Dow misses quarterly profit estimates, plans to cut 2,000 jobs

Dow misses quarterly profit estimates, plans to cut 2,000 jobs

(Reuters) – Chemicals giant Dow Inc on Thursday missed Wall Street estimates for fourth-quarter profit, hurt by higher energy costs, weaker demand and supply chain disruptions and said it would cut about 2,000 jobs globally.

Dow has seen its production costs rise in recent quarters due to higher energy costs and supply chain issues following Russia‘s invasion of Ukraine as well as China’s COVID-led lockdowns.

Prices of U.S. natural gas, a key input in manufacturing chemicals, averaged $6.10 per million metric British thermal units (mmBtu) during the October-December quarter, nearly 26% higher from the previous year.

Supply chain disruptions in other sectors have also affected demand for Dow, which sells its chemicals to industries ranging from automobiles and food packaging to electronics.

Dow said it plans to achieve $1 billion in cost savings in 2023, while it deals with near-term macroeconomic uncertainty.

The Midland, Michigan-based company posted operating income of 46 cents per share, missing analysts average expectation of 58 cents per share, according to Refinitiv IBES data.