Owens Corning Insulation Tops Growth Driven by Nonres; Nephi Restart Planned for Q4 2026

Owens Corning (OC) Insulation: Granular view of volume strength and Nephi restart timing/longer-term plan

1) Insulation top-line strength: where the volume came from

Management characterized the Insulation volume strength as “high single digits” and asked/answered the request for more granularity around the underlying end-market drivers. ¹

A. Nonresidential (Nonres) drove much of the volume strength

• Management explicitly referenced that U.S. and Europe nonresidential “kind of drove” some of the strength, while North American residential was “also up slightly.” ¹
• For the quarter, they also cited strength in “European and nonresidential businesses” as a key contributor to Insulation performance. ²

B. Nonres detail: pockets of strength (U.S. + Europe)

In response to broader questions about what’s behind nonres strength, management described:

• Europe nonres: “decent” nonres markets, plus green shoots / core market rebound that has been emerging. ³⁴
• U.S. nonres: data centers (described as about “5% or less of our overall revenue” but growing fast enough to help top and bottom line), plus other pockets including health care and interiors, and reindustrialization supporting process technology / insulation demand. ³⁴

C. Residential detail: North American resi “up slightly” (but not the main driver)

• For the specific “where did the top-line volume strength come from?” question, management said North American residential was “also up slightly” alongside the nonres contribution. ¹
• Management also noted that (over the period discussed) residential demand is affected by pricing actions and the lag/sequence of housing-driven indicators, but the question you asked here—“where the volume strength came from”—was answered as primarily nonres, with resi modestly positive. ¹⁵

D. Longer-run strategy behind the mix/volume: investment-led growth in nonres and Europe

Management framed the volume strength as the result of an almost decade-long strategy to invest heavily in:

• Nonresidential and European pieces of Insulation to support organic volume growth. ³
  They pointed to specific capacity/investment actions including:
• XPS line in Arkansas, ³
• stone wool facility in Sweden, ³
• and a Kansas City line coming up next year focused more on technical insulation (i.e., nonres product). ⁶³

E. What this implies for “top-line strength”

Putting these pieces together, the quarter’s Insulation top-line volume strength is best explained by:

1. Nonresidential strength (U.S. + Europe), including structurally supported demand pockets like data centers and other nonres segments, plus improving European core markets. ¹³⁴
2. North American residential participation, but only slightly up versus nonres as the primary volume driver. ¹
3. Commercial execution and mix/geography: management explicitly attributed strength to customer/market execution and noted benefits from customer mix and geo mix tied to where multifamily strength vs single-family dynamics are occurring. ⁶

2) Nephi rebuild timing, ramp-up, and longer-term intention to keep Nephi open

A. When the rebuild/rerun activity occurs and when Nephi starts

Management’s guidance and commentary are consistent on restart timing:

• They stated they plan to restart Nephi, Utah, in the fourth quarter. ⁵
• In more detailed Q&A, they said they will “start it up in Q4.” ⁷

B. Why Nephi is being restarted (capacity and network reliability)

Management described Nephi as:

• A smaller asset that is relatively straightforward to take down and start up. ⁶
• Intended to offset some rebuild activity, and they highlighted rebuilds in “’27” (multiple rebuilds in their system). ⁶¹
• Used to ensure they can serve customers well during planned capacity disruptions. ⁶
• Specifically positioned as a network element: Nephi is “important” for customer service continuity due to rebuilds occurring in 2027. ⁶

C. Ramp-up / speed to “open” (how quickly it’s available)

The excerpts do not provide a day-by-day or month-by-month “ramp curve.” However, they provide two usable timing/ramp implications:

1. They are planning a Q4 start-up, which implies Nephi is expected to be available during 2027 so it can “cover” rebuild-related downtime. ⁷⁵
2. They answered a capacity/ramp question by saying Nephi “will help” and “having it up for a full year will offset some of the impact” from rebuild activity. ⁸
   • This suggests the operational goal is not merely a brief Q4 restart, but sufficient throughput such that it meaningfully offsets rebuild disruptions—i.e., it’s expected to be effectively “open” for most of the following year. ⁸

D. Nephi’s longer-term role: intention to keep it open vs temporary use

The provided excerpts emphasize function and network fit, not a multi-year “keep it open indefinitely” commitment. What they do say is:

• Short run intent: they “don’t expect much of a cost increase related to restarting Nephi” and link this to how they can serve the West Coast more cost effectively with Nephi running. ⁶
• Network strategy: they say Nephi is designed to fit broader network management and is used to support customer service during rebuilds. ⁶
• Capacity/network flexibility purpose (and interplay with Kansas City): they also highlight that they intend to start up Kansas City focused on technical insulation, and Nephi “also fits how we want to manage the network overall.” ⁶
• Longer-term “keep open” mechanism implied: Nephi is not presented as a standalone replacement for long-term demand; rather, it’s a network reliability/capacity asset used during rebuild timing (noted as important due to rebuilds in 2027). ⁶

Conclusion on longer-term intention from the excerpts: Nephi’s restart is clearly planned and justified as an important network asset through the period of system rebuilds, with cost and logistics rationale for running it, but the excerpts do not state a definitive long-term duration beyond that role. ⁶⁸

E. How Nephi relates to Kansas City (portfolio/capacity sequencing)

Management laid out a broader system plan:

• Kansas City line: designed to be flexible and to serve multiple parts of the market, and they intend Kansas City to start next year with a focus on technical insulation; it provides flexibility across the network as demand evolves into the year. ⁶⁸
• Nephi timing: Nephi restarts in Q4 and is described as helping offset rebuild impacts—particularly with rebuilds in ’27—while Kansas City is also being brought online as part of longer-term network capacity. ⁶⁵⁸

Bottom line

• Insulation volume strength was primarily driven by nonresidential in both the U.S. and Europe, including data centers (5% or less of revenue but fast-growing) and other nonres pockets (health care, interiors, reindustrialization), while North American residential was “up slightly.” ¹³⁴
• Nephi restart is expected to occur in Q4, with the goal/assumption that having Nephi up for a full year offsets rebuild-related capacity impacts, especially as rebuilds occur in 2027. ⁷⁸⁶
• Longer-term plan as stated in the excerpts is that Nephi is an important network asset designed to support customer service during rebuilds and has cost/logistics advantages when running; the excerpts do not specify an unconditional multi-year “keep open forever” decision beyond that strategic role. ⁶⁸