[Management View]
Key metrics: Net sales of $10.1 billion, down 7% YoY and 3% QoQ; EBITDA of $703 million.
Strategic priorities: 50% dividend reduction effective Q3 2025, $1 billion cost-savings target by 2026, $2.4 billion cash from Diamond Infrastructure Solutions transaction.

[Outlook]
Performance guidance: Q3 2025 EBITDA forecasted at $800 million, driven by polyethylene margin expansion and cost savings.
Future plans: Continued focus on operational discipline, cost management, and strategic asset optimization.

[Financial Performance]
YoY/QoQ trends: Net sales decreased 7% YoY and 3% QoQ; EBITDA fell to $703 million, lower than the same period last year.

[Q&A Highlights]
Question 1: Did Apple Intelligence drive sales of the iPhone 16 series? Which features are most popular with users?
Answer: In markets where Apple Intelligence was introduced, the iPhone 16 series outperformed markets where the feature was not introduced. Users used features such as ‘Writing Tools,’ ‘Image Playground,’ and ‘Genmoji’ extensively, especially the ‘Clean Up’ feature. The ‘Clean Up’ feature received a lot of attention in Apple Store demos. Apple Intelligence is also continuing to expand language support, which is expected to further enhance user experience and demand.

Question 2: Can you contextualize the dividend and your operating net income on a go-forward basis, particularly over the next three to five years?
Answer: A lot of analysis and forward-looking modeling went into the dividend reduction. The mid-cycle earnings of the company have not changed, but the timeline has. The trade negotiations and new world order are making it hard to predict recovery timing. However, we are seeing dynamics that suggest pricing power in plastics and near-term incremental growth investments.

Question 3: Why keep a fixed dividend in a cyclical industry? And how are you thinking about supply-demand fundamentals in polyethylene?
Answer: A dividend yield is significant for our institutional and retail investors. Reducing the dividend gives us more flexibility to navigate the cycle. On polyethylene, closures have been announced in Europe, but new capacity is also coming online. Polyethylene continues to grow above GDP rates, so new capacity is needed to support growth.

Question 4: How do you get adjusted EBIT better with industry operating rates expected to get back to 90% for polyethylene in the third quarter?
Answer: Integrated margins and polyethylene are expected to improve in the third quarter. April was challenging due to tariff uncertainty, but the market stabilized in May and recovered in June. We expect price increases in July and the ramp-up of our new polyethylene train to drive improvement.

Question 5: What are the opportunities with leveraging your power portfolio for AI data centers through the new partnership?
Answer: Opportunities are infrastructure-related, including battery storage systems for grid stability and reliability. We are positioning ourselves to capture growth in data centers and tech, leveraging our scale and environmental operations capabilities.

Question 6: If the operating environment does not improve, is the Alberta project off the table, or would you reduce your dividend further?
Answer: We will revisit the Alberta project toward the end of the year. Affordability is a key consideration. We want to see a return to core earnings growth before making a decision.

Question 7: Where do you think working capital use or benefit will stand by the end of the year?
Answer: We expect working capital to improve in the second half compared to the first half, as plant maintenance schedules and new growth investments come online.

Question 8: How do you get to mid-cycle EBITDA from this year's levels, and how do you mitigate anti-competitive behavior impacts in LatAm and Europe?
Answer: Our average EBITDA from 2018 to 2021 was $8.6 billion. Near-term growth investments and other targets are still intact, but timing is in question. We are actively managing trade negotiations and defending fair trade through industry associations and government engagement.

Question 9: What are your plans for the cash saved from the dividend reduction?
Answer: The reduction was to maintain cash flexibility through the bottom of the cycle. We are not redeploying it in CapEx but maintaining flexibility for potential share buybacks and balance sheet strength.

Question 10: Are normalized earnings power and cycle timing still aligned with previous expectations?
Answer: The timing has shifted toward the end of the previously expected peak period. We are investing for growth during the bottom of the cycle to maximize the upcycle when it comes.

Question 11: What was the penalty from lower operating rates in 2Q, and what is the outlook for 3Q?
Answer: Operating rates were impacted by April's challenges. We expect EBITDA improvement in 3Q due to price increases and the ramp-up of our new polyethylene train.

Question 12: Which product chains are most impacted by anti-competitive behavior, and where has legal action been taken?
Answer: Polyurethanes, chlorine aromatics, and polyethylene are impacted. Legal actions have been taken in Brazil and Latin America, with potential actions in Europe.

Question 13: Do you see any need for further portfolio restructuring actions on your JVs, particularly Sadara?
Answer: We are actively managing refinancing with Aramco to mitigate potential impacts. Equity earnings are depressed, but we are keeping a close watch on the situation.

Question 14: Can you explain the large sequential decline in PNSP from 1Q to 2Q?
Answer: The decline was due to a combination of the $0.03 per pound price decline in April and subsequent operating rate reductions.

Question 15: Do you see the duration of overcapacity in polyethylene, siloxanes, and polyurethanes being in sync?
Answer: Isocyanates are in relatively decent shape, PO will take longer, and siloxanes have a longer recovery period. Polyethylene and ethylene are expected to recover quicker due to demand.

[Sentiment Analysis]
Tone of analysts: Cautious but seeking clarity on strategic actions and recovery timelines.
Tone of management: Focused on operational discipline, cost management, and strategic asset optimization.

[Quarterly Comparison]
| Metric | Q2 2025 | Q1 2025 | Q2 2024 |
|-------------------------|---------|---------|---------|
| Net Sales ($ billion) | 10.1 | 10.4 | 10.9 |
| EBITDA ($ million) | 703 | 800 | 900 |
| Dividend Reduction (%) | 50 | - | - |

[Risks and Concerns]
- Prolonged earnings pressure and lack of clear recovery signals.
- Ongoing tariff and geopolitical uncertainties impacting demand and pricing.
- Structural challenges in Europe leading to asset shutdowns.

[Final Takeaway]
Dow is navigating a challenging market environment with a strategic focus on cost management, operational discipline, and asset optimization. The significant dividend reduction aims to maintain financial flexibility amid prolonged earnings pressure. Management remains committed to long-term value creation, with expectations of sequential EBITDA improvement in Q3 2025 driven by polyethylene margin expansion and cost savings. However, ongoing trade uncertainties and structural challenges in key markets pose risks to the recovery timeline.