Element Solutions IncESI
Element Solutions Inc Segments Disclosure
SEGMENT INFORMATION
The Company's operations are organized into two reportable segments: Electronics and Specialties. These segments represent businesses for which separate financial information is utilized by the chief operating decision maker (CODM) for purposes of allocating resources and evaluating performance. The Company's CODM is the Chief Executive Officer.
The CODM utilizes net sales and Adjusted EBITDA to allocate resources predominantly in the annual budget and forecasting process. The CODM evaluates the performance of the operating segments by considering budget to actual variances when making decisions about allocating capital and personnel to the segments and determining the compensation of certain employees. Adjusted EBITDA for each segment is defined as EBITDA, as further adjusted for additional items included in earnings which the Company believes are not representative or indicative of each of its segments' ongoing business or are considered to be associated with the Company's capital structure. Adjusted EBITDA for each segment also includes an allocation of corporate costs, such as compensation expense and professional fees.
Disaggregated Net Sales
The following table summarizes disaggregated external net sales by product category:
| Year Ended December 31, | ||||||||||||||||||||
| (dollars in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
| Net Sales: | ||||||||||||||||||||
| Electronics | ||||||||||||||||||||
| Assembly Solutions | $ | 907.1 | $ | 782.8 | $ | 726.1 | ||||||||||||||
| Circuitry Solutions | 527.8 | 470.7 | 424.3 | |||||||||||||||||
| Semiconductor Solutions | 351.3 | 307.9 | 264.3 | |||||||||||||||||
| Total Electronics | 1,786.2 | 1,561.4 | 1,414.7 | |||||||||||||||||
| Specialties | ||||||||||||||||||||
| Industrial Solutions | 651.4 | 666.4 | 699.0 | |||||||||||||||||
| Graphics Solutions | 24.2 | 146.2 | 142.7 | |||||||||||||||||
| Energy Solutions | 89.4 | 82.9 | 76.8 | |||||||||||||||||
| Total Specialties | 765.0 | 895.5 | 918.5 | |||||||||||||||||
| Total net sales | $ | 2,551.2 | $ | 2,456.9 | $ | 2,333.2 | ||||||||||||||
Results of Operations
The following table reconciles "Net income" to Adjusted EBITDA:
| Year Ended December 31, | ||||||||||||||||||||
| (dollars in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
| Net income | $ | 191.0 | $ | 244.5 | $ | 118.2 | ||||||||||||||
| Add (subtract): | ||||||||||||||||||||
| Income from discontinued operations, net of tax | — | (1.6) | (2.1) | |||||||||||||||||
| Income tax expense | 74.6 | 44.8 | 13.0 | |||||||||||||||||
| Interest expense, net | 53.4 | 56.3 | 49.3 | |||||||||||||||||
| Depreciation expense | 41.1 | 40.0 | 42.6 | |||||||||||||||||
| Amortization expense | 110.1 | 117.6 | 124.1 | |||||||||||||||||
| EBITDA | 470.2 | 501.6 | 345.1 | |||||||||||||||||
| Adjustments to reconcile to Adjusted EBITDA: | ||||||||||||||||||||
| Restructuring expense | 5.6 | 7.8 | 11.4 | |||||||||||||||||
| Inventory step-up | — | — | 3.3 | |||||||||||||||||
| Acquisition, integration and transaction expenses | 34.9 | 21.7 | 16.8 | |||||||||||||||||
| Foreign exchange losses (gains) on intercompany loans | 28.2 | (23.9) | (9.7) | |||||||||||||||||
| Gain on divestitures | (59.0) | — | — | |||||||||||||||||
| Unrealized losses (gains) on metals derivative contracts | 16.7 | (4.4) | (1.2) | |||||||||||||||||
| Debt financing costs | 1.8 | 0.8 | 7.8 | |||||||||||||||||
| Goodwill impairment | — | — | 80.0 | |||||||||||||||||
| Kuprion Acquisition research and development charge | — | 3.9 | 15.7 | |||||||||||||||||
| 2025 executive share grants | 37.1 | — | — | |||||||||||||||||
| Other, net | 12.1 | 27.2 | 13.1 | |||||||||||||||||
| Adjusted EBITDA | $ | 547.6 | $ | 534.7 | $ | 482.3 | ||||||||||||||
The following tables summarize financial information regarding each reportable segment's results of operations. As noted above, Adjusted EBITDA for each segment excludes certain items that may not be indicative of the Company's core operating results for its reportable segments. As such, the "Segment Total" below may not agree to the corresponding amounts on the Consolidated Statements of Operations.
Year Ended December 31, 2025 | ||||||||||||||||||||
| (dollars in millions) | Electronics | Specialties | Segment Total | |||||||||||||||||
Net sales | $ | 1,786.2 | $ | 765.0 | $ | 2,551.2 | ||||||||||||||
Cost of sales | 1,068.8 | 408.5 | 1,477.3 | |||||||||||||||||
| Selling, technical, general and administrative | 275.7 | 196.4 | 472.1 | |||||||||||||||||
| Research and development | 50.0 | 11.1 | 61.1 | |||||||||||||||||
Other segment items (1) | 35.0 | (0.9) | 34.1 | |||||||||||||||||
Add: Depreciation expense | 25.5 | 15.5 | 41.0 | |||||||||||||||||
Adjusted EBITDA | $ | 382.2 | $ | 165.4 | $ | 547.6 | ||||||||||||||
Year Ended December 31, 2024 | ||||||||||||||||||||
| (dollars in millions) | Electronics | Specialties | Segment Total | |||||||||||||||||
Net sales | $ | 1,561.4 | $ | 895.5 | $ | 2,456.9 | ||||||||||||||
Cost of sales | 910.1 | 506.4 | 1,416.5 | |||||||||||||||||
| Selling, technical, general and administrative | 251.3 | 223.2 | 474.5 | |||||||||||||||||
| Research and development | 45.1 | 11.7 | 56.8 | |||||||||||||||||
Other segment items (1) | 15.3 | (0.9) | 14.4 | |||||||||||||||||
Add: Depreciation expense | 21.9 | 18.1 | 40.0 | |||||||||||||||||
Adjusted EBITDA | $ | 361.5 | $ | 173.2 | $ | 534.7 | ||||||||||||||
Year Ended December 31, 2023 | ||||||||||||||||||||
| (dollars in millions) | Electronics | Specialties | Segment Total | |||||||||||||||||
Net sales | $ | 1,414.7 | $ | 918.5 | $ | 2,333.2 | ||||||||||||||
Cost of sales | 854.2 | 545.4 | 1,399.6 | |||||||||||||||||
| Selling, technical, general and administrative | 227.9 | 215.1 | 443.0 | |||||||||||||||||
| Research and development | 37.2 | 14.0 | 51.2 | |||||||||||||||||
Other segment items (1) | 2.1 | (2.4) | (0.3) | |||||||||||||||||
Add: Depreciation expense | 24.4 | 18.2 | 42.6 | |||||||||||||||||
Adjusted EBITDA | $ | 317.7 | $ | 164.6 | $ | 482.3 | ||||||||||||||
(1) Other segment items for the Electronics segment primarily consisted of $30.3 million, $15.4 million and $1.6 million of realized losses associated with metals derivative contracts for 2025, 2024 and 2023, respectively. See Note 13, Financial Instruments, to the Consolidated Financial Statements for further discussion of these derivative instruments.
Net Sales by Major Country
A major country is defined as one in which total net sales represented 10% or more of the Company's total consolidated net sales in any of the years presented.
| Year Ended December 31, | ||||||||||||||||||||
| (dollars in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
| United States | $ | 524.3 | $ | 566.4 | $ | 576.2 | ||||||||||||||
| China | 557.9 | 479.0 | 418.9 | |||||||||||||||||
| Other countries | 1,469.0 | 1,411.5 | 1,338.1 | |||||||||||||||||
| Total | $ | 2,551.2 | $ | 2,456.9 | $ | 2,333.2 | ||||||||||||||
Long-Lived Assets by Major Country
A major country is defined as one with long-lived assets greater than 10% of the Company's total long-lived assets, net in any of the years presented. Long-lived assets represent property, plant and equipment, net.
| December 31, | ||||||||||||||
| (dollars in millions) | 2025 | 2024 | ||||||||||||
| United States | $ | 108.8 | $ | 94.9 | ||||||||||
| China | 36.1 | 35.7 | ||||||||||||
| Other countries | 174.7 | 146.2 | ||||||||||||
| Total | $ | 319.6 | $ | 276.8 | ||||||||||
Assets by Reportable Segment
Total assets by reportable segment at December 31, 2025 and 2024 are not presented as they are not utilized for purposes of allocating resources and evaluating performance.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 18, 2026 | Showing above |
| 2024 | Feb 19, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Mar 13, 2017 | |
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.