanced commercial organization that we're putting in place across the garment business. So really more of the mindset of a hunter mentality and being able to go out and get a better sales performance. I had mentioned we got about $5 million or $6 million in incremental garment sales alone from the sales plays that we launched. Operator: Your next question comes from the line of Patrick Cunningham with Citi. Unknown Analyst: This is [ Rachel ] on for Patrick. On the Industrial Technology side, can you just expand maybe on which parts of the portfolio is maybe accelerating higher than others? And what sort of order book visibility you have there? Antonella Franzen: Yes, I'd say we saw a really nice performance from an organic growth perspective on both the building technology side as well as the industrial technology side. So in Building Technologies, we were up low single digits. That's our construction-type business. We did see growth across residential and nonresidential is really what drove it; to one of the points that Lori had mentioned earlier, I would say we're clearly outperforming in the residential space, given the market, I would say, would be down, and we had some growth in that area. We're a bit more in line, I would say, on the nonresidential as well as the repair and remodel side of the house. And then when you look at Industrial Technologies, we had a really nice quarter, organic growth in the mid-single digits. The order book is doing well. We're seeing the nice inflection there. We're starting to see that short cycle come back. And we do expect to see -- to continue to see the growth that we saw in the second quarter kind of progress into the second half of the year. Unknown Analyst: Got it. That's very helpful. And could you just talk about the level of spending-driven demand in water and just expand on whether that growth profile has changed over the last year given the acceleration in AI and advanced nodes? Lori Koch: Yes. So on the water side, it's really providing ultra-pure water to the chip manufacturers. So that's where we saw the nice growth. I would say it was kind of up in the 20%-plus range where we've kind of seen it for the past several quarters and where we expect it to continue to grow. So as you know, obviously, the AI revolution continues to take hold, we've got participation in the Water business with respect to the ultra-pure water opportunity. Operator: Your final question comes from the line of Abigail Eberts with Wells Fargo. Abigail Eberts: One more on residential construction. Can you just speak to what drove that above-market growth there? Antonella Franzen: Yes. For us, it was predominantly in the multifamily space that we have a nice position in. We saw some nice growth there within the quarter. I would say single-family homes continues to be, I would say, very soft in the space, but we did see some really good activity in the multifamily that was driving our residential space. Operator: That will conclude our question-and-answer session. I will now turn the call back over to Ann Giancristoforo for closing remarks. Ann Giancristoforo: Great. Thank you, everyone, for joining our call today. For your reference, a copy of our transcript will be posted on DuPont's website. This concludes today's call. Operator: Ladies and gentlemen, thank you all for joining. You may now disconnect. Before you buy stock in DuPont de Nemours, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and DuPont de Nemours wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. DuPont (DD) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Celanese Corporation? Here are five stocks we like better. Acetyl Chain conditions are expected to moderate in the second half of 2026 as supply chains normalize, while the earlier Lanaken closure will increase near-term inventory-absorption costs but improve the cost structure in 2027. Celanese is prioritizing higher-value Engineered Materials opportunities in data centers, electronics, medical applications and drug delivery rather than broad volume growth, with pricing actions helping offset raw-material inflation. Management reaffirmed its $700 million–$800 million 2026 free-cash-flow target and expects $80 million–$100 million of cost reductions entering 2027, while pursuing $1 billion in divestitures and reducing net debt toward approximately $9 billion by the end of 2027. DuPont’s Electronics Spinoff: The Start of Something Big Celanese (NYSE:CE) executives said the company expects supply-chain conditions in its Acetyl Chain business to moderate during the second half of 2026, while cost actions, targeted growth initiatives and free-cash-flow generation remain central to its strategy. During the company’s second-quarter earnings call, President and Chief Executive Officer Scott Richardson said Celanese benefited in the second quarter from the flexibility of its global production and supply-chain network, particularly as it worked to provide reliable supply to customers affected by disruptions. Europe was among the regions more acutely affected by the supply-chain crisis, he said. → 3 Drone Stocks That Should Soar After the Summer Slump Buffett's latest portfolio additions, trims and cuts in Q3 Richardson said the company’s prior expectation for moderation in the back half of the year was already incorporated in its $6 full-year guide. While Celanese received somewhat more benefit than expected in the second quarter, including a slight amount of engineered-materials pre-buying, the anticipated moderation has not been more severe than management expected. Celanese expects third-quarter results to reflect higher inventory-absorption effects following the accelerated closure of its Lanaken facility and the pull-forward of certain engineered-materials closures. In addition, Richardson said the Ibn Sina joint venture did not operate for much of the second quarter, which is expected to reduce equity earnings by about $10 million for the year, with nearly all of that impact occurring in the third quarter. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Richardson said Acetyl Chain profitability has historically been weighted toward the Western Hemisphere, with more than 80% of profitability generated there in 12 of the past 15 years. Although Asian margins increased temporarily from late February into the early part of the second quarter, he said those gains were short-lived and had returned to pre-war levels by the middle of the quarter. Western Hemisphere margins have not returned to pre-war levels, Richardson said, but the company expects markets to remain relatively constructive through year-end. Supply chains have normalized to some extent as material has flowed from regions outside the Middle East, a development that has created some margin compression. Celanese is seeking to contract business gained through its supply reliability for 2027 and beyond. → Jersey Mike's Serves Fresh Gains After IPO Stumble Acetyl Chain volumes were flat year over year in the second quarter. Richardson attributed that outcome largely to product mix, as gains in the vinyls chain were offset by continued destocking in acetate tow. He said destocking in acetate tow moderated during the quarter and customer order patterns have begun to normalize compared with last year, though some destocking is expected to continue in the second half. The Lanaken closure is now expected to occur during the current quarter, sooner than previously anticipated. The earlier closure will produce a higher inventory-absorption impact in the second half, but Richardson said it should create a cleaner cost structure for 2027. Celanese expects to realize some related cost benefits in the fourth quarter, with a more substantial improvement next year. In Engineered Materials, Celanese is concentrating on higher-value applications rather than pursuing broad volume growth. Richardson said the company has identified growth opportunities within more narrowly defined market segments, including data centers, medical applications, electronics and drug delivery. Electronics currently represents about 10% of Engineered Materials revenue and 10% to 15% of its contribution margin, according to Richardson. Medical represents less than 10% of revenue but about 20% of contribution margin. The company believes those businesses can support durable growth through deeper customer alignment and differentiated product development. Richardson also highlighted data-center applications, where the company is supplying materials and engaging in development work with customers. He said artificial-intelligence data-center servers require additional materials for connector protection, signal management, thermal management and wire-and-cable applications, creating what he described as a larger opportunity set than traditional servers. Automotive volumes generally moved with lower vehicle builds during the quarter, he said. Excluding a divestiture, overall Engineered Materials volume was approximately flat year over year, as declines in automotive were offset by growth in non-auto markets. Richardson said the company is prioritizing revenue growth, share gains and product mix over volume growth in standard-grade automotive materials, particularly amid additional polymer capacity in China. Management said it has implemented price increases in Engineered Materials to address raw-material inflation. Richardson said pricing strengthened through the second half of the second quarter, helping support margin expansion, but raw-material costs are expected to create pressure in the third quarter as they flow through inventory. Chief Financial Officer Chuck Kyrish reaffirmed Celanese’s expectation for $700 million to $800 million in free cash flow for 2026. The company generated $140 million of free cash flow in the second quarter despite nearly $200 million of working-capital use, primarily related to accounts receivable, he said. Year to date, working capital represented nearly a $300 million use of cash. Kyrish said the company expects that effect to normalize in the second half and now anticipates full-year working capital to be neutral to slightly positive. He characterized the 2026 free-cash-flow range as a sustainable baseline for future years, with further potential from inventory reductions and lower restructuring cash costs. Celanese expects $80 million to $100 million of cost reductions as it enters 2027. Kyrish said the company expects to capture roughly half of the benefits from its engineered-materials nylon restructuring in 2026, while it expects to realize about one-third of the savings from the Lanaken action this year. The remaining benefits are expected next year. The company remains committed to its goal of $1 billion in divestitures by the end of 2027. Richardson said Celanese is about halfway toward that objective following the Micromax transaction and expects to announce at least one additional deal by the end of 2026. Kyrish said Celanese expects to end 2026 with net debt of about $10 billion and aims to finish 2027 at about $9 billion. The company continues to view approximately three times net debt to EBITDA as its long-term leverage target, with its next objective being to move below four times leverage after crossing five times during 2026. Celanese Corporation is a global chemical and specialty materials company that develops, manufactures and markets a broad portfolio of products serving diverse industries. The company operates through two primary business segments—Engineered Materials and Acetyl Chain—offering solutions that range from high-performance polymers and specialty additives to industrial chemicals and intermediates. Its engineered materials are used in applications such as automotive components, consumer electronics, medical devices and packaging, while its acetyl derivatives find uses in coatings, adhesives, solvents and personal care products. In the Engineered Materials segment, Celanese produces a variety of high-performance thermoplastics, polyether-block-amide (PEBA) elastomers and functional additives designed to enhance product durability, thermal resistance and sustainability. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Celanese Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

DuPont de Nemours, Inc. DD used its second-quarter 2026 earnings call to raise its full-year outlook and outline a stronger second half. Adjusted earnings of $1.88 per share topped the Zacks Consensus Estimate of $1.76. Revenues of $1.819 billion marginally beat the consensus mark of $1.818 billion. DuPont de Nemours, Inc. price-consensus-eps-surprise-chart | DuPont de Nemours, Inc. Quote The call centered on execution, with management linking growth and margins to pricing, productivity, commercial improvements and 80/20 simplification. CFO Antonella Franzen raised the midpoint of full-year adjusted earnings guidance to $7.24 per share and operating EBITDA guidance to $1.76 billion. Organic sales growth is now expected to be slightly above 4%. For the second half, Franzen projected about 6% organic growth, supported by healthcare, industrial water, aerospace and implemented pricing. She expects roughly 40% incremental margins after adjusting for price-cost effects. The outlook assumes $90 million of pricing to remain price-cost neutral, while oil-and-gas inflation creates a 50-basis-point second-half margin headwind. Third-quarter guidance calls for $1.835 billion in sales, $448 million in operating EBITDA and adjusted earnings of $1.80 to $1.90 per share. Currency is expected to reduce growth by about one percentage point. CEO Lori Koch described one operating system linking innovation, commercial excellence, operational excellence and 80/20. DuPont is using it to prioritize higher-value opportunities and scale successful practices. Koch said that the innovation vitality index is about 35%, with greater emphasis shifting toward growth products. Launches include direct lithium extraction solutions, expanded biopharma offerings and products for electric vehicles and battery storage. A Morgan Stanley analyst asked about AI-enabled selling. Koch said AI cut sales-play preparation to four weeks, while the commercial organization drove a roughly 30% win rate and $5 million to $6 million in incremental garment sales. Goldman Sachs and Mizuho analysts focused on Middle East water-project delays. Koch said that projects remain booked but have shifted, with more revenues expected in the fourth quarter than the third. Water organic sales grew at a low-single-digit rate, but increased at a mid-single-digit pace outside the Middle East. Koch said that the region represents about 10% of Water sales. DuPont now expects low-to-mid-single-digit Water growth for 2026 and high-single-digit growth in the second half. Stronger Healthcare demand is offsetting the revision and preserving the segment’s overall growth profile. A Melius Research analyst asked how quickly DuPont can reach its productivity target. Koch aims to reduce cost of goods sold by 3% annually on a net basis, with that run rate achievable within 18 months. The quarter delivered about 200 basis points of COGS reduction, contributing roughly 100 basis points to margin expansion. Koch also put cost of poor quality near 4% of sales, below a benchmark of about 5%. The 80/20 program should add a few million dollars of EBITDA in the second half through simplification, yield improvement and better resource allocation. Koch said it should not create a material top-line headwind. DuPont plans a $250 million third-quarter share repurchase after transaction-adjusted free cash flow conversion reached 127% in the quarter. Franzen said full-year conversion should finish much closer to 100% than the prior 90% target. Improvements in receivables, payables and inventory supported the cash result. A Wolfe Research analyst asked about acquisitions. Koch said that DuPont has well over $1 billion available and is evaluating Water and Healthcare targets, including packaging and contract development and manufacturing opportunities, while maintaining return discipline. Koch’s message was that growth initiatives, productivity and portfolio focus are becoming repeatable operating disciplines. Franzen paired that posture with higher guidance and continued underlying margin momentum. The second-half plan still depends on pricing realization, project timing and strength in healthcare, industrial water and aerospace. Management remained confident while acknowledging those execution requirements. DD carries a Zacks Rank #3 (Hold) at present. Its Momentum Score of A indicates favorable momentum characteristics, but the Value Score of D, Growth Score of F and VGM Score of F show weaker readings across valuation, growth and the combined style profile. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The Zacks Style Score complements the Zacks Rank, with A and B scores preferred. DD’s mix presents a neutral and uneven near-term signal, and the Zacks Rank can change as analysts revise earnings estimates following the reported results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in DuPont de Nemours, Inc.? Here are five stocks we like better. DuPont raised its full-year 2026 outlook after second-quarter results beat prior guidance, with organic sales growth of 4%, operating EBITDA up 8% to $448 million, adjusted EPS up 21% to $1.88 and free-cash-flow conversion of 127%. The company now expects slightly above 4% organic sales growth, $1.760 billion in operating EBITDA and adjusted EPS of $7.24 for 2026. It also expects full-year free-cash-flow conversion to approach 100% and plans to begin a $250 million share-repurchase program in the third quarter. Growth remains strongest in healthcare, aerospace, industrial water and semiconductor applications, while DuPont is pursuing productivity and commercial initiatives and evaluating acquisition opportunities in water and healthcare with more than $1 billion available for potential deals. Kohl's Stock Soars After Better-Than-Feared Quarter DuPont de Nemours (NYSE:DD) raised its full-year 2026 outlook after reporting second-quarter results that exceeded its prior guidance, supported by organic growth, productivity gains and cash-flow generation. Chief Executive Officer Lori Koch said the company delivered 4% organic sales growth, 80 basis points of margin expansion and double-digit adjusted earnings-per-share growth during the quarter. DuPont also plans to begin a $250 million share-repurchase program in the third quarter. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control MarketBeat Week in Review – 05/18 - 05/22 The company completed its previously announced reverse stock split in June, and its GICS classification changed to industrial in July. Koch said the revised classification better reflects the company’s industrial portfolio following its transformation in recent years. Second-quarter net sales were $1.8 billion, up 4% from the prior-year period on 4% organic growth. Growth was broad-based, led by healthcare, aerospace, industrial water and semiconductor markets, Chief Financial Officer Antonella Franzen said. Building technologies also grew year over year, supported by residential and non-residential construction activity. → 3 Drone Stocks That Should Soar After the Summer Slump Dillard’s Posted a Huge Earnings Beat—So Why Did the Rally Fade? Operating EBITDA rose 8% to $448 million, while operating EBITDA margin expanded 80 basis points to 24.6%. The margin result included a 30-basis-point headwind from price-cost dynamics, according to Franzen. Adjusted EPS increased 21% year over year to $1.88. Franzen said stronger operations contributed $0.17 per share to the increase, while below-the-line items contributed another $0.15 per share. → Why Rare Earth Processing Could Be the Real 2027 Opportunity Transaction-adjusted free cash flow totaled $326 million, producing 127% conversion during the quarter. The company said earnings growth and working-capital productivity supported the result. Healthcare & Water Technologies: Sales rose 5% to $856 million, including 4% organic growth and a 1% currency benefit. Segment operating EBITDA increased 4% to $258 million, though margin declined 30 basis points to 30.1% due to mix and growth investments. Diversified Industrials: Sales rose 3% to $963 million, entirely from organic growth. Operating EBITDA increased 7% to $213 million, and margin rose 70 basis points to 22.1%. Within Healthcare & Water Technologies, healthcare sales increased at a mid-single-digit organic rate, with double-digit gains in personal protection and biopharma. Water sales grew at a low-single-digit rate, as double-digit growth in industrial water and semiconductor applications was partly offset by weakness in the Middle East. Outside the Middle East, water organic sales increased at a mid-single-digit rate. Koch said the Middle East represents about 10% of water sales and that project timing has shifted due to the regional conflict, rather than any structural change in the market. The company expects most of the delayed project revenue to arrive in the fourth quarter. DuPont now expects full-year organic sales growth to be slightly above 4%. The company adjusted the midpoint of its sales outlook to $7.175 billion, reflecting a lower expected currency benefit as the U.S. dollar strengthens. The company raised the midpoint of its operating EBITDA outlook to $1.760 billion and its adjusted EPS midpoint to $7.24, a $0.15 increase from its prior forecast. The adjusted EPS outlook would represent an 18% increase from the prior-year pro forma result. Full-year operating EBITDA margin is expected to be 24.5%, including a 30-basis-point headwind from oil and gas inflation. DuPont expects full-year free-cash-flow conversion to be closer to 100% than its prior target of 90%, Franzen said. For the second half, DuPont expects approximately 6% organic sales growth, including pricing actions already implemented. The company forecasts second-half sales of $3.675 billion and operating EBITDA of $900 million. Second-half operating EBITDA margin is expected to be 24.5%, including a 50-basis-point headwind from oil and gas inflation. Third-quarter guidance calls for sales of $1.835 billion, operating EBITDA of $448 million and adjusted EPS of $1.80 to $1.90 per share. Reported third-quarter organic growth is expected to be about 3%, or about 5% after adjusting for a prior-year sales timing shift associated with systems activity before the Qnity separation. Koch said DuPont is integrating innovation, commercial excellence, operational excellence and 80/20 initiatives into a single business system intended to improve growth, margins and execution. The company reported more than a 100-basis-point improvement in on-time, in-full delivery during the quarter and said it is reducing its cost of poor quality. DuPont’s cost of poor quality stands at about 4% of sales, compared with a benchmark of roughly 5%, Koch said. The company is targeting net productivity of 3% of cost of goods sold annually and expects to reach that run rate across the organization within about 18 months. Second-quarter productivity represented about a 200-basis-point reduction on a cost-of-goods-sold basis, contributing about 100 basis points of margin expansion as a percentage of revenue. The company has also piloted 80/20 initiatives across four Diversified Industrials businesses. Koch said the work has identified opportunities to simplify product portfolios, improve manufacturing yield, optimize production sequencing and reallocate commercial and technical resources toward higher-growth markets. DuPont expects a few million dollars of EBITDA benefit in the second half from those efforts, primarily through margin improvement. On the commercial side, DuPont said it has won about 150 opportunities through sales plays, representing a nearly 30% win rate compared with its historical rate in the high teens. Koch said artificial intelligence has accelerated the preparation and launch of sales plays, cutting the process from months to about four weeks, while commercial organization changes have supported the higher win rate. Management cited continued momentum in aerospace, electric-vehicle batteries, industrial water and semiconductor applications. Industrial water sales to semiconductor customers, which provide ultrapure water for chip manufacturing, grew more than 20% and are expected to continue growing, Franzen said. DuPont’s electric-vehicle battery business currently generates about $70 million in revenue, primarily from adhesives. Koch said the company expects the business to move into the triple-digit-million-dollar range in 2026 and 2027. More broadly, the company sees a several-hundred-million-dollar EV opportunity within its approximately $900 million automotive portfolio. The company also introduced an integrated direct-lithium-extraction solution incorporating membranes and ion-exchange resins. Koch said the opportunity requires no incremental capital expenditure and estimated the direct-lithium-extraction market at about $200 million. Alongside the planned buyback, DuPont said it retains more than $1 billion for potential acquisitions. Koch said the company sees an active pipeline in water and healthcare, including packaging and contract development and manufacturing opportunities, but will remain disciplined on valuation and expected returns. DuPont de Nemours (NYSE: DD) is a global science and engineering company that develops and supplies specialty materials, chemicals and industrial biosciences for a wide range of markets. Headquartered in Wilmington, Delaware, the company traces its origins to 1802 and has evolved through more than two centuries of innovation. In recent history DuPont participated in a major combination with Dow Chemical and subsequent reorganization that refocused the company on differentiated, specialty businesses built around science-based solutions. DuPont's operations center on advanced materials and technologies used by manufacturers and OEMs in industries such as transportation, electronics, construction, industrial manufacturing and worker safety. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "DuPont de Nemours Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. DuPont de Nemours (DD) has just reported its second quarter and first half 2026 results, raised full year and second half sales guidance, and announced a fixed income exchange offer tied to its 4.725% 2028 notes. See our latest analysis for DuPont de Nemours. DuPont de Nemours shares are trading at US$142.93, with recent momentum modestly positive given the 1-month share price return of 2.16% and year to date share price return of 16.57%. The 1-year total shareholder return of 59.81% points to strong longer term gains even after a 90 day share price return that declined 4.85%. If DuPont de Nemours is already on your radar, it can also be useful to see what else is moving in related industrial themes and infrastructure. Take a look at the 36 power grid technology and infrastructure stocks After a strong 1 year run and a mixed reaction to the latest earnings beat, DuPont de Nemours now sits at a higher base with expectations reset. Investors may now be asking whether the current valuation still offers enough potential return to justify the risk. Against the last close of $142.93, the most widely followed narrative places DuPont de Nemours fair value closer to $172.07, which implies a meaningful gap that hinges on how its core businesses perform over the next few years. Read the complete narrative. Want to see what sits behind that confidence in DuPont de Nemours Healthcare & Water and specialty lines? The narrative leans heavily on specific growth rates, margin expansion and a targeted profit multiple that together aim to justify a much higher valuation baseline. Result: Fair Value of $172.07 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, DuPont de Nemours still faces meaningful overhangs, including ongoing PFAS related litigation and concentrated electronics exposure to China that could derail the upbeat narrative. Find out about the key risks to this DuPont de Nemours narrative. The analyst narrative and SWS fair value suggest DuPont de Nemours looks undervalued at about $142.93 compared with an estimated $172.07. Yet the stock trades on a P/E of 63.1x, which is much richer than the global Industrials average of 12x and peer average of 22x. Even relative to a fair ratio of 41.9x, the current P/E still looks stretched. That gap points to valuation risk if earnings do not track the optimistic forecasts that underpin the higher fair value. This raises the question of which signal to put more weight on as you think about position sizing and holding period. See what the numbers say about this price — find out in our valuation breakdown. With DuPont de Nemours showing both enthusiasm and concern in the current narratives, it makes sense to move quickly and test the data against your own expectations using the 2 key rewards and 3 important warning signs. Do not stop with DuPont de Nemours. Fresh ideas from different angles can sharpen your portfolio and highlight opportunities you might otherwise overlook. Target dependable cash generators by checking companies in the 7 dividend fortresses that prioritise income and resilience. Hunt for quality at a reasonable price by reviewing the 52 high quality undervalued stocks that combine solid fundamentals with appealing valuations. Strengthen your portfolio core with the solid balance sheet and fundamentals stocks screener (49 results) that focus on businesses built on healthier financial footing. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DD. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

In the second quarter of 2026, DuPont de Nemours, Inc. reported higher sales of US$1,819 million, a sharp rise in net income to US$143 million, stronger earnings per share, completed a US$775 million share repurchase program, raised its full-year 2026 net sales guidance to US$7.16–7.19 billion, and launched an exchange offer for its 4.725% senior unsecured notes due 2028. Together, the earnings beat, higher guidance, and additional share buybacks highlight management’s confidence in DuPont’s core businesses and its focus on returning capital while refining the balance sheet. We’ll now examine how DuPont’s raised 2026 guidance and expanded share repurchases influence its existing investment narrative and risk profile. Rare earth metals are an input to most high-tech devices, military and defence systems and electric vehicles. The global race is on to secure supply of these critical minerals. Beat the pack to uncover the 28 best rare earth metal stocks of the very few that mine this essential strategic resource. To own DuPont today, you need to believe its refocused portfolio in healthcare, water, and specialty materials can translate solid execution into steadier earnings, while legacy liabilities remain manageable. The latest quarter’s higher sales, stronger earnings, raised 2026 guidance, and completed US$775 million buyback support the near term catalyst of improved profitability, but they do not remove the key risk around ongoing PFAS-related and other environmental costs. The most relevant update here is DuPont’s higher 2026 net sales guidance to US$7,160 million to US$7,190 million. That outlook, paired with Q2’s earnings beat, supports the existing catalyst that Healthcare & Water and specialty applications can underpin more stable growth and margins, even as the company continues portfolio reshaping and absorbs legal and regulatory costs tied to its environmental footprint. Yet behind the upbeat guidance and buybacks, investors should be aware of how unresolved PFAS and broader environmental liabilities could still... Read the full narrative on DuPont de Nemours (it's free!) DuPont de Nemours' narrative projects $7.8 billion revenue and $919.6 million earnings by 2029. This requires 4.3% yearly revenue growth and a roughly $787.6 million earnings increase from $132.0 million today. Uncover how DuPont de Nemours' forecasts yield a $172.07 fair value, a 20% upside to its current price. Before this earnings beat and guidance raise, the most pessimistic analysts were assuming only about 3.7 percent annual revenue growth to roughly US$7.6 billion, with earnings rising to about US$814 million, so if you are comparing that cautious view with the stronger recent results, it is worth asking whether those downside scenarios still fit or if the story is shifting toward something closer to the more optimistic expectations. Explore 4 other fair value estimates on DuPont de Nemours - why the stock might be worth less than half the current price! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your DuPont de Nemours research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision. Our free DuPont de Nemours research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate DuPont de Nemours' overall financial health at a glance. Our daily scans reveal stocks with breakout potential. Don't miss this chance: AI is about to change healthcare. These 41 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early. Capitalize on the AI infrastructure supercycle with our selection of the 56 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. Find 52 companies with promising cash flow potential yet trading below their fair value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DD. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

For the quarter ended June 2026, DuPont de Nemours (DD) reported revenue of $1.82 billion, down 44.2% over the same period last year. EPS came in at $1.88, compared to $3.36 in the year-ago quarter. The reported revenue represents a surprise of +0.06% over the Zacks Consensus Estimate of $1.82 billion. With the consensus EPS estimate being $1.76, the EPS surprise was +6.82%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how DuPont de Nemours performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Change in Net Sales - Healthcare & Water Technologies - Currency: 1% versus 0.3% estimated by two analysts on average. Change in Net Sales - Diversified Industrials - Total: 3% versus the two-analyst average estimate of 1.7%. Change in Net Sales - Healthcare & Water Technologies - Total: 5% versus 5.3% estimated by two analysts on average. Net sales- Diversified Industrials: $963 million versus the two-analyst average estimate of $946.87 million. Net sales- Healthcare & Water Technologies: $856 million compared to the $859.9 million average estimate based on two analysts. Operating EBITDA- Healthcare & Water Technologies: $258 million versus the two-analyst average estimate of $256.59 million. Operating EBITDA- Corporate: $-23 million compared to the $-31.56 million average estimate based on two analysts. Operating EBITDA- Diversified Industrials: $213 million versus the two-analyst average estimate of $205.21 million. View all Key Company Metrics for DuPont de Nemours here>>> Shares of DuPont de Nemours have returned +0.2% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance outperformance was driven by broad-based organic growth in healthcare, aerospace, and industrial water, alongside significant productivity gains. Management is transitioning to a unified 'DuPont Business System' that integrates innovation, commercial excellence, and 80/20 principles to drive repeatable growth. The 80/20 initiative, piloted in four Diversified Industrials businesses, is identifying manufacturing complexity reductions and resource reallocation toward high-growth geographies. Commercial execution is being modernized through AI-enabled 'sales plays' that have reduced launch preparation time from months to four weeks. Operational excellence efforts delivered over 100 basis points of improvement in On-Time In-Full (OTIF) delivery and net productivity during the quarter. The shift to an 'Industrials' GICS classification and the completion of a reverse stock split mark the final stages of the company's multi-year portfolio transformation. Full-year organic growth guidance was raised to slightly above 4%, assuming continued strength in medical device, biopharma, and aerospace markets. Second-half organic growth is projected at approximately 6%, supported by 2 percentage points of carryforward pricing to offset oil and gas inflation. Management expects free cash flow conversion to exceed the 90% target, potentially approaching 100% due to net working capital productivity. The 2027 compensation strategy will pivot the sales force to a commission-based structure to foster a 'hunter mindset' and accelerate business development. Strategic M&A remains a priority with over $1 billion in available capacity, specifically targeting high-growth assets in Water and Healthcare packaging or CDMOs. Oil and gas inflation represents a 30 basis point headwind for the full year, increasing to a 50 basis point headwind in the second half. Geopolitical conflict in the Middle East continues to delay Water project shipments, though management views this as a timing issue rather than a structural demand shift. A $250 million share repurchase program is scheduled for launch in the third quarter of 2026. The third quarter 2025 baseline includes a $30 million timing shift from system cutover activity, which investors must account for when calculating year-over-year growth. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management reported a 30% win rate on AI-driven sales plays in the garment business, significantly higher than the historical high-teens benchmark. AI's primary contribution is speed to market, reducing sales play preparation from several months to just four weeks. The company is targeting a net productivity rate of 3% of COGS annually, a major shift from historically flat productivity performance. Full implementation of this 'core curriculum' across the entire organization is expected within the next 18 months. The EV battery adhesive business is currently around $70 million in revenue but is projected to reach triple digits in 2026 and 2027. The total EV-related opportunity now represents nearly 50% of DuPont's $900 million automotive portfolio. Excluding the Middle East, organic growth in the Water segment was mid-single digits in Q2, driven by 20%-plus growth in ultra-pure water for semiconductor manufacturing. Middle East projects are not being cancelled but are shifting into the fourth quarter due to regional logistics and conflict constraints.

DuPont de Nemours, Inc. DD reported second-quarter 2026 net income from continuing operations of $191 million or $1.37 per share, up sharply from $24 million or 17 cents per share in the year-ago quarter. Barring one-time items, adjusted earnings came in at $1.88 per share, up from the year-ago quarter’s $1.27. The figure beat the Zacks Consensus Estimate of $1.76. Net sales of $1,819 million increased 4% year over year and marginally topped the Zacks Consensus Estimate of $1,817.9 million. Organic sales also improved 4%, driven by continued strength across healthcare, industrial water and aerospace end markets. DuPont de Nemours, Inc. price-consensus-eps-surprise-chart | DuPont de Nemours, Inc. Quote Healthcare & Water Technologies generated net sales of $856 million, up 5% year over year. It missed the Zacks Consensus Estimate of $860 million. Organic sales rose 4%, while currency contributed 1%. Healthcare Technologies recorded mid-single-digit organic growth on broad-based increase led by personal protection and biopharma, while Water Technologies posted low-single-digit organic growth driven by industrial water and semiconductor markets, partly offset by weakness in the Middle East. Operating EBITDA increased 4% to $258 million. Diversified Industrials recorded net sales of $963 million, up 3% year over year, exceeding the Zacks Consensus Estimate of $947 million. Organic sales increased 3%, supported by growth in Building Technologies from residential and non-residential construction markets and continued aerospace and electric vehicle strength in Industrial Technologies. Operating EBITDA improved 7% year over year to $213 million. DuPont ended the quarter with cash and cash equivalents of $1.74 billion, up significantly from $715 million at the end of 2025. Long-term debt was $3.13 billion, essentially flat with year-end 2025. Cash provided by operating activities from continuing operations totaled $400 million in the quarter compared with $74 million in the year-ago period. Transaction-adjusted free cash flow rose to $326 million from $107 million a year ago, reflecting stronger earnings and improved cash conversion. Following its second-quarter outperformance, DuPont raised the midpoint of its full-year 2026 operating EBITDA and adjusted earnings guidance. The company now expects net sales in the range of $7.16-$7.19 billion, operating EBITDA between $1.75 billion and $1.77 billion and adjusted earnings of $7.17-$7.32 per share. For the second half of 2026, DuPont projects net sales of $3.66-$3.69 billion, operating EBITDA of $890-$910 million and adjusted earnings of $3.65-$3.80 per share. Management also expects organic sales growth to be slightly above 4% for the full year. The outlook reflects continued strength across healthcare, industrial water and aerospace end markets. Management expects mid-single-digit organic sales growth in the second half and remains focused on productivity, profitable growth and shareholder value creation. DD's shares are down 35.1% in the past year compared with the Zacks Chemicals Diversified industry’s 3.9% rise. Image Source: Zacks Investment Research DD currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the Basic Materials space are Avient Corporation AVNT, Neo Performance Materials Inc. NOPMF and Lundin Mining Corporation LUNMF. Avient is scheduled to report second-quarter results on Aug. 6. The Zacks Consensus Estimate for AVNT’s second-quarter earnings is pegged at 89 cents per share. It carries a Zacks Rank #2 (Buy) at present. NOPMF is slated to report second-quarter results on Aug. 11. The Zacks Consensus Estimate for earnings is pegged at 5 cents per share. NOPMF has a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here. Lundin Mining is scheduled to report second-quarter results on Aug. 5. The Zacks Consensus Estimate for LUNMF’s second-quarter earnings is pegged at 34 cents per share. It currently carries a Zacks Rank #2. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report DuPont de Nemours, Inc. (DD) : Free Stock Analysis Report Lundin Mining Corp. (LUNMF) : Free Stock Analysis Report Avient Corporation (AVNT) : Free Stock Analysis Report Neo Performance Materials Inc. (NOPMF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. DuPont de Nemours Inc (NYSE:DD) delivered strong Q2 2026 results, exceeding guidance with 4% organic sales growth, 80 basis points of margin expansion, and double-digit adjusted EPS growth. The company raised its full-year 2026 guidance for organic sales growth, operating EBITDA, and adjusted EPS, reflecting confidence in continued momentum. Free cash flow conversion was robust at 127% in the quarter, and the company expects full-year conversion to be ahead of its 90% target. The company announced a $250 million share repurchase program for Q3 2026, demonstrating a disciplined capital allocation strategy. Innovation and commercial excellence initiatives are yielding results, including a 30% win rate on AI-driven sales plays and new product launches in high-growth markets like direct lithium extraction and biopharma. Operational excellence programs are driving productivity, with a 100 basis point improvement in net productivity and a continued reduction in cost of poor quality, which is below industry benchmarks. The 80/20 initiative is identifying value creation opportunities, with early execution expected to deliver margin benefits in the second half of 2026. Strong growth was seen across key end markets, including healthcare, aerospace, industrial water, and semiconductor, with diversified industrials showing particular strength in EV battery applications. The company completed a reverse stock split and reclassified its sector to 'Industrial,' aligning its metrics with peers and better reflecting its portfolio transformation. The healthcare and water segment experienced a 30 basis point margin contraction year-over-year due to less favorable mix and growth investments, despite solid top-line growth. Water sales growth was tempered by weakness in the Middle East, with the company revising its full-year water growth outlook to low-to-mid single digits due to project timing and geopolitical conflict. The company faces a 30 basis point margin headwind from oil and gas inflation for the full year, with a 50 basis point headwind expected in the second half, requiring pricing actions to offset. Currency is expected to be a headwind, with the full-year net sales midpoint adjusted down by $0.175 billion due to a strengthening US dollar. The company's 80/20 initiative, while beneficial for margins, may not provide a material top-line boost in the near term, with benefits primarily focused on profitability initially. The Middle East conflict continues to cause project delays and shipment shifts, creating uncertainty and noise in the water business, though no structural changes are expected. The company's R&D expense is being managed lower, and while it remains at ~2.5% of sales, there is a shift in allocation, which could impact long-term innovation if not carefully balanced. Warning! GuruFocus has detected 9 Warning Signs with DD. Is DD fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide an update on the M&A pipeline, given the capacity for both buybacks and mid-size M&A, particularly regarding CDMO opportunities? A: Lori Koch, CEO, stated that the company maintains a robust M&A pipeline across both water and healthcare sectors, with healthcare opportunities spanning packaging and CDMO fronts. DuPont is taking a balanced capital allocation approach, announcing a $250 million share repurchase while retaining over a billion in proceeds for M&A. The company expects gross returns in the mid-teens, reducing to low-teens on a net basis post-synergies, and any acquired assets must be incremental to the overall growth algorithm. Q: Can you unpack the margin contraction in the healthcare and water segment despite solid growth, specifically the mix dynamics and growth investments? A: Antonella Franzen, CFO, explained that the margin contraction was due to a mix shift, as Q1 had a much heavier healthcare sales mix compared to Q2. Underlying margins in healthcare and water remain strong. The company is making investments, such as adding sales resources in the Tyvek business for the garment space, which is already yielding resultsexpecting $5-6 million in incremental garment sales for full year 2026. Q: What is driving the acceleration in second-half growth for diversified industrials, and how should we think about incremental operating leverage with 80/20 kicking in? A: Antonella Franzen, CFO, noted that the second-half acceleration is primarily driven by incremental pricing related to oil and gas headwinds, adding about 2 points of pricing in H2, bringing organic growth to ~6%. No significant uplift is needed to achieve targets. Year-over-year incrementals are around 40% when adjusted for price/cost dynamics. Q: On the 80/20 program, is there still a potential drag on top-line, or are you seeing positive offsets? A: Lori Koch, CEO, indicated that the initial benefits from 80/20 in 2026 will be margin-focused, driven by yield improvements and resource reallocation. While there are longer-term opportunities for growth through enhanced commercial excellence and business development, the company does not see a material top-line headwindit's more of a bottom-line improvement story. Q: Can you provide an update on the Middle East reverse osmosis headwindsare they primarily logistics constraints or structural changes? A: Lori Koch, CEO, clarified there is no structural change; the headwinds are due to the conflict in the region causing project timing shifts. Desalination volumes, a large part of RO, are moving around but not being pulled. Excluding the Middle East, water business organic growth was up mid-single-digits in Q2. The Middle East represents only about 10% of sales. Q: Does the new lithium water opportunity require incremental CapEx, or can it grow within the existing footprint? A: Lori Koch, CEO, confirmed no capital is required. The company introduced a new suite of products for direct lithium extraction (DLE) using existing RO and ion exchange product portfolios. The DLE market is sized around $200 million, and DuPont is well-positioned to capitalize on this growth. Q: Can you elaborate on the EV battery opportunityhow big is it, and is it primarily adhesives or other materials? A: Lori Koch, CEO, stated that the EV battery space is currently around $70 million in revenue, expected to grow into triple digits in 2026-2027. It is primarily adhesives, and the broader EV/electrification opportunity represents a few hundred million dollars. The company has a strong pipeline of wins across all regions as OEMs introduce newer models. Q: On the construction improvement, is that mainly data centers or are other areas expanding? A: Lori Koch, CEO, clarified that the growth is not data center-driven but rather from healthcare and education sectors (HHEP). There is significant investment in new hospitals and university-level projects driving optimism. Most growth is outside data centers in the non-residential space. Q: Regarding the $90 million pricing target for oil and gas headwinds, if raw materials return to pre-conflict levels, how much pricing should you maintain? A: Lori Koch, CEO, said the company will evaluate pricing on a day-by-day basis if raw material costs decline. While the $90 million is specifically related to oil and gas headwinds, DuPont also has pricing in other portfolio areas reflecting product value, which will continue to be part of growth going forward. Q: Where is the right landing zone for R&D expense, and how are you shifting R&D spend and hurdle rates? A: Lori Koch, CEO, noted R&D expense is around 2.5% of sales, with changes reflecting allocation rather than fundamental investment levels. The focus is on differential management, directing more R&D toward high-growth areas and speeding up development cycles. Compared to the old DuPont, the company is more customer-centric, working on specific technological challenges rather than presupposing large opportunities. For the complete transcript of the earnings call, please refer to the full earnings call transcript.