Cash conversion efficiency appears strained, as evidenced by an operating cash flow to net income ratio of 0.09 in 2026Q1, largely driven by volatile working capital requirements and elevated capital expenditures averaging 5% of revenue.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Cash from Operations | 1.99B | 1.94B | 1.42B | 2.41B | 963M | 1.56B | 2.13B | 2.08B | 1.47B | 1.57B | 1.32B | 1.84B | 1.53B | 1.79B | 1.79B | 1.44B | 1.31B | 1.34B | 1.36B | 996M | 1.13B | 1.06B | 1.02B | 1.12B | 872M | 1.06B | 870M | 902M | 942M | 1.01B | 1.01B |
| Operating CF Margin % | - | 12.23% | 8.96% | 14.84% | 6.17% | 9.3% | 15.4% | 13.73% | 9.54% | 10.63% | 9.29% | 12.9% | 10.33% | 12.56% | 14.09% | 10.92% | 9.76% | 10.99% | 8.57% | 8.15% | 11.46% | 11.8% | 10.7% | 12.83% | 10.81% | 12.98% | 10.08% | 11.28% | 12.15% | 13.65% | 13.96% |
| Operating CF Growth % | 434.8% | 36.69% | -41.1% | 150.36% | -38.35% | -26.67% | 2.4% | 41.79% | -6.44% | 18.34% | -27.87% | 20.22% | -14.68% | 0.22% | 24.44% | 9.62% | -2.6% | -0.96% | 36.35% | -11.86% | 6.1% | 4.62% | -9.35% | 28.78% | -17.74% | 21.84% | -3.55% | -4.25% | -6.45% | -0.09% | -5.98% |
| Net Income | 1.58B | 1.57B | 1.38B | 1.26B | 1.03B | 1.44B | 1.07B | 1.27B | 1.34B | 1.39B | 565M | 1.33B | 1.11B | 973M | 680M | 962M | 880M | 426M | 624M | 856M | 711M | 596M | 683M | 494M | -69M | 387M | 620M | 568M | 801M | 714M | 744M |
| Depreciation & Amortization | 541M | 546M | 492M | 514M | 502M | 561M | 509M | 511M | 497M | 460M | 440M | 446M | 450M | 452M | 399M | 425M | 470M | 480M | 563M | 403M | 380M | 372M | 388M | 394M | 398M | 447M | 447M | 419M | 383M | 373M | 363M |
| Stock-Based Compensation | 24M | 0 | 42M | 56M | 34M | 57M | 44M | 39M | 37M | 35M | 45M | 54M | 71M | 81M | 71M | 34M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 4M | -27M | -97M | -187M | -151M | 35M | -47M | -5M | 45M | 36M | 155M | 159M | -89M | -36M | -207M | -19M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | 38M | -32M | 207M | 478M | -25M | -344M | 212M | 215M | -46M | -9M | 273M | 97M | 166M | 309M | 672M | 187M | -279M | 69M | 316M | 66M | 39M | 125M | 2M | 24M | 563M | 103M | 53M | 82M | -54M | 43M | 0 |
| Working Capital Changes | -204M | -117M | -601M | 288M | -432M | -188M | 341M | 51M | -406M | -346M | -143M | -34M | -181M | -8M | 172M | -153M | 239M | 370M | -66M | -329M | 0 | -28M | -55M | 211M | -20M | 123M | -250M | -167M | -188M | -123M | -99M |
| Change in Receivables | -137M | -190M | -181M | 12M | -248M | -63M | 187M | 121M | -69M | -76M | -68M | -125M | -116M | -25M | 171M | -107M | -188M | 294M | -4M | -224M | -87M | -144M | -134M | -58M | -36M | 74M | -44M | -128M | -85M | -124M | -2M |
| Change in Inventory | 39M | -35M | -27M | 145M | -177M | -279M | 111M | 145M | -109M | -116M | 56M | 37M | -99M | 44M | 53M | -74M | -34M | 232M | 79M | -49M | -78M | -59M | -45M | 11M | -9M | 187M | -92M | -7M | -73M | -60M | -56M |
| Change in Payables | 74M | 67M | -259M | 151M | 21M | 295M | 127M | -63M | -76M | 188M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -152M | 15M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -811M | -700M | 107M | -556M | -461M | -2.4B | -1.45B | -1.01B | -764M | -67M | 436M | -395M | -857M | 3M | -1.61B | 353M | -949M | -203M | 125M | -2.21B | -662M | -365M | -260M | -166M | -212M | -245M | -636M | -1.64B | -581M | -583M | -468.4M |
| Capital Expenditures | -765M | -778M | -721M | -516M | -486M | -371M | -304M | -413M | -411M | -360M | -380M | -430M | -564M | -494M | -411M | -390M | -307M | -239M | -383M | -364M | -372M | -288M | -244M | -217M | -238M | -291M | -561M | -490M | -487M | -466M | -476M |
| CapEx % of Revenue | 4.75% | 4.9% | 4.55% | 3.18% | 3.11% | 2.21% | 2.2% | 2.73% | 2.67% | 2.44% | 2.66% | 3.02% | 3.81% | 3.46% | 3.24% | 2.97% | 2.29% | 1.95% | 2.42% | 2.98% | 3.77% | 3.19% | 2.56% | 2.48% | 2.95% | 3.56% | 6.5% | 6.13% | 6.28% | 6.32% | 6.59% |
| Acquisitions | -37M | 42M | 294M | -73M | 3M | -2.14B | -1.17B | -643M | -378M | 268M | 745M | -273M | -488M | -43M | -122M | 47M | -34M | -26M | -1.45B | -233M | -402M | -91M | -67M | -3M | -22M | -10M | -115M | -1.34B | -390M | -363M | -13M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -9M | 36M | 534M | 33M | 22M | 104M | 9M | 27M | 30M | 22M | -9M | -19M | 60M | -24M | 27M | 82M | 20M | 62M | 1.96B | -1.61B | 112M | -36M | 51M | 54M | 48M | 56M | 40M | 189M | 296M | 246M | 20M |
| Cash from Financing | -1.58B | -545M | -1.43B | -1.55B | -409M | 93M | -59M | -758M | -1.21B | -1.95B | -1.18B | -754M | -969M | -1.98B | -351M | -1.63B | -104M | -1.12B | -978M | 1.28B | -501M | -857M | -585M | -593M | -655M | -816M | -278M | 773M | -361M | -360M | -575.1M |
| Debt Issued (Net) | 429M | 903M | -26M | -850M | 377M | 827M | 445M | 35M | 983M | -681M | 248M | 374M | 292M | -605M | 198M | -400M | 759M | -1.28B | -641M | 1.7B | -95M | -92M | -312M | -385M | -423M | -541M | 197M | 1.11B | 86M | 208M | 270M |
| Equity Issued (Net) | -492M | -790M | -752M | -86M | -190M | -210M | 54M | -345M | -1.74B | -761M | -1.08B | -809M | -750M | -932M | 30M | -777M | -440M | -47M | 6M | -80M | -86M | -459M | 21M | 61M | 32M | 8M | -199M | -73M | -195M | -329M | -608M |
| Dividends Paid | -633M | -628M | -622M | -598M | -570M | -536M | -496M | -468M | -453M | -434M | -414M | -383M | -361M | -345M | -358M | -355M | -360M | -430M | -422M | -335M | -316M | -316M | -307M | -294M | -287M | -283M | -276M | -264M | -252M | -239M | -237M |
| Share Repurchases | -492M | -790M | -752M | -86M | -190M | -210M | 0 | -325M | -1.72B | -813M | -1.05B | -751M | -750M | -1B | -92M | -858M | -586M | -59M | -7M | -274M | -153M | -607M | -100M | 0 | 0 | -5M | -247M | -82M | -217M | -343M | -635M |
| Other Financing | -881M | -30M | -25M | -16M | -26M | 12M | -62M | -61M | -29M | -78M | -25M | -105M | -207M | -97M | -221M | -100M | -63M | 634M | 0 | 0 | -4M | 10M | 13M | 25M | 23M | 0 | 0 | 0 | 0 | 0 | 0 |
| Net Change in Cash | -257M | 893M | -223M | 394M | 94M | -821M | 610M | 314M | -534M | -384M | 509M | 625M | -430M | -190M | -151M | 116M | 284M | 36M | 495M | 83M | -11M | -193M | 210M | 382M | 9M | -3M | -47M | 30M | -1M | 59M | -36M |
| Free Cash Flow | 1.23B | 1.16B | 699M | 1.9B | 477M | 1.19B | 1.83B | 1.67B | 1.06B | 1.21B | 923M | 1.36B | 941M | 1.28B | 1.38B | 1.05B | 1B | 1.11B | 975M | 643M | 758M | 777M | 774M | 906M | 634M | 769M | 309M | 412M | 455M | 541M | 532M |
| FCF Margin % | 7.61% | 7.33% | 4.41% | 11.67% | 3.06% | 7.09% | 13.2% | 11.01% | 6.87% | 8.19% | 6.47% | 9.56% | 6.36% | 8.95% | 10.85% | 7.95% | 7.47% | 9.04% | 6.15% | 5.26% | 7.69% | 8.61% | 8.14% | 10.35% | 7.86% | 9.41% | 3.58% | 5.15% | 5.87% | 7.33% | 7.37% |
| FCF Growth % | 56.51% | 66.38% | -63.11% | 297.27% | -59.95% | -34.78% | 9.54% | 57.86% | -12.58% | 30.88% | -32.18% | 44.63% | -26.25% | -7.27% | 31.55% | 4.29% | -9.31% | 13.44% | 51.63% | -15.17% | -2.45% | 0.39% | -14.57% | 42.9% | -17.56% | 148.87% | -25% | -9.45% | -15.9% | 1.69% | -14.77% |
| FCF per Share | 5.47 | 5.12 | 2.98 | 7.99 | 2.01 | 4.97 | 7.68 | 7.00 | 4.30 | 4.69 | 3.45 | 4.97 | 3.37 | 4.40 | 4.44 | 3.28 | 3.05 | 3.34 | 2.94 | 1.95 | 2.28 | 2.27 | 2.24 | 2.65 | 1.88 | 2.28 | 0.89 | 1.17 | 1.27 | 1.49 | 1.40 |
| FCF Conversion (FCF/Net Income) | 0.77x | 1.23x | 1.27x | 1.90x | 0.94x | 1.09x | 2.01x | 1.67x | 1.09x | 0.98x | 1.52x | 1.31x | 0.73x | 0.55x | 1.90x | 1.31x | 1.70x | 4.00x | 2.52x | 1.19x | 1.59x | 1.79x | 1.49x | 2.27x | -12.64x | 2.74x | 1.40x | 1.59x | 1.18x | 1.41x | 1.35x |
| Interest Paid | 117M | 0 | 0 | 213M | 156M | 140M | 153M | 127M | 108M | 100M | 118M | 115M | 218M | 201M | 219M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 213M | 0 | 0 | 495M | 452M | 491M | 367M | 348M | 380M | 648M | 349M | 383M | 642M | 319M | 503M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Working Capital Volatility
As reported in recent financial statements, PPG's operating cash flow to net income ratio has fluctuated wildly, reaching a low of 0.09 in 2026Q1, which suggests that reported earnings frequently decouple from the actual cash generated by core industrial operations during periods of significant working capital absorption.
The extreme variance in the OCF/NI ratio indicates that net income is a poor proxy for immediate liquidity, likely due to the timing of raw material procurement and seasonal inventory builds. Investors should monitor whether this disconnect reflects structural inefficiencies in cash collection or merely the cyclical nature of the specialty chemicals supply chain.
Based on the provided cash flow data, PPG's free cash flow trajectory remains highly inconsistent, swinging from a peak of $730 million in 2023Q4 to a deficit of $163 million in 2026Q1, highlighting the company's vulnerability to sudden shifts in operational cash generation and capital expenditure requirements.
The inability to maintain positive free cash flow across consecutive quarters suggests that the company's high fixed-cost base requires significant volume to achieve self-funding status. This volatility may force management to rely on external financing or balance sheet cash to sustain dividend commitments during industrial downturns.
According to recent SEC filings, PPG's capital expenditure as a percentage of revenue has averaged roughly 5% over the last ten quarters, with a notable spike to 9.1% in 2024Q4, indicating a persistent need for heavy reinvestment to maintain its complex global manufacturing and technical infrastructure.
The sustained level of capital intensity suggests that PPG must continuously upgrade its production facilities to meet stringent aerospace and automotive OEM specifications. This ongoing requirement for capital limits the company's ability to generate excess cash, effectively capping the potential for aggressive share repurchases or debt reduction.
As indicated by the quarterly cash flow statements, working capital changes have been a primary driver of cash flow volatility, with a massive $554 million outflow in 2024Q1 contrasting with a $641 million inflow in 2023Q4, reflecting significant sensitivity to inventory management and accounts receivable cycles.
These dramatic swings in working capital suggest that PPG's cash position is highly susceptible to the timing of customer payments and raw material inventory accumulation. The lack of stability in these cycles warrants further investigation into whether the company is effectively managing its supply chain or merely absorbing market-driven fluctuations.
Based on reported figures, PPG has consistently returned capital to shareholders through dividends totaling approximately $150 million per quarter, even during periods of negative free cash flow, which suggests a rigid capital allocation policy that may prioritize shareholder optics over balance sheet preservation during cyclical troughs.
The persistence of dividend payments despite significant cash flow deficits in 2026Q1 and 2025Q1 implies that management views these distributions as a non-negotiable obligation. This approach may limit the company's capacity to pursue strategic acquisitions or respond to unexpected operational headwinds without increasing leverage.
Quick answers to the most common questions about buying PPG stock.
PPG Industries, Inc. (PPG) generated $1.94B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
PPG Industries, Inc. (PPG) generated $1.16B in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
PPG Industries, Inc. (PPG) spent $778.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, PPG Industries, Inc. (PPG) returned $628.0M to shareholders via cash dividends and spent $790.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.