July 25 (Reuters) - Dow on Tuesday posted a 70% drop in second-quarter profit on lower product prices and weak sales volumes, while warning that the macroeconomic environment would remain challenging in the second half of the year after.
Manufacturing activity in the United States and Europe continued to decline during the reported quarter as interest rate hikes from central banks forced customers to take a disciplined approach towards spending.
Dow said it was expecting third-quarter net sales in the range of $10.25 billion to $10.75 billion, lower than Wall Street's expectations of $12.37 billion in net sales.
Shares of the company fell 1.7% in premarket trading.
Exports from China in June fell the most in three years since the onset of the pandemic, pointing towards an ailing global economy.
Dow's net sales during the quarter fell to $11.4 billion from $15.7 billion, hinting at weak demand for its products that are used in everything from plastics and paints to building materials.
The company posted a net income of $501 million, or 68 cents per share, in the quarter, compared with $1.68 billion, or $2.26 per share, a year earlier.
Dow posted operating income of 75 cents per share, beating estimates by 5 cents, according to Refinitiv data, aided by its cost-saving efforts.
Dow, which said in January that it would cut jobs that would affect 5% of its workforce, said it was on track to deliver its cost-saving target for the year.
Reporting by Sourasis Bose in Bengaluru; Editing by Savio D'Souza and Anil D'Silva
Source: Reuters