PPG beats profit and revenue estimates as demand holds up
PPG’s first quarter showed manufacturers still passing through higher costs, with price increases, aerospace demand and stronger Latin America sales cushioning margins.
PPG Industries delivered a first-quarter beat that underscored how far pricing power still travels in industrial America. The Pittsburgh-based paints and coatings maker said net sales rose 7% to $3.93 billion in the January-March period, topping the $3.85 billion estimate compiled by LSEG, while adjusted earnings per share climbed 6% to $1.83.
The numbers point to a business still finding room to protect margins even as costs rise. PPG said organic sales increased 1% in the quarter, helped by higher selling prices and stronger demand in aerospace and coatings. On April 15, the company announced price increases of up to 20% across parts of its paints, coatings and specialty products portfolio, saying the move was already in progress and could climb further in some products, technologies and regions if needed.
That pricing action matters because PPG is using its strongest end markets to offset uneven industrial demand elsewhere. Chairman and Chief Executive Tim Knavish said the company’s differentiated aerospace business and its architectural coatings operation in Latin America helped drive the quarter. PPG said Performance Coatings posted low-single-digit organic sales growth, led by aerospace, protective and marine coatings, while packaging coatings also turned in outstanding results. Its aerospace order backlog positions the company for continued above-industry growth, a sign that commercial and defense-related demand remains resilient even as broader manufacturing activity softens.
Not every geography moved in the same direction. PPG said its Global Architectural Coatings segment posted low-single-digit organic sales growth and a 230-basis-point improvement in EBITDA margin, with Latin America doing much of the heavy lifting. Europe was mixed, Mexico showed recovering project-related sales and especially strong retail demand, and China automotive production fell from a particularly high comparison in the first quarter of 2025, weighing on margins. The company also bought back about $100 million of stock during the quarter.
PPG’s guidance suggests management believes pricing and mix can still absorb inflation, but only to a point. The company reaffirmed full-year 2026 adjusted EPS guidance of $7.70 to $8.10 and said on April 15 that second-quarter organic sales and adjusted EPS would likely be flat to low-single-digit percentage growth from a year earlier. For industrial customers, the message is clear: premium demand in aerospace and select coatings markets is still giving suppliers leverage, but the pressure from raw materials, energy, logistics and packaging has not gone away.
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