Air Products Reports Solid Fiscal Q3 2025 Results; Updates Full-Year Guidance
Air Products a leading global industrial gases company, today announced its financial results for the third quarter of fiscal year 2025. The company reported steady performance, achieving growth in key areas despite headwinds such as the sale of a major asset, ongoing helium demand softness, and project exits.Strong GAAP Performance Despite Mixed Market Conditions
For the quarter ended June 30, 2025, Air Products reported GAAP earnings per share (EPS) of $3.24, reflecting a 4% increase compared to the prior-year quarter. GAAP operating income rose to $791 million, a 7% increase year-over-year, demonstrating the company’s continued ability to manage costs effectively while generating solid returns from its core operations.
The quarterly results benefited from pre-tax gains of $99 million (equivalent to $76 million after-tax, or $0.34 per share) stemming from the sale of a consolidated subsidiary and other assets. These gains helped offset several one-time expenses, including shareholder activism-related costs of $25 million ($19 million after-tax, or $0.08 per share) and a $24 million charge ($15 million after-tax, or $0.07 per share) tied to updated cost estimates for previously announced project exits and lower sales volumes.
Non-GAAP Metrics Show Slight Softness
On a non-GAAP basis, adjusted EPS was $3.09, representing a 3% decline compared to the third quarter of fiscal 2024. Similarly, adjusted operating income remained flat at $741 million. These adjusted results exclude the aforementioned one-time items to provide a clearer view of the company’s core operating performance.
Air Products noted that non-GAAP metrics were impacted by multiple factors, including the September 2024 sale of its LNG equipment business, reduced helium volumes due to weaker global demand, and the wind-down of certain previously disclosed projects. Despite these challenges, the company cited improved productivity, stronger on-site performance, and effective pricing strategies as key mitigating factors that preserved margin stability.
Revenue Growth Driven by Pricing and Currency
Third-quarter sales totaled $3.0 billion, a 1% increase year-over-year. The modest growth reflects a combination of:
- +3% from higher energy cost pass-through
- +1% from improved pricing
- +1% from favorable currency impacts
- Offset by -4% due to lower sales volumes
The volume decline was primarily attributed to the LNG equipment divestiture, reduced global helium demand, and the exit of certain low-return projects. These were partially offset by stronger performance in on-site business segments, highlighting the resilience of Air Products’ long-term supply contracts.
Updated Fiscal 2025 Guidance
Given current market dynamics and the results achieved so far, Air Products has revised its fiscal 2025 full-year adjusted EPS guidance. The company now expects full-year adjusted EPS to range between $11.90 and $12.10, narrowing from earlier projections. For the fourth quarter, adjusted EPS is projected to be between $3.27 and $3.47.
Additionally, the company reaffirmed its expectation of approximately $5 billion in capital expenditures for the full fiscal year. This spending aligns with Air Products’ strategic focus on building out its clean hydrogen portfolio, decarbonization initiatives, and expanding its industrial gases infrastructure globally.
CEO Statement
Commenting on the results, Air Products CEO Eduardo Menezes stated:
The Air Products team delivered solid results this quarter that exceeded our guidance and surpassed prior-year performance on a comparable basis, excluding the LNG sale. We remain focused on executing our strategy with discipline—driving productivity, managing costs, optimizing pricing, and ensuring excellence in operations. These fundamentals are key to navigating current market challenges and delivering long-term shareholder value.”
Segment Performance Overview
Americas Segment
- Sales: $1.3 billion, up 2% year-over-year
- Operating Income: $374 million, down 4%
- Operating Margin: 29.7%, down 200 basis points
Sales growth in the Americas was supported by a 7% increase in energy cost pass-through and a 1% increase in pricing. However, this was partially offset by a 6% decline in volumes, primarily due to lower helium sales and project exits.
The decrease in operating income was driven by higher maintenance-related depreciation, reduced on-site volumes, and lower helium demand. Despite these challenges, the business benefited from strong pricing in non-helium markets and cost discipline.
Asia Segment
- Sales: $810 million, up 3%
- Operating Income: $217 million, up 8%
- Operating Margin: 26.8%, up 150 basis points
Asia showed robust performance driven by 2% higher volumes, led by growth in the on-sites business. Although helium pricing continued to be a drag, the segment managed to post an 8% increase in operating income due to productivity improvements and lower maintenance costs. Pricing, net of energy, declined 1%—a reflection of the regional energy price environment.
Europe Segment
- Sales: $771 million, up 11%
- Operating Income: $225 million, up 10%
- Operating Margin: 29.2%, down 30 basis points
Europe led the company’s sales growth this quarter, aided by 5% favorable currency translation, 3% higher volumes, 2% better pricing, and 1% energy cost pass-through. The increase in volumes came from the on-sites business, partially offset by helium softness.
Operating income rose 10% on improved pricing and currency gains. However, operating margins slightly declined due to the impact of higher energy pass-through costs.
Middle East and India Equity Affiliates
- Income: $86 million, down 4%
Equity affiliate income in this region decreased modestly, primarily due to lower contributions from an affiliate in Saudi Arabia. The company continues to see long-term strategic potential in the region, particularly in green hydrogen initiatives.
Corporate and Other
- Sales: $143 million, down 39%
- Operating Loss: $83 million, up 46%
The significant drop in sales and rise in operating loss within this category were largely the result of the September 2024 sale of the LNG business. However, these losses were partially offset by cost reductions and productivity improvements, especially in sale-of-equipment and corporate overhead areas.
