- Company name
- Air Products
- Sector
- Industrial gases
- About
- Air Products makes and sells industrial gases, such as oxygen, nitrogen, argon, hydrogen and helium. It builds large plants next to customer sites, such as refineries, chemical plants and semiconductor factories, and supplies them under long-term contracts. It also delivers gases in liquid form by truck and in cylinders to smaller customers. It makes money from these contracts and from the price of the gases, and many on-site contracts pass energy costs through to the customer. It reports segments by region: Americas, Asia, Europe, and Middle East and India. In fiscal 2026, which ended on September 30, 2026, sales were $13.0 billion and adjusted EPS was $13.45. It owns one third of the NEOM Green Hydrogen Project in Saudi Arabia, which it consolidates.
- Thesis
- Air Products trades at a discount because investors doubt the returns on its large clean hydrogen investments. In fiscal 2025, it recorded about $3.7 billion of pre-tax charges for business and asset actions. On June 30, 2026, it stopped the Louisiana Clean Energy Complex and a liquid hydrogen plant in Arizona, with up to $2.9 billion of more pre-tax charges, because the expected returns were too low. The NEOM project in Saudi Arabia is still open: Air Products is to be the only buyer of up to 1.2 million metric tons a year of renewable ammonia, and it must sell this product into a market that is not yet proven. These projects also raised debt to $17.8 billion at September 30, 2026. Capital spending fell to $3.3 billion in fiscal 2026 from $5.1 billion, but Air Products expects $3.0 to $3.5 billion in fiscal 2027, so it does not fall further yet. In Q4 fiscal 2026, Air Products also recorded $224.5 million of pre-tax charges for two coal gasification plants in China. For the gap to close, NEOM must start commercial production in 2027 and sell its ammonia at prices that cover its costs, capital spending must fall toward about $1.5 billion a year for industrial gas projects, and free cash flow must rise. The core business must also keep growing: adjusted EPS grew 12% to $13.45 in fiscal 2026, and Air Products expects $14.15 to $14.50 in fiscal 2027. The next test is the Q1 fiscal 2027 report, estimated for about February 5, 2027. The main test is the start of NEOM production in 2027. If capital spending falls and NEOM sells its ammonia, the gap can close over the next four to six quarters. The main risk is that NEOM ammonia sells at low prices and causes more write-downs.
- Risks
- Air Products is to be the only buyer of up to 1.2 million metric tons a year of renewable ammonia from NEOM, which is expected to start production in 2027. The market for green ammonia is not yet proven. If prices are low, Air Products can lose money on this product and record more charges.
Air Products recorded about $3.7 billion of pre-tax charges in fiscal 2025 and about $3.2 billion in fiscal 2026, mostly for projects it stopped and for two coal gasification plants in China. More exits can bring more charges and lower confidence in how management selects projects.
Debt was $17.8 billion at September 30, 2026, after years of high capital spending. Higher interest rates raise the cost of new debt, and high debt limits the cash for dividends and new projects until capital spending falls.
Merchant gas sales and helium depend on industrial activity. A slowdown in manufacturing can lower volumes and prices.
- Balance sheet
- Cash: $1.3B
Debt: $17.8B
Net debt: $16.4B
Debt due within 12 months: $999M
At September 30, 2026, Air Products had $1.33 billion of cash and $17.8 billion of debt. Debt was $77.0 million of short-term borrowings, $921.7 million of current long-term debt, $16.6 billion of long-term debt and $172.4 million of long-term debt to a related party. Air Products consolidates the NEOM joint venture, in which it owns one third, and the project financing of this joint venture does not give lenders a claim on Air Products. Interest expense was $220.4 million in fiscal 2026. In fiscal 2026, operating cash flow was $4.68 billion, capital spending was $3.3 billion and dividends were $1.60 billion. Air Products expects capital spending of $3.0 to $3.5 billion in fiscal 2027.
As of Sep 30, 2026.
- Checkpoints
- Nov 5, 2026: Q4 fiscal 2026 results and fiscal 2027 guidance. Failed. Watch: Fiscal 2026 adjusted EPS within $13.39 to $13.49, fiscal 2027 guidance with EPS growth and lower capital spending, and a final Yara agreement pass; new project charges or higher capital spending fail. Outcome: Adjusted EPS of $13.45 and the fiscal 2027 guidance of $14.15 to $14.50 met the test, but Air Products recorded $224.5 million of new charges for its China plants and expects fiscal 2027 capital spending of $3.0 to $3.5 billion, near the $3.3 billion of fiscal 2026.
Feb 5, 2027 (estimate): Q1 fiscal 2027 earnings. Pending. Watch: Adjusted EPS within the $3.35 to $3.45 guidance and the fiscal 2027 guidance of $14.15 to $14.50 kept pass; adjusted EPS below the range, a cut to the guidance or new project charges fail.
2027 (estimate): NEOM commercial production starts. Pending. Watch: Commercial production in 2027 with signed buyers for the ammonia passes; a delay or ammonia sales at a loss fails.
- Recent events
- Nov 5, 2026: Air Products reported Q4 fiscal 2026 results. Sales were $3.6 billion, up 12%, and adjusted EPS was $3.61, up 6%. For fiscal 2026, adjusted EPS was $13.45, up 12%, and capital spending was $3.3 billion, down $1.8 billion. Q4 GAAP results include $224.5 million of pre-tax charges for two coal gasification plants in China, one of which it sold in October 2026. Air Products expects fiscal 2027 adjusted EPS of $14.15 to $14.50 and capital spending of $3.0 to $3.5 billion.
Oct 6, 2026: Air Products said that it will report Q4 fiscal 2026 results and hold a call on November 5, 2026, at 8:00 a.m. Eastern time.
Jul 30, 2026: Air Products reported Q3 fiscal 2026 results. Sales were $3.16 billion, up 5%, with volumes up 3% and prices up 1%. Adjusted EPS was $3.47, up 12%. GAAP EPS was a loss of $6.47, because of about $2.9 billion of pre-tax project exit charges. The company raised its fiscal 2026 adjusted EPS guidance to $13.39 to $13.49 and lowered its fiscal 2026 capital spending to about $3.5 billion, from about $4.0 billion. Its Taiwan business, Air Products San Fu, agreed to build four air separation units for a semiconductor expansion.
Jun 30, 2026: Air Products said that it will not continue the Louisiana Clean Energy Complex, because the expected returns did not meet its criteria. It also stopped a liquid hydrogen plant in Casa Grande, Arizona, and some smaller projects, with pre-tax charges of up to $2.9 billion. It said that it is finalizing an agreement with Yara for renewable ammonia from NEOM, where Air Products is to be the only buyer of up to 1.2 million metric tons a year. The NEOM plant was more than 90% complete, with commercial production expected in 2027.
Apr 30, 2026: Air Products reported Q2 fiscal 2026 results. Sales were $3.2 billion, up 9%, and adjusted EPS was $3.20, up 19%. It raised its fiscal 2026 adjusted EPS guidance to $13.00 to $13.25. Samsung selected Air Products to build and operate gas supply facilities for a new semiconductor factory in South Korea.