FMC Corporation (FMC) Q3 2026 earnings review
FMC lowered prices on unsold stock, and its yearly profit vanished
FMC wiped out a quarter of sales to clear old stock from its dealers' warehouses, and demand weakened too. Chairman and chief executive Pierre Brondeau took $672 million of charges against profit to cut the value of goods customers already hold. Before those charges, sales were $745 million, 22% below a year ago, because dealers stopped reordering in September. He also reduced every line of the outlook for the rest of the year.
| Sales before the pricing charges, excluding India | $745 million −22% from a year ago |
|---|---|
| Profit before interest, tax and write-offs, before the charges | $113 million $236 million a year ago |
| Loss per share, excluding one-offs | −$4.41 +$0.89 a year ago |
| Full-year outlook for profit before interest, tax and write-offs | Cut to a loss −$114 million at the middle, from +$650 million |
⚖️ Verdict: 🔴🔴 Very Bearish
The story got worse, because the cost of cleaning up the channel landed on next year as well as on this quarter. FMC expected a profit of about $650 million before interest and tax for 2026; it now forecasts a loss. The cash outflow it plans for the year is $400 million deeper. The better news: the Tessenderlo investment has closed and the India sale is set for December, so the debt plan still stands.
The question now is whether cheaper stock in dealers' warehouses brings growers back to FMC products. Brondeau believes it will, and expects 2027 to be the year the business turns. The other possibility is that the price cuts reset revenue lower while generic rivals keep the volume. Fourth-quarter orders and the February outlook will show which answer is right.
🐂 Bull Case
Cash Improved While Profit Disappeared
Cash told a different story from profit this quarter. Operating activities produced $7 million, where a year earlier they drained money out of the business. Free cash flow improved by $214 million, to an outflow of $18 million, and the quarter still carried restructuring payments.
Working capital did the work. Finance chief Andrew Sandifer said: "Significantly lower EBITDA, in part due to the commercial action charges, was more than offset by working capital improvement". Over nine months, collections released $193.4 million of cash from amounts dealers owe, where the same period of 2025 absorbed $311.6 million.
What to watch: the prepayments North American customers make in the fourth quarter, which FMC assumes match last year's. Most of the quarter's charge costs nothing in cash, so a normal prepayment season would keep the year's outflow inside the new range.
Tessenderlo, Corteva and India Deals Closed
FMC spent this year selling pieces of itself to pay down borrowings, and the pieces are now landing. Tessenderlo Group, a Belgian industrial group, paid $403.2 million for about a fifth of the shares on September 23. Its chief executive, Luc Tack, has joined the FMC board.
Corteva's $200 million prepayment for rimisoxafen, a weedkiller ingredient FMC owns but has not launched, arrived in June. Sandifer told investors the India sale to Crystal Crop Protection remains on track to close on December 1, with the Delaware site sale-leaseback following by the year end. Proceeds repay drawings on the revolving credit line.
What to watch: confirmation in February that both sales completed and that nothing is drawn on the revolver. Each closing removes an assumption from the balance-sheet plan at a moment when trading profit cannot service the borrowings on its own.
Positives this quarter didn't test
Three parts of the long-term case got no test this quarter, because none of them turns on what dealers ordered in September. Each needs a named approval, or a saving visible in the cost base, before it counts.
- Fluindapyr, a fungicide ingredient: "new registrations pending in six new countries", with sales led by it in 2027
- Isoflex, a weedkiller ingredient: exemptions sought in Spain, France and Belgium, and European approvals targeted for 2028
- Project Foundation: $200 million of yearly savings targeted by the end of 2027 from "exiting certain high-cost active ingredient and formulation plants and transitioning production to lower-cost sources"
- Rimisoxafen: first launch expected in 2028 under the Corteva agreement
What to watch: the 2026 sales figure for these new ingredients, which FMC has not published since May. A number near $300 million would show the growth leg is intact while the core portfolio is repriced.
🐻 Bear Case
FMC Repriced Stock Dealers Already Bought
FMC sells crop chemicals through distributors who stock the products before farmers buy them. In North America it has long invoiced at a high list price and paid rebates back after the season. Chairman and chief executive Pierre Brondeau scrapped that arrangement on October 1. The same announcement marked down older stock held by dealers in Brazil, Argentina, the United States and Canada.
The bill reached $672 million against quarterly profit, and $639 million of it came straight out of revenue. Roughly $500 million closes out the old rebate cycle and resets the invoice value of North American channel stock. The other $175 million lowers prices on goods sold since 2023. Brondeau called that piece "the only component of the total charge that is expected to reduce future cash collections".
This matters because the invoice price and the price that actually clears the channel had drifted apart. The filing still states that "We believe our current pricing is competitive", yet dealers needed credits before they would move goods to growers. They hold "the lowest inventory values we have ever seen", Brondeau said, under "high financing costs, the perception of ample supply and demand uncertainty".
What to watch: how much of the repricing turns into credit notes by February, and whether North American orders recover in the first half. If dealers reorder once their stock is cheaper, the charge will have bought back growth that no other action could buy.
Dealers Stopped Reordering Before the Charges
Strip out every charge and the business still shrank. Sales excluding India and the pricing actions were $745 million, 22% below a year ago. Volumes alone took 21 points off that comparison. Brondeau said dealers "sharply reduced replenishment orders" in the closing weeks, after a quarter that had tracked broadly in line through early September.
- Profit before interest, tax and write-offs, before the charges: $113 million against $236 million a year ago
- Price: down 2%, a lighter drag than the 7% of the second quarter
- Europe, Middle East and Africa: sales down 22% on "expected registration losses"
- Asia outside India: down 8% as generic rivals undercut prices
- Selling and overhead costs: 23% of sales before the charges, against 17% a year earlier
That $113 million landed under the $120 million floor management set in August, so the shortfall came from demand rather than from accounting. Costs actually helped. The fourth-quarter outlook assumes the same conditions persist, naming "strained grower margins, a highly competitive market and demand uncertainty in multiple regions", and leans on volume to offset lower prices.
What to watch: the volume figure in the February results, set beside the high-single-digit price decline the fourth quarter assumes. Volumes that grow while prices fall that far would show the cheaper channel stock is pulling product through to growers.
Equity Is Gone and the Leverage Test Returns
Four quarters of write-downs have consumed the company's book value. Shareholders' funds showed a deficit of $19.4 million at the end of September, against $3.77 billion a year earlier. Borrowings stand at $4.2 billion against cash of $736 million. Net debt is therefore about $3.4 billion, barely changed since December.
The test on total borrowings returns at the end of December, and the ratio banks will measure stood at 6.1 times against a 6.75 limit. Interest cover of 2.3 times sits just above the required minimum. FMC told investors in October that it wants to discuss further changes with its lenders, and Sandifer said "we will prioritize liquidity".
What to watch: the leverage figure for December, reported in February, and any new agreement with the banks. Sandifer intends that "we intend to largely self-finance the seasonal working capital build in the first half of 2027", which leaves little room if the fourth quarter disappoints.
Risks this quarter didn't answer
Five standing worries got no resolution in these materials, and two of them moved the wrong way. Each needs a specific number or document before it can be settled, and February is the next chance.
- Latin American credit: the provision against unpaid bills reached $87.6 million, from $43.3 million in December, after FMC wrote off $92.6 million of older receivables
- Portland Harbor clean-up: FMC added $20 million to the reserve and calls a further $31 million reasonably possible
- Dilution: 30.3 million new shares went to Tessenderlo at $13.30 each, and the credit agreement bars buybacks until the end of 2028
- Approvals: Isoflex still awaits European registrations, the delay that cut short its 2025 launch
- New ingredient sales: neither the release nor the call gives the 2026 figure
👓 Other Themes
Two Write-Downs Deepened the Reported Loss
Two write-downs with no cash effect account for most of the reported loss. FMC set aside $808.8 million against deferred tax assets in the United States and Switzerland. It also cut $287.5 million from the carrying value of its Rynaxypyr brands, citing revised expectations for future results. Excluding those items and the pricing charges, the loss was about $299 million by our math.
💲 Other KPIs
The count rose 6% from a year ago, because the Tessenderlo shares only joined in late September. FMC assumes 156.0 million shares for the fourth quarter, a quarter more than the same period last year. Whatever the business earns from here spreads across more shares.
Up 15% from a year ago, the third straight quarter of increases. The secured notes FMC issued in June carry an 8% coupon, the dearest money on its balance sheet. Finance costs for the full year are planned at $270 million to $280 million, roughly $35 million above 2025.
FMC's own stock grew 9% since December while its dealers cut theirs. Half-finished product accounts for most of the rise. Inventory that builds as sales fall ties up cash, and clearing it needs either demand or the plant closures now under way.
🔮 Guidance
Cut. The middle of the range is flat against last year's fourth quarter. It also needs sales to jump 46% from the third quarter's underlying level, by our math. Recent years delivered a step of 13% to 17% from the third quarter to the fourth. FMC expects volume to offset a high-single-digit price decline.
Cut by $75 million at the middle, to a 22% decline against last year. The full-year outlook leaves almost exactly this range for the quarter, so nothing hides behind it. Lower prices and currency more than offset higher volumes and better costs, FMC said.
Cut roughly in half. The middle of the range is 48% below last year's fourth quarter. That is a steeper fall than the one in profit before interest and tax, because the share count has grown since the Tessenderlo investment.
Cut by $800 million at the middle, to a 28% decline for the year. The third-quarter charges explain most of the move, and weaker demand the rest. Nine-month sales excluding India came to $1.71 billion. This is the third reduction in four statements, and much the largest of them.
Cut from a profit to a loss. The middle of the range sits $764 million under the August figure, of which $672 million is the pricing charge. Excluding that charge the year still falls short of what FMC described in August. The fourth quarter now carries the entire remainder of the year.
Cut to a loss. The middle of the range is 221% below last year. On the official measure FMC has already lost $19.74 a share over nine months. The calculation assumes 135.2 million shares for the year, a count that climbs as the new shares count for longer.
Cut by $400 million at the middle. Sandifer gave four reasons: weaker third-quarter trading, a lower fourth-quarter profit plan, smaller collections and more restructuring spending. The range includes about $180 million of restructuring payments, so before those the year spans an outflow of $170 million to a small inflow.
Trimmed by $5 million at the middle, yet still some $35 million above 2025. Asset proceeds repaid short-term drawings earlier than assumed, and foreign borrowing costs fell. This is the only line of the outlook that moved in FMC's favour this quarter.
New figures, below the earlier path. Brondeau said "We expect 2027 to mark the beginning of a financial inflection for FMC". He sees the core portfolio growing in low single digits and the newer ingredients in the mid-teens. The middle of the range sits 14% under the path described at the start of this year, by our math.
New, and also below the earlier path. Brondeau expects more from the same drivers once the channel transition ends and the new factories run for a full year. He told investors that "a much larger branded business will benefit from the lower cost base". Even the top of this range sits under what FMC earned in 2024.
Raised by $500 million. Sandifer still expects nothing drawn on the revolving credit line at the year end, helped by the India and Delaware proceeds. The figure assumes the new cash range holds and that both sales complete on time. He also expects the company to meet its lending terms through 2027.
❓ Key Questions
What will new ingredient sales reach this year?
FMC last published a $300 million to $400 million target for fluindapyr, Isoflex and Dodhylex in May, and has not restated it. Without the number, nobody can check progress toward the $2 billion ambition for 2035.
How many dealers have accepted the new pricing terms?
Brondeau says early feedback is positive and the switch takes three quarters. A count of signed customers, or the share of channel stock already repriced, would show whether the charge bought real agreement.
How much cash will the price credits cost?
Sandifer says the credits spread over four to six quarters, with little falling in 2026. A quarterly figure would let readers separate the accounting charge from the cash it eventually consumes.
What replaced the $1.2 billion target for 2027?
FMC confirmed that target in 2025 and has not mentioned it since. The new range for the same year is roughly half as large, and nobody has explained the gap in public.
What sales base supports the 2027 profit range?
Brondeau gave a profit range for 2027 and an 18% to 19% margin assumption, but no sales range. The revenue figure behind it decides whether prices or volumes do the work.