Updated Version 3 - Dow expects its profit to exceed market expectations, benefiting from rising prices and cost reductions.

Updated the first paragraph with fourth quarter forecasts, updated the share price data in the sixth paragraph, and added details in the fourth and seventh paragraphs.

Reuters, October 22 - Dow Chemical DOW.N expects its adjusted core profit for the fourth quarter to exceed Wall Street estimates and quarterly earnings forecasts, as rising polyethylene prices and cost-cutting measures have more than offset increases in raw material and logistics expenses.

After the escalation of conflict in Iran in late February (link), the closure of the Strait of Hormuz disrupted the transport of oil and petrochemical products, tightening global chemical supplies and driving a significant surge in prices for plastics and polymers (link).

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Earlier this year, Dow announced plans to cut about 4,500 jobs, representing 13% of its total workforce (link), to reduce costs. As part of broader efforts to enhance profitability, the company has also been reviewing its global asset portfolio.

On Thursday, Dow said that nearly 70% of its planned job cuts have been carried out, and it expects its restructuring plan to deliver more than $200 million in gains in the second half of this year.

Chief Executive Officer Karen S. Carter stated in a release that, through cost reductions and business portfolio optimization initiatives—including the closure of high-cost upstream assets—Dow remains on track to achieve annual core profit growth of more than $1 billion in both 2026 and 2027.

The company's share price rose by 2.3% in pre-market trading.

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According to data compiled by London Stock Exchange Group (LSEG), Dow expects fourth-quarter adjusted core profit to be about $1.54 billion, beating analysts’ average forecast of $1.38 billion.

In the quarter ended September 30, propelled by higher prices for polyethylene and functional polymers across all regions, net sales in Dow’s Packaging & Specialty Plastics segment increased more than 18% year-over-year to $5.8 billion.

Quarterly revenue in its Industrial Intermediates & Infrastructure segment grew 7.9% to $3.06 billion, and net sales in the Performance Materials & Coatings segment rose over 8% to $2.25 billion.

The Michigan-based company reported adjusted earnings per share of 71 cents, versus the average analyst forecast of 64 cents.

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