Detailed narrative
Q2 results and the earnings bridge
Adjusted EPS of $3.20 rose 19% (+$0.51) YoY and beat the top of guidance, driven by on-site volume, non-helium pricing, currency (+3% as the dollar weakened), productivity and lower depreciation, partially offset by fixed cost inflation, planned Americas maintenance outages, and a continued helium price headwind.
Sales rose 9% and adjusted operating income grew 19% on volume, currency and lower costs, partially offset by a price headwind. Adjusted operating margin expanded over 200 bps to 23.7% despite a 50 bps drag from higher energy pass-through. Improved equity affiliate income (primarily Mexico) also helped.
Helium supply disruption and resilience
Recent Middle East conflict curtailed helium supply from Qatar, which represents roughly one-third of world helium volume; the Air Products-connected Qatar plant (on the local natural gas grid, not the LNG source) has been down since December. Helium's largest end markets are electronics, aerospace and medical.
Management stressed a resilient supply chain: multiple U.S. sources, long-term partnerships with Sonatrach (Algeria) and Qatar Energy, a dedicated Texas storage cavern operational ~5 years, and a large helium ISO container fleet from subsidiary Gardner Cryogenics. The system is sized to cover Air Products' own volumes if one source is down, not to backfill the whole market.
Contracts average 3–5 years, with some recently longer as customers prioritize reliability.
Large-project portfolio: NEOM, Darrow/Louisiana, Alberta
On NEOM (green hydrogen/ammonia, West Coast Saudi Arabia, unaffected by the conflict), the renewable power side is essentially complete—the substation was energized on grid power—with next steps to connect the solar park and commission using its own renewable power; marketing/distribution negotiations with Yara are progressing (CBAM risk sits with Yara, not the U.S. hydrogen/nitrogen agreement).
On the Louisiana/Darrow blue-ammonia project, the base case is not to proceed absent a reliable capital cost estimate and EPC agreements meeting risk-adjusted returns; a go/no-go is targeted by mid-calendar 2026, and downsizing to ~50% is impractical because one process area has three trains.
Alberta has no updates as regulatory conditions in Canada evolve.
Electronics super-cycle and the Samsung win
Management framed a historical semiconductor super-cycle serving AI demand, with industry CapEx projected in excess of $0.5 trillion between now and 2030. Air Products is executing ~$1 billion in ASU and hydrogen projects in Asia for multiphase semiconductor and memory customers and expects to add $1.5–$2 billion to backlog in the next 6 months.
It announced (day prior) a build-own-operate project with Samsung in South Korea for multiple production facilities and specialty gas supply systems for a new advanced fab—described as its largest-ever electronics investment, its fifth phase at what it calls the world's largest electronics site, with volumes ~3x Phase 1 and a ~4-year construction.
Helium volumes to large Asia electronics customers are expected to more than double 2026–2030.
Segment detail
Americas operating income grew 2% on on-site volume and non-helium merchant price (merchant volume up including helium for space launches), offset by a prior-year one-time📎 customer contract addendum, lower helium price, higher power costs, and maintenance turnarounds. Asia jumped 25% on productivity, favorable on-site and helium volumes, ramping new assets, and reduced depreciation from gasification assets held for sale, partly offset by helium pricing.
Europe rose 8% on on-site volume (lapping a prior-year turnaround), currency and non-helium price, offset by depreciation, fixed cost inflation and helium headwinds. Middle East and India improved on lower cost with slightly positive equity/affiliate income. Corporate and Other improved on lower sale-of-equipment cost headwinds and productivity.
China coal gasification economics
Two coal gasification assets in China were classified as held for sale. Halting their depreciation contributed roughly 1%–1.5% benefit to the quarter, and collection on previously reserved past dues (as coal-to-methanol/oil economics improved with higher oil/LNG costs) added a further ~1%–1.5% tailwind.
Management is actively pursuing the sale of these assets, and expects stronger oxygen demand from Chinese coal gasification customers as oil and LNG costs support higher volumes.
Capital allocation and end markets
Capital discipline remains a priority: FY26 capex maintained at ~$4 billion while cutting spend ~$1 billion versus prior year, with $800 million returned to shareholders in dividends in H1 and net debt-to-EBITDA at 2.2x against a long-term A/A2 rating goal.
End-market color: strong U.S. Gulf Coast refining run rates lifting on-site hydrogen volumes to record levels; European chemicals pressured by feedstock costs; stronger China coal-gasification oxygen demand; electronics and aerospace as bright spots. In aerospace, Air Products supplied liquid hydrogen and liquid helium (via proprietary liquid helium pumps) to NASA's Artemis 2 mission and announced a new Florida ASU to expand support for NASA and commercial space launch customers.