TopBuild (BLD) Q1 2026 earnings summary

Executive summary

• Net sales rose 17.2% year-over-year to $1.45 billion for Q1 2026, driven by acquisitions despite lower organic volume and pricing declines, offsetting softness in residential and light commercial construction.

• Net income declined to $104.8 million from $123.4 million, with margins pressured by higher SG&A and amortization from acquisitions.

• Four acquisitions completed in 2026 added over $80 million in annual revenue, diversifying end-market exposure.

• Major acquisitions in 2025 and early 2026 expanded the commercial roofing and specialty distribution footprint.

• Entered into a definitive merger agreement with QXO, Inc., offering shareholders cash or QXO stock, subject to approvals, to accelerate cross-selling, procurement, and digital initiatives.

Financial highlights

• Gross profit margin was 27.7%, down from 28.5% year-over-year; gross profit rose to $400.3 million from $351.5 million.

• Operating profit was $175.0 million (12.1% margin), down from $177.5 million (14.4% margin) last year.

• Adjusted EBITDA increased 1.6% to $238.6 million; adjusted EBITDA margin fell to 16.5% from 19.0%.

• SG&A expenses increased to 15.6% of sales, up from 14.1% in Q1 2025, mainly due to acquisition-related costs.

• Cash and cash equivalents stood at $268.8 million as of March 31, 2026, down from $400.3 million at the end of 2025.

Outlook and guidance

• Residential construction demand remains uneven due to high prices and borrowing costs, but long-term fundamentals are positive.

• Commercial and industrial backlog is strong, with recent acquisitions supporting growth in these segments.

• M&A remains a priority, supported by strong free cash flow and a robust acquisition pipeline.

• Comfort Pro acquisition (approx. $6 million annual sales) expected to close in Q2 2026.

• Management expects adequate liquidity and cash flow to support operations and obligations for at least the next twelve months.