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    IEP
    Earnings call· Jun 2026(Q2 FY26)

    ICAHN ENTERPRISES Q2 FY26 earnings call IEP

    Aug 5, 2026 Source

    Executive summary

    Icahn Enterprises Q2 FY26 — Strategic Divestiture and Portfolio Optimization

    Icahn Enterprises' second quarter was marked by significant portfolio optimization, highlighted by the definitive agreement to sell Pep Boys for $700 million, a move expected to bolster liquidity and address upcoming debt maturities. While the company reported a net loss and a decline in Net Asset Value primarily due to fund and CVI performance, strategic actions like the Pep Boys divestiture and ongoing segment management aim to enhance long-term value. The company continues to focus on maintaining liquidity to capitalize on future opportunities within its diversified operating segments.

    Highlights

    5

    • Icahn Enterprises entered a definitive agreement to sell Pep Boys for $700 million, expected to close in Q3 FY26, providing significant financial flexibility.

    • CVI declared a $0.10 per share dividend, reflecting confidence in its strong positioning to capitalize on energy market opportunities.

    • Century reported base revenue and gross profit growth of 36% and 21% respectively in Q2 FY26, with its stock up approximately 4%.

    • JetBlue reported solid Q2 FY26 results, growing revenue per available seat mile by approximately 11%, with its stock up approximately 30%.

    • Real Estate adjusted EBITDA increased by $9 million YoY in Q2 FY26, driven by assets transferred from the Automotive segment and intercompany rent from Pep Boys.

    Concerns

    5

    • Net Asset Value (NAV) decreased by $765 million in Q2 FY26 compared to Q1 FY26, primarily driven by a $243 million decrease in funds and a $435 million decrease in CVI.

    • Net loss attributable to IEP was $355 million ($0.52 per unit) in Q2 FY26, compared to a $165 million loss ($0.30 per unit) in the prior year quarter.

    • Adjusted EBITDA loss attributable to IEP was $134 million in Q2 FY26, a decrease from $40 million in Q2 FY25.

    • Investment funds had a negative return of 10.9% for the quarter (including refining hedges), with short positions contributing a negative performance attribution of 15.5%.

    • Pharma adjusted EBITDA decreased by $14 million YoY in Q2 FY26 due to reduced sales from generic competition and increased R&D expenses.

    Segment performance

    7
    SegmentRevenueYoYQoQMargin
    Investment Funds
    Experienced a negative return for the quarter, primarily driven by short positions. Investment in funds was approximately $2 billion at quarter end with $741 million in cash.
    Negative return (excluding refining hedges): -7.7%Long positions performance attribution: +3.9%Short positions performance attribution: -15.5%Net short notional exposure at quarter end: 30%Net short notional exposure prior quarter end: 29%Net long notional exposure (excluding refining hedges) at quarter end: 23%Net short notional exposure (excluding refining hedges) prior quarter end: 2%
    		———-10.9% return (including refining hedges)
    Energy
    Adjusted EBITDA increased compared to Q2 FY25 ($40 million). Refining operations were solid despite higher RFS obligation costs. Fertilizer segment had strong results due to robust demand. CVR declared a $0.10 per share dividend.
    Crude utilization: over 98%
    		———$102 million adjusted EBITDA attributable to IEP
    Automotive
    Revenue decrease primarily driven by store closures in 2025, partially offset by improved pricing. Pep Boys sale expected to close in Q3, retaining AMCo and Precision 2 Auto Care franchise businesses.
    Same-store sales: flat
    		decreased by $14 million———
    Real Estate
    Adjusted EBITDA increased compared to prior year, driven by income from assets transferred from the Automotive segment. Expected to include over 400 owned and leased locations post-Pep Boys sale.
    Intercompany rent from Pep Boys: $9 millionThird-party tenants income: $2 million
    		———$9 million adjusted EBITDA increase
    Food Packaging
    Decrease primarily due to lower volume and continued disruptive headwinds from restructuring plan.
    		———$2 million adjusted EBITDA decrease
    Home Fashions
    Decrease primarily due to softening demand in hospitality business and continued supply chain disruptions.
    		———$1 million adjusted EBITDA decrease
    Pharma
    Decrease primarily due to reduced sales from generic competition in anti-obesity drug therapy and increased R&D expenses for ongoing pivotal drug trials (TRANSCEND trial).
    		———$14 million adjusted EBITDA decrease

    Operational metrics

    11
    Net Asset Value
    $765 million decreasevs Q1 FY26
    Q2 FY26

    NAV decreased by $765 million compared to Q1. Included in Q2 NAV is an estimated gain of approximately $100 million from the expected sale of Pep Boys.

    Net Asset Value
    $268 million increasevs Q2 FY26 end
    July

    Updating just for market value subsidiaries and investments for the month of July, NAV increased by $268 million.

    Net Loss Attributable to IEP
    $355 millionvs $165 million loss in Q2 FY25
    Q2 FY26

    Net loss attributable to IEP was $355 million or a loss of $0.52 per unit.

    Adjusted EBITDA Loss Attributable to IEP
    $134 millionvs $40 million adjusted EBITDA in Q2 FY25
    Q2 FY26

    Q2 '26 adjusted EBITDA loss attributable to IEP was $134 million compared to adjusted EBITDA attributable to IEP of $40 million for the prior year quarter.

    Holding Company Cash and Investment in Funds
    $2.4 billion
    Q2 FY26

    As of quarter end, the holding company had cash and investment in the funds of $2.4 billion.

    Subsidiary Cash and Revolver Availability
    $1.4 billion
    Q2 FY26

    and our subsidiaries had cash and revolver availability of $1.4 billion.

    Holding Company Liquidity
    roughly $2 billion
    Subsequent to Q2 FY26 (end of July)

    Subsequent to quarter end, our investment in the funds declined to approximately $1.7 billion as of the end of July, resulting in holding company liquidity of roughly $2 billion.

    Distribution per Depository Unit
    $0.50unchanged
    Q2 FY26

    The Board declared unchanged distribution at $0.50 per depository unit.

    CVR Dividend per Share
    $0.10
    Q2 FY26

    We were pleased to see CVI declare a $0.10 per share dividend.

    Revenue per Available Seat Mile Growth
    approximately 11%
    Q2 FY26

    JetBlue reported solid Q2 results, growing revenue per available seat mile by approximately 11%.

    Operating Expenses per Available Seat Mile (excluding fuel)
    approximately 2%
    Q2 FY26

    while operating expenses per available seat mile, excluding fuel, increased by approximately 2%.

    Industry KPIs

    3
    MetricValueDetails
    Named project wins pipeline—
    Segment organic growth margin36% revenue growth, 21% gross profit growth%
    Spin stranded cost portfolio moves$700 millionUSD

    Deals & partnerships

    4
    UndisclosedSale of Pep Boys business$700 million

    IEP will retain owned real estate, franchise businesses (AMCo and Precision 2 Auto Care), and certain supercenter leases. Pep Boys expected to lease most locations from IEP post-closing.

    UndisclosedAcquisition of a premier provider of mechanical and electrical construction services

    Century announced an acquisition of a premier provider of mechanical and electrical construction services.

    UndisclosedSale of food ingredients business and portfolio of botanical extracts, vitamins, minerals, and food enhancement

    IFF entered into an agreement to sell its food ingredients business and its portfolio of botanical extracts vitamins and minerals and food enhancement as part of portfolio optimization.

    AT&TCompletion of license purchase agreement

    Echostar announced the completion of its license purchase agreement with AT&T.

    Risks & headwinds

    6
    Major geopolitical developments contributing to volatility across energy marketsnear-term

    near-term uncertainty

    Mitigation: CVI is well positioned to capitalize on attractive market opportunities for the balance of 2026.

    Higher RFS obligation costs weighing down refining marginsQ2 FY26

    margins were weighed down

    Reduced sales due to generic competition in anti-obesity drug therapyQ2 FY26

    $14 million decrease in Pharma adjusted EBITDA

    Mitigation: Ongoing pivotal drug trials (TRANSCEND trial preparation on schedule)

    Increased R&D expenses related to ongoing pivotal drug trialsQ2 FY26

    $14 million decrease in Pharma adjusted EBITDA

    Mitigation: TRANSCEND trial preparation for PAH drug remains on schedule with one site active and patients qualified, a second site in pre-screening, and 12 additional sites in contracting.

    Lower volume and continued disruptive headwinds from restructuring planQ2 FY26

    $2 million decrease in Food Packaging adjusted EBITDA

    Softening demand in hospitality business and continued supply chain disruptions in the Strait of HormuzQ2 FY26

    $1 million decrease in Home Fashions adjusted EBITDA

    What to watch in Q3 FY26

    4

    Pep Boys Divestiture Completion

    Q3 FY26
    CurrentDefinitive agreement entered
    TargetSale closed

    Why it matters

    The closing of this $700 million divestiture is critical for enhancing IEP's liquidity and providing flexibility to address upcoming debt maturities.

    Looking ahead, we expect the sale of Pep Boys to close during the third quarter.

    2 min read6 chapters

    Detailed Narrative

    01

    NAV and Investment Fund Performance

    Icahn Enterprises' Net Asset Value (NAV) saw a significant decrease of $765 million in Q2 FY26, primarily attributed to a $243 million decline in the investment funds and a $435 million decrease from CVI. The investment funds experienced a negative return of 10.9% for the quarter, largely due to a 15.5% negative performance attribution from short positions. Despite this, the company's investment in the funds remained approximately $2 billion at quarter-end, with $741 million in cash.

    02

    Strategic Divestiture of Pep Boys

    The company entered a definitive agreement in July to sell Pep Boys for $700 million, subject to customary adjustments. This transaction is viewed as a successful culmination of a multi-year transformation plan, validating efforts to strengthen the business and create value. IEP will retain the owned real estate, franchise businesses (AMCo and Precision 2 Auto Care), and certain supercenter leases, with Pep Boys expected to lease most locations from IEP post-closing.

    03

    Energy Segment Resilience (CVR)

    The Energy segment, primarily CVR, reported adjusted EBITDA attributable to IEP of $102 million in Q2 FY26, up from $40 million in Q2 FY25. Refining operations maintained solid crude utilization over 98%, despite higher RFS obligation costs. The Fertilizer segment delivered strong results driven by robust demand. CVI also declared a $0.10 per share dividend, and management believes it is well-positioned to benefit from global tightness in refined products and nitrogen fertilizer.

    04

    Automotive Segment Transition

    Q2 FY26 Automotive service revenues decreased by $14 million year-over-year, mainly due to store closures in 2025, partially offset by improved pricing. Same-store sales were flat. Following the Pep Boys sale, the retained AMCo and Precision 2 Auto Care franchise businesses are expected to offer significant long-term value, and certain supercenter leases will integrate into the Real Estate segment, with Pep Boys becoming a primary tenant.

    05

    Performance of Other Operating Segments

    Real Estate's adjusted EBITDA increased by $9 million YoY, benefiting from transferred automotive assets and intercompany rent. Food Packaging's adjusted EBITDA decreased by $2 million due to lower volume and restructuring headwinds. Home Fashions saw a $1 million decrease in adjusted EBITDA from softening hospitality demand and supply chain disruption🌐s. Pharma's adjusted EBITDA decreased by $14 million, impacted by generic competition for its anti-obesity drug and increased R&D for ongoing pivotal drug trials, including the TRANSCEND trial for its PAH drug.

    06

    Liquidity and Capital Allocation

    Icahn Enterprises maintains substantial liquidity, with $2.4 billion at the holding company and $1.4 billion in cash and revolver availability at its subsidiaries as of quarter-end. Subsequent to quarter-end, holding company liquidity was approximately $2 billion. The proceeds from the Pep Boys sale are expected to further enhance liquidity, providing flexibility to address upcoming 2027 debt maturities and capitalize on future investment opportunities.

    AI-generated summary of the company’s earnings call. Not investment advice.