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Quaker Houghton Reports Second Quarter Results for 2025

In its latest announcement, Quaker Houghton (NYSE: KWR), a global leader in industrial process fluids, has shared its financial results for the second quarter of 2025. The company reported net sales of $483.4 million, a notable 4% increase compared to $463.6 million in the same period last year. This rise was attributed mainly to a 2% organic sales volume increase, fueled by roughly 5% growth from new business acquisitions.

However, the company faced a significant challenge, recording a net loss of $66.6 million, equivalent to a loss of $3.78 per diluted share. This stands in stark contrast to a net income of $34.9 million or $1.94 per diluted share reported during Q2 of 2024. The principal factor contributing to this loss was an $88.8 million non-cash goodwill impairment charge related to the EMEA segment, indicating stark effects from ongoing turbulent market conditions.

Quaker Houghton’s non-GAAP calculations fared somewhat better, with a net income of $30 million and earnings per diluted share of $1.71, albeit a decrease from $38.2 million and $2.13, respectively, in the previous year. The adjusted EBITDA for this quarter was $75.5 million, with an adjusted EBITDA margin of 15.6%, both figures showing a decrease over the previous year's performance.

Key Factors Influencing the Results

According to Joe Berquist, CEO and President, the increase in sales volumes is primarily a result of strong performances in the Asia/Pacific segment, which experienced an 8% organic growth. This trend highlights the effectiveness of the company’s strategies in capitalizing on new business opportunities. However, the company continues to navigate a challenging macroeconomic environment, particularly in the Americas and EMEA regions, where uncertainty due to tariffs has negatively impacted end market conditions.

Despite the ongoing struggles within some markets, Quaker Houghton remains focused on enhancing efficiencies and customer satisfaction. The management has initiated actions expected to generate up to $20 million in annualized cost savings by the end of 2026, with plans to strengthen performance significantly in the second half of 2025.

Furthermore, the segment analyses revealed varied performances across different regions, with significant sales in:

• - Americas: $221.1 million, down from $223.5 million last year, signaling a slight decline in volumes and adverse foreign currency impacts.
• - EMEA: Sales reached $139.9 million, a marginal 1% increase supported by new business but offset by a decline in selling price.
• - Asia/Pacific: Showcased the most robust growth at $122.4 million, reflecting a 20% increase fueled by rising sales volumes and acquisitions.

In response to market dynamics, the company has emphasized its commitment to maintaining a strong balance sheet and generating consistent cash flow, which will support ongoing investments and shareholder value creation. Following the report, Quaker Houghton’s share repurchases tallied $32.7 million in Q2 2025, alongside a quarterly dividend increase of approximately 5%.

Looking Ahead

As 2025 progresses, Quaker Houghton anticipates navigating a continued uncertain economic landscape but is optimistic about leveraging the opportunities in their operational strategies. The company's strong foundation and recent actions indicate that they are well-positioned to regain profitability and sustain performance across their diverse global markets.

The management encouraged stakeholders to stay tuned for further updates as they redirect focus toward achieving improved results in the upcoming quarters. Quaker Houghton remains committed to innovation, customer engagement, and cost management as they steer through challenges ahead.

Conclusion

While the second quarter of 2025 showed both encouraging sales growth and concerning financial losses, Quaker Houghton’s resilience and response strategies provide a framework for future improvement. The forthcoming periods will be crucial for the company's efforts to solidify its market presence and generate sustained profitability amidst ongoing global market pressures.