SOLS · Solstice Advanced Materials Inc.

Solstice Advanced Materials delivered a strong start to 2026, with first quarter net sales rising 10% year-over-year to $991 million, driven by double-digit growth in its Nuclear, Electronic Materials, and Refrigerants platforms. This performance reflects robust demand in secular growth trends including artificial intelligence, data centers, semiconductor manufacturing, and nuclear energy. Despite the top-line expansion, GAAP net income attributable to the company declined 37% to $85 million, primarily due to incremental standalone operating costs following its separation from Honeywell, higher R&D investments, and increased net interest expense. Adjusted EBITDA remained relatively flat at $249 million, though margin compressed 277 basis points to 25.1%, largely attributable to the ongoing transition to low global warming potential (LGWP) refrigerants and elevated R&D spending. Segment performance was mixed: the Refrigerants & Applied Solutions (RAS) segment posted 12% sales growth, led by a 27% surge in Nuclear revenues, while the Electronic & Specialty Materials (ESM) segment grew 7%, highlighted by a 21% increase in Electronic Materials. The company generated strong operating cash flow of $199 million and free cash flow of $124 million, maintaining a healthy balance sheet with a net leverage ratio of 1.4x. Management reaffirmed its full-year 2026 guidance, projecting net sales between $3.9 billion and $4.1 billion and adjusted diluted EPS in the range of $2.45 to $2.75, signaling confidence in executing on its strategic priorities despite macroeconomic uncertainties.