Westlake Swings to $260M Profit in Q2 as PEM Margins Surge on Higher Prices
WLK sits 27% above its 52-week low of $56.33 on elevated volume (1.9× avg).
Summary
Westlake Corporation reported Q2 2026 net income of $260 million, a dramatic swing from a $142 million loss a year ago, driven by higher PEM selling prices and its profitability improvement plan. The company generated positive free cash flow, reduced debt by $500 million, and returned $99 million to shareholders.
Key Events · Earnings and Guidance · WLK
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Q2 Net Income Swings to $260M
Westlake reported Q2 2026 net income of $260 million ($2.01/share), compared to a net loss of $142 million ($1.11/share) in Q2 2025, driven by higher PEM selling prices and volume growth.
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PEM EBITDA Margin Expands to 21%
Performance and Essential Materials segment EBITDA margin, excluding identified items, surged to 21% from 3% a year ago, as average sales prices rose 14% YoY, particularly for polyethylene and PVC resin.
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Profitability Plan Delivers $150M Benefit
The three-pillar profitability improvement plan contributed ~$150 million in EBITDA benefits in Q2, progressing toward the $600 million full-year 2026 target.
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Free Cash Flow Turns Positive
Westlake generated $111 million in free cash flow in Q2 after $207 million in capital expenditures, enabling $500 million in debt reduction and $99 million returned to shareholders via dividends and buybacks.
Analysis · WLK · Industrial Applications And Services
A sharp turnaround defined Westlake's Q2 2026, with net income reaching $260 million compared to a $142 million loss a year ago. The recovery was powered by the Performance and Essential Materials segment, where EBITDA margin vaulted to 21% from 3% as average sales prices climbed 14% year-over-year, supported by higher oil prices amid Middle East tensions. The company's three-pillar profitability plan contributed roughly $150 million in EBITDA benefits, keeping it on pace for the $600 million full-year target. Free cash flow swung to a positive $111 million, enabling $500 million in debt reduction and $99 million returned to shareholders. After two consecutive quarterly losses, these results mark a significant inflection and validate management's restructuring efforts.
At the time of this filing, WLK was trading at $71.56 on NYSE in the Industrial Applications And Services sector, with a market capitalization of approximately $9B. The 52-week trading range was $56.33 to $124.23. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.