Can you size the proportion of Opteon sales from the stationary aftermarket and quantify the year-over-year decline assumed in Q3 guidance?

Shane Hostetter stated that the company doesn't typically disclose the exact sizing of the aftermarket. However, he noted that Q2 and Q3 of the prior year benefited from approximately $65 million in aftermarket sales that were effectively "pre-buy" due to the AIM Act transition, which would have otherwise been allocated to the current year. “We believe from the Q2 and Q3 perspective, there's probably about $65 million of aftermarket sales that realistically, you think about like-for-like probably should have been allocated to more of this year. It was just more prebuy given some of the overall inventory constraints in the market that we took advantage of in supply.”

Given last year's "presales," will the aftermarket stationary business continue to see falling sales through Q1 next year, or when will it normalize?

Denise Dignam confirmed that the transition period for the technology, including destocking, is expected to span 2025 and 2026, with a pickup in sales anticipated in Q1 2027 ahead of the next cooling season. “I think you should look at this transition -- the transition of the technology over '25 and '26 and then really picking back up in next season in the end of the Q1 of 2027.”

Given Q4 is seasonally weak, what gives confidence in the projected sequential step-up in EBITDA from Q3 to Q4 (midpoint $190M for Q3, $170M-$220M for Q4)?

Shane Hostetter explained that the strong Q4 expectation is driven by anticipated strength in TT and APM. For TT, this includes pricing tailwinds and significant cost improvements. For APM, it's due to a strong order book in high-value end markets, improved product mix, and the absence of higher inventory costs that impacted the first three quarters. “I think your observation is correct that we do anticipate a strong Q4 on the backs of really strength in TT and APM comparatively to the prior quarters... The strength in TT really is on the back of some pricing, obviously, tailwinds that we're seeing in the market. But also, we have line of sight into really good cost improvements within TT... On APM... the first 3 quarters really were impacted by higher costs that we were sitting in inventory that were coming through given the absorption related to Washington Works. We're not going to see that in the fourth quarter.”

Chemours (CC) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Materials· Aug 5, 2026

Source: earnings call transcript

Executive summary

The Chemours Company Q2 FY26 — Strong Pricing and Operational Performance Offset Softer Residential AC Demand

Chemours delivered a mixed second quarter, with strong pricing execution and operational improvements in Titanium Technologies and Advanced Performance Materials offsetting softer demand in the Thermal and Specialized Solutions residential aftermarket. The company continues to advance its Pathway to Thrive strategy, focusing on balance sheet de-risking, debt reduction, and portfolio transformation, with an emphasis on high-value growth markets like data centers and semiconductors. Management is exploring all strategic options to unlock shareholder value.

Highlights

Adjusted EBITDA exceeded expectations, supported by stronger operational performance and improved product mix in APM, lower corporate costs, and pricing strength in TT.
Pricing improved across all businesses, including a 5% year-to-date price increase in TT due to three announced TiO2 price increases since December 2025.
APM's Performance Solutions portfolio net sales grew 8% year-over-year, driven by high-value specialty applications for data center and semiconductor end markets.
Strong cash generation enabled repayment of close to $270 million of the 2028 euro term loan, with $103 million beyond prior communication.
Notable progress resolving legacy litigation, including settlements with the U.S. EPA and West Virginia DEP, derisking the balance sheet.

Concerns

Net sales were slightly below expectations due to softer residential stationary AC demand in Thermal and Specialized Solutions (TSS).
TSS aftermarket customers built additional inventory in 2025 due to AIM Act channel fill, leading to an oversupplied channel and destocking in Q2 2026.
Residential demand in TSS is pressured by higher interest rates, affordability challenges, and a slower housing market, weighing on Q2 order activity.
APM net sales were down year-over-year primarily due to lower volumes from the SPS Capstone line closure in Q3 2025.
APM Adjusted EBITDA declined year-over-year due to lower sales volumes from the line closure and higher costs from a now-resolved Washington Works outage.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year Net Sales Growth	1% to 5% high materiality	FY26 · 2026	High
Full-year Adjusted EBITDA	$775M to $825M high materiality	FY26 · 2026	High
Full-year Capital Expenditures	$250M to $280M medium materiality	FY26 · 2026	High
Full-year Free Cash Flow Conversion	above 25% high materiality	FY26 · 2026	High
Net Leverage Ratio	around 3.8x adjusted EBITDA high materiality	FY26 · 2026	High
Long-term Adjusted EBITDA	at least $1B high materiality	annual	High
Long-term Free Cash Flow Conversion	exceeding 40% high materiality	annual	High
TSS Net Sales Growth	decline mid-teens to 20% medium materiality	Q3 · 2026	High
TSS Adjusted EBITDA	$125M to $140M medium materiality	Q3 · 2026	High
TT Net Sales Growth	increase low to mid-single-digit percentage medium materiality	Q3 · 2026	High
TT Adjusted EBITDA	$70M to $80M medium materiality	Q3 · 2026	High
APM Net Sales Growth	increase mid- to high single-digit percentage medium materiality	Q3 · 2026	High
APM Adjusted EBITDA	$20M to $30M medium materiality	Q3 · 2026	High
Consolidated Net Sales Growth	decrease 5% to flat high materiality	Q3 · 2026	High
Consolidated Adjusted EBITDA	$175M to $205M high materiality	Q3 · 2026	High
Corporate Expenses	$40M to $45M low materiality	Q3 · 2026	High
Capital Expenditure	$65M medium materiality	Q3 · 2026	High
Free Cash Flow	at least $50M high materiality	Q3 · 2026	High
Consolidated Adjusted EBITDA	$170M to $220M high materiality	Q4 · 2026	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Thermal and Specialized Solutions (TSS) Net sales were slightly down due to lower volumes from reduced aftermarket sales of Opteon blend in North America, partially offset by higher pricing in Freon refrigerants. OEM volumes for Opteon grew. Adjusted EBITDA and margins increased year-over-year due to higher pricing and timing of certain costs. Aftermarket is working through elevated inventory from 2025 channel fill. Opteon OEM volumes growth: year-over-yearFreon refrigerants pricing: higherAftermarket inventory: elevatedAftermarket destocking: ongoingStationary aftermarket growth target: mid- to high single-digit percentage annually (long-term)	slightly down	—	—	increased year-over-year
Titanium Technologies (TT) Net sales increased slightly due to global pricing strength. Adjusted EBITDA improved year-over-year, while margin was flat, driven by pricing offsetting higher costs from inflation. The business is managing production to demand and optimizing manufacturing. Global pricing strength: increasedTiO2 price increases: 3 since Dec 2025Year-to-date price increase: approximately 5%Volumes: lower (across key end markets, except Asia ex-China and Latin America)	increased slightly	—	—	improved year-over-year
Advanced Performance Materials (APM) Net sales were down primarily due to lower volumes from the SPS Capstone line closure in Q3 2025 and higher costs from a resolved Washington Works outage. Performance Solutions showed strong momentum in high-value data center and semiconductor end markets. Performance Solutions net sales growth: 8% year-over-yearPerformance Solutions sales to targeted markets (data center, semiconductor, AI, advanced electronics): >40%	down	—	—	declined year-over-year

Orderbook & backlog

APM Performance Solutions Order Book strong Q2 FY26

Driven by long-term sustainable demand tailwinds in data center and semiconductor end markets.

Product announcements

Product	Type	Timeline	Details
2-phase liquid cooling products	milestone	Q2 FY26

Risks & headwinds

Softer Residential Stationary AC Demand Q2 FY26, potentially continuing through the year

Net sales slightly below expectations

Mitigation:Disciplined commercial execution, focus on OEM growth, expectation of aftermarket normalization and seasonal restocking ahead of next year's cooling season.

Elevated Aftermarket Inventory (TSS) Continuing through the year, normalizing by Q1 2027

oversupplied channel heading into 2026

Mitigation:Aftermarket expected to begin normalizing as inventory levels are reduced and seasonal restocking begins.

Macroeconomic Headwinds (TSS) Q2 FY26, potentially continuing

higher interest rates, affordability challenges, slower housing market

Mitigation:Focus on long-term fundamentals, advantaged market position, regulatory tailwinds.

Inflationary Pressures (TT) Ongoing

higher costs from inflation

Mitigation:Strong commercial execution, disciplined cost management, realized pricing gains (5% YTD price increase) more than offsetting headwinds.

SPS Capstone Line Closure Impact (APM) Q2 FY26 (closure in Q3 2025)

lower volumes, net sales down

Mitigation:Shifting portfolio mix to Performance Solutions, focusing on higher-value markets with stronger growth and margin potential.

Washington Works Outage (APM) Q2 FY26 (now resolved)

higher costs, Adjusted EBITDA declined

Mitigation:Return to normal operating levels at Washington Works, anticipated earnings growth beyond Q3.

Sulfuric Acid Price Increase (TT) Ongoing trend, exacerbated by war

input cost of sulfur increasing

Mitigation:Helpful from a pricing standpoint, focus on fair trade markets where customers value reliability.

What to watch in Q3 FY26

TSS Aftermarket Inventory Normalization

next quarter (Q3 FY26) and into Q1 2027

Current elevated inventory levels

Target beginning to normalize

Why it matters

Normalization of aftermarket inventory is crucial for TSS volume recovery and margin improvement, as it currently pressures sales and mix.

Looking ahead, we would expect the aftermarket to begin normalizing as inventory levels are reduced and seasonal restocking begins ahead of next year's cooling season.

Find out whether CC delivers this. Inve re-checks your case every morning.

Q&A highlights

Why are Q3 TSS margins guided lower (high 20s vs. historical 30%+), and is this a temporary or resetting baseline?

Shane Hostetter attributed the lower Q3 margins primarily to a less favorable mix due to softer aftermarket sales in residential and light commercial. He stated that the business is still fundamentally a "30-plus margin business" and expects restocking in 2027 to help.

“I don't look at the margin sequentially from Q2 to Q3. I kind of look at it compared to prior year. Certainly, we'd be guiding to lower margins. And really, this goes hand-in-hand with the discussions we had on the script whereby we're seeing really slower business in the aftermarket, specifically in residential, light commercial in TSS. And that's really a mixed attribute. That's really the predominant driver there.”

asked by Peter Osterland · answered by Shane Hostetter

2 min read 6 chapters

Detailed narrative

Q2 Performance Highlights

Chemours reported Q2 results with net sales slightly below expectations, mainly due to softer residential stationary AC demand in TSS. However, Adjusted EBITDA exceeded expectations, driven by strong operational performance and improved product mix in APM, lower corporate costs, and robust pricing in Titanium Technologies. The company emphasized disciplined commercial execution and the positive impact of its Pathway to Thrive strategy.

TSS Market Dynamics

The Thermal and Specialized Solutions (TSS) business saw solid Q2 results, but net sales were down year-over-year due to lower volumes from reduced aftermarket sales of Opteon blend in North America. This was partially offset by higher pricing in Freon refrigerants.

The aftermarket is experiencing destocking after initial channel fill in 2025 related to the U.S. AIM Act, compounded by higher interest rates and a slower housing market. OEM volumes for Opteon grew year-over-year.

Titanium Technologies (TT) Resilience

The TT segment demonstrated strong execution in a challenging, inflationary market. Net sales increased slightly year-over-year, primarily due to global pricing strength, which increased across all regions. Volumes were lower in most key end markets, except for Asian markets (excluding China) and Latin America. Three TiO2 price increases have been announced since December 2025, contributing to approximately a 5% year-to-date price increase.

Advanced Performance Materials (APM) Transformation

APM's Q2 net sales were down year-over-year, mainly due to the SPS Capstone line closure in Q3 2025 and higher costs from a resolved Washington Works outage. However, the Performance Solutions portfolio showed strong momentum, with net sales up 8% year-over-year, driven by demand in data center and semiconductor end markets.

Over 40% of Performance Solutions sales are now focused on these high-growth markets, and sales into AI infrastructure represent a high single-digit percentage of total APM and TSS sales.

Balance Sheet and Capital Allocation

Chemours continued to strengthen its financial position through strong cash generation and disciplined capital allocation. The company repaid nearly $270 million of its 2028 euro term loan in Q2, exceeding prior commitments. Progress was also made in resolving legacy litigation, including settlements with the U.S. EPA and West Virginia DEP, which are seen as de-risking the balance sheet and improving financial flexibility.

Pathway to Thrive Strategy

The company is halfway through its Pathway to Thrive strategy, which aims to strengthen its foundation, improve resilience, and create strategic portfolio options. Management highlighted significant progress in de-risking the balance sheet, advancing portfolio transformation, and establishing a stronger operating model through lean principles.

The strategy is intended to create greater flexibility for future portfolio actions, with "no portfolio action off the table" to unlock step-change value for shareholders.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.