Solstice Refrigerant Sales Rise 8 Percent on Data Center and Automotive Demand
Refrigerant sales reached $433 million, up from $400 million. Company sales rose 8 percent to $1.05 billion, and Solstice raised its 2026 sales outlook to $4.195 billion to $4.22 billion.
Solstice Advanced Materials, spun off from Honeywell in October 2025, said Nov. 4 that third-quarter refrigerant sales rose 8 percent to $433 million, citing "strong demand across automotive and data center applications." Total company sales also rose 8 percent, to $1.046 billion, and Solstice raised its full-year guidance for the second consecutive quarter.
The quarterly report it filed the same day breaks the gain down further. Across the Refrigerants and Applied Solutions segment, sales rose $39 million, including $30 million from volume, "mainly due to demand for LGWP refrigerants in the stationary end market, driven by data center demand, and in the automotive end market." Price added $9 million, "primarily driven by higher pricing in refrigerants within the stationary end market," the 10-Q says.
Chillers Lead the Data Center Business
Solstice does not report data center sales separately. On the July 30 call, President and CEO David Sewell said the category was "still a smaller piece of our overall refrigerants" but the fastest-growing part of the business, "growing strong double digits." He said, "Most of that is still in standard cooling that we do in data centers, chillers," and described the company's work in two-phase and immersion cooling as "really to be coming in the future."
The segment's adjusted EBITDA rose 3 percent to $251 million. Its margin of 34.5 percent was 82 basis points lower than a year earlier, partly because of higher research spending, but 160 basis points better than in the second quarter. In July, Sewell said that, more than a year into the R-454B transition, he expected the segment to reach adjusted EBITDA margins in the mid-30 percent range in the second half "as the aftermarket develops."
Other parts of the segment were mixed. Healthcare packaging sales rose 24 percent and nuclear conversion services 4 percent, with the nuclear backlog at $2.6 billion. Building Solutions and Intermediates fell 5 percent as construction markets stayed soft.
A Higher Outlook After a Dropped Merger
Solstice now expects 2026 sales of $4.195 billion to $4.22 billion, up from $4.125 billion to $4.185 billion, and adjusted EBITDA of $1.05 billion to $1.06 billion. Fourth-quarter sales guidance is $1.01 billion to $1.035 billion.
The quarter also carried the cost of a deal that did not happen. Solstice agreed July 6 to buy Element Solutions for $10 in cash and half a Solstice share per Element share, then terminated the agreement by mutual consent Aug. 27 with no payment either way. It booked $34 million of bridge and backstop financing fees and $23 million of professional fees for the merger in the third quarter. Net income came to $80 million, or 50 cents a share, against a $35 million loss a year earlier, when spin-off taxes weighed on results.
"Our businesses are well positioned to benefit from key secular growth trends including nuclear energy, thermal management, AI and data centers, and we continue to invest to support that growth," Sewell said in the release. Solstice has repurchased $100 million of stock under a $500 million authorization it plans to substantially complete by the end of the first quarter of 2027.
In its October notice setting 2027 allocations, EPA took back 1,144,200 metric tons exchange value equivalent of Solstice consumption allowances over imports the company had not covered with allowances. Even after that cut, Solstice holds the largest 2027 consumption allocation of any company, 47,890,358.4 after adjustments.
Why This Matters to Contractors
Solstice's nine-month figures show how much of its refrigerant growth has come from price. Segment sales rose $208 million through September, and $62 million of that, about 30 percent, came from pricing that the 10-Q again ties mainly to refrigerants in the stationary market. Volume contributed $125 million. A distributor quoting R-454B cylinders into 2027 is buying from a supplier that told investors its refrigerant margins would climb as the R-454B aftermarket develops.
Sources
- U.S. Environmental Protection Agency, "Phasedown of Hydrofluorocarbons: Notice of 2027 Allowance Allocations for Production and Consumption of Regulated Substances," Federal Register, Oct. 6, 2026. federalregister.gov
- Solstice Advanced Materials, "Solstice Advanced Materials Reports Third Quarter 2026 Results," Nov. 4, 2026 (SEC Exhibit 99.1). sec.gov
- Solstice Advanced Materials, Form 10-Q for the quarter ended Sept. 30, 2026, filed Nov. 4, 2026. sec.gov
- Stock Analysis, "Solstice Advanced Materials (SOLS) Q2 2026 Earnings Call Transcript," July 30, 2026. stockanalysis.com