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Dow (NYSE:DOW) just dropped a bombshell1,500 job cuts and a $1 billion cost-saving blitz as it fights through a sluggish economic backdrop. Q4 numbers weren't pretty: a net loss of $35 million ($0.08 per share), pressured by weak pricing in packaging and specialty plastics. Sales dipped 2% to $10.4 billion, missing estimates, though volume eked out a 1% gain. CEO Jim Fitterling made it clearuntil demand picks up, it's all about cutting costs and protecting cash flow. That means slashing up to $500 million in capital spending for 2025 while tightening operational efficiency.
The earnings missed the mark, sending shares down 6.3% in the morning. Its adjusted EPS stayed at breakeven versus the expected $0.24. Packaging & Specialty Plastics, a major revenue driver, took a 6% hit as polyethylene prices sagged. On the flip side, Industrial Intermediates & Infrastructure showed some resilience, holding steady year-over-year. Dow is also making moves to improve liquidity, selling a minority stake in its U.S. Gulf Coast infrastructure for up to $3 billiona strategic play to boost financial flexibility.
Looking ahead, Dow is banking on its efficiency push and incremental growth projects to get back on track. Management is optimistic about a demand rebound in packaging, energy, and electronics, but for now, the focus is on preserving margins and returning cash to shareholders. The stock is still down nearly 29% over the past year, but if these cost-cutting measures pay off, Dow might just be setting up for a comeback.
This article first appeared on GuruFocus.