This article first appeared on GuruFocus .
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Net Sales:$1.9 billion, up 4% year over year.
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Organic Sales Growth:5% in Q3; currency headwind of 1%.
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Operating EBITDA:$469 million, up 8% year over year.
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Operating EBITDA Margin:25.1%, up 90 basis points year over year.
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Adjusted EPS:$2.09, up 31% year over year.
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Free Cash Flow:Transaction-adjusted free cash flow of $341 million; conversion of 121%.
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Healthcare & Water Technologies Net Sales:$865 million, up 4% on 4% organic growth.
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Healthcare & Water Technologies Operating EBITDA:$263 million, up 7%; margin of 30.4%, up 80 basis points.
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Diversified Industrials Net Sales:$1 billion, up 4% on 5% organic growth; 1% currency headwind.
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Diversified Industrials Operating EBITDA:$242 million, up 11%; margin of 24.1%, up 140 basis points.
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Net Productivity:Over 2% in the quarter.
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Share Repurchases:Completed $250 million ASR and substantially completed an additional $100 million of open market repurchases; intends to repurchase another $250 million in Q4.
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Full Year 2026 Net Sales Guidance:About $7.19 billion, assuming organic growth of approximately 4.5%.
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Full Year 2026 Operating EBITDA Guidance:$1.785 billion; margin of 24.8%, up 80 basis points year over year.
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Full Year 2026 Adjusted EPS Guidance:Midpoint of $7.50, up 22% versus prior year pro forma.
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Full Year 2026 Free Cash Flow Conversion Guidance:Approximately 100%, ahead of 90% target.
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Q4 2026 Net Sales Guidance:Estimated $1.825 billion, assuming organic growth of about 8%.
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Q4 2026 Operating EBITDA Guidance:$455 million; margin of 24.9%.
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Q4 2026 Adjusted EPS Guidance:$1.90 to $1.95 per share, up 17% to 19% versus prior year pro forma.
Release Date: November 03, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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DuPont de Nemours Inc ( NYSE:DD ) exceeded Q3 2026 guidance with 5% organic sales growth, 90 basis points of margin expansion, 31% adjusted EPS growth, and robust free cash flow conversion.
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The company raised full-year 2026 guidance for organic sales growth, operating EBITDA, and adjusted EPS, all at or above the high end of the previously communicated range.
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DuPont de Nemours Inc ( NYSE:DD ) delivered over 2% net productivity in the quarter, contributing to margin expansion, with a target of 3% net productivity in COGS.
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The company returned significant capital to shareholders, completing a $250 million ASR and $100 million of open market repurchases, and announced an intention to repurchase another $250 million in Q4.
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DuPont de Nemours Inc ( NYSE:DD ) is advancing innovation with new products like a purification technology for peptide therapeutics (including GLP-1 drugs) and Tyvek with Renewable Attribution, and increased its front-end innovation pipeline.
Negative Points
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Middle East disruptions pushed approximately $15 million of water project revenue from 2026 into 2027, impacting the Water Technologies segment.
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Currency headwinds negatively impacted net sales by 1% in the quarter.
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The company faces continued weakness in construction and automotive markets, with low single-digit declines in both, representing about 40% of the portfolio.
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Oil and gas inflation created a margin headwind, partially offsetting productivity gains.
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The company expects a sequential step-down in Diversified Industrial margins in Q4, driven by typical seasonality and other factors.
Q & A Highlights
Q: Can you unpack the impact of internal productivity initiatives on margins and the runway ahead? A: CEO Lori Koch said DuPont is targeting net 3% productivity in COGS and delivered just over 2% net productivity in Q3, driving about 100 basis points of EBITDA margin lift, partly offset by growth investments. Gains came from cost, quality and volume variance improvements, procurement savings, and better OTIF and defect rates. OTIF is now in the low 80s against an ultimate 95% target, leaving significant runway.
Q: How much Middle East water project revenue was pushed from 2026 into 2027? A: CFO Antonella Franzen said DuPont pushed out about $15 million of revenue. While the company has the orders in hand for its large Middle East water projects, continued regional disruptions led guidance to assume these projects shift into 2027, though strength in other markets allowed DuPont to raise guidance to the high end of its prior range.
Q: How is the innovation portfolio performing, and what is the grow-versus-replace mix? A: CEO Lori Koch said the Vitality Index was about 35% last year with a similar target for 2026, and the current mix is roughly 60% replace and 40% growth, with a goal of reaching 50-50. DuPont is shifting more R&D into growth areas and using AI agents in two businesses to cut front-end project advancement from about three months to roughly five days. Replace innovation also contributed about 150 basis points of margin lift last year.
Q: What drove the Q3 revenue beat versus guidance, price or volume? A: CFO Antonella Franzen said of the roughly $30 million beat, about $10 million came from incremental price implemented in the quarter and about $20 million came from volume.
Q: How should investors think about the pace of share buybacks beyond Q4 versus M&A priorities? A: CFO Antonella Franzen said DuPont has significant financial flexibility, with net debt-to-EBITDA at about 1.1 times, and views buybacks as opportunistic rather than an automatic $250 million per quarter. The timing of potential M&A will determine how much capital goes to repurchases. CEO Lori Koch added the bolt-on pipeline in Water and Healthcare remains robust, with about $1.5 billion of firepower for accretive M&A after announcing intent to repurchase about 7% of shares.
Q: What is driving Building Technologies' outperformance in a tough construction market? A: CEO Lori Koch said the overall market is down low single digits while DuPont's volumes are expected to be relatively flat, with pricing also contributing to organic growth. Outperformance comes from share gains, including conversions to Tyvek house wrap among national and large regional builders, and favorable mix from increased multifamily penetration, which typically brings broader bundle sales.
Q: How is the aerospace business positioned, and what is the outlook into 2027? A: CEO Lori Koch said aerospace is about $300 million, or roughly 3% of revenue, growing at a double-digit rate with a sizable backlog and better visibility than most of the portfolio. Vespel, used in engines, and Tedlar, used in aircraft bodies, are both seeing low double-digit growth, and DuPont expects that level to continue for the foreseeable future.
Q: What drove the stronger-than-expected Diversified Industrial margins, and why do they step down sequentially in Q4? A: CEO Lori Koch attributed the improvement to favorable mix, including low double-digit aerospace growth, productivity focus and 80/20 initiatives. DuPont expects a few million dollars of 80/20 benefit this year with a runway to tens of millions on the initial roughly $700 million revenue scope, now expanded to the roughly $200 million Molykote business. Some businesses also benefited from sold-out assets and capacity release.
Q: Is pricing offsetting inflation dollar for dollar, and what is the outlook for Q4? A: CFO Antonella Franzen said DuPont is offsetting inflation on a dollar basis. Full-year pricing is now expected at about $110 million versus the $90 million previously discussed, and Q4 pricing should be similar to Q3 levels. The team will continue taking action if costs move further.
Q: What is the longer-term growth algorithm within Healthcare, particularly personal protection versus medical packaging? A: CEO Lori Koch said Tyvek medical packaging is about half of Tyvek revenue and garments the other half. Garments generally grow alongside industrial production at 2% to 3%, while medical packaging tracks surgical procedures at mid-single digits. New products include Tyvek with Renewable Attribution and Apex garments for comfort and breathability, with overall volume growth approaching 4%.
Q: One year after the Qnity separation, how is the standalone DuPont performing? A: CEO Lori Koch said DuPont is at the top end or above all medium-term targets set at the 2025 Investor Day on growth, margin expansion, EPS and free cash flow. Organic growth of 4.5% is being delivered despite about 40% of the portfolio, construction and automotive, being down low single digits. Productivity is ahead of expectations at about 80 basis points of annual lift versus the 50 to 70 basis point target, despite a roughly 40 basis point price-cost headwind.
Q: What does the 3% net productivity target mean for margin expansion, and is DuPont reinvesting the gains? A: CFO Antonella Franzen cautioned against double counting, noting the 3% is net within COGS and helps offset inflation there, while SG&A inflation and investments remain. In Q3, about 120 basis points of margin expansion came from growth and productivity combined, offset by oil and gas inflation, netting 90 basis points of overall expansion. CEO Lori Koch noted oil and gas inflation was a margin headwind even though costs were fully offset on a dollar basis.
Q: Can Water return to mid-single-digit organic growth next year if Middle East disruptions persist? A: CEO Lori Koch said full-year 2026 water guidance embeds about 1% organic growth including the Middle East project push. Excluding the Middle East, water would be up mid-single digits, in line with
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
