Mohawk Industries, Inc. have just announced second quarter 2025 net earnings of $147 million and earnings per share (“EPS”) of $2.34; adjusted net earnings were $173 million, and adjusted EPS was $2.77.
Net sales for the second quarter of 2025 were $2.8 billion, essentially flat as reported and a decrease of 0.8% adjusted for constant days and exchange rates versus the prior year. During the second quarter of 2024, the Company reported net sales of $2.8 billion, net earnings of $157 million and earnings per share of $2.46; adjusted net earnings were $192 million, and adjusted EPS was $3.00.
For the six months ended June 28, 2025, net earnings and EPS were $219 million and $3.49, respectively; adjusted net earnings were $269 million, and adjusted EPS was $4.29. Net sales for the first six months of 2025 were $5.3 billion, a decrease of 2.8% as reported and 0.7% on an adjusted basis versus the prior year.
For the six months ended June 29, 2024, the Company reported net sales of $5.5 billion, net earnings and EPS were $262 million and $4.10, respectively; adjusted net earnings were $310 million and adjusted EPS was $4.85. Commenting on the Company’s second quarter, Chair and CEO Jeff Lorberbaum (pic) stated: “In challenging conditions across our regions, our results reflect the impact of our ongoing operational improvements, cost containment actions and market development initiatives.
“Our premium residential and commercial products and new collections introduced during the past 24 months benefited our performance. Our restructuring actions are on schedule and delivering the expected savings as we have closed high-cost operations, eliminated inefficient assets, streamlined distribution and leveraged technology to improve our administrative and operational costs.
“Our global operations teams continue to identify productivity initiatives to lower our costs through enhancements to equipment, conserving energy, optimizing our supply chain and re-engineering products. Our industry faced continued pricing pressure from lower market volumes, which we are mitigating through strengthening product and channel mix.
"During the second quarter, we generated approximately $125 million of free cash flow, and we purchased approximately 393,000 shares of our stock for approximately $42 million. Our Board of Directors recently approved a new authorization to acquire $500 million of the Company’s outstanding common stock.
“We are confident in our strategies to deliver long-term profitable growth as the industry recovers from this cyclical downturn. Given the increasing tariffs, we are emphasizing the benefits of our locally produced collections and leading position as a North American manufacturer.
“We have begun to address the implemented tariffs through price adjustments and supply chain optimization. Earlier this month, the U.S. government set a new deadline of August 1 for countries to complete tariff negotiations while also announcing specific tariffs on key trading partners.
“We are continuing to monitor the changing tariff levels and will adjust our strategies as they evolve. Net sales in the Global Ceramic Segment increased by 0.5% as reported, or 1.1% adjusted for constant days and exchange rates versus the prior year.
“The Segment’s operating margin was 7.9% as reported, or 8.1% on an adjusted basis due to favourable net impact of price and product mix and productivity gains, partially offset by higher input costs. Net sales in the Flooring Rest of the World Segment increased by 1.0% as reported, or decreased by 3.0% adjusted for constant days and exchange rates versus the prior year.
“The Segment’s operating margin was 9.0% as reported, or 10.4% on an adjusted basis due to productivity gains, partially offset by competitive industry pricing. Net sales in the Flooring North America Segment decreased by 1.2% versus the prior year as reported.
“The Segment’s operating margin was 5.5% as reported, or 7.3% on an adjusted basis due to higher input costs and unfavourable impact of temporary plant shutdowns, partially offset by stronger productivity gains. As we focus on market development, operational improvements and cost containment, we are continuing to take actions that will optimize our performance in the current market.
“Ongoing inflation and low consumer confidence are constraining industry sales, and the timing of the inflection point remains unpredictable. To improve sales, we are leveraging the strength of our portfolio, superior service and brand value to expand our business with current and new customers.
“Though pricing pressure in our markets remains elevated, we are improving our mix through our premium collections, commercial sales and recent product introductions. Input cost pressures will continue, with the impact peaking in the third quarter as higher costs flow through our inventory.
“To mitigate these higher costs, our teams continue to execute productivity initiatives in all aspects of our operations. Our restructuring actions should deliver approximately $100 million in benefits this year while strengthening our operations for the future.
“Evolving U.S. trade policy should benefit Mohawk, since approximately 85% of our U.S. sales are from goods produced in North America. We will manage the impact of tariffs through supply chain enhancements, cost optimization and price adjustments.
“Our guidance does not include the potential impact from new tariffs, which have not been finalized at this time. Given these factors, we expect our third quarter adjusted EPS will be between $2.56 and $2.66, excluding any restructuring or other one-time charges.
“Historically, down cycles in our industry are followed by several years of sales growth from pent up demand. During the past three years, we have made targeted investments to improve our operational performance, cost position and product features.
“Through these actions, we are strategically positioned to respond to today’s challenges and capitalize on opportunities as the industry recovers.”
