Patrick Industries (PATK) Q3 2025 earnings summary

Executive summary

• Net sales for Q3 2025 increased 6% year-over-year to $976 million, driven by organic growth, acquisitions, and market share gains in RV, Marine, and Powersports segments despite industry shipment declines.

• Net income for Q3 2025 was $35 million, down from $41 million in the prior year, with diluted EPS at $1.01, impacted by higher operating expenses, legal settlement, and convertible notes.

• Operating income decreased to $66 million from $74 million, with operating margin down to 6.8% from 8.1% due to temporary inefficiencies and higher costs.

• Strong balance sheet with $779 million in net liquidity and net leverage ratio at 2.8x, supporting flexibility and growth initiatives.

• Completed strategic acquisitions, including LilliPad Marine, and continued investments in product development, digital tools, and AI to drive efficiency and value.

Financial highlights

• Q3 net sales: $976 million, up 6% year-over-year; adjusted EBITDA: $112 million (margin 11.5%), down from $121 million (margin 13.2%) last year.

• Gross margin: 22.6% vs. 23.1% prior year; operating margin: 6.8% vs. 8.1%.

• Free cash flow for first nine months: $134 million; trailing twelve months: $211 million; cash from operations: $199 million.

• Net income: $35 million; diluted EPS: $1.01, down from $1.20 in prior year.

• Returned $13 million to shareholders via dividends and $32 million in share repurchases YTD; $168 million remains on repurchase authorization.

Outlook and guidance

• FY2025 adjusted operating margin expected at ~7%; FY2026 margin to improve by 70–90 bps.

• RV wholesale shipments for FY2025 estimated at 335,000–345,000 units; retail shipments expected down low single digits.

• Marine and Powersports unit shipments expected down low to mid-single digits; manufactured housing shipments projected flat to up 5%.

• FY2025 operating cash flow projected at $330–$350 million; capex: $75–$85 million; free cash flow forecasted at $250 million+.

• Management expects sufficient liquidity for at least the next 12 months, excluding acquisitions.