Masco | 8-K: FY2026 Q2 Revenue Misses Estimate at USD 1.992 B

Revenue: As of FY2026 Q2, the actual value is USD 1.992 B, missing the estimate of USD 2.086 B.

EPS: As of FY2026 Q2, the actual value is USD 1.6, beating the estimate of USD 1.2858.

EBIT: As of FY2026 Q2, the actual value is USD 468 M.

Second Quarter 2026 Financial Highlights

Net Sales

• Total net sales decreased 3% to $1,992 million compared to the second quarter of 2025.
• Plumbing Products’ net sales decreased 3%.
• Decorative Architectural Products’ net sales decreased 4%.
• In local currency, North American sales decreased 5%, while International sales increased 4%.

Gross Margin

• Reported gross margin increased 600 basis points to 43.6% from 37.6% in the second quarter of 2025.
• Adjusted gross margin increased 610 basis points to 43.8% from 37.7% in the second quarter of 2025.

Operating Profit and Margin

• Reported operating profit increased 14% to $470 million from $412 million in the second quarter of 2025.
• Reported operating margin increased 350 basis points to 23.6% from 20.1% in the second quarter of 2025.
• Adjusted operating profit increased 17% to $482 million from $413 million in the second quarter of 2025.
• Adjusted operating margin increased 410 basis points to 24.2% from 20.1% in the second quarter of 2025.

Segment Operating Profit and Margin (Q2 2026)

• Plumbing Products: Reported operating profit was $352 million, with a reported operating margin of 26.3%. Adjusted operating profit was $361 million, with an adjusted operating margin of 27.0%.
• Decorative Architectural Products: Reported operating profit was $147 million, with a reported operating margin of 22.4%. Adjusted operating profit was $148 million, with an adjusted operating margin of 22.6%.

Net Income

• Net income attributable to Masco Corporation was $318 million in Q2 2026, up from $270 million in Q2 2025.

Operating Costs

• Selling, general and administrative expenses were $397 million in Q2 2026, compared to $361 million in Q2 2025. As a percentage of net sales, reported SG&A was 19.9% in Q2 2026, compared to 17.6% in Q2 2025.
• Interest expense was - $28 million in Q2 2026, compared to - $26 million in Q2 2025.
• Income tax expense was $107 million in Q2 2026, compared to $95 million in Q2 2025.

Six Months Ended June 30, 2026 Financial Highlights

Net Sales

• Total net sales increased to $3,910 million in 2026 from $3,852 million in 2025.
• Plumbing Products’ net sales increased 3% to $2,700 million.
• Decorative Architectural Products’ net sales decreased 2% to $1,209 million.

Operating Profit and Margin (YTD 2026)

• Reported operating profit was $787 million, with a reported operating margin of 20.1%.
• Adjusted operating profit was $807 million, with an adjusted operating margin of 20.6%.

Cash Flow (Six Months Ended June 30, 2026)

• Net cash from operating activities was $417 million, compared to $148 million for the same period in 2025.
• Capital expenditures were - $77 million, compared to - $68 million in 2025.
• Net cash for investing activities was - $78 million, compared to - $70 million in 2025.
• Net cash for financing activities was - $433 million, compared to - $344 million in 2025.
• Cash and cash investments at June 30, 2026, were $548 million, down from $647 million at December 31, 2025.

Liquidity and Capital Allocation

• Total liquidity at the end of the second quarter was $1,548 million, including $548 million in cash and cash investments and $1,000 million in revolver availability.
• Masco Corporation returned $454 million to shareholders through dividends and share repurchases during the second quarter.

Working Capital (As of June 30, 2026)

• Receivable days were 56, inventory days were 85, and payable days were 69.
• Working capital was $1,512 million.
• Working capital as a percentage of last twelve months (LTM) sales was 19.8%.

Outlook

Masco Corporation expects 2026 reported earnings per share to be in the range of $4.21 to $4.41. On an adjusted basis, the company anticipates earnings per share between $4.40 and $4.60, an increase from previous guidance. This updated guidance reflects an anticipated full-year net benefit of approximately $85 million from IEEPA tariff refunds.