DD · Earnings call · 2026Q2T · Full report

Gross Margin Drivers

DuPont de Nemours, Inc. · 2026-08-04 · Importance 31 · Surprise 32

Healthcare & Water Technologies margin declined 30 basis points year over year to 30.1% in the second quarter despite 5% reported sales growth. The decline reflected a less favorable mix after a healthcare-heavy first quarter and investments in additional sales resources, including Tyvek garment initiatives. DuPont expects those investments to generate approximately $5 million to $6 million of incremental garment sales in full-year 2026. Excluding price/cost effects, segment margins are expected to increase approximately 50 basis points in the second half, driven by productivity and operating leverage.

Key facts

• In the quarter they saw about 200 basis points of reduction on a COGS basis contributing about 100 basis points of margin expansion as a percent of revenue.
• Cost of poor quality: company at about 4% of sales versus benchmark around 5% of sales.