Griffon 2025 Q3 Earnings Sharp Earnings Decline Despite Record Q3 Net Income

Griffon reported a significant decline in earnings for Q3 2025, swinging to a loss of $2.65 per share from a profit of $0.87 per share a year ago. While the company achieved a new record high for fiscal Q3 net income over the past 20 years, results fell well below expectations. Guidance was adjusted downward for full-year revenue, with the firm now projecting $2.5 billion versus prior guidance of $2.6 billion.

Revenue
Griffon’s total revenue for Q3 2025 decreased by 5.3% to $613.63 million compared to $647.81 million in the same period a year ago. The Home and Building Products segment accounted for the majority of the revenue at $400.24 million, while the Consumer and Professional Products segment contributed $213.38 million. The decline in total revenue reflects a mixed performance across its core business lines.

Earnings/Net Income
The company reported a net loss of $120.14 million in Q3 2025, representing a 392.4% deterioration from a net income of $41.09 million in the prior-year period. On a per-share basis, earnings swung to a loss of $2.65, marking a 404.6% negative change from the previous year’s profit of $0.87 per share, indicating a substantial underperformance despite a record Q3 net income.

Price Action
Griffon’s stock price has fallen significantly in the post-earnings period, dropping 6.40% in a single trading day, 16.37% for the week, and 11.43% month-to-date, reflecting investor concerns over the earnings miss and revised outlook.

Post Earnings Price Action Review
Despite the negative earnings print, a strategy of buying GFF when earnings beat and holding for 30 days historically delivered strong returns, with a 258.32% return outperforming the benchmark by 173.91%. The strategy also showed a CAGR of 29.80%, with no maximum drawdown and a Sharpe ratio of 0.74, suggesting effective risk-adjusted returns.



CEO Commentary
Chairman and CEO Ronald J. Kramer highlighted the strong performance of the Home and Building Products segment, which posted a 31.4% EBITDA margin driven by favorable pricing and product mix. For the Consumer and Professional Products segment, Kramer acknowledged weak demand but noted a 270 basis-point improvement in EBITDA margin. The company also reported $261 million in free cash flow year-to-date, repurchased $113 million in shares, reduced debt by $76 million, and paid $32 million in dividends. Kramer expressed cautious optimism, emphasizing the company’s strategic direction and resilience amid economic uncertainty.

Guidance
Griffon now expects FY2025 revenue to reach $2.5 billion, down from the prior guidance of $2.6 billion. This $100 million reduction is attributed to weaker performance in the Consumer and Professional Products segment. However, the company is maintaining its segment adjusted EBITDA guidance of $575 million to $600 million, with Home and Building Products expected to maintain a margin above 31% and Consumer and Professional Products projected to deliver an EBITDA margin of approximately 8%. Griffon also anticipates interest expenses of $95 million and capital expenditures of $60 million, with free cash flow expected to exceed net income and a normalized tax rate of about 28%.

Additional News
On August 7, 2025, the same day as the earnings report, Griffon reaffirmed its long-term free cash flow outlook of exceeding $1 billion through 2027. This signal of financial strength and confidence in future cash generation underscores the company’s commitment to maintaining its strong balance sheet and returning capital to shareholders. While no immediate M&A activity or C-level changes were disclosed in the available content, the firm’s continued buyback and dividend programs highlight its focus on shareholder value creation.