Axalta Coating Sys — Income Statement, Cash Flows & Balance Sheet
Is Axalta profitable?
Axalta is solidly profitable, and operating income hit a three-year high even as revenue dipped slightly.
| Metric | 2023 | 2024 | 2025 | Change (2023–2025) |
|---|---|---|---|---|
| Net sales ($M) | $5,184 | $5,276 | $5,117 | -1.3% |
| Gross profit ($M) | $1,618 | $1,798 | $1,762 | +8.9% |
| Gross margin | 31.2% | 34.1% | 34.4% | +3.2 pts |
| Income from operations ($M) | $588 | $706 | $735 | +25.0% |
| Net income attributable to shareholders ($M) | $267 | $391 | $378 | +41.6% |
Sales edged lower in 2025, but margins kept improving — Axalta has been wringing more profit out of each dollar of revenue, reflecting lower input costs and the benefits of its restructuring program.
A sharp jump in the tax rate meaningfully reduced net income versus 2024, masking underlying profit improvement.
| Metric | 2024 | 2025 | Change |
|---|---|---|---|
| Income before taxes ($M) | $496 | $546 | +$50M |
| Tax provision ($M) | $105 | $167 | +$62M |
| Effective tax rate | 21.1% | 30.6% | +9.5 pts |
| Net income attributable to shareholders ($M) | $391 | $378 | -$13M |
Pre-tax profit rose meaningfully, but a higher effective tax rate — driven partly by Bermuda's new 15% corporate income tax taking effect in 2025, plus changes in unrecognized tax benefits — caused reported net income to slip slightly from the prior year.
Where does Axalta's revenue come from?
Axalta operates two segments; Performance Coatings is the larger earner but Mobility Coatings is the faster-growing profit engine.
| Segment / End-Market | 2023 Sales | 2024 Sales | 2025 Sales | 2023 Adj. EBITDA | 2024 Adj. EBITDA | 2025 Adj. EBITDA |
|---|---|---|---|---|---|---|
| Refinish | $2,084M | $2,164M | $2,051M | — | — | — |
| Industrial | $1,324M | $1,291M | $1,226M | — | — | — |
| Performance Coatings total | $3,408M | $3,455M | $3,277M | $742M | $838M | $788M |
| Light Vehicle | $1,340M | $1,405M | $1,438M | — | — | — |
| Commercial Vehicle | $436M | $416M | $402M | — | — | — |
| Mobility Coatings total | $1,776M | $1,821M | $1,840M | $209M | $278M | $340M |
Note: Segment Adjusted EBITDA is a non-GAAP measure that adds back depreciation, amortization, and certain one-time items to operating profit.
Performance Coatings is the dominant revenue contributor, but it saw sales decline as refinish and industrial volumes softened. Mobility Coatings told the opposite story — sales grew modestly while profitability surged, with Adjusted EBITDA more than doubling over two years, suggesting significant operational improvement in that segment.
Does Axalta generate cash?
Axalta converts profit into cash reliably, with operating cash flow at a multi-year high in 2025.
| Metric | 2023 | 2024 | 2025 | Change (2024–2025) |
|---|---|---|---|---|
| Cash from operations ($M) | $575 | $576 | $649 | +$73M |
| Capital expenditures ($M) | ($138) | ($140) | ($196) | +$56M |
| Free cash flow (GAAP: ops minus capex) ($M) | $437 | $436 | $453 | +$17M |
Operating cash flow improved meaningfully, though the company is stepping up investment in its facilities, which kept free cash flow growth modest. The capex increase is partly tied to the ongoing restructuring program.
Axalta returned cash to shareholders aggressively while continuing to pay down debt.
| Use of Cash | 2023 | 2024 | 2025 |
|---|---|---|---|
| Debt repayments ($M) | ($904) | ($420) | ($230) |
| Share buybacks ($M) | ($50) | ($100) | ($165) |
| Net borrowings proceeds ($M) | $706 | $328 | $0 |
After heavy debt refinancing in 2023, Axalta has shifted to straightforward debt paydown and is simultaneously ramping up share repurchases each year, a sign of growing financial confidence.
How strong is Axalta's balance sheet?
Axalta carries significant debt, but has been steadily reducing it and remains in full covenant compliance.
| Metric | 2024 | 2025 | Change |
|---|---|---|---|
| Total long-term borrowings ($M) | $3,401 | $3,179 | -$222M |
| Cash and equivalents ($M) | $593 | $657 | +$64M |
| Net debt (borrowings minus cash) ($M) | $2,808 | $2,522 | -$286M |
| Revolving credit facility available ($M) | $778 | $770 | -$8M |
Debt is declining and liquidity is healthy, with nearly $800 million of undrawn revolving credit available. The next meaningful maturity is $500 million of senior notes due in 2027, which investors will want to monitor.
Goodwill and intangibles make up a large portion of the asset base, which is typical for a business built partly through acquisitions.
| Asset | 2024 | 2025 | Change |
|---|---|---|---|
| Goodwill ($M) | $1,640 | $1,795 | +$155M |
| Intangible assets, net ($M) | $1,149 | $1,147 | -$2M |
| Total assets ($M) | $7,249 | $7,599 | +$350M |
Goodwill and intangibles together represent over half of total assets. Axalta performed a full quantitative impairment test in 2025 and concluded all values were recoverable with significant cushion, though this remains an area to watch given the pending merger with AkzoNobel.