EMN · 10-Q · 2026Q3 · Full report

Gross Margin Drivers

EASTMAN CHEMICAL CO · 2026-10-30 · Importance 18 · Surprise 14

First-nine-month 2026 gross profit was $1,523 million, up from $1,506 million in the year-earlier period. Excluding restructuring-related inventory adjustments, gross profit increased in Chemical Intermediates and Additives & Functional Products, partly offset by decreases in Fibers and Advanced Materials. In Advanced Materials, first-nine-month 2026 gross profit included inventory adjustments related to closing a German performance films production line.

Key facts

• Eastman’s other components of post-employment benefit cost were $17 million more favorable in third quarter 2026 than in third quarter 2025, associated with a prior service credit from its 2025 other postretirement benefit plan amendment. source
• Eastman’s other components of post-employment benefit cost were $50 million more favorable in the first nine months of 2026 than in the first nine months of 2025, due to a prior service credit related to its 2025 other postretirement benefit plan amendment. source
• Eastman’s first-nine-months 2026 gross profit included inventory adjustments associated with closing a production line at a German Advanced Materials performance films facility. source
• Eastman’s third-quarter 2026 EBIT excluding non-core items increased year over year, primarily due to improved asset utilization, lower planned maintenance expense, and higher selling prices, partly offset by higher variable compensation expense and higher raw-material and distribution costs. source
• Eastman’s first-nine-months 2026 EBIT excluding non-core items increased year over year due primarily to favorable foreign currency exchange and higher selling prices net of higher raw-material, energy, and distribution costs; lower sales volume mix partly offset the increase, while cost-reduction benefits more than offset higher variable compensation expense. source
• Eastman’s gross profit increased in third quarter 2026, with gains in Advanced Materials, Chemical Intermediates, and Additives & Functional Products partly offset by a decline in Fibers. source
• Eastman’s selling, general, and administrative expenses increased in third quarter and the first nine months of 2026 compared with the corresponding 2025 periods, primarily because of higher variable compensation costs, partly offset by cost-reduction initiatives. source