CABOT CORP
For the period ended Dec 31, 2025. Filed Feb 4, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2025 · Filed Feb 4, 2026
CBT$71.05-2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-05.
0000950170-25-102921
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-31; filed 2026-02-04.
0001193125-26-037240
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 96 previous paragraphs and 88 current paragraphs.
42 unchanged; 37 reworded; 8 added; 16 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 11 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
First quarter of Fiscal 2026 versus First quarter of Fiscal 2025—Consolidated
Current report
For the first quarter of fiscal 2026, gross profit decreased by $24 million compared to the same period of fiscal 2025. The decrease in Gross profit in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025 was driven primarily by lower volumes in both our Reinforcement Materials and Performance Chemical segments ($25 million combined). The lower volumes in our Reinforcement Materials segment were primarily due to lower volumes in the Americas and Asia Pacific Region. Volumes were impacted by lower production levels at our tire customers and year-end inventory management by our customers in the Americas and increased competitive intensity in Asia Pacific. The lower volumes in our Performance Chemicals segment were primarily due to weaker demand in Europe.
Current report
Selling and administrative expenses increased by $3 million in the first quarter of fiscal 2026 compared to the same period of fiscal 2025 primarily due to higher legal expenses.
Current report
Interest expense of $18 million in the first quarter of fiscal 2026 was unchanged compared to the same period of fiscal 2025.
Current report
Total other unallocated items remained flat in the first quarter of fiscal 2026 when compared to the same period in fiscal 2025.
Current report
U.S. EPA Consent Decree
Current report
As described in Part 1, Item 1 of the 2025 Form 10-K under the heading “Safety, Health, Environment, and Sustainability”, pursuant to the Consent Decree we entered into in November 2013 with the U.S. Environmental Protection Agency (“EPA”) and the Louisiana Department of Environmental Quality (“LDEQ”) regarding Cabot’s three carbon black manufacturing facilities in the U.S. Cabot has installed technology controls for sulfur dioxide and/or nitrogen oxide at its carbon black plants in Pampa, Texas and Franklin, Louisiana, and is in the process of installing sulfur dioxide and nitrogen oxide technology controls at its plant in Ville Platte, Louisiana. We are currently in discussions with the EPA and LDEQ to extend our compliance date at the Ville Platte facility to mid calendar year 2026. We expect that the total capital costs to install these technology controls will be approximately $270 million and will be incurred through mid calendar year 2026. As of December 31, 2025, we have incurred approximately $251 million to install these controls in the U.S. Operating these controls increases our plant operating costs.
Current report
In the first quarter of fiscal 2026, financing activities primarily consisted of share repurchases of $52 million and dividend payments of $24 million and $13 million to common stockholders and noncontrolling interest, respectively. There were also repayments of $8 million for short-term borrowings with a maturity greater than 90 days and net proceeds of $7 million from short-term borrowings with a maturity 90 days or less.
Removed paragraphs (16)
Previous report
Asset impairment charges, which primarily include charges associated with an impairment of goodwill, other long-lived assets or assets held for sale.
Previous report
Gains (losses) on sale of a business.
Previous report
Third quarter of Fiscal 2025 versus Third quarter of Fiscal 2024—Consolidated
Previous report
For the three and nine months ended June 30, 2025, Net sales and other operating revenue decreased by $93 million and $179 million, respectively, compared to the same periods of fiscal 2024.
Previous report
The decrease in Net sales and other operating revenues in the first nine months of fiscal 2025 compared to the first nine months of fiscal 2024 was driven by lower volumes in Reinforcement Materials ($94 million), less favorable pricing and product mix in both our Reinforcement Materials and Performance Chemicals segments ($92 million combined), and the unfavorable impact from foreign currency translation in Reinforcement Materials ($23 million), partially offset by higher volumes in Performance Chemicals ($35 million). The lower volumes in Reinforcement Materials were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix was driven by lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments. The higher volumes in Performance Chemicals were primarily in our Fumed Metal Oxides, Inkjet Colorants and Battery Materials product lines from higher demand.
Previous report
For the three and nine months ended June 30, 2025, gross profit decreased by $12 million and remained flat, respectively, compared to the same periods of fiscal 2024.
Previous report
The decrease in Gross profit in the third quarter of fiscal 2025 as compared to the third quarter of fiscal 2024 was driven primarily by lower volumes in both our Reinforcement Materials and Performance Chemical segments ($25 million combined) which were partially offset by higher gross profit per ton in both our Reinforcement Materials and Performance Chemicals segments ($9 million combined). The lower volumes in both our Reinforcement Materials and Performance Chemicals segments were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The higher gross profit per ton in both our Reinforcement Materials and Performance Chemicals segments was primarily driven by optimization actions and lower spending from cost management efforts.
Previous report
Selling and administrative expenses decreased by $6 million and $18 million for the three and nine months ended June 30, 2025, respectively, compared to the same periods of fiscal 2024, primarily from cost management efforts.
Previous report
Interest expense remained flat and decreased by $6 million in the three and nine months ended June 30, 2025, respectively, compared to the same periods of fiscal 2024, due to lower average interest rates on short term borrowings.
Previous report
For the nine months ended June 30, 2025, the (Provision) benefit for income taxes was a provision of $133 million compared to a $121 million provision for the same period in fiscal 2024, primarily due to higher earnings in the current period.
Previous report
In the first nine months of fiscal 2025 and fiscal 2024, we reported Net income (loss) attributable to Cabot Corporation of $288 million ($5.22 per diluted common share) and $243 million ($4.30 per diluted common share), respectively. The higher Net income in the first nine months of fiscal 2025 compared with the same period in fiscal 2024 was primarily due to lower Argentina controlled currency devaluation and other losses ($43 million).
Previous report
Total other unallocated items decreased by $4 million and $6 million for the three and nine months ended June 30, 2025, respectively, when compared to the same periods in fiscal 2024.
Previous report
In the first nine months of fiscal 2025, sales in Reinforcement Materials decreased by $188 million as compared to the first nine months of fiscal 2024 primarily due to lower volumes ($94 million), less favorable pricing and product mix ($66 million) and the less favorable impact from foreign currency translation ($23 million). The lower volumes were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix was primarily due to lower raw materials costs that are generally passed through to our customers.
Previous report
In the first nine months of fiscal 2025, EBIT in Reinforcement Materials decreased by $25 million compared to the same period of fiscal 2024. The decrease was primarily driven by lower volumes ($39 million), partially offset by lower selling and administrative expenses ($8 million) and the favorable impact from foreign currency translation ($5 million). The lower volumes were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The lower selling and administrative expenses were primarily due to cost management efforts.
Previous report
In the first nine months of fiscal 2025, sales in Performance Chemicals increased by $14 million as compared to the first nine months of fiscal 2024 primarily due to higher volumes ($35 million), partially offset by less favorable pricing and product mix ($25 million). The higher volumes were primarily in our fumed metal oxides product line and the less favorable pricing and product mix were primarily due to lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments.
Previous report
In the first nine months of fiscal 2024, financing activities primarily consisted of net repayment of commercial paper of $123 million, share repurchases of $106 million, dividend payments to stockholders of $69 million, cash dividends paid to noncontrolling interests of $27 million, and net repayment of $12 million under our Euro Credit Agreement, which includes repayments of $26 million partially offset by proceeds of $14 million. These payments were partially offset by proceeds from sales of common stock of $15 million from stock option exercises.
Reworded paragraphs (37)
Previous wording
Refer to the discussion under the heading “Recent Accounting Pronouncements” in Note B of our Notes to the Consolidated Financial Statements.
Current wording
Refer to the discussion under the heading “Recent Accounting Pronouncements” in Note B of our Notes to the unaudited Consolidated Financial Statements.
Previous wording
Our discussion under the heading “Third Quarter of Fiscal 2025 versus Third Quarter of Fiscal 2024—By Business Segment” includes a discussion of Total segment EBIT, which is a non-GAAP financial measure defined as Income (loss) from operations before income taxes and equity in earnings from affiliated companies less certain items and other unallocated items. Our Chief Operating Decision Maker, who is our President and Chief Executive Officer, uses segment EBIT to evaluate the operating results of each segment and to allocate resources to the segments. We believe Total segment EBIT, which reflects the sum of EBIT from our reportable segments, provides useful supplemental information for our investors as it is an important indicator of our operational strength and performance, allows investors to see our results through the eyes of management, and provides context for our discussion of individual business segment performance. Total segment EBIT should not be considered an alternative for Income (loss) from operations before income taxes and equity in earnings of affiliated companies, which is the most directly comparable U.S. GAAP financial measure. A reconciliation of Total segment EBIT to Income (loss) from operations before income taxes and equity in earnings of affiliated companies is provided under the heading “Third quarter of Fiscal 2025 versus Third quarter of Fiscal 2024—By Business Segment”. Investors should consider the limitations associated with this non-GAAP measure, including the potential lack of comparability of this measure from one company to another.
Current wording
Our discussion under the heading “First Quarter of Fiscal 2026 versus First Quarter of Fiscal 2025—By Business Segment” includes a discussion of Total segment EBIT, which is a non-GAAP financial measure defined as Income (loss) from operations before income taxes and equity in earnings from affiliated companies less certain items and other unallocated items. Our Chief Operating Decision Maker, who is our President and Chief Executive Officer, uses segment EBIT to evaluate the operating results of each segment and to allocate resources to the segments. We believe Total segment EBIT, which reflects the sum of EBIT from our reportable segments, provides useful supplemental information for our investors as it is an important indicator of our operational strength and performance, allows investors to see our results through the eyes of management, and provides context for our discussion of individual business segment performance. Total segment EBIT should not be considered an alternative for Income (loss) from operations before income taxes and equity in earnings of affiliated companies, which is the most directly comparable U.S. GAAP financial measure. A reconciliation of Total segment EBIT to Income (loss) from operations before income taxes and equity in earnings of affiliated companies is provided under the heading “First Quarter of Fiscal 2026 versus First Quarter of Fiscal 2025—By Business Segment”. Investors should consider the limitations associated with this non-GAAP measure, including the potential lack of comparability of this measure from one company to another.
Previous wording
During the third quarter of fiscal 2025, Income (loss) before income taxes and equity in earnings of affiliated companies decreased as compared to the third quarter of fiscal 2024. The decrease was primarily due to lower segment EBIT in Reinforcement Materials, partially offset by lower Unallocated corporate costs and higher segment EBIT in Performance Chemicals.
Current wording
During the first quarter of fiscal 2026, Income (loss) before income taxes and equity in earnings of affiliated companies decreased as compared to the first quarter of fiscal 2025. The decrease was primarily due to lower segment EBIT in our Reinforcement Materials segment, partially offset by higher segment EBIT in our Performance Chemicals segment.
Previous wording
The decrease in Net sales and other operating revenues in the third quarter of fiscal 2025 compared to the third quarter of fiscal 2024 was driven by lower volumes in both our Reinforcement Materials and Performance Chemicals segments ($66 million combined) and less favorable pricing and product mix in Reinforcement Materials ($27 million). The lower volumes in both Reinforcement Materials and Performance Chemicals were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix in Reinforcement Materials was driven by lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments.
Current wording
For the first quarter of fiscal 2026, Net sales and other operating revenue decreased by $106 million compared to the same period of fiscal 2025. The decrease in Net sales and other operating revenue in the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025 was driven by less favorable pricing and product mix in both our Reinforcement Materials and Performance Chemicals segments ($61 million combined) and lower volumes in both our Reinforcement Materials and Performance Chemicals segments ($56 million combined), partially offset by the favorable impact from foreign currency translation in both our Reinforcement Materials and Performance Chemicals segments ($15 million combined). The less favorable pricing and product mix was primarily driven by lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments. The lower volumes in our Reinforcement Materials segment were primarily due to lower volumes in the Americas and Asia Pacific Region. Volumes were impacted by lower production levels at our tire customers and year-end inventory management by our customers in the Americas, and increased competitive intensity in Asia Pacific. The lower volumes in our Performance Chemicals segment were primarily due to weaker demand in Europe.
Previous wording
Research and technical expenses decreased by $1 million in the third quarter of fiscal 2025 and decreased by $2 million for the nine months ended June 30, 2025, respectively, compared to the same periods of fiscal 2024.
Current wording
Research and technical expenses decreased by $1 million in the first quarter of fiscal 2026 compared to the same period of fiscal 2025 primarily due to cost management efforts.
Previous wording
Interest and dividend income decreased by $1 million and $5 million in the three and nine months ended June 30, 2025, respectively, compared to the same periods of fiscal 2024, primarily due to lower average interest rates, partially offset by higher average cash balances.
Current wording
Interest and dividend income increased by $1 million in the first quarter of fiscal 2026 compared to the same period of fiscal 2025 primarily due to higher average cash balances, partially offset by lower average interest rates.
Previous wording
Other income (expense) was $3 million in the third quarter of fiscal 2024, with no such amounts in the third quarter of fiscal 2025, and $35 million less expense for the nine months ended June 30, 2025. The change in both periods was primarily due to lower foreign exchange losses primarily in Argentina.
Current wording
Other income (expense) was nil in the first quarter of fiscal 2026 compared to income of $1 million for the same period of fiscal 2025. The change was primarily due to a difference in the amount of foreign exchange losses, primarily in Argentina, in the first quarter of fiscal 2026.
Previous wording
For the three months ended June 30, 2025, the (Provision) benefit for income taxes was a provision of $43 million compared to a provision of $40 million for the same period in fiscal 2024, with the change primarily due to the mix of earnings. Our income taxes are affected by the mix of earnings in the tax jurisdictions in which we operate, and by the presence of valuation allowances in certain tax jurisdictions.
Current wording
For the first quarter of fiscal 2026, the (Provision) benefit for income taxes was a provision of $37 million compared to a provision of $41 million for the same period in fiscal 2025, with the change primarily due to lower earnings. Our income taxes are affected by the mix of earnings in the tax jurisdictions in which we operate and by the presence of valuation allowances in certain tax jurisdictions.
Previous wording
Net Income (Loss) Attributable to Noncontrolling Interests
Current wording
Equity in Earnings of Affiliated Companies and Net Income (Loss) Attributable to Noncontrolling Interests
Previous wording
Equity in earnings of affiliated companies, net of tax, decreased by $1 million and remained flat during the three and nine months ended June 30, 2025, respectively, compared to the same periods of fiscal 2024 primarily due to lower profitability of our equity affiliate in Venezuela.
Current wording
Equity in earnings of affiliated companies, net of tax, remained flat in the first quarter of fiscal 2026 compared to the same period of fiscal 2025.
Previous wording
Net income (loss) attributable to noncontrolling interests, net of tax, increased by $1 million in the three months ended June 30, 2025, compared to the same period of fiscal 2024 primarily due to higher earnings of our joint ventures in the Czech Republic and China. Net income (loss) attributable to noncontrolling interests, net of tax, decreased by $1 million in the first nine months of fiscal 2025 compared to the same period of fiscal 2024 primarily due to lower earnings of our joint venture in the Czech Republic.
Current wording
Net income (loss) attributable to noncontrolling interests, net of tax, decreased by $2 million in the first quarter of fiscal 2026 compared to the same period of fiscal 2025 primarily due to lower earnings of our joint ventures in China.
Previous wording
In the third quarter of fiscal 2025 and fiscal 2024, we reported Net income (loss) attributable to Cabot Corporation of $101 million ($1.86 per diluted common share) and $109 million ($1.94 per diluted common share), respectively. The lower Net income in the third quarter of fiscal 2025 compared with the same period in fiscal 2024 was primarily due to lower Segment EBIT in Reinforcement Materials ($8 million).
Current wording
In the first quarters of fiscal 2026 and 2025, we reported Net income (loss) attributable to Cabot Corporation of $73 million ($1.37 per diluted common share) and $93 million ($1.67 per diluted common share), respectively. The lower Net income in the first quarter of fiscal 2026 compared with the same period in fiscal 2025 was primarily due to lower EBIT in our Reinforcement Materials segment ($28 million), partially offset with higher EBIT in our Performance Chemicals segment ($3 million).
Previous wording
Third quarter of Fiscal 2025 versus Third quarter of Fiscal 2024—By Business Segment
Current wording
First quarter of Fiscal 2026 versus First quarter of Fiscal 2025—By Business Segment
Previous wording
Income (loss) before income taxes and equity in earnings of affiliated companies, Certain items, Other unallocated items and Total segment EBIT for the three and nine months ended June 30, 2025 and 2024 are included in the following table, and details of each item is set forth in the sections below.
Current wording
Income (loss) before income taxes and equity in earnings of affiliated companies, Certain items, Other unallocated items and Total segment EBIT for the first quarter of fiscal 2026 and 2025 are included in the following table, and details of each item is set forth in the sections below.
Previous wording
Details of the certain items for the three and nine months ended June 30, 2025 and 2024 are as follows:
Current wording
Details of the certain items for the first quarter of fiscal 2026 and 2025 are as follows:
Previous wording
A discussion of items that we refer to as “other unallocated items” can be found under the heading “Definition of Terms and Non-GAAP Financial Measures”. The balances of unallocated corporate costs are primarily comprised of expenditures related to managing a public company that are not allocated to the segments and corporate business development costs related to ongoing corporate projects. The balances of General unallocated income (expense) consist of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, interest and dividend income, the profit or loss related to the corporate adjustment for unearned revenue and unrealized holding gains (losses) for investments. This does not include items of income or expense from the items that are separately treated as Certain items.
Current wording
A discussion of items that we refer to as “other unallocated items” can be found under the heading “Definition of Terms and Non-GAAP Financial Measures”. The balances of unallocated corporate costs are primarily comprised of expenditures related to managing a public company and corporate business development costs related to ongoing corporate projects that are not allocated to the segments. The balances of General unallocated income (expense) consist of gains (losses) arising from foreign currency transactions, net of other foreign currency risk management activities, interest and dividend income, the profit or loss related to the corporate adjustment for unearned revenue and unrealized holding gains (losses) for investments. This does not include items of income or expense from the items that are separately treated as Certain items.
Previous wording
Sales and EBIT for Reinforcement Materials for the third quarter of fiscal 2025 and 2024 were as follows:
Current wording
Sales and EBIT for Reinforcement Materials for the first quarter of fiscal 2026 and 2025 were as follows:
Previous wording
Sales in Reinforcement Materials decreased by $76 million in the third quarter of fiscal 2025 compared to the same period of fiscal 2024 primarily due to lower volumes ($51 million) and less favorable pricing and product mix ($27 million). The lower volumes were primarily due to lower customer demand in the Americas and Asia Pacific driven by uncertainty from tariffs and a weaker global macroeconomic environment. The less favorable pricing and product mix was primarily due to lower raw materials costs that are generally passed through to our customers.
Current wording
Sales in Reinforcement Materials decreased by $91 million in the first quarter of fiscal 2026 compared to the same period of fiscal 2025 primarily due to less favorable pricing and product mix ($57 million) and lower volumes ($44 million), partially offset by the favorable impact from foreign currency translation ($10 million). The less favorable pricing and product mix was primarily due to lower raw materials costs that are generally passed through to our customers. The lower volumes were primarily due to lower volumes in the Americas and Asia Pacific. Volumes were impacted by lower production levels at our tire customers and year-end inventory management by our customers in the Americas, and increased competitive intensity in Asia Pacific.
Previous wording
EBIT in Reinforcement Materials in the third quarter of fiscal 2025 decreased by $8 million compared to the same period of fiscal 2024. The decrease in EBIT was primarily driven by lower volumes ($21 million), partially offset by lower selling and administrative expenses ($6 million) and higher gross profit per ton ($5 million). The lower volumes were primarily due to lower customer demand in the Americas and Asia Pacific driven by uncertainty from tariffs and a weaker global macroeconomic environment. The lower selling and administrative expenses and higher gross profit per ton were primarily due to cost management efforts.
Current wording
EBIT in Reinforcement Materials in the first quarter of fiscal 2026 decreased by $28 million compared to the same period of fiscal 2025. The decrease in EBIT was primarily driven by lower volumes ($17 million), and lower gross profit per ton ($12 million). The lower volumes were primarily due to lower volumes in the Americas and Asia Pacific. Volumes were impacted by lower production levels at our tire customers and year-end inventory management by our customers in the Americas and increased competitive intensity in Asia Pacific. The lower gross profit per ton was primarily due to lower pricing from increased competitive intensity in Asia Pacific.
Previous wording
As we look to the fourth quarter of the fiscal year, we expect the Reinforcement Materials segment EBIT to modestly decline from the third quarter of fiscal 2025 primarily due to expected higher costs sequentially, partially offset by expected higher volumes in Asia Pacific.
Current wording
As we look to the second quarter of the fiscal year, we expect Reinforcement Materials segment EBIT to decline sequentially from the first quarter of fiscal 2026 primarily due to lower pricing outcomes related to our calendar year 2026 annual tire customer agreements as compared to calendar year 2025, partially offset by higher expected sequential volumes from seasonality improvements.
Previous wording
Sales and EBIT for Performance Chemicals for the third quarter of fiscal 2025 and 2024 were as follows:
Current wording
Sales and EBIT for Performance Chemicals for the first quarter of fiscal 2026 and 2025 were as follows:
Previous wording
Sales in Performance Chemicals decreased by $12 million in the third quarter of fiscal 2025 as compared to the same period of fiscal 2024 as lower volumes ($15 million) were partially offset by the favorable impact from foreign currency translation ($3 million). The lower volumes were primarily due to lower customer demand driven by uncertainty from tariffs and a weaker global macroeconomic environment, particularly in auto-related applications.
Current wording
Sales in Performance Chemicals decreased by $11 million in the first quarter of fiscal 2026 as compared to the same period of fiscal 2025 primarily due to lower volumes ($12 million) and less favorable pricing and product mix ($4 million), partially offset by the favorable impact from foreign currency translation ($5 million). The lower volumes in our Performance Chemicals segment were primarily due to weaker demand in Europe. The less favorable pricing and product mix was primarily driven by lower raw material costs which, in certain instances, are passed through to our customers through formulas and other market-based adjustments.
Previous wording
In the first nine months of fiscal 2025, EBIT in Performance Chemicals increased by $32 million as compared to the same period of fiscal 2024. The increase was driven primarily by higher volumes ($25 million) and higher gross profit per ton ($5 million). The higher volumes were driven by higher demand primarily in our fumed metal oxides product line. The higher gross profit per ton was primarily from overall cost management efforts, targeted price increases and optimization measures across the segment.
Current wording
EBIT in Performance Chemicals increased by $3 million in the first quarter of fiscal 2026 as compared to the same period of fiscal 2025 primarily due to higher gross profit per ton ($10 million), partially offset by lower volumes ($8 million). The higher gross profit per ton was primarily driven by a favorable product mix and lower spending from overall cost management efforts and optimization measures across the segment. The lower volumes in our Performance Chemicals segment were primarily due to weaker demand in Europe.
Previous wording
In July 2025, Dow, our fence-line partner at our fumed metal oxides facility in Barry, Wales, announced that it would be ceasing its polysiloxane operations at their site by mid-calendar year 2026. Dow currently supplies our operations with chlorosilane feedstock, which we convert into fumed silica, under an agreement with a term through the end of calendar year 2028. We are in discussions with Dow about how they will satisfy performance under the terms of our contract.
Current wording
In July 2025, Dow, our fence-line partner at our fumed metal oxides facility in Barry, Wales, announced that it would be ceasing its polysiloxane operations at their site by mid-calendar year 2026. Dow currently supplies our operations with chlorosilane feedstock, which we convert into fumed silica, under an agreement with a term through the end of calendar year 2028. During the first quarter of fiscal 2026, we amended our agreement with Dow to include a mechanism for Dow to compensate Cabot in the event that Dow fails to supply chlorosilane for the duration of the supply agreement. We intend to cease production of fumed silica at our manufacturing plant in Barry, Wales beginning in the fourth quarter of fiscal 2026. We will continue operations to post-treat fumed silica at this site.
Previous wording
As we look to the fourth quarter of the fiscal year, we expect the Performance Chemicals segment EBIT to decline from the third quarter of fiscal 2025 primarily due to expected lower seasonal volumes and expected higher costs sequentially.
Current wording
As we look to the second quarter of the fiscal year, we expect the Performance Chemicals segment EBIT to be relatively flat sequentially from the first quarter of fiscal 2026 primarily due to higher expected seasonal volumes which we expect to be offset with higher costs.
Previous wording
Our liquidity position, as measured by cash and cash equivalents plus borrowing availability, decreased by $36 million during the first nine months of fiscal 2025, which was largely due to a higher outstanding commercial paper balance partially offset by a higher cash balance at the end of the period. As of June 30, 2025, we had cash and cash equivalents of $239 million and borrowing availability under our revolving credit agreements of $1.1 billion. We have access to borrowings under the following two credit agreements:
Current wording
Our liquidity position, as measured by cash and cash equivalents plus borrowing availability, decreased by $26 million during the first quarter of fiscal 2026 as compared to September 30, 2025, which was largely due to a lower cash balance at the end of the period. As of December 31, 2025, we had cash and cash equivalents of $230 million and borrowing availability under our revolving credit agreements of $1.2 billion.
Previous wording
As of each of June 30, 2025 and September 30, 2024, we had $130 million and $113 million, respectively, of borrowings under the Euro Credit Agreement and no outstanding borrowings under the U.S. Credit Agreement at either date. There was $98 million and $45 million of commercial paper outstanding as of June 30, 2025 and September 30, 2024, respectively.
Current wording
As of December 31, 2025 and September 30, 2025, we had $128 million and $130 million, respectively, of borrowings under the Euro Credit Agreement and no outstanding borrowings under the U.S. Credit Agreement at either date. There was $6 million of commercial paper outstanding as of both December 31, 2025 and September 30, 2025.
Previous wording
Cash provided by operating activities, which consists of net income adjusted for the various non-cash items included in income, changes in working capital and changes in certain other balance sheet accounts, totaled $446 million in the first nine months of fiscal 2025 compared to $488 million of cash provided by operating activities during the same period of fiscal 2024.
Current wording
Cash provided by operating activities, which consists of net income adjusted for the various non-cash items included in income, changes in working capital and changes in certain other balance sheet accounts, totaled $126 million in the first quarter of fiscal 2026 compared to $124 million of cash provided by operating activities during the same period of fiscal 2025.
Previous wording
Cash provided by operating activities in the first nine months of fiscal 2024 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $114 million, foreign exchange losses of $38 million, and a decrease in net working capital of $18 million. The decrease in net working capital was largely driven by an increase in Accounts Payable and accrued liabilities and a decrease in inventories, partially offset by an increase in Accounts and notes receivable.
Current wording
Cash provided by operating activities in the first quarter of fiscal 2026 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $41 million and a decrease in net working capital of $5 million. The decrease in net working capital was largely driven by a decrease in Accounts and notes receivable, which was partially offset by a decrease in Accounts payable and accrued liabilities.
Previous wording
Cash provided by operating activities in the first nine months of fiscal 2025 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $114 million and cash dividends received from our equity investments of $13 million, which was offset by an increase in net working capital of $13 million. The increase in net working capital was largely driven by a decrease in Accounts Payable and accrued liabilities offset by a decrease in Accounts and notes receivable and Inventories.
Current wording
Cash provided by operating activities in the first quarter of fiscal 2025 was driven by business earnings excluding the non-cash impacts of depreciation and amortization of $37 million and cash dividends received from one of our equity investments of $12 million, which was partially offset by an increase in net working capital of $38 million. The increase in net working capital was largely driven by a decrease in Accounts Payable and accrued liabilities, and an increase in inventories, partially offset by a decrease in Accounts and notes receivable.
Previous wording
Investing activities consumed $239 million of cash in the first nine months of fiscal 2025 compared to $146 million of cash consumed in the first nine months of fiscal 2024.
Current wording
Investing activities consumed $69 million of cash in the first quarter of fiscal 2026 compared to $104 million of cash consumed in the first quarter of fiscal 2025.
Previous wording
In the first nine months of fiscal 2025 and 2024, investing activities included $210 million and $149 million, respectively, of capital expenditures for sustaining and compliance capital projects at our operating facilities as well as growth-related capital. In addition, in the first nine months of fiscal 2025, investing activities included $27 million for cash paid for the asset acquisition described in Note C of our Notes to the Consolidated Financial Statements.
Current wording
In the first quarter of fiscal 2026 and 2025, investing activities included $69 million and $77 million, respectively, of capital expenditures for sustaining and compliance capital projects at our operating facilities as well as growth-related capital. In addition, in the first quarter of fiscal 2025, investing activities included $27 million for cash paid for the asset acquisition described in Note C of our Notes to the Consolidated Financial Statements.
Previous wording
Capital expenditures for fiscal 2025 are expected to be between $250 million and $275 million. Our planned capital spending program for fiscal 2025 is for sustaining, compliance and improvement capital projects at our operating facilities as well as capacity expansion capital expenditures.
Current wording
Capital expenditures for fiscal 2026 are expected to be between $200 million and $230 million. Our planned capital spending program for fiscal 2026 is for sustaining, compliance and improvement capital projects at our operating facilities.
Previous wording
Financing activities consumed $190 million of cash in the first nine months of fiscal 2025 compared to $326 million of cash consumed during the same period of fiscal 2024.
Current wording
Financing activities consumed $92 million of cash in the first quarter of fiscal 2026 compared to $24 million of cash consumed during the same period of fiscal 2025.
Previous wording
In the first nine months of fiscal 2025, financing activities primarily consisted of share repurchases of $129 million, dividend payments to stockholders of $71 million, and cash dividends paid to noncontrolling interests of $57 million. There were also net proceeds from the issuance of commercial paper of $52 million and net proceeds from short-term borrowings of $3 million, which includes proceeds of $14 million partially offset by repayments of $11 million.
Current wording
In the first quarter of fiscal 2025, financing activities primarily consisted of share repurchases of $42 million and dividend payments of $24 million and $20 million to common stockholders and noncontrolling interest, respectively. These payments were partially offset by net proceeds from the issuance of commercial paper of $55 million and proceeds from long-term debt of $6 million under our Euro Credit Agreement.
Previous wording
This report on Form 10-Q contains “forward-looking statements” under the Federal securities laws. These forward-looking statements address expectations or projections about the future, including our expectations regarding our future business performance and overall prospects, including for EBIT, volumes and costs in our business segments in the fourth quarter of fiscal 2025, and the principal assumptions underlying these expectations, including the possible impact of the OBBA and our relationship with DOW on our operations, and demand for our products, the sufficiency of our cash on hand, cash provided from operations and cash available under our credit and commercial paper facilities to fund our cash requirements in both the next twelve months and the foreseeable future; anticipated capital spending; regulatory developments, including regulatory compliance costs and potential impact on our operations; cash requirements and uses of available cash, including future cash outlays associated with respirator liabilities and the timing of such outlays; amortization expenses; our operating tax rate; timing of the expected closing of our acquisition in Mexico; and the possible outcome of legal and environmental proceedings. From time to time, we also provide forward-looking statements in other materials we release to the public and in oral statements made by authorized officers.
Current wording
This report on Form 10-Q contains “forward-looking statements” under the Federal securities laws. These forward-looking statements address expectations or projections about the future, including our expectations regarding our future business performance and overall prospects, including for EBIT, volumes and costs in our business segments in the second quarter of fiscal 2026, and the principal assumptions underlying these expectations, including demand for our products, the sufficiency of our cash on hand, cash provided from operations and cash available under our credit and commercial paper facilities to fund our cash requirements in both the next twelve months and the foreseeable future; anticipated capital spending; regulatory developments, including regulatory compliance costs and potential impact on our operations; cash requirements and uses of available cash, including future cash outlays associated with respirator liabilities and reorganization activity and the timing of such outlays; amortization expenses; charges we expect to record in connection with reorganization activities; our operating tax rate; the cessation of production of fumed silica at our manufacturing plant in Barry, Wales beginning in the fourth quarter of fiscal 2026; and the possible outcome of legal and environmental proceedings. From time to time, we also provide forward-looking statements in other materials we release to the public and in oral statements made by authorized officers.
Previous wording
In addition to factors described elsewhere in this report, the following are some of the factors that could cause our actual results to differ materially from those expressed in our forward-looking statements: industry capacity utilization and competition from other specialty chemical companies; safety, health and environmental requirements and related constraints imposed on our business; regulatory and financial risks related to climate change developments; volatility in the price and availability of energy and raw materials, including with respect to the Russian invasion of Ukraine and the U.S.-China trade relationship; a significant adverse change in a customer or joint venture relationship or the failure of a customer or joint venture partner to perform its obligations under agreements with us; failure to achieve growth expectations from new products, applications and technology developments; failure to realize benefits from acquisitions, alliances, or joint ventures or achieve our portfolio management objectives; negative or uncertain worldwide or regional economic conditions and market opportunities, including from trade relations, global health matters or geo-political conflicts; litigation or legal proceedings; interest rates, tax rates, tariffs, currency exchange controls, and fluctuations in foreign currency; our inability to complete capacity expansions or other development projects; and the accuracy of the assumptions we used in establishing reserves for our share of liability for respirator claims. These other factors and risks are discussed more fully in our 2024 10-K.
Current wording
In addition to factors described elsewhere in this report, the following are some of the factors that could cause our actual results to differ materially from those expressed in our forward-looking statements: industry capacity utilization, shifts in the geographic area of tire production, and competition from other specialty chemical companies; safety, health and environmental requirements and related constraints imposed on our business; regulatory and financial risks related to climate change developments; volatility in the price and availability of energy and raw materials, including with respect to the Russian invasion of Ukraine; a significant adverse change in a customer or joint venture relationship or the failure of a customer or joint venture partner to perform its obligations under agreements with us; failure to achieve growth expectations from new products, applications and technology developments; failure to realize benefits from acquisitions, alliances, or joint ventures or achieve our portfolio management objectives; unanticipated delays in or increased costs of site development projects; negative or uncertain worldwide or regional economic conditions and market opportunities, including from trade relations, global health matters or geo-political conflicts; litigation or legal proceedings; interest rates, tax rates, tariffs, currency exchange controls, and fluctuations in foreign currency; and the accuracy of the assumptions we used in establishing reserves for our share of liability for respirator claims. These other factors and risks are discussed more fully in our 2025 10-K.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
We have access to borrowings under the following two credit agreements:
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
EBIT in Performance Chemicals increased by $2 million in the third quarter of fiscal 2025 as compared to the same period of fiscal 2024 primarily due to higher gross profit per ton ($4 million). The higher gross profit per ton was primarily driven by lower spending from overall cost management efforts, targeted price increases and optimization measures across the segment.