Mohawk Industries (MHK) investor relations material

Executive summary

• Q4 2025 net sales reached $2.7 billion, up 2.4% as reported, with adjusted EPS at $2.00 and adjusted operating income at $152 million; performance outpaced most markets, especially in commercial segments.

• Full-year 2025 sales were $10.8 billion, flat year-over-year; adjusted EPS was $8.96, down 7.5%; adjusted net earnings were $559 million.

• Free cash flow for 2025 was $620–621 million, with $149–150 million spent on share repurchases.

• Housing turnover and consumer confidence remained weak due to affordability, inflation, and geopolitical tensions, impacting discretionary spending.

• U.S. accounted for 55% of 2025 sales, Europe 30%, and other geographies 15%.

Financial highlights

• Q4 2025 adjusted gross profit margin was 24.3%; adjusted operating margin was 5.6%.

• Q4 2025 adjusted EBITDA was $301 million; trailing twelve months adjusted EBITDA was $1.3 billion.

• Net debt at year-end 2025 was $1.17 billion; leverage at 0.9x adjusted EBITDA.

• Net cash from operating activities for 2025 was $1.06 billion; capital expenditures were $435 million.

• Annual net sales for 2025 were $10.8 billion, down 0.5% year-over-year; adjusted EBITDA margin was 12.1%.

Outlook and guidance

• Q1 2026 expected to be seasonally slow, with adjusted EPS guidance of $1.75–$1.85, excluding restructuring or one-time charges.

• 2026 sales and earnings are expected to improve, contingent on economic and housing market recovery, with growth driven by sales initiatives, product innovation, and operational improvements.

• Full-year 2026 CapEx planned at $480 million, focused on product innovation, cost reduction, and maintenance.

• Recent restructuring initiatives expected to generate $60–70 million in savings in 2026.

• Corporate expenses for 2026 estimated at $52–$55 million.