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DuPont is one of the largest chemical companies in the world. Image source: Getty Images. 

DuPont's (NYSE:DD) days are numbered. But that's not because of a bad earnings report. In fact, the earnings report was stellar (more on that below). 

But soon, the company will be completing its merger with Dow Chemical and will split into three separate companies. It's this merger -- and its aftermath -- that is more important to long-term investors than the company's current quarterly performance. Nevertheless, DuPont's second-quarter earnings report still contains some valuable information...particularly for those thinking of buying in before the merger occurs. 

Crushing it

DuPont's second quarter demolished expectations. Adjusted earnings (excluding one-time items) increased by $1.24 per share, handily topping the Thomson Reuters analysts' consensus of $1.10. Even GAAP earnings beat estimates, coming in at $1.16 per share, up from $1.06 a year ago. 

The company also improved its earnings projections. Not only does it now expect third-quarter operating earnings to be 50% higher than in 2015, it's also upping its prior full-year operating earnings estimate of $3.05-$3.20 per share to $3.15-$3.20 per share. 

Margins also improved. Gross margins expanded by more than 100 basis points. Segment operating margins increased about 250 basis points. In fact, operating margins expanded in all reportable segments.

Even this kind of stellar earnings, though, didn't change the fact that the stock has underperformed the market so far this year:

DD Chart

DD data by YCharts.

New businesses are booming

DuPont has been transitioning away from its traditional materials science business (which brought us Teflon, Nylon, Freon, and other well-known brands). In fact, the company spun off many of these brands -- including Teflon and Freon -- into a new company, Chemours, in 2015. At the time, many questioned this strategy, but there's no doubt that in this quarter, the agriculture and nutrition & health divisions were highlights of the company's business portfolio.

In the agriculture unit -- by far the company's largest -- earnings increased 12% because of lower product costs, higher volumes, and cost savings. There were a few offsets: a $36 million negative currency impact, for example, and lower soybean volumes. On the whole, though, the unit's performance was strong, with increased corn seed and insecticide volumes, and operating margins that expanded by 290 basis points.

Earnings in the nutrition & health division were even stronger, up 30% (33% if you discount negative currency effects). The company cited cost savings and volume growth here as well, especially in probiotics and specialty proteins. Operating margins expanded by about 350 basis points. 

All of the divisions fared well -- the company's smallest division, industrial biosciences, also had standout earnings. In this quarter, at least, it seems as though DuPont's diversification is paying off for investors.

R&D continues

One of the worries investors have about the upcoming merger-and-split is the potential loss of DuPont's storied research and development efforts. When the company revealed in 2015 that it planned to close its Central Research Division and "substantially redesign" its R&D structure, concerns arose that the company would be substantially cutting back on its R&D efforts, with possible negative consequences down the road.

The company's first-quarter earnings release seemed to substantiate these fears. R&D spending dropped from 6.5% of sales (in Q1 and Q2 of 2015) to 5.6%. Further cuts, though, have failed to materialize. This quarter, the company again spent 6.5% of sales on research and development. This should give investors confidence that the company is still looking out for its future post-merger product portfolio.

Foolish Takeaway

DuPont had a fantastic quarter up and down the board. All of its businesses grew earnings and operating margins, and sales volumes were up in its largest segment, agriculture. The company continues to spend on R&D, raised the low end of its full-year outlook, and is looking strong as it prepares to merge with Dow Chemical. Obviously, the company's long-term fortunes hinge on the success -- or failure -- of that merger, but in the meantime, things are looking good.

John Bromels has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.