Finance
Air Products Forecasts Dour Q2 Profit, Sees Challenges in China
Published by Global Banking & Finance Review®
Posted on February 6, 2025
2 min readLast updated: January 26, 2026
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Air Products forecasts a lower Q2 profit due to challenges in China and tariff impacts, with new management focusing on risk management.
Air Products Expects Lower Q2 Profit Due to China Challenges
By Vallari Srivastava
(Reuters) -Air Products forecast second-quarter profit below Wall Street's expectations on Thursday, as the industrial gases manufacturer expects challenging conditions in key regions such as China.
The company, which recently emerged from an expensive boardroom battle, told analysts on a post-earnings call that tariffs could also impact its projects, sending shares down 1%.
The ongoing trade war between the United States and China, initiated by President Donald Trump's 10% tariff on Chinese imports, has led to retaliatory measures from China, including targeted tariffs on U.S. goods and potential sanctions on various companies.
"China's still a wait and see ... right now we see no material improvement. The market still remains challenging," said CFO Melissa Schaeffer, adding that the company is monitoring the impact of tariffs and China's economic stimulus.
China represents 16% of Air Products' total revenue, while the U.S. accounts for 41%, according to LSEG data.
Earlier this week, activist investor Mantle Ridge succeeded in replacing long-serving CEO Seifi Ghasemi with Eduardo Menezes, a former executive from Air Products' rival, Linde, concluding a months-long proxy fight.
Air Products recorded a charge of $29.9 million in the first quarter due to costs related to shareholder activism.
Morningstar analyst Krzysztof Smalec expects the new management to focus on instilling a more disciplined risk-management framework and improving margins by eliminating costs associated with non-core activities.
The Lehigh Valley, Pennsylvania-based company increased its quarterly dividend to $1.79 per share from $1.77 per share previously and expects to return about $1.6 billion to shareholders in 2025.
It expects second-quarter adjusted profit between $2.75 per share and $2.85 per share, compared to analysts' expectations of $3.05 per share, according to data compiled by LSEG.
(Reporting by Vallari Srivastava in Bengaluru; Editing by Tasim Zahid)
Key Takeaways
- •Air Products forecasts lower Q2 profit than expected.
- •Challenges in China impact industrial gases manufacturer.
- •US-China trade war affects Air Products' operations.
- •New management aims to improve risk management and margins.
- •Dividend increased, $1.6 billion return to shareholders by 2025.
Frequently Asked Questions about Air Products forecasts dour Q2 profit, sees challenges in China
1What is the main topic?
The article discusses Air Products' forecast of a lower Q2 profit due to challenges in China and tariff impacts.
2How is Air Products affected by the US-China trade war?
Tariffs and retaliatory measures impact Air Products' projects and revenue, particularly in China.
3What changes are expected in Air Products' management?
New management aims to focus on disciplined risk management and improving margins by cutting non-core costs.
