Specialty chemicals giant LANXESS has reported a sharp downturn in its 2025 financial performance, underscoring the strain on the global chemical industry amid weak demand and mounting geopolitical uncertainty.
The company’s revenue fell 10.9 percent to EUR 5.673 billion, down from EUR 6.366 billion a year earlier. Earnings also took a hit, with EBITDA pre-exceptionals dropping 16.9 percent to EUR 510 million, while margins narrowed to 9.0 percent from 9.6 percent.
The slump reflects a broad-based slowdown across customer industries, with lower sales volumes and sustained pricing pressure—particularly from Asian competitors—dragging down results. Falling raw material costs further pushed selling prices lower. The company also felt the impact of losing earnings from its Urethane Systems unit following its sale in April 2025, alongside unfavorable currency movements.
“2025 was an extremely tough year for the entire chemical industry and for LANXESS as well. For 2026, we expect to see positive momentum in the second half of the year at the earliest, for example through the German government’s infrastructure stimulus program,” said Matthias Zachert, LANXESS CEO.
“For us, therefore, the guiding principle for 2026 remains: We control the things we can control. That means continuing to cut costs, streamline processes, and create new market opportunities.”
Looking ahead, LANXESS forecasts EBITDA pre-exceptionals of between EUR 450 million and EUR 550 million for 2026—signaling continued caution despite hopes for a late-year recovery.
In response to the downturn, the company is intensifying cost-cutting efforts. LANXESS plans to deliver an additional EUR 100 million in annual savings by 2028, including cutting 550 jobs—around two-thirds of them in Germany—primarily in administrative roles. The company says the reductions will be implemented as responsibly as possible through attrition and demographic changes.
These measures build on earlier production network optimizations announced in August 2025, expected to yield EUR 50 million in annual savings. Combined, LANXESS is targeting EUR 150 million in structural cost reductions by the end of 2028.
Short-term labor costs are also being trimmed. Employees under collective agreements will move to a 35-hour workweek through year-end, while non-union staff and management will see no base salary increases.
The company’s ongoing “FORWARD!” action plan, launched in 2023, is already delivering EUR 150 million in annual savings.
Despite the earnings pressure, LANXESS strengthened its balance sheet. Net financial liabilities fell 15 percent to EUR 2.023 billion at the end of 2025, largely driven by proceeds from the Urethane Systems sale.
Segment snapshots:
Consumer Protection saw sales drop 9.2 percent to EUR 1.889 billion, but EBITDA held steady at EUR 290 million, with margins improving to 15.4 percent thanks to cost savings.
Specialty Additives reported a 6.9 percent decline in revenue to EUR 2.056 billion, while EBITDA fell 11.5 percent to EUR 201 million amid weak demand and currency headwinds.
Advanced Intermediates was hardest hit, with revenue down 8.4 percent to EUR 1.653 billion and EBITDA plunging 39 percent to EUR 128 million, as low plant utilization and intense Asian competition eroded margins.
As LANXESS pushes ahead with restructuring and cost discipline, the company is betting on internal efficiencies—and a potential macroeconomic rebound—to steady its performance in the year ahead.
