Air Products and Chemicals, Inc.

On-site supply contracts representing roughly 49% of FY2025 revenue carry 15-20 year take-or-pay terms and have historically achieved renewal rates above 95%. The merchant gas business adds repeat-purchase dynamics but is more sensitive to industrial activity levels, moderating overall forward visibility below what a predominantly recurring revenue base would provide.

Air Products concentrates almost entirely in industrial gases including atmospheric gases, hydrogen, and helium, with no meaningful presence in packaged gases, chemistry distribution, or engineering services that peers such as Linde operate. Revenues span multiple gas types and customer industries but remain exposed to the same broad industrial production cycle.

The Americas segment contributed approximately $5.1 billion of FY2025 revenue, representing roughly 42% of total, while Asia and Europe/Middle East/India each contribute meaningfully. The company operates in over 50 countries, but the Americas' share slightly exceeds the threshold that would indicate a fully balanced global footprint.

Industrial gas is asset-intensive; each new ton of capacity requires dedicated plant construction with significant upfront capital, limiting operating leverage relative to capital-light models. Within the existing on-site footprint, once plants are built and contracted, incremental gas production carries low marginal cost and sustains the company's industry-leading adjusted EBITDA margin above 40%.

The on-site segment delivers gases that are mission-critical to customers' continuous manufacturing processes, with take-or-pay commitments that typically run two decades. The roughly half of revenue from merchant and equipment channels is more transactional and volume-sensitive, keeping overall quality above average but short of a predominantly contractual revenue base.