Westlake shares jumped 15.4% to $80.63 at the latest close. The move sits beside a three-month filing that reports an improvement in results: revenue rose 10.8% to $3.3 billion, while the company went from a $142 million net loss to $260 million of net income.
The more revealing number is gross profit. It rose 153% to $652 million, lifting gross margin to 19.9% from 8.7% a year earlier. Westlake went from losing money on operations to producing $364 million of operating income.
Management attributes that reversal primarily to higher prices, along with selected volume gains and lower feedstock costs. The company disclosed that polyethylene and PVC resin prices rose, while volumes increased for pipe and fittings, caustic soda, epoxy resin, and ACI-related compounds.
"The increase in gross profit margin in the second quarter of 2026, as compared to the second quarter of 2025 was primarily due to higher sales prices for polyethylene and PVC resin, and higher sales volumes for pipe and fittings, caustic soda, and epoxy resin, ACI related compounds sales volumes, and lower fuel and ethane feedstock costs."
Westlake, 10-Q, Aug. 5, 2026
That makes the margin recovery less mysterious, but not necessarily simpler. Westlake’s annual results have shown sharp swings. The latest annual period had revenue of $11.2 billion and an operating margin of -14.1%.
Cash supplies the counterweight. Westlake ended the latest reported period with $1.6 billion, down from $2.1 billion a year earlier. The filing also says capital-spending intensity declined and free-cash-flow margin improved. It separately identifies financing as a significant cash use.
"Financing Activities Net cash used for financing activities during the first six months of 2026 as compared to first six months of 2025 increased by $507 million, which was primarily due to the redemption of $496 million aggregate principal amount of outstanding 3.60% 2026 Senior Notes in May 2026."
Westlake, 10-Q, Aug. 5, 2026
So the cash balance and the income statement are describing different things. The business generated a much larger profit in the three months ended June 30, while Westlake also used cash to retire debt. The filing also reports that inventory rose 1.3% and accounts receivable rose 6.7%, alongside the financing disclosure.
A separate data point is that over the six months ended June 30, sales volumes decreased 1%, even as average sales prices increased 3%. Westlake said the volume decline reflected lower PVC resin, chlorine, caustic soda, styrene, and building-products sales, partly offset by stronger pipe, fittings, polyethylene, and ACI-related compounds volumes.
Westlake’s next quarterly report will put the open question in one place: whether the stronger margin and free-cash-flow conversion persist.
The comparison therefore shows both a return to profitability and higher commodity prices among the disclosed drivers, while cash remains lower.