Dow's profitability is under severe pressure, with gross margins compressing from 12.5% in 2024Q1 to 6.5% in 2026Q1 alongside a shift to negative operating income.
| Sales/Revenue | 39.33B | 39.97B | 42.96B | 44.62B | 56.9B | 54.97B | 38.54B | 42.95B | 60.28B | 43.73B |
| Revenue Growth % | -7.74% | -6.97% | -3.72% | -21.58% | 3.52% | 42.62% | -10.27% | -28.75% | 37.84% | - |
| Cost of Goods Sold | 36.91B | 37.57B | 38.51B | 39.65B | 49.05B | 44.58B | 33.73B | 36.99B | 41.44B | 44.24B |
| COGS % of Revenue | - | 94.01% | 89.63% | 88.86% | 86.19% | 81.1% | 87.51% | 86.13% | 68.75% | 101.16% |
| Gross Profit | 2.42B | 2.4B | 4.46B | 4.97B | 7.86B | 10.39B | 4.81B | 5.96B | 8.16B | 11.27B |
| Gross Margin % | 6.16% | 5.99% | 10.37% | 11.14% | 13.81% | 18.9% | 12.49% | 13.87% | 13.54% | 25.78% |
| Gross Profit Growth % | - | -46.24% | -10.4% | -36.72% | -24.36% | 115.88% | -19.21% | -27.01% | -27.61% | - |
| Operating Expenses | 3.33B | 2.13B | 2.39B | 2.46B | 2.53B | 2.5B | 2.24B | 2.35B | 2.58B | 4.57B |
| OpEx % of Revenue | - | 5.34% | 5.57% | 5.5% | 4.44% | 4.55% | 5.81% | 5.48% | 4.28% | 10.45% |
| Selling, General & Admin | 1.44B | 1.38B | 1.58B | 1.63B | 1.68B | 1.65B | 1.47B | 1.59B | 1.78B | 2.92B |
| SG&A % of Revenue | - | 3.46% | 3.68% | 3.65% | 2.94% | 2.99% | 3.82% | 3.7% | 2.96% | 6.68% |
| Research & Development | 733M | 751M | 810M | 829M | 851M | 857M | 768M | 765M | 1.54B | 803M |
| R&D % of Revenue | - | 1.88% | 1.89% | 1.86% | 1.5% | 1.56% | 1.99% | 1.78% | 2.55% | 1.84% |
| Other Operating Expenses | 2M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | -907M | 260M | 2.06B | 2.52B | 5.33B | 7.89B | 2.57B | 3.6B | 5.58B | 6.7B |
| Operating Margin % | -2.31% | 0.65% | 4.8% | 5.64% | 9.37% | 14.35% | 6.68% | 8.38% | 9.25% | 15.33% |
| Operating Income Growth % | - | -87.4% | -17.96% | -52.8% | -32.4% | 206.49% | -28.55% | -35.44% | -16.8% | - |
| EBITDA | 1.26B | 3.09B | 4.96B | 5.13B | 8.09B | 10.73B | 5.16B | 6.27B | 8.31B | 7.33B |
| EBITDA Margin % | 3.2% | 7.74% | 11.54% | 11.49% | 14.22% | 19.52% | 13.39% | 14.6% | 13.79% | 16.76% |
| EBITDA Growth % | -71.22% | -37.6% | -3.3% | -36.62% | -24.6% | 107.83% | -17.7% | -24.56% | 13.46% | - |
| D&A (Non-Cash Add-back) | 2.17B | 2.83B | 2.89B | 2.61B | 2.76B | 2.84B | 2.59B | 2.67B | 2.74B | 624M |
| EBIT | -1.33B | -1.65B | 2.36B | 1.39B | 6.74B | 8.83B | 2.95B | -300M | 4.81B | 3.77B |
| Net Interest Income | -715M | -713M | -558M | -507M | -478M | -634M | -840M | -866M | -978M | -976M |
| Interest Income | 166M | 152M | 200M | 229M | 173M | 55M | 38M | 81M | 82M | 0 |
| Interest Expense | 881M | 865M | 758M | 736M | 651M | 689M | 878M | 947M | 1.06B | 976M |
| Other Income/Expense | -1.62B | -2.77B | -464M | -1.86B | 759M | 259M | -502M | -4.85B | -1.83B | -3.9B |
| Pretax Income | -2.53B | -2.51B | 1.6B | 656M | 6.09B | 8.14B | 2.07B | -1.25B | 5.92B | 237M |
| Pretax Margin % | -6.42% | -6.28% | 3.72% | 1.47% | 10.7% | 14.82% | 5.37% | -2.9% | 9.82% | 0.54% |
| Income Tax | 72M | -67M | 399M | -4M | 1.45B | 1.74B | 777M | 470M | 1.28B | 1.52B |
| Effective Tax Rate % | -2.85% | 2.67% | 24.94% | -0.61% | 23.81% | 21.36% | 37.52% | -37.69% | 21.71% | 643.04% |
| Net Income | -2.76B | -2.62B | 1.12B | 589M | 4.58B | 6.31B | 1.23B | -1.36B | 4.5B | 465M |
| Net Margin % | -7.02% | -6.56% | 2.6% | 1.32% | 8.05% | 11.48% | 3.18% | -3.18% | 7.46% | 1.06% |
| Net Income Growth % | -1042.32% | -335.04% | 89.47% | -87.15% | -27.4% | 415.18% | 189.74% | -130.34% | 867.53% | - |
| Net Income (Continuing) | -2.6B | -2.44B | 1.2B | 660M | 4.64B | 6.41B | 1.29B | -1.72B | 2.94B | 595M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 432M | 1.83B | 1.88B |
| Minority Interest | 1.51B | 1.51B | 496M | 501M | 529M | 574M | 570M | 553M | 1.14B | 1.19B |
| EPS (Diluted) | -3.83 | -3.69 | 1.57 | 0.82 | 6.28 | 8.38 | 1.64 | -2.31 | 6.00 | 0.62 |
| EPS Growth % | -1095.23% | -335.03% | 91.46% | -86.94% | -25.06% | 410.98% | 171% | -138.5% | 867.74% | - |
| EPS (Basic) | - | -3.69 | 1.57 | 0.82 | 6.32 | 8.44 | 1.64 | -2.31 | 6.02 | 0.62 |
| Diluted Shares Outstanding | 721.2M | 711.6M | 705.1M | 709M | 725.6M | 749M | 742.3M | 742.5M | 750M | 750M |
| Basic Shares Outstanding | 721.2M | 711.6M | 703.8M | 705.7M | 721M | 743.6M | 740.5M | 742.5M | 747.2M | 742.66M |
| Dividend Payout Ratio | - | - | 176.16% | 334.8% | 43.78% | 32.85% | 169.06% | - | 82.48% | 695.7% |
Cyclical Margin Compression
As reported in recent quarterly filings, Dow's revenue has experienced a sustained decline, with the most recent period showing a 6.1% year-over-year contraction, signaling that the company remains trapped in a challenging demand environment for its core polyolefins and specialty chemical product lines.
The consistent negative growth trajectory suggests that the company is struggling to find volume support amidst a broader industrial slowdown. Investors should monitor whether this trend reflects structural market share loss or merely a temporary destocking phase within the global packaging and construction supply chains.
Based on the provided financial data, Dow's gross margin has compressed significantly to 6.5% in 2026Q1, down from 12.5% in early 2024, illustrating the company's limited ability to pass through volatile feedstock costs during periods of global overcapacity.
This margin degradation appears to confirm that the company's cost-curve advantage is currently insufficient to offset the impact of depressed pricing power. The inability to maintain double-digit gross margins warrants further investigation into whether the current pricing environment is a cyclical trough or a permanent shift in competitive dynamics.
According to the income statement, Dow's operating income has swung to a loss of $31 million in 2026Q1, highlighting how the company's high fixed-cost structure exacerbates earnings volatility when revenue growth fails to cover the underlying operational overhead.
The rapid transition from positive operating income to losses suggests that the company lacks the necessary flexibility to scale its cost base down in lockstep with declining sales. This operational leverage profile implies that any recovery in profitability will be highly sensitive to the timing and magnitude of a demand rebound.
As indicated by the reported net loss of $445 million in 2026Q1, Dow's bottom-line performance is currently characterized by significant instability, with net margins frequently dipping into negative territory over the last ten quarters due to non-operating items and cyclical headwinds.
The frequent divergence between operating income and net income suggests that investors should be cautious of one-time charges and equity-method accounting impacts that may be masking the underlying cash-generating capability of the business. The lack of consistent profitability raises questions regarding the sustainability of current capital allocation priorities.
While management emphasizes long-term structural advantages, the recent financial performance suggests that Dow's earnings power is currently highly vulnerable, with the company failing to achieve positive net income in six of the last ten reported quarters.
Short-sellers would likely focus on the potential for further impairment charges and the risk that the company's massive capital intensity will continue to weigh on returns during a prolonged downturn. The current financial trajectory suggests that the market may be underestimating the duration of this commodity cycle trough.
Quick answers to the most common questions about buying DOW stock.
For fiscal year 2025, Dow Inc. (DOW) reported total revenue of $39.97B. This represents a 8.6% decline compared to $43.73B in 2017.
Dow Inc. (DOW) reported a net loss of $2.62B for the fiscal year ending 2025.
Dow Inc. (DOW) reported an operating income of $260.0M, resulting in an operating profit margin of 0.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Dow Inc. (DOW) generated $2.40B in gross profit for the year, representing a gross profit margin of 6.0%. This demonstrates the company's core pricing power and production efficiency.