Axalta Coating Systems Ltd.AXTA
Axalta Coating Systems Ltd. Segments Disclosure
SEGMENTS
The Company identifies an operating segment as a component: (i) that engages in business activities from which it may earn revenues and incur expenses; (ii) whose operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance; and (iii) that has available discrete financial information.
We have two operating segments, which are also our reportable segments: Performance Coatings and Mobility Coatings. The CODM reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. Our CODM is identified as the Chief Executive Officer because he has final authority over performance assessment and resource allocation decisions. Our segments are based on the type and concentration of customers served, service requirements, methods of distribution and major product lines.
Through our Performance Coatings segment, we provide high-quality liquid and powder coatings solutions to both large regional and global OEMs and to a fragmented and local customer base. These customers comprise independent or multi-shop operator body shops as well as a wide variety of industrial manufacturers. We are one of only a few suppliers with the technology to provide precise color matching and highly durable coatings systems. The end-markets and reporting units within this segment are refinish and industrial.
Through our Mobility Coatings segment, we provide coatings technologies for light vehicle and commercial vehicle OEMs. These global customers are faced with evolving megatrends in electrification, sustainability, personalization and autonomous driving that require a high level of technical expertise. The OEMs require efficient, environmentally responsible coatings systems that can be applied with a high degree of precision, consistency and speed. The end-markets and reporting units within this segment are light vehicle and commercial vehicle.
Segment Adjusted EBITDA is the primary measure used by our CODM to evaluate financial performance of the operating segments and allocate resources and is therefore our measure of segment profitability in accordance with GAAP under ASC 280, Segment Reporting. Asset information is not reviewed or included with our internal management reporting. Therefore, we have not disclosed asset information for each reportable segment. The following table presents relevant information of our reportable segments.
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
Net sales (1): | ||||||||||||||||||||
| Refinish | $ | 2,051 | $ | 2,164 | $ | 2,084 | ||||||||||||||
| Industrial | 1,226 | 1,291 | 1,324 | |||||||||||||||||
| Total Net sales Performance Coatings | 3,277 | 3,455 | 3,408 | |||||||||||||||||
| Light Vehicle | 1,438 | 1,405 | 1,340 | |||||||||||||||||
| Commercial Vehicle | 402 | 416 | 436 | |||||||||||||||||
| Total Net sales Mobility Coatings | 1,840 | 1,821 | 1,776 | |||||||||||||||||
| Total Net sales | $ | 5,117 | $ | 5,276 | $ | 5,184 | ||||||||||||||
| Segment Adjusted EBITDA: | ||||||||||||||||||||
| Performance Coatings | $ | 788 | $ | 838 | $ | 742 | ||||||||||||||
| Mobility Coatings | 340 | 278 | 209 | |||||||||||||||||
| Total | $ | 1,128 | $ | 1,116 | $ | 951 | ||||||||||||||
| Investment in unconsolidated affiliates: | ||||||||||||||||||||
| Performance Coatings | $ | 1 | $ | 2 | $ | 2 | ||||||||||||||
| Mobility Coatings | 11 | 9 | 9 | |||||||||||||||||
| Total | $ | 12 | $ | 11 | $ | 11 | ||||||||||||||
(1)The Company has no intercompany sales between segments.
The following tables reconcile net sales to Segment Adjusted EBITDA for the years ended December 31, 2025, 2024 and 2023:
| Year Ended December 31, 2025 | ||||||||||||||||||||
| Performance Coatings | Mobility Coatings | Total | ||||||||||||||||||
Net sales | $ | 3,277 | $ | 1,840 | $ | 5,117 | ||||||||||||||
Segment cost of goods sold (1) | 1,767 | 1,180 | 2,947 | |||||||||||||||||
Other segment items (2) | 722 | 320 | 1,042 | |||||||||||||||||
| Segment Adjusted EBITDA | $ | 788 | $ | 340 | $ | 1,128 | ||||||||||||||
| Year Ended December 31, 2024 | ||||||||||||||||||||
| Performance Coatings | Mobility Coatings | Total | ||||||||||||||||||
Net sales | $ | 3,455 | $ | 1,821 | $ | 5,276 | ||||||||||||||
Segment cost of goods sold (1) | 1,849 | 1,209 | 3,058 | |||||||||||||||||
Other segment items (2) | 768 | 334 | 1,102 | |||||||||||||||||
| Segment Adjusted EBITDA | $ | 838 | $ | 278 | $ | 1,116 | ||||||||||||||
| Year Ended December 31, 2023 | ||||||||||||||||||||
| Performance Coatings | Mobility Coatings | Total | ||||||||||||||||||
Net sales | $ | 3,408 | $ | 1,776 | $ | 5,184 | ||||||||||||||
Segment cost of goods sold (1) | 1,898 | 1,233 | 3,131 | |||||||||||||||||
Other segment items (2) | 768 | 334 | 1,102 | |||||||||||||||||
| Segment Adjusted EBITDA | $ | 742 | $ | 209 | $ | 951 | ||||||||||||||
(1)Certain amounts included in cost of goods sold on the consolidated statements of operations are excluded from Segment cost of goods sold regularly provided to the CODM.
(2)Other segment items for both segments include certain cost of goods sold not regularly provided to the CODM, selling, general and administrative expenses, other operating charges, research and development expenses, and other expense, net. Certain amounts included in Segment cost of goods sold, including depreciation, are excluded from Segment Adjusted EBITDA and are adjusted for in other segment items.
The following table reconciles Segment Adjusted EBITDA to income before income taxes for the periods presented:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
Segment Adjusted EBITDA (1): | |||||||||||||||||
| Performance Coatings | $ | 788 | $ | 838 | $ | 742 | |||||||||||
| Mobility Coatings | 340 | 278 | 209 | ||||||||||||||
| Total | 1,128 | 1,116 | 951 | ||||||||||||||
| Interest expense, net | 176 | 205 | 213 | ||||||||||||||
| Depreciation and amortization | 295 | 280 | 276 | ||||||||||||||
Debt extinguishment and refinancing-related costs (a) | 2 | 5 | 10 | ||||||||||||||
Termination benefits and other employee-related costs (b) | 23 | 67 | 18 | ||||||||||||||
Merger and acquisition-related costs (c) | 32 | 11 | 3 | ||||||||||||||
Site closure costs (d) | 6 | 1 | 7 | ||||||||||||||
Impairment charges (e) | — | — | 15 | ||||||||||||||
Foreign exchange remeasurement losses (f) | 15 | 11 | 23 | ||||||||||||||
Long-term employee benefit plan adjustments (g) | 12 | 9 | 9 | ||||||||||||||
Stock-based compensation (h) | 25 | 28 | 26 | ||||||||||||||
Gains on sales of assets (i) | (6) | — | — | ||||||||||||||
Environmental charges (j) | 2 | 4 | — | ||||||||||||||
Other adjustments (k) | — | (1) | (4) | ||||||||||||||
| Income before income taxes | $ | 546 | $ | 496 | $ | 355 | |||||||||||
| (1) | The primary measure of segment operating performance is Segment Adjusted EBITDA, which is defined as net income before interest, taxes, depreciation, amortization and select other items impacting operating results. These other items impacting operating results are items that management has concluded are (i) non-cash items included within net income, (ii) items the Company does not believe are indicative of ongoing operating performance or (iii) non-recurring, unusual or infrequent items that have not occurred within the last two years or we believe are not reasonably likely to recur within the next two years. Segment Adjusted EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts and prior year financial results, providing a measure that management believes reflects the Company’s core operating performance, which represents Segment EBITDA adjusted for the select items referred to above. | ||||
| (a) | Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which we do not consider indicative of our ongoing operating performance. | ||||
| (b) | Represents expenses and associated changes to estimates related to employee termination benefits, consulting, legal and other employee-related costs associated with restructuring programs and other employee-related costs. We do not consider these amounts indicative of our ongoing operating performance. | ||||
| (c) | Represents merger and acquisition-related expenses, including business combination, negotiation, documentation and integration activity, associated with both consummated and unconsummated transactions, all of which we do not consider indicative of our ongoing operating performance. | ||||
| (d) | Represents costs related to the closure of certain manufacturing sites, which we do not consider indicative of our ongoing operating performance. | ||||
| (e) | Represents impairment charges, which we do not consider indicative of our ongoing operating performance. The losses recorded during the year ended December 31, 2023 were primarily due to the decision to demolish assets at a previously closed manufacturing site during the three months ended June 30, 2023 and the then-anticipated exit of a non-core business category in the Mobility Coatings segment during the three months ended March 31, 2023. | ||||
| (f) | Represents foreign exchange losses resulting from the remeasurement of assets and liabilities denominated in foreign currencies, net of the impacts of our foreign currency instruments used to hedge our balance sheet exposures. | ||||
| (g) | Represents the non-cash, non-service cost components of long-term employee benefit costs. | ||||
| (h) | Represents non-cash impacts associated with stock-based compensation. | ||||
| (i) | Represents non-recurring income related to the sales of fixed assets. | ||||
| (j) | Represents costs related to certain environmental remediation activities, which we do not consider indicative of our ongoing operating performance. | ||||
| (k) | Represents costs for certain non-operational or non-cash gains, net, unrelated to our core business and which we do not consider indicative of our ongoing operating performance. | ||||
Geographic Area Information:
The following tables provide disaggregated information related to our net sales and long-lived assets.
Net sales by region were as follows:
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| North America | $ | 1,761 | $ | 2,014 | $ | 2,038 | ||||||||||||||
| EMEA | 1,824 | 1,784 | 1,776 | |||||||||||||||||
| Asia Pacific | 902 | 862 | 781 | |||||||||||||||||
Latin America (1) | 630 | 616 | 589 | |||||||||||||||||
Total (2) | $ | 5,117 | $ | 5,276 | $ | 5,184 | ||||||||||||||
Net long-lived assets by region were as follows:
| Year Ended December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| North America | $ | 561 | $ | 539 | ||||||||||
| EMEA | 420 | 362 | ||||||||||||
| Asia Pacific | 185 | 185 | ||||||||||||
Latin America (1) | 133 | 95 | ||||||||||||
Total (3) | $ | 1,299 | $ | 1,181 | ||||||||||
(1)Includes Mexico.
(2)Net Sales are attributed to countries based on the customer’s location. Sales to customers in China represented approximately 12%, 11% and 10% of the total for the years ended December 31, 2025, 2024 and 2023. Sales to customers in Germany represented approximately 7% of the total for the years ended December 31, 2025, 2024 and 2023. Mexico represented approximately 6% of the total for the year ended December 31, 2025 and 7% for the years ended December 31, 2024 and 2023. Brazil represented approximately 5%, 4% and 3% of the total for the years ended December 31, 2025, 2024 and 2023, respectively. Canada, which is included in the North America region, represented approximately 3% of total for the years ended December 31, 2025, 2024 and 2023.
(3)Long-lived assets consist of property, plant and equipment, net. Germany long-lived assets amounted to approximately $230 million and $204 million at December 31, 2025 and 2024, respectively. China long-lived assets amounted to approximately $156 million at December 31, 2025 and 2024. Mexico long-lived assets amounted to approximately $92 million and $63 million at December 31, 2025 and 2024, respectively. Canada long-lived assets, which are included in the North America region, amounted to approximately $6 million at December 31, 2025 and 2024.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 16, 2023 | |
| 2021 | Feb 18, 2022 | |
| 2020 | Feb 18, 2021 | |
| 2019 | Feb 19, 2020 | |
| 2018 | Feb 26, 2019 | |
| 2017 | Feb 22, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 29, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.