KRO Q2 Earnings Beat Estimates on Volume Growth and Lower Costs

Higher TiO2 sales volumes and lower production costs aided results, while lower average selling prices remained a headwind.

KRO's Volume and Pricing

TiO2 sales volumes increased 15.9% year over year to 153 thousand metric tons from 132 thousand metric tons. The company attributed the increase primarily to market share gains across all markets. Production volumes rose 8% to 135 thousand metric tons from 125 thousand metric tons in the year-ago quarter.

Average TiO2 selling prices remained below year-ago levels and reduced the year-over-year change in second-quarter net sales by 3%. Kronos entered 2026 with average TiO2 selling prices below early-2025 levels, though prices increased 4% during the first six months of 2026. The company implemented price increases and surcharges during the second quarter to address higher operating costs.

TiO2 segment profit jumped to $41 million from $10.9 million a year earlier. Higher sales volumes, lower production and raw material costs, lower unabsorbed fixed costs and benefits from cost-reduction initiatives supported the increase. Lower selling prices and unfavorable currency movements partly offset these gains.

Financials

Kronos ended the quarter with cash and cash equivalents of $26.6 million as of June 30, 2026. Long-term debt stood at $569.6 million as of June 30, 2026, up from $557.4 million as of Dec. 31, 2025.

Outlook

Management emphasized continued execution on pricing and cost initiatives as key priorities following the restructuring actions implemented in late 2025. Additional pricing actions may be needed as overall selling prices remain below 2025 levels. Kronos expects gross margin to improve as lower-cost inventory produced during 2026 flows through the system and more favorable selling prices take hold, though higher production, energy and logistics costs remain a pressure point.

Customers remain cautious on inventories, but longer lead times and a favorable backlog entering the third quarter have improved near- and intermediate-term production flexibility. Demand has strengthened from 2025 levels but remains below historical norms, particularly in North America, where elevated interest rates, economic uncertainty and subdued consumer spending continue to weigh on activity. Kronos expects full-year 2026 net sales to exceed 2025 levels, with gross margin and operating income margin also improving year over year, although geopolitical instability, tariffs, shipping disruptions and energy costs remain sources of uncertainty.

KRO’s Price Performance

Shares of Kronos have gained 53.3% in the past year compared with the 8.5% rise of the industry.

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KRO’s Zacks Rank & Key Picks

KRO currently carries a Zacks Rank #2 (Buy). 

Some other top-ranked stocks are Almonty Industries Inc. ALM, ClearSign Technologies Corporation CLIR and Applied Industrial Technologies, Inc. AIT  

Almonty is slated to report second-quarter 2026 results on Aug. 13. The Zacks Consensus Estimate for earnings is pegged at 10 cents per share. ALM carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

ClearSign is scheduled to report second-quarter 2026 results on Aug. 19. The consensus estimate for CLIR’s loss per share is pegged at 25 cents. CLIR presently carries a Zacks Rank #2. 

Applied Industrial is scheduled to report fourth-quarter fiscal 2026 results on Aug. 13. The Zacks Consensus Estimate for AIT’s fiscal fourth-quarter earnings per share is pegged at $2.92. AIT carries a Zacks Rank #2 at present. 

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This article originally published on Zacks Investment Research (zacks.com).

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