The chemical industry promises another year of cutbacks

Firms cut costs in 2025, but after dismal earnings reports, more of the same is in store

The latest chemistry news, including important research advances, business and policy trends, chemical safety practices, career guidance, and more. In an environment rife with uncertainty, overcapacity, and sluggish markets, chemical company results plunged in 2025. But as executives disclosed financial results for the year, they argued that their efforts to control their own destinies—through cost cutting, streamlining, and portfolio management—at least blunted the blows from a hostile market.

They vowed to continue advancing such measures in 2026. BASF, the world’s largest chemical maker, wrapped up its earnings season posting a 2.9% decline in 2025 sales and a 38.8% drop in earnings from the previous year. Sales volumes increased for all its businesses except basic chemicals, but prices and currency exchange rates worked against the German firm. “We in the chemical industry faced an uncertain and very volatile global market environment with considerable headwinds in 2025,” CEO Markus Kamieth said in a presentation to reporters on Feb.

27. “We therefore focused primarily on the things we can control within the framework of our Winning Ways strategy.” For example, BASF has reduced annual costs by $2 billion since 2023 and plans to boost that number to $2.7 billion by the end of this year. In the past 2 years, the company also shed 11% of its senior executives and reduced head count by 4,800 workers, excluding the 1,000 it has hired at its large new site in China.

In October, it inked an agreement to sell a majority stake in its coatings business to the private equity firm Carlyle and the Qatar Investment Authority. Dow set the tone for the industry in late January when it was the first major chemical company to report earnings. A year earlier, Dow had unveiled a streamlining program that would eliminate 1,500 jobs and save $1 billion. When the company announced a $657 million loss last month, it said it would have to cut much deeper: another 4,500 positions as part of $2 billion streamlining program.

Eastman Chemical cut costs by about $100 million in 2025 and is planning to shed another $125 million–$150 million in expenses this year. Despite that, Eastman’s earnings sunk by 32.7% in 2025 to $627 million, on a 6.5% decline in sales over 2024 values. Eastman CEO Mark Costa vented his frustrations about the economy to analysts in a conference call. “Everyone’s talking about how great GDP is and its growth last year.

[But] if you back out data centers, [artificial intelligence], health care, GDP is sort of flat,” he said, referring to the US gross domestic product. “Eighty percent of our consumers out there are really struggling with the economic challenges they have and the affordability, the fear of what tariffs are going to do, fear about ‘Can I get a new job if I lose mine?’ ” One bright spot for Eastman is its new methanolysis plant in Kingsport, Tennessee, which breaks down polyethylene terephthalate into its raw materials dimethyl terephthalate and ethylene glycol.

Eastman’s earnings from the plant increased by $60 million in 2025. Solvay’s sales fell 9.0% and its earnings dropped 31.2% in 2025 over the previous year’s. “In the current challenging environment, cost savings are a key lever used by management to sustain performance,” CEO Philippe Kehren says in the company’s earnings announcement. Over the last 2 years, Solvay has shed $235 million in annual costs.

It shut peroxides plants in the UK and Portugal and a trifluoroacetic acid unit in France. As it announced earnings, the company disclosed that it would also be reducing soda ash capacity at its plant in Spain. Celanese posted a 7.1% decline in sales and a 51.1% drop in earnings over the previous year’s as the company was bogged down by slow automotive and construction markets. But in prepared remarks to investors on Feb.

17, CEO Scott Richardson emphasized how the company has been able to help itself. For example, it cut about $120 million in costs in 2025, sold off its Micromax inks and pastes business for about $500 million, and refinanced its debt, a move that reduced upcoming debt maturities from $4.8 billion to $2.1 billion. Celanese plans an additional $50 million–$70 million in cost savings in 2026 as well as possible plant closures and additional asset sales, likely of one of its joint ventures, that would bring its total divestitures to $1 billion.

DuPont is one of the few chemical firms where economics tended to work in its favor last year. Because of strong health-care and water markets, its sales increased 1.9% and profits 31.2% over 2024. The year was one of significant transformation for DuPont. It spun off its electronic materials business as Qnity Electronics in November. It also agreed to sell its aramid business to Arclin in a deal that should close later this quarter.

On a conference call, CEO Lori Koch said she would like to use some of the proceeds for acquisitions, likely in health care.

Summary

This report covers the latest developments in artificial intelligence. The information presented highlights key changes and updates that are relevant to those following this topic.

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