© Reuters. The Dow Chemical logo is displayed on a board above the floor of the New York Stock Exchange shortly after the opening bell in New York, December 22, 2015. REUTERS/Lucas Jackson/File photo

By Sourasis Bose

(Reuters) – Chemicals maker Dow on Tuesday beat profit and sales estimates for the second quarter as it kept a tight lid on costs amid worries of a global economic slowdown.

The Midland, Michigan-based company reported an operating income of 75 cents per share, compared with analysts’ estimates of 70 cents, according to Refinitiv data. Dow’s shares were trading up 2.6%.

In January the company said it would cut jobs affecting 5% of its workforce. Dow added on Tuesday it was on track for its $1 billion cost-savings target for the year.

U.S.-based chemical makers also benefited from lower prices for key raw material , which more than halved from the record highs reached last year after Russia’s invasion of Ukraine crimped global supplies.

Dow’s second-quarter revenue fell 27% to $11.42 billion, compared with estimates of $11.27 billion.

The company, which makes chemicals used in everything from plastics and paints to building materials, however, warned that the macroeconomic environment would remain challenging in the second half of the year and forecast lower-than-expected third-quarter revenue.

“Third, fourth quarter is going to be that low point (of end demand), and then we’d start to ramp back from there,” Dow CEO James Fitterling said.

The company said it expected third-quarter net sales in the range of $10.25 billion to $10.75 billion, lower than estimates of $12.37 billion.

Dow also forecast sales to be down between 5% and 9% sequentially in the third quarter.

“In China, while we are experiencing growth, the anticipated economic rebound following the end of zero-COVID restrictions, has yet to fully materialize,” a company executive said on a post-earnings call on Tuesday.

Dow also flagged that recessionary pressures in Europe would persist.

The company’s net income for the second quarter dropped 70% to $501 million on lower product prices and weak sales volume.