Dow launches Transform to Outperform to raise the competitive industry benchmark for productivity and growth to enable improved returns

Rhea-AI Summary

Dow (NYSE: DOW) announced Transform to Outperform, a company-wide simplification and productivity program targeting at least $2 billion of near-term Op. EBITDA uplift and building on a prior $1 billion cost savings program. The plan expects $1.1–1.5 billion of one-time costs, including $600–800 million severance for about 4,500 roles.

A phased timeline targets $500M in-year for 2026, $1.2B incremental in 2027, and $300M incremental in 2028; estimated cash costs peak in 2026.

Positive

• Targeted near-term Op. EBITDA uplift of $2 billion
• 2027 incremental Op. EBITDA target of $1.2 billion
• Plan builds on prior $1 billion cost savings program

Negative

• One-time implementation costs estimated at $1.1–1.5 billion
• Severance of $600–800 million for ~4,500 roles
• Estimated 2026 cash cost of $800–1,000 million

News Market Reaction

-2.23%

6 alerts

-2.23% News Effect

-2.8% Trough in 1 hr 31 min

-$450M Valuation Impact

$19.75B Market Cap

0.1x Rel. Volume

On the day this news was published, DOW declined 2.23%, reflecting a moderate negative market reaction. Argus tracked a trough of -2.8% from its starting point during tracking. Our momentum scanner triggered 6 alerts that day, indicating moderate trading interest and price volatility. This price movement removed approximately $450M from the company's valuation, bringing the market cap to $19.75B at that time.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Target Op. EBITDA uplift: $2 billion One-time program costs: $1.1–1.5 billion Severance costs: $600–800 million +5 more

8 metrics

Target Op. EBITDA uplift $2 billion Near-term improvement targeted under Transform to Outperform

One-time program costs $1.1–1.5 billion Estimated total one-time costs for Transform to Outperform

Severance costs $600–800 million Severance for approximately 4,500 Dow roles

Other one-time costs $500–700 million Additional one-time costs tied to transformation actions

Role reductions 4,500 roles Approximate number of Dow positions affected by severance

2026 Op. EBITDA uplift $500 2026 in-year Op. EBITDA target uplift ($MM) from program

2027 Op. EBITDA uplift $1,200 2027 incremental Op. EBITDA target uplift ($MM)

2028 Op. EBITDA uplift $300 2028 incremental Op. EBITDA target uplift ($MM)

Market Reality Check

Price: $27.55 Vol: Volume 17,727,021 is 1.58...

high vol

$27.55 Last Close

Volume Volume 17,727,021 is 1.58x the 20-day average of 11,237,582, indicating elevated trading ahead of this announcement. high

Technical Shares trade above the 200-day moving average of 25.57, with a pre-news price of 27.78 and a modest -0.11% move over 24 hours.

Peers on Argus

Pre-news moves in key chemicals peers were mixed: CE -2.39%, OLN -1.9%, LYB -0.5...

Pre-news moves in key chemicals peers were mixed: CE -2.39%, OLN -1.9%, LYB -0.55%, IFF -1.9%, while MEOH rose 2.4%. This pattern does not point to a unified sector rotation around DOW’s transformation update.

Historical Context

5 past events · Latest: Jan 15 (Neutral)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Jan 15	Management promotion	Neutral	-1.1%	Bank peer announced promotion of its Chief Credit Officer to Executive Vice President.
Jan 13	CEO appointment	Neutral	+0.2%	Valtris Specialty Chemicals named a new Chief Executive Officer effective immediately.
Nov 10	AI collaboration	Positive	-0.8%	Kyndryl expanded its AI and automation-driven application modernization collaboration with Dow.
Oct 23	Quarterly earnings	Neutral	+12.9%	Dow reported 3Q25 results with lower sales and EBIT but stronger cash generation and support.
Oct 09	Dividend declaration	Positive	-6.5%	Dow declared a $0.35 quarterly dividend, marking its 457th consecutive distribution.

Pattern Detected

Past DOW-related news shows mixed alignment: positive strategic or dividend updates have sometimes seen negative next-day moves, while one earnings report coincided with a strong gain.

Recent Company History

Recent history for DOW includes an earnings report on Oct 23, 2025 where shares rose 12.95% despite year-over-year sales and EBIT pressure, and a dividend declaration on Oct 9, 2025 followed by a -6.48% move. A Nov 10, 2025 collaboration with Kyndryl on AI and automation coincided with a modest decline. Compared with those events, today’s large-scale productivity and cost-structure program extends the earlier AI-driven efficiency focus but on a broader, company-wide scale.

Market Pulse Summary

This announcement outlines a large-scale productivity and growth program targeting at least $2 billi...

Analysis

This announcement outlines a large-scale productivity and growth program targeting at least $2 billion in near-term Op. EBITDA uplift, offset by $1.1–1.5 billion in one-time costs and reductions of about 4,500 roles. It extends prior AI and automation initiatives into a broader operating-model reset. Investors may watch how phased EBITDA targets for 2026–2028, cost delivery, and any follow-on updates compare with historical earnings and cash-flow milestones.

Key Terms

op. EBITDA, ai, automation

3 terms

op. EBITDA financial

"Targeting at least $2 billion near-term Op. EBITDA improvement Actions aim to radically"

Operating EBITDA is a measure of a company’s profit from its regular business before interest, taxes, depreciation and amortization, stripped of one-time gains or costs. Think of it like the cash-generating power of a store’s everyday sales and expenses, not including seasonal windfalls or repair bills; investors use it to compare how well core operations perform over time and across companies without noise from financing or unusual events.

ai technical

"in part by utilizing AI and automation to deliver step change in growth and"

Artificial intelligence (AI) is technology that enables machines to mimic human thinking and learning, allowing them to analyze information, recognize patterns, and make decisions. For investors, AI matters because it can improve how businesses operate, create new products, or identify opportunities faster and more accurately than humans alone, potentially impacting company success and market trends.

automation technical

"in part by utilizing AI and automation to deliver step change in growth and"

Automation is the use of technology to perform tasks with minimal human intervention, often replacing manual work with machines or software. It matters to investors because it can increase efficiency, reduce costs, and enable faster decision-making, potentially leading to higher profits and competitive advantages for businesses.

AI-generated analysis. Not financial advice.

• Targeting at least $2 billion near-term Op. EBITDA improvement
• Actions aim to radically simplify the Company's operating model, streamline its processes, reset its cost structure and modernize how it serves customers
• Benefits will be accretive to 2025 earnings levels and Dow's previously announced $1 billion cost savings program

MIDLAND, Mich., Jan. 29, 2026 /PRNewswire/ -- Dow (NYSE: DOW) today announced a comprehensive plan to simplify how it operates and streamline its end-to-end processes. The Company will also reset its cost structure and modernize how it serves customers. Transform to Outperform targets the addition of at least $2 billion in near-term Op. EBITDA, in part by utilizing AI and automation to deliver step change in growth and productivity and improve shareholder returns.

A simpler, more efficient Dow
"The goal of Transform to Outperform is to achieve significant growth and productivity gains that elevate Dow's competitive position," said Karen S. Carter, Dow's chief operating officer. "We are building on the momentum of our current self-help measures – transforming Dow into a company that is more resilient, consistently delivers growth, enables customer success, and delivers greater shareholder value across the cycle."

Key transformation goals & benefits
This work represents an ongoing intensive, company-wide analysis and Dow has established a dedicated internal team to guide the transformation. The Company expects to provide at least $2 billion in near-term Op. EBITDA uplift. Dow's current projections are that approximately two thirds of the benefits will be from productivity improvements and one third from growth.

The Company anticipates ~$1.1-1.5 billion in one-time costs associated with Transform to Outperform, including ~$600-800 million in severance for ~4,500 Dow roles and ~$500-700 million in other one-time costs.

Year	Target Op. EBITDA ($MM)	Est. Cash Cost to Achieve ($MM)
2026	$500 in-year	$800-1,000 in-year
2027	$1,200 incremental	$300-500 in-year
2028	$300 incremental	$0

A commitment to long-term strength and competitiveness
"Transform to Outperform will drive significant simplification in how work gets done, aimed at ensuring Dow's continued global leadership," said Jim Fitterling, Dow chair and CEO. "By leveraging best-in-class, cross-industry processes and leading-edge technologies, this work will further accelerate measures we have already taken to address the prolonged trough and structural industry challenges. Our efforts will build on Dow's strong focus on safe and reliable operations while driving increased accountability and continuous improvement. This work aims to deliver improved growth, productivity and shareholder returns."

As Dow implements the actions announced today, the Company will engage local stakeholders in each region and in compliance with local regulations and consultation processes.

About Dow

Dow (NYSE: DOW) is one of the world's leading materials science companies, serving customers in high-growth markets such as packaging, infrastructure, mobility and consumer applications. Our global breadth, asset integration and scale, customer-focused innovation and leading business positions enable us to achieve profitable growth and help deliver a sustainable future. We operate manufacturing sites in 29 countries and employ approximately 34,600 people. Dow delivered sales of approximately $40 billion in 2025. References to Dow or the Company mean Dow Inc. and its subsidiaries. Learn more about us at www.dow.com.

For further information, please contact:

Investors: Andrew Riker ajriker@dow.com

Media: Sarah Young syoung3@dow.com

X: https://twitter.com/DowNewsroom 
Facebook: https://www.facebook.com/dow/ 
LinkedIn: http://www.linkedin.com/company/dow-chemical 
Instagram: http://instagram.com/dow_official 

Cautionary Statement about Forward-Looking Statements

Certain statements in this press release are "forward-looking statements" within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements often address expected future business and financial performance, financial condition, and other matters, and often contain words or phrases such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "opportunity," "outlook," "plan," "project," "seek," "should," "strategy," "target," "will," "will be," "will continue," "will likely result," "would" and similar expressions, and variations or negatives of these words or phrases.

Forward-looking statements are based on current assumptions and expectations of future events that are subject to risks, uncertainties and other factors that are beyond Dow's control, which may cause actual results to differ materially from those projected, anticipated or implied in the forward-looking statements and speak only as of the date the statements were made. These factors include, but are not limited to: sales of Dow's products; Dow's expenses, future revenues and profitability; any sanctions, export restrictions, supply chain disruptions or increased economic uncertainty related to the ongoing conflicts between Russia and Ukraine and in the Middle East; capital requirements and need for and availability of financing; unexpected barriers in the development of technology, including with respect to Dow's contemplated capital and operating projects; Dow's ability to realize its commitment to carbon neutrality on the contemplated timeframe, including the completion and success of its integrated ethylene cracker and derivatives facility in Alberta, Canada; size of the markets for Dow's products and services and ability to compete in such markets; Dow's ability to develop and market new products and optimally manage product life cycles; the rate and degree of market acceptance of Dow's products; significant litigation and environmental matters and related contingencies and unexpected expenses; the success of competing technologies that are or may become available; the ability to protect Dow's intellectual property in the United States and abroad; developments related to contemplated restructuring activities and proposed divestitures or acquisitions such as workforce reduction, manufacturing facility and/or asset closure and related exit and disposal activities, and the benefits and costs associated with each of the foregoing; fluctuations in energy and raw material prices; management of process safety and product stewardship; changes in relationships with Dow's significant customers and suppliers; changes in public sentiment and political leadership; increased concerns about plastics in the environment and lack of a circular economy for plastics at scale; changes in consumer preferences and demand; changes in laws and regulations, political conditions, tariffs and trade policies, or industry development; global economic and capital markets conditions, such as inflation, market uncertainty, interest and currency exchange rates, and equity and commodity prices; business, logistics, and supply disruptions; security threats, such as acts of sabotage, terrorism or war, including the ongoing conflicts between Russia and Ukraine and in the Middle East; weather events and natural disasters; disruptions in Dow's information technology networks and systems, including the impact of cyberattacks; risks related to Dow's separation from DowDuPont Inc. such as Dow's obligation to indemnify DuPont de Nemours, Inc. and/or Corteva, Inc. for certain liabilities; and any global and regional economic impacts of a pandemic or other public health-related risks and events on Dow's business.

Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. A detailed discussion of principal risks and uncertainties which may cause actual results and events to differ materially from such forward-looking statements is included in the section titled "Risk Factors" contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, and the Company's subsequent reports filed with the U.S. Securities and Exchange Commission. These are not the only risks and uncertainties that Dow faces. There may be other risks and uncertainties that Dow is unable to identify at this time or that Dow does not currently expect to have a material impact on its business. If any of those risks or uncertainties develops into an actual event, it could have a material adverse effect on Dow's business. Dow Inc. and The Dow Chemical Company and its consolidated subsidiaries assume no obligation to update or revise publicly any forward-looking statements whether because of new information, future events, or otherwise, except as required by securities and other applicable laws.

^®TM Trademark of The Dow Chemical Company or an affiliated company of Dow

 

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SOURCE The Dow Chemical Company

FAQ

What is Dow's Transform to Outperform and its Op. EBITDA target (DOW)?

Transform to Outperform is a company-wide simplification program targeting at least $2 billion near-term Op. EBITDA. According to the company, benefits will come about two-thirds from productivity and one-third from growth, and will be accretive to 2025 earnings levels.

How much will Transform to Outperform cost and include severance for DOW?

Total one-time costs are estimated at $1.1–1.5 billion, including $600–800 million in severance for ~4,500 roles. According to the company, other one-time charges are expected to total roughly $500–700 million of that range.

What is the 2026–2028 Op. EBITDA timeline for Dow's program (DOW)?

The plan targets $500M in-year for 2026, $1.2B incremental in 2027, and $300M incremental in 2028. According to the company, cash costs are front-loaded, with the largest spend expected in 2026.

How will Transform to Outperform drive growth and productivity at Dow (DOW)?

The initiative uses AI, automation, and process simplification to drive step-change productivity and growth. According to the company, it will simplify operating models, streamline end-to-end processes, and modernize customer service to improve returns.

Will Transform to Outperform affect Dow's prior cost savings commitment (DOW)?

Yes. The program is designed to be accretive to 2025 earnings and builds on Dow's previously announced $1 billion cost savings program. According to the company, Transform to Outperform extends and accelerates those measures.