Solstice Advanced Materials Inc.

Second-quarter 2026 net sales were $1.148 billion, up 11% year over year. Adjusted EBITDA was $290 million, up 2% year over year, with adjusted EBITDA margin at 25.3%; GAAP net income attributable to Solstice was $119 million, up from $97 million a year ago, or $0.75 per diluted share, and adjusted diluted EPS was $0.88. For the first half, operating cash flow was $461 million and free cash flow was $248 million. Segment highlights: Refrigerants & Applied Solutions net sales were $850 million, up 12%, with adjusted EBITDA of $280 million and margin of 32.9%; Electronic & Specialty Materials net sales were $298 million, up 8%, with adjusted EBITDA of $64 million and margin of 21.6%. Full-year 2026 guidance was raised to net sales of $4.125 billion to $4.185 billion, adjusted EBITDA of $1.035 billion to $1.055 billion, adjusted diluted EPS of $2.75 to $2.95, and capital expenditures of $420 million to $440 million. Third-quarter 2026 net sales guidance was $990 million to $1.03 billion.

David Sewell framed the quarter as evidence of a resilient portfolio with broad-based demand across nuclear, electronic materials, refrigerants, and health care packaging, noting that 6 of 7 businesses grew and 4 grew at double-digit rates. He emphasized that the company is reinvesting in high-return growth areas through CapEx and R&D while also returning cash to shareholders. His tone was confident and constructive, especially on secular demand from AI, data centers, semiconductor manufacturing, thermal management, and nuclear energy, and he said the Element Solutions deal accelerates that strategy.

Tina Pierce focused on the mechanics behind the quarter and the outlook: 11% organic sales growth, modest FX tailwind, and EBITDA margin pressure mainly from plant turnaround timing and prior-year incentive credits. She pointed to the segment details, including RAS EBITDA margin of 32.9% and ESM margin of 21.6%, and said margins have been consistent around the 25% range overall. On the balance sheet, she cited $2 billion of total debt, $750 million of cash, $1.25 billion of net debt, approximately 1.3x net leverage, and $1.75 billion of total liquidity. She also highlighted $186 million of first-half CapEx, up 32%, and reiterated the $0.075 quarterly dividend.

Analysts pressed on why third-quarter EBITDA guidance was not given, and management effectively said investors can back into it using a low-25% margin range, with only small sequential margin improvement expected. Questions also focused on refrigerants, where management said data center cooling is still a smaller part of sales but is the fastest-growing piece, with growth driven mostly by standard cooling and future upside from 2-phase and immersion cooling. On nuclear, management said mid-30% second-half margins are still expected despite the product loan return, and described active work on Metropolis debottlenecking, brownfield versus greenfield options, customer contract discussions, and encouraging government feedback. Analysts also asked about debt financing for Element Solutions, and management said it will be opportunistic across potential windows in September, October/November, or the first half.