The Saudi Basic Industries Corporation (SABIC) returned to profitability in the third quarter of 2026, reporting a net profit of $133 million (SAR 499 million), compared to $116 million (SAR 434 million) in the same period last year.
The improvement was driven by higher selling prices for its products and stronger results from investments in affiliates and joint ventures, despite ongoing geopolitical challenges and pressure on supply chains.
Financial results for the third quarter of 2026, showed that revenue increased 14% quarter on quarter to $7.51 billion (SAR 28.17 billion), up 13.5% compared to the second quarter, when revenue totaled $6.62 billion (SAR 24.81 billion).
However, it reported a 3.1% year-over-year revenue decline, from $7.75 billion (SAR 29.08 billion) in the third quarter of 2025.
Improved Adjusted EBITDA
SABIC highlighted an Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of $1.27 billion (SAR 4.75 billion), an increase of 40% Q-o-Q.
Meanwhile, the company registered an Adjusted EBIT (Earnings Before Interest and Taxes) of $579 million (SAR 2.17 billion), an increase of 434% Q-o-Q, in addition to an Adjusted Net Income of $222 million (SAR 840 million).
SABIC attributed the improvement in its Q3 results to a $153 million (SAR 575 million) increase in gross profit, in addition to a $432 million (SAR 1.62 billion) improvement in results from non-integrated joint ventures and associates mainly due to the reversal of impairment losses on listed equity investments in Europe following an increase in share prices.
These positive factors were partially offset by losses related to discontinued operations amounting to around $263 billion (SAR 985 million) in relation to the reclassification of foreign currency translation from equity to the income statement following the successful completion of the sale of SABIC's thermoplastics engineering businesses in North America, South America and Europe as part of the company's portfolio optimization program.
Also, net financial results declined by around $95 million (SAR 358 million,) mainly due to the fair-value valuation of derivative instruments recognized in equity in the corresponding quarter of the previous year, which are non-cash in nature.
9-Month Losses Narrow
The net loss for the nine months of 2026 narrowed to around $85 million (SAR 320 million), compared with a net loss of $1.29 billion (SAR 4.84 billion) for the corresponding period of 2025.
SABIC recorded a revenue of $21.10 billion (SAR 79.13 billion) for the first nine months of 2026, marking a 10.7% decrease compared to the $23.62 billion (SAR 88.57 billion) reported during the same period in 2025.
It also reported year-on-year declines in gross profit to $4.24 billion (SAR 15.91 billion), compared with $4.57 billion (SAR 17.12 billion) a year earlier.
Operating profit fell to $1.13 billion (SAR 4.22 billion), from $1.40 billion (SAR 5.25 billion).
SABIC said the narrower net loss was primarily attributable to an $819 million (SAR 3.07 billion) reduction in losses from discontinued operations, alongside a $648 million (SAR 2.43 billion) improvement in results from joint ventures and associates.
It then reported an increase of a $333 million (SAR 1.25 billion) in selling and distribution expenses during the first nine months of 2026 compared to the same period in the previous year, as well as a $323 million (SAR 1.21 billion) decline in gross profit, driven by lower sales volumes.
Focus on Operational Efficiency
SABIC reaffirmed its commitment to operational efficiency, portfolio optimization and selective growth, while maintaining the operational flexibility needed to navigate geopolitical and logistical challenges, according to its earnings statement.
“In Q3 2026, Sabic demonstrated exceptional resilience, despite geopolitical developments and market headwinds, coupled with a clear and robust forward-looking vision and continued focus on strategic objectives, namely portfolio optimization, transformation and selective growth, in efforts to support the company’s long-term profitability and value creation for shareholders, building on its historic journey of more than five decades,” said Sabic chief executive Faisal M Alfaqeer.
In terms of cash flow, net cash generated from operating activities after capital expenditure reached approximately $1.50 billion (SAR 5.61 billion) in the first nine months of the year, compared with around $1.05 billion (SAR 3.94 billion) in the same period in 2025.
The company cut its full-year capital expenditure guidance to between $3 billion and $3.3 billion from its previous estimate of $3.5 billion and $4 billion, according to its latest presentation.
