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Mohawk Q3 Earnings Miss, Revenues Beat Estimates, Stock Down
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Key Takeaways
Mohawk's Q3 EPS of $2.67 missed estimates, but sales rose 1.4% YoY to $2.8B.
Cost savings, new product lines and lower interest costs aided Q3 results despite weak volumes.
MHK targets $110M in 2025 savings through restructuring and supply chain efficiencies.
Mohawk Industries, Inc. (MHK - Free Report) reported third-quarter 2025 results, with earnings falling slightly short of the Zacks Consensus Estimate, while net sales surpassed the same. On a year-over-year basis, the top line increased, while the bottom line declined.
Shares of this leading global flooring manufacturer declined 4.2% in yesterday’s after-hours trading session.
Mohawk has been facing weak housing demand, high input costs and trade-related challenges. Slower home sales and lingering inflation have hurt margins, while tariffs and supply chain shifts add complexity. Despite cost-saving measures, market volumes remain soft, keeping near-term performance under pressure.
Nonetheless, Mohawk’s growth is underpinned by a strong premium product mix, ongoing productivity gains and cost-saving initiatives that are expected to deliver about $110 million in annualized savings in 2025. Solid cash flow and share buybacks highlight financial discipline. Falling interest rates, rising home equity and pent-up housing demand should gradually lift home sales and remodeling activity, while a housing shortage and aging properties support long-term demand. Favorable tariff changes and lower freight costs also strengthen Mohawk’s U.S. manufacturing edge, positioning the company for sustained growth as the housing market recovers.
Inside MHK’s Q3 Numbers
Mohawk reported adjusted earnings per share (EPS) of $2.67, which missed the Zacks Consensus Estimate of $2.68 by 0.4%. In the year-ago quarter, the company reported an adjusted EPS of $2.90.
Mohawk Industries, Inc. Price, Consensus and EPS Surprise
Net sales of $2.8 billion beat the consensus estimate of $2.73 billion by 1.1% and net sales were up 1.4% year over year. On an adjusted basis, net sales remained essentially flat year over year.
Adjusted gross margin contracted 90 basis points (bps) year over year to 25.3%. Adjusted selling, general and administrative expenses, as a percent of net sales, rose 60 bps to 17.9% from the year-ago period. Adjusted operating margin contracted 130 bps to 7.5% from 8.8% a year ago.
Mohawk’s Segmental Details
Global Ceramic: Sales in the segment totaled $1.1 billion, up 4.4% year over year on a reported basis. On an adjusted basis, sales were up 1.8% from the year-ago level to $1.08 billion.
Adjusted operating income decreased to $89.8 million from $90.8 million a year ago. The segment’s adjusted operating margin contracted to 8.1% from 8.6% a year ago.
Flooring North America: Net sales of the segment amounted to $936.8 million, down 3.8% year over year on a reported basis.
The segment registered an adjusted operating profit of $67.9 million, down from $88.9 million reported in the prior-year period. Adjusted operating margin was 7.2%, down from 9.1% a year ago.
Flooring Rest of the World: Net sales in the segment increased 4.3% year over year on a reported basis to $716.4 million. On an adjusted basis, sales were down 0.9% from the year-ago level to $693.5 million.
Adjusted operating income was $59.3 million, down from $71.8 million reported a year ago. The segment’s adjusted operating margin was 8.3%, down from 10.5% in the year-ago period.
Financial Highlights of MHK
As of Sept. 27, 2025, Mohawk had cash and cash equivalents of $516.2 million compared with $424 million on Sept. 28, 2024. The long-term debt, less the current portion, was $1.74 billion compared with $1.72 billion at the end of third-quarter 2024.
At the end of the third quarter, the company generated free cash flow of $310.3 million compared with $204.2 million a year ago.
Focus on Operational Discipline Amid Market Uncertainty
The company is focusing on strengthening sales strategies, advancing product innovation and enhancing operational productivity to navigate ongoing industry challenges. Inflationary pressures and higher tariffs remain headwinds, and the timing of a recovery is still uncertain.
To support growth, Mohawk is targeting opportunities in new home construction and remodeling, which should help ease housing inflation pressures. Management is confident that declining global interest rates will gradually boost home sales and renovation activity. Leveraging its strong brands, diverse product portfolio and customer relationships, the company continues to expand across markets.
While pricing pressure stays high, Mohawk is enhancing its product mix through premium offerings, expanding commercial sales, optimizing its supply chain and increasing its focus on domestic manufacturing. Productivity initiatives are being implemented across operations to mitigate rising costs, and ongoing restructuring efforts are expected to generate approximately $110 million in savings this year.
MHK’s Q4 View
MHK expects adjusted EPS in the range of $1.90-$2.00, excluding restructuring and other charges, compared with the year-ago figure of $1.95. The guidance does not reflect potential new tariffs, which are yet to be finalized.
Hilton Worldwide Holdings Inc. (HLT - Free Report) reported third-quarter 2025 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
Hilton’s results were supported by its resilient business model, which delivered strong bottom-line performance despite softer RevPAR trends. Growth was driven by a robust development pipeline, increased construction starts and strong demand for brand conversions. Global expansion and sustained net unit growth momentum further reinforced Hilton’s performance and outlook confidence.
Hasbro, Inc. (HAS - Free Report) reported third-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top line increased year over year, while the bottom line declined from the prior-year quarter’s figure. The downside was mainly due to weaker contributions from the Consumer Products segment.
Nonetheless, Hasbro raised its full-year revenue and adjusted EBITDA guidance. The update was supported by strong performance in the Wizards segment, along with steady contributions from the games portfolio, licensing partnerships and execution of the “Playing to Win” strategy. Despite ongoing macroeconomic challenges, Hasbro expects cost efficiency measures and business diversification to support its growth plans for 2025 and beyond.
Mattel, Inc. (MAT - Free Report) reported third-quarter 2025 results, with both earnings and revenues missing the Zacks Consensus Estimate. The top and bottom lines also fell year over year from the prior-year quarter’s figure.
Mattel delivered a soft performance in the quarter, likely impacted by global trade dynamics, shifting retailer ordering patterns across the industry, and ongoing uncertainty surrounding tariff conditions. Key segments such as Barbie and Fisher-Price continued to face headwinds, resulting in lower gross billings. Despite these challenges, point-of-sale momentum remains positive both in the U.S. and international markets. Mattel has reiterated its full-year guidance for 2025.
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Mohawk Q3 Earnings Miss, Revenues Beat Estimates, Stock Down
Key Takeaways
Mohawk Industries, Inc. (MHK - Free Report) reported third-quarter 2025 results, with earnings falling slightly short of the Zacks Consensus Estimate, while net sales surpassed the same. On a year-over-year basis, the top line increased, while the bottom line declined.
Shares of this leading global flooring manufacturer declined 4.2% in yesterday’s after-hours trading session.
Mohawk has been facing weak housing demand, high input costs and trade-related challenges. Slower home sales and lingering inflation have hurt margins, while tariffs and supply chain shifts add complexity. Despite cost-saving measures, market volumes remain soft, keeping near-term performance under pressure.
Nonetheless, Mohawk’s growth is underpinned by a strong premium product mix, ongoing productivity gains and cost-saving initiatives that are expected to deliver about $110 million in annualized savings in 2025. Solid cash flow and share buybacks highlight financial discipline. Falling interest rates, rising home equity and pent-up housing demand should gradually lift home sales and remodeling activity, while a housing shortage and aging properties support long-term demand. Favorable tariff changes and lower freight costs also strengthen Mohawk’s U.S. manufacturing edge, positioning the company for sustained growth as the housing market recovers.
Inside MHK’s Q3 Numbers
Mohawk reported adjusted earnings per share (EPS) of $2.67, which missed the Zacks Consensus Estimate of $2.68 by 0.4%. In the year-ago quarter, the company reported an adjusted EPS of $2.90.
Mohawk Industries, Inc. Price, Consensus and EPS Surprise
Mohawk Industries, Inc. price-consensus-eps-surprise-chart | Mohawk Industries, Inc. Quote
Net sales of $2.8 billion beat the consensus estimate of $2.73 billion by 1.1% and net sales were up 1.4% year over year. On an adjusted basis, net sales remained essentially flat year over year.
Adjusted gross margin contracted 90 basis points (bps) year over year to 25.3%. Adjusted selling, general and administrative expenses, as a percent of net sales, rose 60 bps to 17.9% from the year-ago period. Adjusted operating margin contracted 130 bps to 7.5% from 8.8% a year ago.
Mohawk’s Segmental Details
Global Ceramic: Sales in the segment totaled $1.1 billion, up 4.4% year over year on a reported basis. On an adjusted basis, sales were up 1.8% from the year-ago level to $1.08 billion.
Adjusted operating income decreased to $89.8 million from $90.8 million a year ago. The segment’s adjusted operating margin contracted to 8.1% from 8.6% a year ago.
Flooring North America: Net sales of the segment amounted to $936.8 million, down 3.8% year over year on a reported basis.
The segment registered an adjusted operating profit of $67.9 million, down from $88.9 million reported in the prior-year period. Adjusted operating margin was 7.2%, down from 9.1% a year ago.
Flooring Rest of the World: Net sales in the segment increased 4.3% year over year on a reported basis to $716.4 million. On an adjusted basis, sales were down 0.9% from the year-ago level to $693.5 million.
Adjusted operating income was $59.3 million, down from $71.8 million reported a year ago. The segment’s adjusted operating margin was 8.3%, down from 10.5% in the year-ago period.
Financial Highlights of MHK
As of Sept. 27, 2025, Mohawk had cash and cash equivalents of $516.2 million compared with $424 million on Sept. 28, 2024. The long-term debt, less the current portion, was $1.74 billion compared with $1.72 billion at the end of third-quarter 2024.
At the end of the third quarter, the company generated free cash flow of $310.3 million compared with $204.2 million a year ago.
Focus on Operational Discipline Amid Market Uncertainty
The company is focusing on strengthening sales strategies, advancing product innovation and enhancing operational productivity to navigate ongoing industry challenges. Inflationary pressures and higher tariffs remain headwinds, and the timing of a recovery is still uncertain.
To support growth, Mohawk is targeting opportunities in new home construction and remodeling, which should help ease housing inflation pressures. Management is confident that declining global interest rates will gradually boost home sales and renovation activity. Leveraging its strong brands, diverse product portfolio and customer relationships, the company continues to expand across markets.
While pricing pressure stays high, Mohawk is enhancing its product mix through premium offerings, expanding commercial sales, optimizing its supply chain and increasing its focus on domestic manufacturing. Productivity initiatives are being implemented across operations to mitigate rising costs, and ongoing restructuring efforts are expected to generate approximately $110 million in savings this year.
MHK’s Q4 View
MHK expects adjusted EPS in the range of $1.90-$2.00, excluding restructuring and other charges, compared with the year-ago figure of $1.95. The guidance does not reflect potential new tariffs, which are yet to be finalized.
MHK’s Zacks Rank & Recent Consumer Discretionary Releases
Mohawk currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hilton Worldwide Holdings Inc. (HLT - Free Report) reported third-quarter 2025 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
Hilton’s results were supported by its resilient business model, which delivered strong bottom-line performance despite softer RevPAR trends. Growth was driven by a robust development pipeline, increased construction starts and strong demand for brand conversions. Global expansion and sustained net unit growth momentum further reinforced Hilton’s performance and outlook confidence.
Hasbro, Inc. (HAS - Free Report) reported third-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top line increased year over year, while the bottom line declined from the prior-year quarter’s figure. The downside was mainly due to weaker contributions from the Consumer Products segment.
Nonetheless, Hasbro raised its full-year revenue and adjusted EBITDA guidance. The update was supported by strong performance in the Wizards segment, along with steady contributions from the games portfolio, licensing partnerships and execution of the “Playing to Win” strategy. Despite ongoing macroeconomic challenges, Hasbro expects cost efficiency measures and business diversification to support its growth plans for 2025 and beyond.
Mattel, Inc. (MAT - Free Report) reported third-quarter 2025 results, with both earnings and revenues missing the Zacks Consensus Estimate. The top and bottom lines also fell year over year from the prior-year quarter’s figure.
Mattel delivered a soft performance in the quarter, likely impacted by global trade dynamics, shifting retailer ordering patterns across the industry, and ongoing uncertainty surrounding tariff conditions. Key segments such as Barbie and Fisher-Price continued to face headwinds, resulting in lower gross billings. Despite these challenges, point-of-sale momentum remains positive both in the U.S. and international markets. Mattel has reiterated its full-year guidance for 2025.