HNI (HNI) Q1 2026 earnings summary

Executive summary

• Net sales rose 125% year-over-year to $1.35 billion, driven by the $1.9 billion Steelcase acquisition, while organic net sales declined 3.2% year-over-year.

• Q1 2026 GAAP net loss was $38.8 million (diluted EPS $(0.55)), primarily due to acquisition-related purchase accounting and restructuring charges; non-GAAP diluted EPS was $0.34, modestly exceeding expectations.

• Cost management, synergy realization, and network optimization offset volume softness and continued investment, with synergy capture and accretion on track.

• Steelcase integration progressing well, with cultures melding successfully and additional savings expected from network optimization over the next three years.

• Continued focus on price realization, customer-centric growth, and operational improvements.

Financial highlights

• Q1 2026 net sales were $1,347.5 million, up 125% year-over-year, with $774.0 million from Steelcase; organic net sales declined 3% year-over-year.

• Gross profit was $499.9 million (gross margin 37.1%, down 260 bps); non-GAAP gross margin was 40.0%.

• Q1 GAAP operating loss was $36.4 million; non-GAAP operating income was $52.1 million.

• Q1 GAAP EPS was $0.55; non-GAAP diluted EPS was $0.34, slightly ahead of expectations.

• Interest expense rose to $20.7 million due to higher borrowings for the Steelcase acquisition.

Outlook and guidance

• Expecting modest net sales growth and double-digit non-GAAP EPS growth for full-year 2026, with accelerating growth in the second half.

• Workplace Furnishings revenue to increase low single digits for the year, with high single-digit growth in H2; Residential Building Products to see modest price-driven growth in H2.

• Steelcase expected to be net neutral in H1 and modestly accretive in H2 and full year.

• Capital expenditures for 2026 projected at $130–$140 million, focused on operational improvements and digital capabilities.

• Projecting double-digit EPS growth in 2027, supported by Steelcase synergies and network optimization.