Dow Implements $1 Billion Cost-Saving Strategy Amid Economic Challenges and Sales Decline

### Dow Implements Strategic Cost-Saving Measures Amid Economic Uncertainty

Dow Inc., a prominent player in the materials science sector, announces targeted actions aimed at achieving $1 billion in cost savings to bolster its financial stability in the face of ongoing macroeconomic challenges. The company experiences a decline in net sales for the fourth quarter of 2024, totaling $10.4 billion, a drop of 2% year-over-year attributed primarily to seasonal downturns in the Performance Materials & Coatings segment. CEO Jim Fitterling highlights the need for these measures to navigate the slower-than-expected recovery and to remain competitive across economic cycles.

To realize these savings, Dow plans a significant reduction in direct costs, estimating cuts between $500 million and $700 million, primarily through decreased expenditures on purchased services and third-party contract labor. Additionally, the company announces a workforce reduction of approximately 1,500 roles globally, which is expected to lead to a notable decrease in labor costs. Despite the challenging nature of these decisions, Fitterling emphasizes their necessity to ensure the company's long-term growth objectives are met. The restructuring will incur a charge of $250 million to $325 million in the first quarter of 2025, largely covering severance and related benefits.

These actions come in light of Dow's overall financial results, which reflect a decline in cash from operating activities down to $2.9 billion for 2024, significantly lower than the previous year's $5.2 billion. The company's strategy focuses on high-growth markets such as packaging, infrastructure, mobility, and consumer applications, reinforcing its commitment to sustainability and innovation. As Dow moves forward, it vows to engage local stakeholders and adhere to regional regulations during the implementation of these cost-saving measures.

In other relevant news, Dow reports a decline in equity losses related to its Thai joint ventures, dropping from $95 million the previous year to $51 million this quarter. While the company faces challenges with local prices falling by 3% across all operating segments, its commitment to returning value to shareholders remains steadfast, with $492 million returned in dividends during the latest quarter. Dow continues to prioritize its long-term vision of being the most customer-centric materials science company, focusing on sustainable solutions and operational efficiency.