Key Highlights

  • Third quarter sales Revenue rose 8% to $2,385 million from $2,202 million.
  • EBIT was $305 million, compared with $188 million a year earlier.
  • EPS was $2.19, and adjusted EPS was $1.84, versus $1.14.
  • Operating cash flow was $290 million, compared with $402 million.
  • A $375 million Department of Energy award was reinstated.

Pricing drives an 8% sales increase

Eastman Chemical (NYSE:EMN) reported third quarter 2026 results on October 29, 2026. Sales revenue was $2,385 million, up 8% from $2,202 million, due to 7% higher selling prices and 1% higher Volume and mix.

Higher prices were primarily driven by higher raw material and distribution costs and tight market conditions in Chemical Intermediates because of the ongoing conflict in the Middle East. CEO Mark Costa said the company implemented higher sequential price increases in its specialties and remains on track for about $500 million of selling price increases.

Earnings improve on asset utilization

EBIT rose to $305 million from $188 million, and adjusted EBIT was $305 million versus $210 million. The company attributed the gain mainly to improved asset utilization following inventory reduction actions in the third quarter of 2025, lower planned maintenance expense and favorable price-cost, partly offset by higher variable compensation.

EPS was $2.19 versus $0.60, and adjusted EPS was $1.84 versus $1.14. On a calculated basis, EBIT Margin was about 12.8% of sales, against about 8.5% a year earlier.

GAAP EPS exceeded adjusted EPS this quarter because reported results included a $4 million income tax benefit, a negative 2% effective rate, while the adjusted figure applied a 15% rate. The interim tax adjustment was worth $0.35 per share.

Segment performance

Advanced Materials sales rose 5%, with 4% from higher selling prices and 1% from favorable currency. Volume and mix were unchanged, as gains in specialty plastics and advanced interlayers were offset by lower volume in performance films. EBIT increased on substantially improved asset utilization and lower planned maintenance costs.

Additives and Functional Products sales rose 9%, with a 10% increase from higher selling prices partly offset by 1% lower volume and mix, tied to cost pass-through contracts. The company described the segment as resilient.

Chemical Intermediates sales rose 16%, with 12% from higher prices and 4% from volume and mix, as tight market conditions linked to the Middle East conflict lifted olefin and derivative products. Segment EBIT was $35 million versus $1 million.

Fibers sales were unchanged at $255 million, as 4% higher volume and mix offset 4% lower prices from acetate tow contract pricing. Segment EBIT fell to $52 million from $67 million, and the company said Fibers is on track to deliver expected volume growth in the second half as customers meet annual contract commitments.

Cash flow, savings and the DOE award

Operating cash flow was $290 million in the quarter versus $402 million, and $377 million for the nine months. The company expects to release Working Capital in the fourth quarter.

It is on track to deliver $125 million to $150 million of cost savings, net of inflation. Eastman also announced the reinstatement of a $375 million Department of Energy award supporting the scale-up of its circular platform, which it expects to drive significant revenue growth in 2026 and 2027.

The company returned $96 million to stockholders through dividends. Cash and cash equivalents were $768 million at September 30, 2026, and net Debt was $4,450 million versus $4,221 million at December 31, 2025.

For full-year 2026, Eastman projects adjusted EPS of $6.00 to $6.20 and Operating Cash Flow of about $850 million.

Readers tracking the name will likely follow whether price increases hold as input costs shift, fiber volumes in the second half and working capital release.