Solstice boosts annual forecasts as AI-linked demand drives quarterly beat

By Pooja Menon

Nov 4 (Reuters) - Solstice ‌Advanced Materials raised ​its ​2026 forecasts on Wednesday after strong demand from data centers for its nuclear, refrigerant and electronic materials and higher prices ‌helped it surpass third-quarter estimates.

Surging investment in AI infrastructure and ⁠more complex chips are boosting demand for the specialty material maker's products used in ‌cooling systems, high-performance computing ‌and nuclear power generation.

Sales of electronic materials rose over 31% to $135 million in the third quarter. Refrigerant sales increased 8.3% to $433 million, supported ​by automotive and data center cooling applications, while backlog in its nuclear business is now at $2.6 billion.

CEO David Sewell told Reuters that ⁠although geopolitical tensions have increased the cost of diesel and sulfur, the impact on Solstice remained ​immaterial given its limited exposure to the Middle East and its ability to hike prices.

Solstice, spun off from Honeywell ​last year, agreed with peer Element ‌Solutions to shelve their $14.5 billion merger in August, citing preference of both sets of shareholders to retain their independence.

The ⁠company's third-quarter net sales rose 8% to $1.05 billion.

It posted adjusted profit per share of 80 cents for the three months ended September 30, beating analysts' estimate ⁠of 69 cents, according to data compiled by LSEG.

Sewell also said the company was ​talking to customers about conditional orders tied to the expansion of its uranium conversion plant in Illinois. This would address a potential shortage of uranium hexafluoride in ‌the US through 2030, he said.

Shares were up 2.3% in premarket trading.

Solstice raised the lower end of its ‌2026 adjusted earnings per share forecast range to $2.90 from $2.75, while retaining the ⁠upper end at $2.95.

The company expects ‌annual net sales between $4.20 ​billion and $4.22 billion, compared with a prior forecast of $4.13 billion to $4.19 billion.

(Reporting by Pooja Menon in Bengaluru; Editing by ‌Sahal Muhammed)

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