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DuPont de Nemours, Inc. - Q1 2026 10-Q Summary

Business Context and Reporting Period

This report covers the quarterly period ended March 31, 2026. DuPont operates two primary reportable segments: Healthcare & Water Technologies and Diversified Industrials. The period is defined by the completion of the Aramids Divestiture on April 1, 2026, and the prior separation of the Electronics Business into Qnity Electronics, Inc. in November 2025. Both divested businesses are reported as discontinued operations.

Key Financial Metrics

Material Changes vs. Prior Period

• Profitability Turnaround: The Company returned to profitability with Net Income of $164 million, compared to a loss of $581 million in Q1 2025. The prior year loss was heavily impacted by a $768 million goodwill impairment charge related to the Aramids business, which is now classified as discontinued operations.
• Revenue Growth: Net sales increased 4% year-over-year, driven by a 2% increase in organic sales and a 2% favorable currency impact (weaker U.S. dollar vs. Euro).
• Segment Performance:
  • Healthcare & Water Technologies: Sales up 6% ($806M); Operating EBITDA up 9% to $244M.
  • Diversified Industrials: Sales up 3% ($875M); Operating EBITDA up 8% to $200M.
• Restructuring: Restructuring and asset-related charges increased to $46 million in Q1 2026 from $39 million in Q1 2025, primarily due to the new "2026 DuPont Restructuring Program."
• Discontinued Operations: Q1 2026 included $14 million of income from discontinued operations, whereas Q1 2025 included a $661 million loss due to the Aramids impairment.

Guidance, Outlook, and Risks

• Restructuring Program: In February 2026, DuPont launched a restructuring program targeting $80 million in pre-tax charges through 2028, with $52 million incurred in Q1 2026.
• Share Repurchases: Under a $2 billion authorization approved in November 2025, the Company completed an Accelerated Share Repurchase (ASR) in January 2026 totaling $500 million (12.2 million shares). On May 5, 2026, the Company announced a new ASR to repurchase an additional $275 million.
• Reverse Stock Split: The Company plans to seek stockholder approval for a reverse stock split (ratio between 1-for-2 and 1-for-4) at its 2026 Annual Meeting.
• PFAS Litigation: Significant contingent liabilities remain regarding Per- and Polyfluoroalkyl Substances (PFAS). A proposed Judicial Consent Order with the State of New Jersey involves an aggregate payment of $875 million over 25 years; DuPont's share is approximately $311 million (net present value of $186 million accrued). The settlement is pending court approval.
• Geopolitical Risks: Ongoing military conflict in the Middle East poses risks to supply chains and logistics, though no material impact has been recorded to date.

Investor Verification Checklist

• Discontinued Operations Classification: Verify the impact of the Aramids and Electronics divestitures on year-over-year comparability, specifically the removal of the $768M impairment charge from continuing operations.
• PFAS Liability Exposure: Monitor the status of the New Jersey Judicial Consent Order and the potential for additional costs beyond the accrued $186 million, given the "reasonably possible" nature of future claims.
• Restructuring Execution: Track the realization of cost savings from the 2026 DuPont Restructuring Program against the $80 million charge estimate.
• Liquidity and Debt: Confirm the renewal of the $1 billion 364-day revolving credit facility expiring May 6, 2026, and the status of the $2 billion five-year facility.
• Share Count Adjustments: Note that financial statements do not yet reflect the proposed reverse stock split, which will alter share counts and per-share metrics upon approval.