Executive Summary

Q4 delivered record fourth‑quarter net sales of $1.31B and record Q4 Adjusted EBITDA of $275M; Adjusted EBITDA margin expanded 170 bps YoY to 21.0% as price/mix, lower variable costs, and transformation savings offset FX and volume headwinds .
Mobility Coatings outperformed: net sales +4% YoY to $468M, Light Vehicle +9% on 6% volume growth (China/LatAm strength); Performance Coatings net sales -1% as Refinish gains (+2%) were offset by Industrial (-5%) and FX .
GAAP diluted EPS rose 91% YoY to $0.63; Adjusted diluted EPS +30% to $0.60; free cash flow was $177M (lower YoY on higher capex and working capital) and net leverage fell to 2.5x (8th straight quarterly decline) .
2025 outlook: FY net sales $5.35–$5.40B, Adjusted EBITDA $1.150–$1.175B, Adjusted EPS $2.50–$2.60, FCF ≈$500M; includes ~$10M tariff headwind and Q1 guide of ~$265M EBITDA and ~$0.54 EPS .

What Went Well and What Went Wrong

What Went Well
- Margin execution: Q4 Adjusted EBITDA margin reached 21.0% (+170 bps YoY), achieving the 2026 A Plan’s 21% target ahead of schedule; full‑year Adjusted EBITDA margin 21.2% (+280 bps YoY) . CEO: “We delivered record net sales and Adjusted EBITDA... in a challenging macro environment” .
- Mobility outperformance: Light Vehicle +9% YoY on 6% volume growth; Mobility Adjusted EBITDA +29% YoY to $77M (margin 16.4%, +320 bps) on price/mix, volume and transformation savings .
- Structural deleveraging and capital discipline: net leverage to 2.5x; repaid full $105M revolver draw used for CoverFlexx; liquidity $1.4B . CFO: “Balance sheet... provides greater optionality... CapEx to $175–$190M in 2025; $600M buyback authority remaining” .
What Went Wrong
- Volume softness and FX: Total Q4 net sales +1% with a ~1% FX headwind; Performance Coatings -1% YoY, Industrial -5% on weak demand and FX .
- Free cash flow moderation: Q4 FCF fell to $177M vs $254M last year on higher working capital and capex; full‑year FCF $451M (flat YoY) as earnings growth offset working capital .
- Tariff and inflation headwinds emerging: FY25 plan embeds ~$10M EBITDA headwind from tariffs; raw materials expected up low single‑digits in 2025 (offset by productivity) .

Financial Results

Overall P&L, cash, and leverage (oldest → newest)

Metric	Q2 2024	Q3 2024	Q4 2024
Net Sales ($B)	$1.351	$1.320	$1.311
GAAP Diluted EPS ($)	$0.51	$0.46	$0.63
Adjusted Diluted EPS ($)	$0.57	$0.59	$0.60
Adjusted EBITDA ($M)	$291	$291	$275
Adjusted EBITDA Margin (%)	21.5%	22.1%	21.0%
Net Income Margin (%)	8.4%	7.7%	10.5%
Cash from Operations ($M)	$114	$194	$234
Free Cash Flow ($M)	$95	$164	$177
Net Leverage (x)	2.6x	2.7x	2.5x

YoY comparison (Q4)

Metric	Q4 2023	Q4 2024	YoY
Net Sales ($B)	$1.297	$1.311	+1% (incl. ~1% FX headwind)
GAAP Diluted EPS ($)	$0.33	$0.63	+91%
Adjusted Diluted EPS ($)	$0.46	$0.60	+30%
Adjusted EBITDA ($M)	$251	$275	+10%
Adjusted EBITDA Margin (%)	19.3%	21.0%	+170 bps
Net Income ($M)	$74	$137	+85%
Free Cash Flow ($M)	$254	$177	-$77M (working capital, capex)

Segment and end‑market detail

Segment/End‑Market	Q3 2024	Q4 2024	YoY Commentary
Performance Coatings Net Sales ($M)	$877	$843	-1% YoY; Refinish +2% to $545M; Industrial -5% to $298M; FX headwinds
Refinish Net Sales ($M)	$554	$545	+2% YoY in Q4 (CoverFlexx, price/mix, net wins; Europe volumes/FX headwinds)
Industrial Net Sales ($M)	$323	$298	-5% YoY (weak demand, FX)
Mobility Coatings Net Sales ($M)	$443	$468	+4% YoY; LV +9% (vol +6%; China/LatAm strength), CV -10% to $99M (NA/LatAm Class 8)
Performance Coatings Adj. EBITDA ($M)	$221 (25.3%)	$198 (23.5%)	Q4 YoY +4%; margin +90 bps on lower variable costs, price/mix, CoverFlexx
Mobility Adj. EBITDA ($M)	$70 (15.7%)	$77 (16.4%)	+29% YoY; margin +320 bps on price/mix, volume, transformation

Additional KPIs and notes

Price/mix, cost and transformation: Q4 gross margin +150 bps YoY to 34%; variable costs down 7% FY; 2024 transformation delivered ~$20M; 2025 plan embeds $30–$40M more .
Working capital: Q4 operating cash $234M and FCF $177M declined YoY on higher capex and receivable/payable timing; management expects working capital normalization to support 2025 FCF ≈$500M .
Body shop wins and tech adoption: ~2,800 net body shop wins in 2024; ~300 Irus Mix installs to date; plan to double in 2025 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Sales YoY	Q1 2025	n/a	Flat	New
Adjusted EBITDA ($M)	Q1 2025	n/a	≈$265	New
Adjusted Diluted EPS ($)	Q1 2025	n/a	≈$0.54	New
Net Sales ($B)	FY 2025	n/a	$5.35–$5.40	New
Adjusted EBITDA ($B)	FY 2025	n/a	$1.150–$1.175	New
Adjusted Diluted EPS ($)	FY 2025	n/a	$2.50–$2.60	New
Free Cash Flow ($M)	FY 2025	n/a	≈$500	New
D&A ($M)	FY 2025	n/a	≈$285	New
Tax Rate (as adjusted)	FY 2025	n/a	≈25%	New
Diluted Shares (M)	FY 2025	n/a	≈219	New
Interest Expense ($M)	FY 2025	n/a	≈$190	New
Capex ($M)	FY 2025	n/a	$175–$190	New

Notes: FY25 guidance includes estimated ~$10M tariff headwind; RM inflation low single‑digit for 2025 expected to be offset by productivity .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3 2024)	Current Period (Q4 2024)	Trend
Margin trajectory	Q2: adj. EBITDA margin 21.5%; margin stabilization a focus . Q3: 22.1%; early productivity tailwinds .	Q4: 21.0% (+170 bps YoY); A Plan 21% achieved early .	Sustained >21% margins; maintain while pivoting to growth.
Mobility LV outperformance	Q2: LV volumes +7%, China nearly +30% . Q3: LV vol +5% vs -5% builds; share gains 9 of last 10 qtrs .	Q4: LV +9% (vol +6%), China/LatAm drove growth; more accretive wins coming .	Continued share gains vs builds; accretive mix.
Refinish strategy (premium + economy)	Q2: premium tech (Irus ecosystem), economy expansion via CoverFlexx . Q3: distributor consolidation and soft body shop activity; still net share gains .	Q4: Refinish +2% YoY; ~2,800 net body shop wins; plan to double Irus installs in 2025 .	Premium leadership + scaling economy; tech‑driven wins continue.
Industrial portfolio and margins	Q2: +300 bps margin expansion target; deprioritize low‑margin SKUs . Q3: +300 bps achieved YTD, aiming >400 bps vs A Plan .	Q4: Industrial -5% sales on weak demand, but segment EBITDA/margins improved YoY .	Margin work ahead of demand recovery; upside as macro improves.
Tariffs/macro	Q3: building macro softness; cautious H2 .	Q4: ~$10M FY25 EBITDA impact embedded; <10% of US raws from China; mitigation via resourcing/pricing .	Manageable headwind; mitigation plans in progress.
Supply chain and costs	Q2: raw material deflation mid‑single digits FY; pockets of tightness . Q3: raw materials trending flat into Q4; 2025 low‑single‑digit inflation .	Q4: 2025 raws low single‑digit inflation; offset by productivity programs .	Price/cost balanced; productivity offsets inflation.
Technology/digital paint	Q2/Q3: Irus Mix/Nimbus rollout; 300 units planned 2024 .	Q4: Dürr partnership to integrate NextJet for digital paint/two‑tone on main line .	Expanding OEM digital paint capability; sustainability benefit.
Capital allocation/ROIC	Q2: net leverage 2.6x; $700M buyback program; ROIC target 15% . Q3: net leverage 2.7x; repurchased $50M .	Q4: net leverage 2.5x; 2024 ROIC 14.6% with line of sight to 15% in 2025 .	Deleveraging enables M&A + buybacks; closing in on ROIC target.

Management Commentary

CEO (prepared remarks): “We delivered record net sales and Adjusted EBITDA for the fourth quarter and full year… Adjusted EBITDA margin of over 21% as we continue down the path to delivering against our commitments outlined in the 2026 A Plan” .
CFO (non‑GAAP update): “We are ceasing to adjust for step‑up D&A from the DuPont acquisition... and beginning to adjust through the amortization of all acquired intangibles... metrics reported today reflect these changes” .
CFO (costs): “We anticipate minimal raw material inflation in the first quarter and… low single‑digit inflation for the full year 2025, which we expect to offset with our productivity programs” .
CEO (Mobility): “We’ve had double‑digit [China] growth through many of the quarters… customers we chose to play with… are growing market share… including EV players” .
CFO (tariffs): “We are forecasting a full year adjusted EBITDA impact of $10 million from tariffs… included in our guidance” .

Q&A Highlights

Mobility share gains and price/mix: Light Vehicle volume +6% underpinned by partnering with fast‑growing local OEMs in China/LatAm; price/mix tailwind partly mix‑driven vs 4Q23 comp .
Refinish outlook and wins: 2,800 net body shop wins in 2024; focus on premium plus economy via CoverFlexx; aim to double Irus Mix installs in 2025 (largely Europe first) .
Transformation levers: $30–$40M transformation benefit in 2025 with additional levers (logistics, plant productivity) potentially pulled forward .
Free cash flow bridge: 2024 shortfall vs increased 3Q guide driven by working capital timing (AR collections, DPO down ~6–7 days); expected to reverse, with $500M FY25 FCF a floor .
Tariffs detail: ~$10M impact reflects China + Canada/Mexico measures; anti‑dumping (e.g., TiO2) already embedded; mitigation via onshoring, supplier inventories, potential pricing actions .
LatAm growth pipeline: Light Vehicle wins rising to $60–$70M (from ~$50M) rolling in over ~18 months, notably Brazil .

Estimates Context

S&P Global consensus EPS and revenue estimates for Q4 2024 and near‑term forward periods were unavailable at the time of this analysis due to a temporary retrieval limit, so we cannot provide quantitative beat/miss versus Street estimates. Where comparisons to internal expectations were referenced on the call (e.g., adjusted EPS exceeding expectations on lower tax/interest), we cite management commentary .
If you would like, we can refresh the S&P Global consensus once the data service limit resets and update the “vs estimates” columns accordingly.

Key Takeaways for Investors

Margin durability with growth: Axalta sustained >21% Adjusted EBITDA margins while growing Mobility and Refinish, suggesting pricing discipline and structural cost work can absorb 2025’s low‑single‑digit RM inflation .
Mobility is a multiyear share‑gain story: China/LatAm wins are accretive and compounding (LV +9% with +6% volume in Q4); additional $60–$70M LV revenue ramps through the next 18 months .
Refinish secular share gains: ~2,800 net body shop wins and scaling Irus/Nimbus ecosystem should support premium segment leadership; CoverFlexx expands economy access in North America .
Industrial optionality: Demand remains soft, but portfolio rationalization and margin progress are ahead of plan; recovery in H2‑2025 could provide operating leverage .
Cash and capital allocation: Net leverage down to 2.5x with $1.4B liquidity; FY25 FCF ≈$500M supports programmatic buybacks ($600M remaining) and bolt‑on M&A .
Tariff risk manageable: ~$10M EBITDA headwind embedded; <10% of US raws sourced from China; mitigation plans include resourcing and pricing actions .
2025 setup: Guide implies low‑single‑digit revenue growth and ~~21%+ margin profile with transformation benefits and productivity offsets; watch FX (~~$80–$100M FY sales headwind) and working capital normalization .

Appendix: Additional Relevant Press Releases (Q4 period and strategic context)

Partnership with Dürr to integrate robotic digital paint (NextJet) for on‑line two‑tone/customization, supporting OEM productivity and sustainability (low overspray) .
Headquarters consolidation at Philadelphia Navy Yard to enhance collaboration under “ONE Axalta” .
Recognition: 2024 R&D 100 Award for Primerless Consolidated Coating System, highlighting innovation leadership .

All data and quotations sourced from Axalta’s Q4 2024 press release and 8‑K materials and the Q4, Q3, and Q2 earnings calls and press releases: – – –.

Axalta Coating Systems Ltd. (AXTA)·Q4 2024 Earnings Summary