Qnity Reports Third Quarter 2026 Results, Raises Full-Year Financial Guidance
Qnity Reports Third Quarter 2026 Results, Raises Full-Year Financial Guidance – Third quarter Net Sales and Organic Sales (1) of $1.6 billion, up 22% year- over-year
– GAAP Net Income of $196 million and Adjusted Operating EBITDA (1) of $503 million
– Qnity Electronics, Inc. (“Qnity”) (NYSE: Q) today reported results for the third quarter ended September 30, 2026. “We delivered our tenth consecutive quarter of profitable growth with strong performance across both segments as Qnity continues to establish itself as the premier solutions provider across the semiconductor value chain,” said Jon Kemp, Qnity’s Chief Executive Officer. “A year of disciplined execution as an independent company shows what sets Qnity apart: a deep portfolio, close alignment with our customers' roadmaps, and a local-for-local model that delivers at scale.”
Kemp added, “Materials innovation is quickly becoming a critical driver of chip performance as the industry shifts toward shrink and stack. Qnity’s end-to-end solutions across the stack enable customers to address the most complex system level challenges: signal reliability, power density, and thermal management. We see tremendous opportunities ahead, and we’re continuing to invest in differentiated technologies where we see visible customer demand to create significant value for our shareholders.” Financial Results Summary
In millions, except per share GAAP Results amounts Q3 2026(1) Q3 2025(2) Net Sales $1,556 $1,276 Semiconductor Technologies 797 693 Interconnect Solutions 759 583 Gross Profit $743 $575 Net Income $196 $223 Diluted Earnings Per Share $0.87 $1.01 Non-GAAP Results Adjusted Gross Profit $743 $575 Adjusted Operating EBITDA $503 $370 Adjusted Earnings, net of tax $306 $197 Adjusted Earnings Per Share $1.46 $0.94
(1) Organic Sales, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating EBITDA, Adjusted Operating EBITDA Margin, Adjusted Earnings, and Adjusted EPS are non-GAAP measures. See “Non-GAAP Measures” for further discussion, including a definition of significant items. Reconciliations to the most directly comparable GAAP measure, including details of significant items, can be found in the “Non-GAAP Measures” section of this press release.
(2) Q3 2025 is presented on a pro forma basis. The pro forma non-GAAP measures give effect to pro forma adjustments related to interest expense associated with our current indebtedness, agreements executed in connection with the spin-off on November 1, 2025, from DuPont de Nemours, Inc. (“DuPont”) and other standalone costs as if the spin-off had occurred on January 1, 2025. See “Non-GAAP Measures” for further discussion, including a definition of significant items. Reconciliations to the most directly comparable GAAP measure, including details of significant items, can be found in the “Non-GAAP Measures” section of this press release. Refer to the “Non-GAAP Measures” section of this press release for further details on these adjustments.
Qnity is raising full‑year guidance based on strong third‑quarter performance and continued momentum in the business. Qnity’s full year 2026 guidance (3) is as follows:
Net Sales $5.77B - $5.83B Adjusted Operating EBITDA $1.785B - $1.805B Adjusted EPS $4.95 - $5.05 Adjusted Free Cash Flow $800M - $900M
(3) We calculate forward-looking Adjusted Operating EBITDA, Adjusted EPS, and Adjusted Free Cash Flow based on internal forecasts that exclude certain information that would be included in the most directly comparable forward- looking GAAP measures. We are not providing a quantitative reconciliation of forward-looking Non-GAAP financial measures to the corresponding GAAP financial measure for these measures due to the unreasonable effort and uncertainty in estimating certain items necessary for such reconciliations, including adjustments that could be made for significant items, interest expense, indirect legacy costs/benefits, transformation, integration, and other charges, share- based compensation amounts, non-recurring, unusual or unanticipated charges, expenses or gains.
Qnity will hold a conference call to review these results on Wednesday, November 4, 2026, at 8:00 a.m. ET. Investors can join the conference call via telephone by dialing (800) 343-5172 (domestic) or +1 (203) 518-9856 (international) and using the participant code QNITY. An audio-only live webcast, presentation materials, and replay will also be made available at Events | Qnity Electronics, Inc. (Q) .
Qnity is a premier technology provider across the semiconductor value chain, empowering AI, high performance computing, and advanced connectivity. From groundbreaking solutions for semiconductor chip manufacturing, to enabling high- speed transmission within complex electronic systems, our high-performance materials and integration expertise make tomorrow’s technologies possible. More information about Qnity, a constituent of the S&P 500 index, its businesses, and solutions can be found at http://www.qnityelectronics.com.
Qnity™, the Qnity Node Logo, and all products, unless otherwise noted, denoted with TM or ® are trademarks, trade names or registered trademarks of affiliates of Qnity Electronics, Inc. 2
This release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements use words such as "plans", "expects", "will", "would", "anticipates", "believes", "intends", "seeks", "projects", "efforts", "estimates", "potential", "continue", "intend", “outlook”, "may", "could", "should" and similar expressions, among others, as well as other words or expressions referencing future events, conditions or circumstances. Statements that describe or relate to the market, industry and macroeconomic environment, Qnity's business plans or prospects, goals, intentions, strategies, future operating or financial performance, outlook, including without limitation statements under the heading “Guidance for Full Year 2026” and statements regarding Qnity’s strategic path, operating model, transformation plan and its expected costs and benefits and timing thereof, IT independence, share repurchases, and capital allocation plan to deliver above-market growth and strong profitability and statements that do not relate to historical or current fact, are examples of forward-looking statements. Forward-looking statements are based on our current beliefs, expectations and assumptions, which may not prove to be accurate, and involve a number of known and unknown risks and uncertainties, many of which are out of Qnity's control. Forward-looking statements are not guarantees of future performance, and there are a number of important factors that could cause actual outcomes and results to differ materially from the results contemplated by such forward-looking statements, including Qnity’s ability to realize the anticipated benefits of its multi-year transformation plan in the anticipated timeframe or at all and the risk that the costs of such plan may be higher than currently anticipated; the competitive environment in which Qnity operates; the risks from Qnity’s international operations, including geopolitical uncertainty and conflict, trade restrictions and sanctions laws; Qnity’s ability to comply with complex and increasing legal and regulatory requirements; the ability to realize the intended benefits of Qnity’s spin off from DuPont, including achievement of the anticipated synergies and operational efficiencies in connection with the spin off and completed and future, if any, divestitures, mergers, acquisitions, and other portfolio management, productivity and infrastructure actions; contractual allocation of certain liabilities in connection with the spin-off; and the possibility of disputes, litigation or unanticipated costs in connection with the spin-off. Additional information concerning risks and uncertainties can be found in Qnity's filings with the U.S. Securities and Exchange Commission (the “SEC”), including under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in our most recent Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026, and in Qnity’s future filings with the SEC. Any forward-looking statement speaks only as of the date on which it is made. Qnity does not undertake any obligation to publicly update or revise any forward- looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
This press release includes information that does not conform to accounting principles generally accepted in the United States of America (“U.S. GAAP”) and are considered non-GAAP measures, including the presentation of Organic Sales, Adjusted Gross Profit, Adjusted Pro Forma Gross Profit, Adjusted Operating EBITDA, Adjusted Pro Forma Operating EBITDA, Adjusted Operating EBITDA Margin, Adjusted Pro Forma Operating EBITDA Margin, Adjusted Earnings, Adjusted Pro Forma Earnings, Adjusted EPS, Adjusted Pro Forma EPS, Base Tax Rate, Adjusted Free Cash Flow, Adjusted Pro Forma Free Cash Flow, Adjusted Pro Forma Base Tax Rate. The non-GAAP measures presented are not necessarily indicative of the future possible key performance indicators or non-GAAP measures of Qnity.
Qnity believes these non-GAAP financial measures are useful to investors because they provide additional information related to the performance of Qnity on an as-managed basis by DuPont and a stand-alone basis. These non-GAAP financial measures supplement disclosures prepared in accordance with U.S. GAAP and reflect results in a manner that enables, in some instances, more meaningful analysis of trends and facilitates comparison of results across periods. These non-GAAP financial measures should not be viewed as an alternative to U.S. GAAP. Furthermore, such non-GAAP measures may not be consistent with similar measures provided or used by other companies. Reconciliations for these non-GAAP measures to their most directly comparable U.S. GAAP financial measures are provided below. Non-GAAP measures included in this press release are defined below.
Adjusted Earnings is defined as net income available for Qnity common stockholders excluding the after-tax impacts of significant items, amortization expense of intangibles, non-operating pension / other post-employment benefits (“OPEB”) credits / costs, and indirect legacy costs / benefits and adjusted for the income tax effect of these excluded items. Adjusted Earnings is the numerator used in the calculation of Adjusted EPS.
Base Tax Rate is a non-GAAP measure defined as the GAAP Effective Tax Rate excluding the tax rate impacts of adjustments to net income available for Qnity common stockholders in determining Adjusted Earnings.
Adjusted Operating EBITDA is defined as Pre-tax Earnings (i.e., “Income before income taxes") before interest, depreciation, amortization, non-operating pension / OPEB benefits credits / costs, foreign exchange gains / losses, indirect legacy costs / benefits, and adjusted for significant items.
Adjusted Operating EBITDA Margin is defined as Adjusted Operating EBITDA divided by Net Sales.
Adjusted Free Cash Flow is defined as cash provided by/used for operating activities less capital expenditures and excluding the impact of indirect legacy costs / benefits related to cost sharing arrangements executed between DuPont and Qnity at the time of spin-off, IT independence costs, and transformation, integration, and other charges, as well as cash inflows/outflows that are unusual in nature and/or infrequent in occurrence that neither relate to the ordinary course of the Company's underlying business liquidity.
Significant items are items that impact Qnity and arise outside the ordinary course of business that management believes may cause misinterpretation of underlying business performance, both historical and future, based on a combination of some or all of the item’s size, unusual nature and infrequent occurrence. Within this definition, Management classifies as significant items certain costs and expenses associated with transformation, integration, and other charges related to transformational activities, including acquisitions and divestitures, as they are considered unrelated to ongoing business performance.
Indirect legacy costs/benefits relate to cost sharing arrangements executed between DuPont and Qnity at the time of the spin-off. Such costs include certain litigation and environmental-related shared costs, taxes, and indirect cost sharing arrangements, and are excluded from Adjusted Earnings, Adjusted Operating EBITDA, and Adjusted Free Cash Flow, as defined above, as they are considered unrelated to ongoing Qnity business performance.
Organic Sales is defined as net sales excluding the impacts of currency and portfolio actions. 4 Adjusted Gross Profit is calculated as Gross Profit (net sales less cost of sales), excluding the impact of Significant items on Net Sales and Cost of Sales and the impact on Cost of Sales from certain services associated with transaction agreements entered with DuPont, including the Transition Services Agreement, certain product service agreements, contract manufacturing agreements, raw materials supply agreements, and site services agreements. Adjusted Gross Margin is defined as Adjusted Gross Profit divided by Net Sales.
Qnity has also presented measures on a pro forma basis which were prepared in a manner consistent with Article 11 of Regulation S-X. Our pro forma results give effect to the spin-off and related transactions as if the Spin Off occurred on January 1, 2025. Our Pro Forma adjustments reflect:
• The impact of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the spin-off; and
• Transaction and other incremental costs required to operate as a stand-alone entity.
We believe pro forma measures are helpful to supplement our financial results as they allow a comparison of results as a stand-alone company as if the agreements were in place for the periods presented.
Adjusted Pro Forma Earnings is defined as net income available for Qnity common stockholders excluding the impacts of significant items, amortization expense of intangibles, non-operating pension / other post-employment benefits credits / costs, and indirect legacy costs / benefits, less the after-tax impacts of the pro forma adjustments described above and adjusted for the income tax effect of these excluded items. Adjusted Pro Forma Earnings is the numerator used in the calculation of Adjusted Pro Forma EPS.
Adjusted Pro Forma EPS is defined as Adjusted Pro Forma Earnings per common share - diluted.
Adjusted Pro Forma Base Tax Rate is a non‑GAAP measure defined as the Base Tax Rate adjusted to reflect the estimated income tax effects of the pro forma adjustments described above.
Adjusted Pro Forma Operating EBITDA is defined as Adjusted Operating EBITDA less certain pro forma adjustments described above.
Adjusted Pro Forma Operating EBITDA Margin is defined as Adjusted Pro Forma Operating EBITDA divided by Net Sales.
Adjusted Pro Forma Free Cash Flow is defined as pro forma cash provided by/used for operating activities less capital expenditures and excluding the impact of indirect legacy costs / benefits related to cost sharing arrangements executed between DuPont and Qnity at the time of spin-off, IT independence costs, transformation, integration, and other charges, and transaction and other incremental costs required to operate as a stand-alone entity, as well as cash inflows/outflows that are unusual in nature and/or infrequent in occurrence that neither relate to the ordinary course of the Company's underlying business liquidity.
Adjusted Pro Forma Gross Profit is calculated as Gross Profit (net sales less cost of sales), excluding the impact on Cost of Sales from certain services associated with transaction agreements entered with DuPont, including the Transition Services Agreement, certain product service agreements, contract manufacturing agreements, raw materials supply agreements, and site services agreements. 5
September 30, In millions 2026 December 31, 2025 ────────────────────────────────────────────────────────────────────────────── Assets Current Assets Cash and cash $ 1,124 $ 915 equivalents Accounts and notes receivable 1,237 992 - net Inventories - net 775 661 Prepaid and other 83 70 current assets Total current $ 3,219 $ 2,638 assets Property, plant and equipment - net of accumulated depreciation 1,842 1,701 (September 30, 2026 - 1,412; December 31, 2025 - 1,450) Other Assets Goodwill 7,530 7,522 Other intangible 972 1,111 assets Investments and noncurrent 443 402 receivables Deferred income 45 42 tax assets Deferred charges 666 654 and other assets Total other $ 9,656 $ 9,731 assets Total Assets $ 14,717 $ 14,070 Liabilities and Equity Current Liabilities Short-term $ 23 $ 24 borrowings Accounts payable 886 680 Income taxes 141 150 payable Accrued and other current 493 502 liabilities Total current $ 1,543 $ 1,356 liabilities Long-Term Debt 3,996 4,003 Other Noncurrent Liabilities Deferred income 185 273 tax liabilities Pensions and other post-employment 81 80 benefits - noncurrent Other noncurrent 1,023 992 obligations Total other noncurrent $ 1,289 $ 1,345 liabilities Total Liabilities $ 6,828 $ 6,704 Commitments and contingent liabilities Stockholders' Equity Common stock (authorized 1,666,666,667 shares of $0.01 par value each; issued 2 2 2026: 209,164,927 shares; 2025: 209,479,173 shares) Preferred stock (authorized 1 share of $1.50 million par 2 2 value each; issued 2026: 1 share; 2025: 1 share) Additional 7,275 7,286 paid-in capital Retained earnings 442 18 Accumulated other comprehensive -130 -213 loss Total Qnity $ 7,591 $ 7,095 equity Noncontrolling 298 271 interests Total equity $ 7,889 $ 7,366 Total Liabilities $ 14,717 $ 14,070 and Equity
Nine Months Ended In millions September 30, Operating Activities 2026 2025 ────────────────────────────────────────────────────────────────────────────── Net income $ 494 $ 620 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of property, plant and 141 124 equipment Amortization of definite-lived 152 156 intangible assets Stock-based compensation 37 12 Credit for deferred income tax and other -68 -61 tax related items Net gain on sales of -5 -1 assets Restructuring and asset related charges — 20 - net Net periodic pension 3 6 benefit cost Periodic benefit plan -5 -3 contributions Earnings of nonconsolidated -39 -37 affiliates less dividends received Other net loss 29 — Changes in assets and liabilities: Accounts and notes -230 -97 receivable Inventories -107 -33 Other assets 14 13 Accounts payable 203 81 Accrued and other 1 -6 current liabilities Other noncurrent 36 -1 liabilities Income tax liabilities -9 -11 Cash provided by $ 647 $ 782 operating activities Investing Activities Capital expenditures -290 -214 Proceeds and adjustments to proceeds from sales of property 6 — and businesses, net of cash divested Other investing 4 — activities, net Cash used for investing $ -280 $ -214 activities Financing Activities Repayments on long-term -18 — debt Proceeds from term loan facility 360 — repricing Repayments from term loan facility -360 — repricing Repurchases of common -75 — stock Employee taxes paid for share-based -7 — payment arrangements Distributions to noncontrolling -10 -21 interests Dividends paid to -50 — stockholders Net transfers to Parent — -2,311 Proceeds from issuance — 1,750 of long-term debt Payments for debt -2 -34 issuance costs Cash used for financing $ -162 $ -616 activities Effect of exchange rate changes on cash 4 10 and cash equivalents Increase (decrease) in cash and cash $ 209 $ -38 equivalents Cash and cash equivalents at beginning $ 915 $ 166 of period Cash and cash equivalents at end of $ 1,124 $ 128 period
1. The nine months ended September 30, 2025 excludes accrued interest income earned on employee retention credits. Refer to details of significant items below.
2. Reflects the incremental costs required to operate as a stand-alone entity in the amount of $12 million and $45 million for the three and nine months ended September 30, 2025, respectively.
3. Reflects the net benefit of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the Spin-Off in the amount of zero and $7 million for the three and nine months ended September 30, 2025, respectively.
1. Reflects the incremental costs required to operate as a stand-alone entity in the amount of $12 million and $45 million for the three and nine months ended September 30, 2025, respectively.
2. Reflects the net benefit of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the Spin-Off in the amount of zero and $7 million for the three and nine months ended September 30, 2025, respectively.
2. Refer to the Consolidated Statement of Cash Flows included in the schedules above for major GAAP cash flow categories as well as further detail relating to the changes in "Cash provided by operating activities" for the three and nine month periods noted.
3. Reflects taxes paid on certain legal entity restructuring actions in preparation for the Separation of Qnity from DuPont.
4. Reflects the after-tax incremental interest expense related to our current debt structure in the amount of $50 million and $174 million for the three and nine months ended September 30, 2025, respectively.
5. Reflects the after-tax incremental costs required to operate as a stand-alone entity in the amount of $8 million and $34 million for the three and nine months ended September 30, 2025, respectively.
6. Reflects the net after-tax benefit of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the Spin-Off in the amount of zero and $5 million for the three and nine months ended September 30, 2025, respectively.
7. Reflects an adjustment to reflect principal payments and interest expense payable, as well as adjustments to employee related liabilities as if these amounts were presented on a stand-alone basis in the amount of $24 million and $19 million for the three and nine months ended September 30, 2025, respectively.
1. Base Tax Rate is a non-GAAP measure defined as the GAAP Effective Tax Rate excluding the tax rate impacts of adjustments to net income available for Qnity common stockholders in determining Adjusted Earnings. Refer to the definitions of Non-GAAP metrics for additional information.
2. Reflects the tax rate impact of incremental interest expense related to our current debt structure in the amounts of 3.2% and 4.2% for the three and nine months ended September 30, 2025, respectively.
1. Reflects the net benefit of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the spin-off on Cost of Sales in the amounts of zero and $3 million for the three and nine months ended September 30, 2025.
2. Adjusted gross profit is calculated as Gross Profit (net sales less cost of sales), excluding the impact of Significant items on Net Sales and Cost of Sales and the impact on Cost of Sales from certain services associated with transaction agreements entered with DuPont, including the Transition Services Agreement, certain product service agreements, contract manufacturing agreements, raw materials supply agreements, and site services agreements. Adjusted gross margin is defined as adjusted gross profit divided by net sales. 11
Reconciliati… of Net Income1to Adjusted Earnings and Adjusted Pro Forma Earnings In millions, except per Three Months Income share amounts Ended Statement (Unaudited) 2026 Sep 30, 2025 Sep 30, Classification ────────────────────────────────────────────────────────────────────────────── Net Income available for Qnity common $ 183 $ 211 stockholders (GAAP)1 Earnings Per $ 0.87 $ 1.01 Share (GAAP)2 Less: Significant Items and Other Non-GAAP Adjustments3 Transformati… Transformation, integration & -53 -1 integration & other other charges charges4 Amortization Amortization of of -50 -51 intangibles intangibles Non-operating Other income pension 1 -2 (expense) - net credits Gain on sale — — Other income of assets (expense) - net Indirect legacy Other income (costs) -39 — (expense) - net benefits - net Debt Repricing - -3 — Interest Loss on Expense Extinguishme… Debt Other income Repricing - -2 — (expense) - net Fees Tax effect of Provision for Non-GAAP 23 10 income taxes Adjustments5 Adjusted Earnings $ 306 $ 255 (non-GAAP) Pro forma — -58 adjustments6… Adjusted Pro Forma $ 306 $ 197 Earnings Adjusted Pro Forma $ 1.46 $ 0.94 Earnings Per Share8
1. Net income available for Qnity common stockholders. 2. Earnings per common share - diluted. 3. All Non-GAAP Adjustments are shown on a pre-tax basis with the exception of "Tax effect of Non-GAAP Adjustments" 4. Q3 2026 Transformation, integration and other charges primarily consisted of costs incurred to support the Company’s information technology independence initiatives of approximately $35 million, costs related to transformation initiatives of approximately $11 million, other integration-related costs of approximately $4 million, and severance and other asset-related charges of approximately $3 million. Q3 2025 relates to pre-separation severance charges. 5. The income tax effect on significant items was calculated based upon the enacted tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment. 6. Reflects the after tax incremental interest expense related to our current debt structure in the amount of $50 million for the three months ended September 30, 2025. 7. Reflects the after tax incremental costs required to operate as a stand-alone entity in the amount of $8 million for the three months ended September 30, 2025. 8. Adjusted Pro Forma Earnings Per Share is calculated based on Adjusted Pro Forma Earnings divided by common shares – diluted of 210.0 million shares and 209.4 million shares as of September 30, 2026 and September 30, 2025 respectively.
Reconciliati… of Net Income1to Adjusted Earnings and Adjusted Pro Forma Earnings In millions, except per Nine Months Income share amounts Ended Statement (Unaudited) 2026 Sep 30, 2025 Sep 30, Classification ────────────────────────────────────────────────────────────────────────────── Net Income available for Qnity common $ 458 $ 592 stockholders (GAAP)1 Earnings Per $ 2.18 $ 2.83 Share (GAAP)2 Less: Significant Items and Other Non-GAAP Adjustments3 Transformati… Transformatio… integration & -123 -20 integration & other other charges charges4 Employee Other income retention — 2 (expense) - credit5 net Amortization Amortization of -152 -156 of intangibles intangibles Non-operating Other income pension 3 -2 (expense) - credits net Gain on sale Other income of assets6 5 — (expense) - net Indirect legacy Other income (costs) -84 — (expense) - benefits - net net Debt Repricing - -3 — Interest Loss on Expense Extinguishme… Debt Other income Repricing - -2 — (expense) - Fees net Tax effect of Provision for Non-GAAP 32 35 income taxes Adjustments7 Adjusted Earnings $ 782 $ 733 (non-GAAP) Pro forma — -203 adjustments8… Adjusted Pro Forma $ 782 $ 530 Earnings Adjusted Pro Forma $ 3.72 $ 2.53 Earnings Per Share11
1. Net income available for Qnity common stockholders. 2. Earnings per common share - diluted. 3. All Non-GAAP Adjustments are shown on a pre-tax basis with the exception of "Income Tax Items" and "Tax effect of Non-GAAP Adjustments" 4. Transformation, integration and other charges for the nine months ended September 30, 2026 primarily consisted of costs incurred to support the Company’s information technology independence initiatives of approximately $83 million, costs related to transformation initiatives of approximately $21 million, other integration‑related costs of approximately $10 million, and severance and other asset-related charges of approximately $9 million. Q3 2025 relates to pre-separation severance charges. 5. Reflects accrued interest earned on employee retention credits and is recorded in “Interest income” within the “Other income (expense) - net” line item in the Company’s Consolidated Statements of Operations. 6. The gain on sale of assets was attributable to the sale of land during the nine months ended September 30, 2026. 7. The income tax effect on significant items was calculated based upon the enacted tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment. 8. Reflects the after tax incremental interest expense related to our current debt structure in the amount of $174 million for the nine months ended September 30, 2025. 9. Reflects the after tax incremental costs required to operate as a stand-alone entity in the amount of $34 million for the nine months ended September 30, 2025. 10. Reflects the after tax net benefit of the Transition Services Agreements and other commercial agreements entered into with DuPont in connection with the Spin-Off in the amount of $5 million for the nine months ended September 30, 2025. 11. Adjusted Pro Forma Earnings Per Share is calculated based on Adjusted Pro Forma Earnings divided by common shares – diluted of 210.2 million shares, and 209.4 million shares for the nine month periods ended September 30, 2026, and September 30, 2025, respectively.
Full text with the tables
Exhibit 99.1
Qnity Reports Third Quarter 2026 Results, Raises Full-Year Financial Guidance
– Third quarter Net Sales and Organic Sales (1) of $1.6 billion, up 22% year-
over-year
– Gross Margin and Adjusted Gross Margin (1) of 47.8%
– GAAP Net Income of $196 million and Adjusted Operating EBITDA (1) of $503
million
– GAAP EPS of $0.87, down 14% year-over-year
– Adjusted EPS (1) of $1.46, up 55% year-over-year
WILMINGTON, Del., November 4, 2026
– Qnity Electronics, Inc. (“Qnity”) (NYSE: Q) today reported results for the
third quarter ended September 30, 2026.
“We delivered our tenth consecutive quarter of profitable growth with strong
performance across both segments as Qnity continues to establish itself as the
premier solutions provider across the semiconductor value chain,” said Jon Kemp,
Qnity’s Chief Executive Officer. “A year of disciplined execution as an
independent company shows what sets Qnity apart: a deep portfolio, close
alignment with our customers' roadmaps, and a local-for-local model that
delivers at scale.”
Kemp added, “Materials innovation is quickly becoming a critical driver of chip
performance as the industry shifts toward shrink and stack. Qnity’s end-to-end
solutions across the stack enable customers to address the most complex system
level challenges: signal reliability, power density, and thermal management. We
see tremendous opportunities ahead, and we’re continuing to invest in
differentiated technologies where we see visible customer demand to create
significant value for our shareholders.”
Financial Results Summary
In millions, except per share GAAP Results
amounts
Q3 2026(1) Q3 2025(2)
Net Sales $1,556 $1,276
Semiconductor Technologies 797 693
Interconnect Solutions 759 583
Gross Profit $743 $575
Net Income $196 $223
Diluted Earnings Per Share $0.87 $1.01
Non-GAAP Results
Adjusted Gross Profit $743 $575
Adjusted Operating EBITDA $503 $370
Adjusted Earnings, net of tax $306 $197
Adjusted Earnings Per Share $1.46 $0.94
(1) Organic Sales, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted
Operating EBITDA, Adjusted Operating EBITDA Margin, Adjusted Earnings, and
Adjusted EPS are non-GAAP measures. See “Non-GAAP Measures” for further
discussion, including a definition of significant items. Reconciliations to the
most directly comparable GAAP measure, including details of significant items,
can be found in the “Non-GAAP Measures” section of this press release.
(2) Q3 2025 is presented on a pro forma basis. The pro forma non-GAAP measures
give effect to pro forma adjustments related to interest expense associated with
our current indebtedness, agreements executed in connection with the spin-off on
November 1, 2025, from DuPont de Nemours, Inc. (“DuPont”) and other standalone
costs as if the spin-off had occurred on January 1, 2025. See “Non-GAAP
Measures” for further discussion, including a definition of significant items.
Reconciliations to the most directly comparable GAAP measure, including details
of significant items, can be found in the “Non-GAAP Measures” section of this
press release. Refer to the “Non-GAAP Measures” section of this press release
for further details on these adjustments.
Guidance for Full Year 2026
Qnity is raising full‑year guidance based on strong third‑quarter performance
and continued momentum in the business.
Qnity’s full year 2026 guidance (3) is as follows:
Net Sales $5.77B - $5.83B
Adjusted Operating EBITDA $1.785B - $1.805B
Adjusted EPS $4.95 - $5.05
Adjusted Free Cash Flow $800M - $900M
(3) We calculate forward-looking Adjusted Operating EBITDA, Adjusted EPS, and
Adjusted Free Cash Flow based on internal forecasts that exclude certain
information that would be included in the most directly comparable forward-
looking GAAP measures. We are not providing a quantitative reconciliation of
forward-looking Non-GAAP financial measures to the corresponding GAAP financial
measure for these measures due to the unreasonable effort and uncertainty in
estimating certain items necessary for such reconciliations, including
adjustments that could be made for significant items, interest expense, indirect
legacy costs/benefits, transformation, integration, and other charges, share-
based compensation amounts, non-recurring, unusual or unanticipated charges,
expenses or gains.
Conference Call and Webcast Information
Qnity will hold a conference call to review these results on Wednesday, November
4, 2026, at 8:00 a.m. ET. Investors can join the conference call via telephone
by dialing (800) 343-5172 (domestic) or +1 (203) 518-9856 (international) and
using the participant code QNITY. An audio-only live webcast, presentation
materials, and replay will also be made available at Events | Qnity Electronics,
Inc. (Q) .
About Qnity
Qnity is a premier technology provider across the semiconductor value chain,
empowering AI, high performance computing, and advanced connectivity. From
groundbreaking solutions for semiconductor chip manufacturing, to enabling high-
speed transmission within complex electronic systems, our high-performance
materials and integration expertise make tomorrow’s technologies possible. More
information about Qnity, a constituent of the S&P 500 index, its businesses, and
solutions can be found at http://www.qnityelectronics.com.
Qnity™, the Qnity Node Logo, and all products, unless otherwise noted, denoted
with TM or ® are trademarks, trade names or registered trademarks of affiliates
of Qnity Electronics, Inc.
2
Cautionary Statement Regarding
Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of the
“safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of
1995. Forward-looking statements use words such as "plans", "expects", "will",
"would", "anticipates", "believes", "intends", "seeks", "projects", "efforts",
"estimates", "potential", "continue", "intend", “outlook”, "may", "could",
"should" and similar expressions, among others, as well as other words or
expressions referencing future events, conditions or circumstances. Statements
that describe or relate to the market, industry and macroeconomic environment,
Qnity's business plans or prospects, goals, intentions, strategies, future
operating or financial performance, outlook, including without limitation
statements under the heading “Guidance for Full Year 2026” and statements
regarding Qnity’s strategic path, operating model, transformation plan and its
expected costs and benefits and timing thereof, IT independence, share
repurchases, and capital allocation plan to deliver above-market growth and
strong profitability and statements that do not relate to historical or current
fact, are examples of forward-looking statements. Forward-looking statements are
based on our current beliefs, expectations and assumptions, which may not prove
to be accurate, and involve a number of known and unknown risks and
uncertainties, many of which are out of Qnity's control. Forward-looking
statements are not guarantees of future performance, and there are a number of
important factors that could cause actual outcomes and results to differ
materially from the results contemplated by such forward-looking statements,
including Qnity’s ability to realize the anticipated benefits of its multi-year
transformation plan in the anticipated timeframe or at all and the risk that the
costs of such plan may be higher than currently anticipated; the competitive
environment in which Qnity operates; the risks from Qnity’s international
operations, including geopolitical uncertainty and conflict, trade restrictions
and sanctions laws; Qnity’s ability to comply with complex and increasing legal
and regulatory requirements; the ability to realize the intended benefits of
Qnity’s spin off from DuPont, including achievement of the anticipated synergies
and operational efficiencies in connection with the spin off and completed and
future, if any, divestitures, mergers, acquisitions, and other portfolio
management, productivity and infrastructure actions; contractual allocation of
certain liabilities in connection with the spin-off; and the possibility of
disputes, litigation or unanticipated costs in connection with the spin-off.
Additional information concerning risks and uncertainties can be found in
Qnity's filings with the U.S. Securities and Exchange Commission (the “SEC”),
including under the headings “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and “Risk Factors” in our most recent
Annual Report on Form 10-K for the year ended December 31, 2025, filed with the
SEC on February 26, 2026, and in Qnity’s future filings with the SEC. Any
forward-looking statement speaks only as of the date on which it is made. Qnity
does not undertake any obligation to publicly update or revise any forward-
looking statements, whether as a result of new information, future events or
otherwise, except as required by applicable law.
Investor Contact
Meg Miller
meg.miller@qnityelectronics.com
Media Contact
Ashley Boucher
ashley.boucher@qnityelectronics.com
3
Non-GAAP Financial Measures
This press release includes information that does not conform to accounting
principles generally accepted in the United States of America (“U.S. GAAP”) and
are considered non-GAAP measures, including the presentation of Organic Sales,
Adjusted Gross Profit, Adjusted Pro Forma Gross Profit, Adjusted Operating
EBITDA, Adjusted Pro Forma Operating EBITDA, Adjusted Operating EBITDA Margin,
Adjusted Pro Forma Operating EBITDA Margin, Adjusted Earnings, Adjusted Pro
Forma Earnings, Adjusted EPS, Adjusted Pro Forma EPS, Base Tax Rate, Adjusted
Free Cash Flow, Adjusted Pro Forma Free Cash Flow, Adjusted Pro Forma Base Tax
Rate. The non-GAAP measures presented are not necessarily indicative of the
future possible key performance indicators or non-GAAP measures of Qnity.
Qnity believes these non-GAAP financial measures are useful to investors because
they provide additional information related to the performance of Qnity on an
as-managed basis by DuPont and a stand-alone basis. These non-GAAP financial
measures supplement disclosures prepared in accordance with U.S. GAAP and
reflect results in a manner that enables, in some instances, more meaningful
analysis of trends and facilitates comparison of results across periods. These
non-GAAP financial measures should not be viewed as an alternative to U.S. GAAP.
Furthermore, such non-GAAP measures may not be consistent with similar measures
provided or used by other companies. Reconciliations for these non-GAAP measures
to their most directly comparable U.S. GAAP financial measures are provided
below. Non-GAAP measures included in this press release are defined below.
Adjusted Earnings is defined as net income available for Qnity common
stockholders excluding the after-tax impacts of significant items, amortization
expense of intangibles, non-operating pension / other post-employment benefits
(“OPEB”) credits / costs, and indirect legacy costs / benefits and adjusted for
the income tax effect of these excluded items. Adjusted Earnings is the
numerator used in the calculation of Adjusted EPS.
Adjusted EPS is defined as Adjusted Earnings per common share - diluted.
Base Tax Rate is a non-GAAP measure defined as the GAAP Effective Tax Rate
excluding the tax rate impacts of adjustments to net income available for Qnity
common stockholders in determining Adjusted Earnings.
Adjusted Operating EBITDA is defined as Pre-tax Earnings (i.e., “Income before
income taxes") before interest, depreciation, amortization, non-operating
pension / OPEB benefits credits / costs, foreign exchange gains / losses,
indirect legacy costs / benefits, and adjusted for significant items.
Adjusted Operating EBITDA Margin is defined as Adjusted Operating EBITDA divided
by Net Sales.
Adjusted Free Cash Flow is defined as cash provided by/used for operating
activities less capital expenditures and excluding the impact of indirect legacy
costs / benefits related to cost sharing arrangements executed between DuPont
and Qnity at the time of spin-off, IT independence costs, and transformation,
integration, and other charges, as well as cash inflows/outflows that are
unusual in nature and/or infrequent in occurrence that neither relate to the
ordinary course of the Company's underlying business liquidity.
Significant items are items that impact Qnity and arise outside the ordinary
course of business that management believes may cause misinterpretation of
underlying business performance, both historical and future, based on a
combination of some or all of the item’s size, unusual nature and infrequent
occurrence. Within this definition, Management classifies as significant items
certain costs and expenses associated with transformation, integration, and
other charges related to transformational activities, including acquisitions and
divestitures, as they are considered unrelated to ongoing business performance.
Indirect legacy costs/benefits relate to cost sharing arrangements executed
between DuPont and Qnity at the time of the spin-off. Such costs include certain
litigation and environmental-related shared costs, taxes, and indirect cost
sharing arrangements, and are excluded from Adjusted Earnings, Adjusted
Operating EBITDA, and Adjusted Free Cash Flow, as defined above, as they are
considered unrelated to ongoing Qnity business performance.
Organic Sales is defined as net sales excluding the impacts of currency and
portfolio actions.
4
Adjusted Gross Profit is calculated as Gross Profit (net sales less cost of
sales), excluding the impact of Significant items on Net Sales and Cost of Sales
and the impact on Cost of Sales from certain services associated with
transaction agreements entered with DuPont, including the Transition Services
Agreement, certain product service agreements, contract manufacturing
agreements, raw materials supply agreements, and site services agreements.
Adjusted Gross Margin is defined as Adjusted Gross Profit divided by Net Sales.
Qnity has also presented measures on a pro forma basis which were prepared in a
manner consistent with Article 11 of Regulation S-X. Our pro forma results give
effect to the spin-off and related transactions as if the Spin Off occurred on
January 1, 2025. Our Pro Forma adjustments reflect:
• Interest expense associated with our current debt structure;
• Income tax effect of incremental interest expense;
• The impact of the Transition Services Agreements and other commercial
agreements entered into with DuPont in connection with the spin-off; and
• Transaction and other incremental costs required to operate as a stand-alone
entity.
We believe pro forma measures are helpful to supplement our financial results as
they allow a comparison of results as a stand-alone company as if the agreements
were in place for the periods presented.
Adjusted Pro Forma Earnings is defined as net income available for Qnity common
stockholders excluding the impacts of significant items, amortization expense of
intangibles, non-operating pension / other post-employment benefits credits /
costs, and indirect legacy costs / benefits, less the after-tax impacts of the
pro forma adjustments described above and adjusted for the income tax effect of
these excluded items. Adjusted Pro Forma Earnings is the numerator used in the
calculation of Adjusted Pro Forma EPS.
Adjusted Pro Forma EPS is defined as Adjusted Pro Forma Earnings per common
share - diluted.
Adjusted Pro Forma Base Tax Rate is a non‑GAAP measure defined as the Base Tax
Rate adjusted to reflect the estimated income tax effects of the pro forma
adjustments described above.
Adjusted Pro Forma Operating EBITDA is defined as Adjusted Operating EBITDA less
certain pro forma adjustments described above.
Adjusted Pro Forma Operating EBITDA Margin is defined as Adjusted Pro Forma
Operating EBITDA divided by Net Sales.
Adjusted Pro Forma Free Cash Flow is defined as pro forma cash provided by/used
for operating activities less capital expenditures and excluding the impact of
indirect legacy costs / benefits related to cost sharing arrangements executed
between DuPont and Qnity at the time of spin-off, IT independence costs,
transformation, integration, and other charges, and transaction and other
incremental costs required to operate as a stand-alone entity, as well as cash
inflows/outflows that are unusual in nature and/or infrequent in occurrence that
neither relate to the ordinary course of the Company's underlying business
liquidity.
Adjusted Pro Forma Gross Profit is calculated as Gross Profit (net sales less
cost of sales), excluding the impact on Cost of Sales from certain services
associated with transaction agreements entered with DuPont, including the
Transition Services Agreement, certain product service agreements, contract
manufacturing agreements, raw materials supply agreements, and site services
agreements.
5
Qnity Electronics, Inc.
Consolidated Statements of Operations (Unaudited)
In
milli… Three Nine
except Months Months
per Ended Ended
share Septem… Septemb…
amoun… 2026 30, 2025 2026 30, 2025
──────────────────────────────────────────────────────────────────────────────
Net $ 1,556 $ 1,276 $ 4,300 $ 3,564
sales
Cost
of 813 $ 701 2,273 $ 1,918
sales
Resea…
and 105 $ 92 297 $ 264
devel…
expen…
Selli…
gener…
and 200 $ 159 573 $ 453
admin…
expen…
Amort…
of 50 $ 51 152 $ 156
intan…
Trans…
integ…
and 53 $ 1 123 $ 20
other
charg…
Equity
in
earni… 15 $ 15 39 $ 37
of
nonco…
affil…
Inter… 64 $ 14 186 $ 14
expen…
Other
income -39 $ -1 -71 $ -3
(expe…
- net
Income
before $ 247 $ 272 $ 664 $ 773
income
taxes
Provi…
for 51 $ 49 170 $ 153
income
taxes
Net $ 196 $ 223 $ 494 $ 620
income
Net
income
attri… 13 $ 12 36 $ 28
to
nonco…
inter…
Net
income
avail…
for $ 183 $ 211 $ 458 $ 592
Qnity
common
stock…
Per
common
share
data:
Earni…
per
common $ 0.87 $ 1.01 $ 2.19 $ 2.83
share
-
basic
Earni…
per
common $ 0.87 $ 1.01 $ 2.18 $ 2.83
share
-
dilut…
Weigh…
common
shares 209.4 209.4 209.6 209.4
outst…
-
basic
Weigh…
common
shares 210.0 209.4 210.2 209.4
outst…
-
dilut…
6
Qnity Electronics, Inc.
Consolidated Balance Sheets (Unaudited)
September 30,
In millions 2026 December 31, 2025
──────────────────────────────────────────────────────────────────────────────
Assets
Current Assets
Cash and cash $ 1,124 $ 915
equivalents
Accounts and
notes receivable 1,237 992
- net
Inventories - net 775 661
Prepaid and other 83 70
current assets
Total current $ 3,219 $ 2,638
assets
Property, plant
and equipment -
net of
accumulated
depreciation 1,842 1,701
(September 30,
2026 - 1,412;
December 31, 2025
- 1,450)
Other Assets
Goodwill 7,530 7,522
Other intangible 972 1,111
assets
Investments and
noncurrent 443 402
receivables
Deferred income 45 42
tax assets
Deferred charges 666 654
and other assets
Total other $ 9,656 $ 9,731
assets
Total Assets $ 14,717 $ 14,070
Liabilities and
Equity
Current
Liabilities
Short-term $ 23 $ 24
borrowings
Accounts payable 886 680
Income taxes 141 150
payable
Accrued and other
current 493 502
liabilities
Total current $ 1,543 $ 1,356
liabilities
Long-Term Debt 3,996 4,003
Other Noncurrent
Liabilities
Deferred income 185 273
tax liabilities
Pensions and
other
post-employment 81 80
benefits -
noncurrent
Other noncurrent 1,023 992
obligations
Total other
noncurrent $ 1,289 $ 1,345
liabilities
Total Liabilities $ 6,828 $ 6,704
Commitments and
contingent
liabilities
Stockholders'
Equity
Common stock
(authorized
1,666,666,667
shares of $0.01
par value each;
issued 2 2
2026:
209,164,927
shares; 2025:
209,479,173
shares)
Preferred stock
(authorized 1
share of
$1.50 million par 2 2
value each;
issued
2026: 1 share;
2025: 1 share)
Additional 7,275 7,286
paid-in capital
Retained earnings 442 18
Accumulated other
comprehensive -130 -213
loss
Total Qnity $ 7,591 $ 7,095
equity
Noncontrolling 298 271
interests
Total equity $ 7,889 $ 7,366
Total Liabilities $ 14,717 $ 14,070
and Equity
7
Qnity Electronics, Inc.
Consolidated Statement of Cash Flows (Unaudited)
Nine Months Ended
In millions September 30,
Operating Activities 2026 2025
──────────────────────────────────────────────────────────────────────────────
Net income $ 494 $ 620
Adjustments to reconcile
net income to
net cash provided by
operating
activities:
Depreciation of
property, plant and 141 124
equipment
Amortization of
definite-lived 152 156
intangible assets
Stock-based compensation 37 12
Credit for deferred
income tax and other -68 -61
tax related items
Net gain on sales of -5 -1
assets
Restructuring and asset
related charges — 20
- net
Net periodic pension 3 6
benefit cost
Periodic benefit plan -5 -3
contributions
Earnings of
nonconsolidated -39 -37
affiliates
less dividends received
Other net loss 29 —
Changes in assets and
liabilities:
Accounts and notes -230 -97
receivable
Inventories -107 -33
Other assets 14 13
Accounts payable 203 81
Accrued and other 1 -6
current liabilities
Other noncurrent 36 -1
liabilities
Income tax liabilities -9 -11
Cash provided by $ 647 $ 782
operating activities
Investing Activities
Capital expenditures -290 -214
Proceeds and adjustments
to proceeds
from sales of property 6 —
and businesses,
net of cash divested
Other investing 4 —
activities, net
Cash used for investing $ -280 $ -214
activities
Financing Activities
Repayments on long-term -18 —
debt
Proceeds from term loan
facility 360 —
repricing
Repayments from term
loan facility -360 —
repricing
Repurchases of common -75 —
stock
Employee taxes paid for
share-based -7 —
payment arrangements
Distributions to
noncontrolling -10 -21
interests
Dividends paid to -50 —
stockholders
Net transfers to Parent — -2,311
Proceeds from issuance — 1,750
of long-term debt
Payments for debt -2 -34
issuance costs
Cash used for financing $ -162 $ -616
activities
Effect of exchange rate
changes on cash 4 10
and cash equivalents
Increase (decrease) in
cash and cash $ 209 $ -38
equivalents
Cash and cash
equivalents at beginning $ 915 $ 166
of period
Cash and cash
equivalents at end of $ 1,124 $ 128
period
8
Qnity Electronics, Inc.
Segment and Geographic Information
Net
Sales
by
Segm…
and In Three Septe… Septem… Nine Septem… Septe…
Geog… milli… Months 30, 30, Months 30, 30,
Regi… (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Semi… $ 797 $ 693 $ 2,262 $ 1,981
Tech…
Inte… 759 583 2,038 1,583
Solu…
Total $ 1,556 $ 1,276 $ 4,300 $ 3,564
Amer… $ 210 $ 168 $ 566 $ 472
EMEA2 105 106 312 293
Asia 1,241 1,002 3,422 2,799
Paci…
Total $ 1,556 $ 1,276 $ 4,300 $ 3,564
Net
Sales
Vari… Three
by Months
Segm… Ended
and Septe…
Geog… 30,
Regi… 2026
──────────────────────────────────────────────────────────────────────────────
Local
Price Total
& Volume Organ… Curre… Total
Prod…
Mix
Perc…
chan…
from
prior
year
(Una…
Semi… — % 16 % 16 % -1 % 15 %
Tech…
Inte… — 29 29 1 30
Solu…
Total — % 22 % 22 % — % 22 %
Amer… 1 % 23 % 24 % — % 24 %
EMEA2 — — — — —
Asia — 24 24 — 24
Paci…
Total — % 22 % 22 % — % 22 %
Net
Sales
Vari… Nine
by Months
Segm… Ended
and Septe…
Geog… 30,
Regi… 2026
──────────────────────────────────────────────────────────────────────────────
Local
Price Total
& Volume Orga… Curre… Total
Prod…
Mix
Perc…
chan…
from
prior
year
(Una…
Semi… -1 % 16 % 15 % -1 % 14 %
Tech…
Inte… — 27 27 2 29
Solu…
Total — % 21 % 21 % — % 21 %
Amer… — % 20 % 20 % — % 20 %
EMEA2 -1 5 4 2 6
Asia — 22 22 — 22
Paci…
Total — % 21 % 21 % — % 21 %
1. Includes United States, Canada, and Latin America
2. Europe, Middle East and Africa.
9
Qnity Electronics, Inc.
Selected Financial Information and Non-GAAP Measures
Reco…
of
Net
Inco…
to
Adju…
Oper…
EBIT…
and
Adju…
Pro
Forma
Oper…
EBIT…
and
reco…
of
Net
Inco…
Marg…
to
Adju…
Oper…
EBIT…
Marg…
and
Adju…
Pro
Forma
Oper… In Three Sep Sep Nine Sep Sep
EBIT… milli… Months 30, 30, Mont… 30, 30,
Marg… (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Net
Inco… $ 196 $ 223 $ 494 $ 620
(GAA…
+
Prov…
for 51 49 170 153
inco…
taxes
Inco…
befo…
inco… $ 247 $ 272 $ 664 $ 773
taxes
(GAA…
+
Depr… 98 94 293 280
and
amor…
'-
Inte… 4 — 11 —
inco…
'+
Inte… 64 14 186 14
expe…
'-
Non-… 1 -2 3 -2
pens…
cred…
-
Fore…
exch… -5 1 -12 -4
(los…
gains
- net
-
Indi…
lega… -39 — -84 —
(cos…
bene…
- net
-
Sign… -55 -1 -120 -18
items
char…
Adju…
Oper… $ 503 $ 382 $ 1,345 $ 1,091
EBIT…
(non…
Pro
forma — -12 — -38
adju…
3
Adju…
Pro
Forma $ 503 $ 370 $ 1,345 $ 1,053
Oper…
EBIT…
(non…
Net
Inco… 12.6 % 17.5 % 11.5 % 17.4 %
Marg…
(GAA…
Adju…
Oper…
EBIT… 32.3 % 29.9 % 31.3 % 30.6 %
Marg…
(non…
Adju…
Pro
Forma
Oper… 32.3 % 29.0 % 31.3 % 29.5 %
EBIT…
Marg…
(non…
1. The nine months ended September 30, 2025 excludes accrued interest income
earned on employee retention credits. Refer to details of significant items
below.
2. Reflects the incremental costs required to operate as a stand-alone entity in
the amount of $12 million and $45 million for the three and nine months ended
September 30, 2025, respectively.
3. Reflects the net benefit of the Transition Services Agreements and other
commercial agreements entered into with DuPont in connection with the Spin-Off
in the amount of zero and $7 million for the three and nine months ended
September 30, 2025, respectively.
Adju…
Oper…
EBIT…
Segm…
and
Adju…
Pro
Forma In Three Sep Nine Sep
Oper… milli… Months Sep 30, 30, Months 30, Sep 30,
EBIT… (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Semi… $ 285 $ 240 $ 801 $ 713
Tech…
Inte… 236 152 602 403
Solu…
Corp… -18 -10 -58 -25
Adju…
Oper… $ 503 $ 382 $ 1,345 $ 1,091
EBIT…
(non…
Pro
forma — -12 — -38
adju…
Adju…
Pro
Forma $ 503 $ 370 $ 1,345 $ 1,053
Oper…
EBIT…
(non…
1. Reflects the incremental costs required to operate as a stand-alone entity in
the amount of $12 million and $45 million for the three and nine months ended
September 30, 2025, respectively.
2. Reflects the net benefit of the Transition Services Agreements and other
commercial agreements entered into with DuPont in connection with the Spin-Off
in the amount of zero and $7 million for the three and nine months ended
September 30, 2025, respectively.
Equi…
in
Earn…
of
Nonc…
Affi… In Three Sep Nine Sep
by milli… Months Sep 30, 30, Months 30, Sep 30,
Segm… (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Semi… $ 14 $ 14 $ 39 $ 38
Tech…
Inte… 1 1 — -1
Solu…
Total
Equi…
in
Earn…
incl… $ 15 $ 15 $ 39 $ 37
in
Net
Inco…
(GAA…
10
Qnity Electronics, Inc.
Selected Financial Information and Non-GAAP Measures
Reco…
of
Cash
prov…
by
oper…
acti…
to
Adju…
Free
Cash
Flow…
Adju…
Pro
Forma
Free In Three Sep Nine Sep
Cash milli… Months Sep 30, 30, Months 30, Sep 30,
Flow1 (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Cash
prov…
by $ 271 $ 302 $ 647 $ 782
oper…
acti…
(GAA…
Less:
Capi… 78 61 290 214
expe…
Less:
Tran…
inte… -36 — -84 —
and
other
char…
Less:
Indi…
lega…
(cos… -91 — -114 —
bene…
-
net
Less:
DuPo…
sepa… — — -52 —
fore…
tax
cost3
Adju…
Free
Cash $ 320 $ 241 $ 607 $ 568
Flow
(non…
Pro
forma
adju… — -34 — -184
5, 6,
7
Adju…
Pro
Forma
Free $ 320 $ 207 $ 607 $ 384
Cash
Flow
(non…
1. Refer to the definitions of Non-GAAP metrics for additional information.
2. Refer to the Consolidated Statement of Cash Flows included in the schedules
above for major GAAP cash flow categories as well as further detail relating to
the changes in "Cash provided by operating activities" for the three and nine
month periods noted.
3. Reflects taxes paid on certain legal entity restructuring actions in
preparation for the Separation of Qnity from DuPont.
4. Reflects the after-tax incremental interest expense related to our current
debt structure in the amount of $50 million and $174 million for the three and
nine months ended September 30, 2025, respectively.
5. Reflects the after-tax incremental costs required to operate as a stand-alone
entity in the amount of $8 million and $34 million for the three and nine months
ended September 30, 2025, respectively.
6. Reflects the net after-tax benefit of the Transition Services Agreements and
other commercial agreements entered into with DuPont in connection with the
Spin-Off in the amount of zero and $5 million for the three and nine months
ended September 30, 2025, respectively.
7. Reflects an adjustment to reflect principal payments and interest expense
payable, as well as adjustments to employee related liabilities as if these
amounts were presented on a stand-alone basis in the amount of $24 million and
$19 million for the three and nine months ended September 30, 2025,
respectively.
Reconc…
of
Effect…
Tax
Rate
(GAAP)
to Base
Tax
Rate
(non-G…
and
Adjust…
Pro
Forma
Base
Tax Three Nine
Rate Months Months
(non-G… Ended Ended
Sep 30, Sep 30, Sep 30, Sep 30,
2026 2025 2026 2025
──────────────────────────────────────────────────────────────────────────────
Effect…
Tax 20.6 % 18.0 % 25.6 % 19.8 %
Rate
(GAAP)
Less:
Signif…
items 0.1 % 0.1 % -2.3 % 0.1 %
(charg…
benefit
Less:
Indire…
legacy
(costs) -2.1 % — % -3.6 % — %
benefi…
-
net
Less:
Amorti… 0.2 % 0.3 % 0.1 % — %
of
intang…
Base
Tax 18.8 % 18.4 % 19.8 % 19.9 %
Rate1(…
Pro
forma — % 3.2 % — % 4.2 %
adjust…
Adjust…
Pro
Forma 18.8 % 21.6 % 19.8 % 24.1 %
Base
Tax
Rate1(…
1. Base Tax Rate is a non-GAAP measure defined as the GAAP Effective Tax Rate
excluding the tax rate impacts of adjustments to net income available for Qnity
common stockholders in determining Adjusted Earnings. Refer to the definitions
of Non-GAAP metrics for additional information.
2. Reflects the tax rate impact of incremental interest expense related to our
current debt structure in the amounts of 3.2% and 4.2% for the three and nine
months ended September 30, 2025, respectively.
Reco…
of
Gross
Prof…
to
Adju…
Pro
Forma
Gross
Prof…
and
Gross
Marg…
to
Adju…
Pro
Forma In Three Sep Sep Nine Sep Sep
Gross milli… Months 30, 30, Mont… 30, 30,
Marg… (Unau… Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Gross
Prof… $ 743 $ 575 $ 2,027 $ 1,646
(GAA…
Gross
Marg… 47.8 % 45.1 % 47.1 % 46.2 %
(GAA…
Pro
forma — — — -3
adju…
Adju…
Pro
Forma $ 743 $ 575 $ 2,027 $ 1,649
Gross
Prof…
(non…
Adju…
Pro
Forma 47.8 % 45.1 % 47.1 % 46.3 %
Gross
Marg…
(non…
1. Reflects the net benefit of the Transition Services Agreements and other
commercial agreements entered into with DuPont in connection with the spin-off
on Cost of Sales in the amounts of zero and $3 million for the three and nine
months ended September 30, 2025.
2. Adjusted gross profit is calculated as Gross Profit (net sales less cost of
sales), excluding the impact of Significant items on Net Sales and Cost of Sales
and the impact on Cost of Sales from certain services associated with
transaction agreements entered with DuPont, including the Transition Services
Agreement, certain product service agreements, contract manufacturing
agreements, raw materials supply agreements, and site services agreements.
Adjusted gross margin is defined as adjusted gross profit divided by net sales.
11
Qnity Electronics, Inc.
Selected Financial Information and Non-GAAP Measures
Reconciliati…
of Net
Income1to
Adjusted
Earnings and
Adjusted Pro
Forma
Earnings
In millions,
except per Three Months Income
share amounts Ended Statement
(Unaudited) 2026 Sep 30, 2025 Sep 30, Classification
──────────────────────────────────────────────────────────────────────────────
Net Income
available for
Qnity common $ 183 $ 211
stockholders
(GAAP)1
Earnings Per $ 0.87 $ 1.01
Share (GAAP)2
Less:
Significant
Items and
Other
Non-GAAP
Adjustments3
Transformati… Transformation,
integration & -53 -1 integration &
other other charges
charges4
Amortization Amortization of
of -50 -51 intangibles
intangibles
Non-operating Other income
pension 1 -2 (expense) - net
credits
Gain on sale — — Other income
of assets (expense) - net
Indirect
legacy Other income
(costs) -39 — (expense) - net
benefits -
net
Debt
Repricing - -3 — Interest
Loss on Expense
Extinguishme…
Debt Other income
Repricing - -2 — (expense) - net
Fees
Tax effect of Provision for
Non-GAAP 23 10 income taxes
Adjustments5
Adjusted
Earnings $ 306 $ 255
(non-GAAP)
Pro forma — -58
adjustments6…
Adjusted Pro
Forma $ 306 $ 197
Earnings
Adjusted Pro
Forma $ 1.46 $ 0.94
Earnings Per
Share8
1. Net income available for Qnity common
stockholders.
2. Earnings per common share - diluted.
3. All Non-GAAP Adjustments are shown on a pre-tax
basis with the exception of "Tax effect of
Non-GAAP Adjustments"
4. Q3 2026 Transformation, integration and other
charges primarily consisted of costs incurred to
support the Company’s information technology
independence initiatives of approximately $35
million, costs related to transformation
initiatives of approximately $11 million, other
integration-related costs of approximately $4
million, and severance and other asset-related
charges of approximately $3 million. Q3 2025
relates to pre-separation severance charges.
5. The income tax effect on significant items was
calculated based upon the enacted tax laws and
statutory income tax rates applicable in the tax
jurisdiction(s) of the underlying non-GAAP
adjustment.
6. Reflects the after tax incremental interest
expense related to our current debt structure in
the amount of $50 million for the three months
ended September 30, 2025.
7. Reflects the after tax incremental costs
required to operate as a stand-alone entity in the
amount of $8 million for the three months ended
September 30, 2025.
8. Adjusted Pro Forma Earnings Per Share is
calculated based on Adjusted Pro Forma Earnings
divided by common shares – diluted of 210.0
million shares and 209.4 million shares as of
September 30, 2026 and September 30, 2025
respectively.
12
Qnity Electronics, Inc.
Selected Financial Information and Non-GAAP Measures
Reconciliati…
of Net
Income1to
Adjusted
Earnings and
Adjusted Pro
Forma
Earnings
In millions,
except per Nine Months Income
share amounts Ended Statement
(Unaudited) 2026 Sep 30, 2025 Sep 30, Classification
──────────────────────────────────────────────────────────────────────────────
Net Income
available for
Qnity common $ 458 $ 592
stockholders
(GAAP)1
Earnings Per $ 2.18 $ 2.83
Share (GAAP)2
Less:
Significant
Items and
Other
Non-GAAP
Adjustments3
Transformati… Transformatio…
integration & -123 -20 integration &
other other charges
charges4
Employee Other income
retention — 2 (expense) -
credit5 net
Amortization Amortization
of -152 -156 of intangibles
intangibles
Non-operating Other income
pension 3 -2 (expense) -
credits net
Gain on sale Other income
of assets6 5 — (expense) -
net
Indirect
legacy Other income
(costs) -84 — (expense) -
benefits - net
net
Debt
Repricing - -3 — Interest
Loss on Expense
Extinguishme…
Debt Other income
Repricing - -2 — (expense) -
Fees net
Tax effect of Provision for
Non-GAAP 32 35 income taxes
Adjustments7
Adjusted
Earnings $ 782 $ 733
(non-GAAP)
Pro forma — -203
adjustments8…
Adjusted Pro
Forma $ 782 $ 530
Earnings
Adjusted Pro
Forma $ 3.72 $ 2.53
Earnings Per
Share11
1. Net income available for Qnity common
stockholders.
2. Earnings per common share - diluted.
3. All Non-GAAP Adjustments are shown on a pre-tax
basis with the exception of "Income Tax Items" and
"Tax effect of Non-GAAP Adjustments"
4. Transformation, integration and other charges
for the nine months ended September 30, 2026
primarily consisted of costs incurred to support
the Company’s information technology independence
initiatives of approximately $83 million, costs
related to transformation initiatives of
approximately $21 million, other
integration‑related costs of approximately $10
million, and severance and other asset-related
charges of approximately $9 million. Q3 2025
relates to pre-separation severance charges.
5. Reflects accrued interest earned on employee
retention credits and is recorded in “Interest
income” within the “Other income (expense) - net”
line item in the Company’s Consolidated Statements
of Operations.
6. The gain on sale of assets was attributable to
the sale of land during the nine months ended
September 30, 2026.
7. The income tax effect on significant items was
calculated based upon the enacted tax laws and
statutory income tax rates applicable in the tax
jurisdiction(s) of the underlying non-GAAP
adjustment.
8. Reflects the after tax incremental interest
expense related to our current debt structure in
the amount of $174 million for the nine months
ended September 30, 2025.
9. Reflects the after tax incremental costs
required to operate as a stand-alone entity in the
amount of $34 million for the nine months ended
September 30, 2025.
10. Reflects the after tax net benefit of the
Transition Services Agreements and other
commercial agreements entered into with DuPont in
connection with the Spin-Off in the amount of $5
million for the nine months ended September 30,
2025.
11. Adjusted Pro Forma Earnings Per Share is
calculated based on Adjusted Pro Forma Earnings
divided by common shares – diluted of 210.2
million shares, and 209.4 million shares for the
nine month periods ended September 30, 2026, and
September 30, 2025, respectively.
13