Cabot Corporation Reports Decline in Revenue and Profitability for Third Quarter 2025

Cabot Corporation reported its financial results for the third quarter and nine months ended June 30, 2025, revealing a decline in both revenue and profitability compared to the previous fiscal year. For the third quarter, net sales and other operating revenues totaled $923 million, down from $1,016 million in the same period last year. The company’s gross profit also decreased to $244 million from $256 million, reflecting challenges in customer demand and pricing pressures across its segments. Net income attributable to Cabot Corporation was $101 million, or $1.86 per diluted share, compared to $109 million, or $1.94 per diluted share, in the prior year.

The decline in revenue was attributed to lower volumes in both the Reinforcement Materials and Performance Chemicals segments, which were impacted by reduced customer demand amid a weaker global macroeconomic environment and uncertainties related to tariffs. Specifically, the Reinforcement Materials segment saw a revenue drop of $76 million, primarily due to lower volumes and less favorable pricing. In contrast, the Performance Chemicals segment experienced a smaller decline, with revenues decreasing by $12 million, although it benefited from higher demand in certain product lines.

Cabot's operational metrics showed a mixed performance across its segments. The Reinforcement Materials segment reported revenues of $573 million, down from $649 million, while the Performance Chemicals segment generated $320 million, slightly lower than the previous year's $332 million. The company also noted a decrease in selling and administrative expenses, which fell to $62 million from $68 million, reflecting ongoing cost management efforts. Research and technical expenses remained stable, indicating a consistent investment in innovation despite the revenue challenges.

In terms of strategic developments, Cabot completed the acquisition of certain assets and licensed technology for its Battery Materials product line for $27 million in October 2024. Additionally, the company announced plans to acquire Bridgestone Corporation's carbon black manufacturing facility in Tamaulipas, Mexico, for approximately $70 million, expected to close in the first half of fiscal 2026, pending regulatory approval. These acquisitions are part of Cabot's strategy to enhance its product offerings and expand its market presence.

Looking ahead, Cabot anticipates continued challenges in the fourth quarter due to expected higher costs and seasonal volume declines, particularly in the Reinforcement Materials segment. The company expects its operating tax rate for fiscal 2025 to range between 27% and 29%. Despite the current headwinds, Cabot remains focused on managing its liquidity and capital investments, with cash and cash equivalents of $239 million and access to $1.1 billion in borrowing capacity as of June 30, 2025.