American Woodmark (AMWD) Q2 Earnings call transcript Nov 26, 2025
2min read In the recent earnings call, American Woodmark Corporation provided insights into its financial performance and outlook for the future. The call, led by Senior Vice President and CFO Paul Joachimczyk and President and CEO Scott Culbreth, offered valuable information on the company's strategy, financial performance, and market conditions. Here are the key takeaways from the call.
Financial Performance
For the second fiscal quarter of 2025, American Woodmark reported net sales of $452.5 million, a decline of 4.5% compared to the previous year. This decrease was attributed to a slowdown in new construction single-family starts, a softening demand in the remodel market, and higher mortgage rates. Despite these challenges, the company maintained a focus on operational excellence and cost management, with operational expenses decreasing by 290 basis points to 9.3% of net sales. However, the decline in sales and restructuring costs led to a decrease in adjusted EBITDA to $60.2 million or 13.3% of net sales.
Market Conditions and Outlook
The call highlighted the impact of macroeconomic factors, including interest rates and consumer confidence, on the housing industry and American Woodmark's performance. The company expects the repair and remodel market to be down mid-single digits and new construction to be up low single digits in fiscal year 2025. This outlook is driven by the ongoing challenges in the remodel market, with larger discretionary projects expected to trend worse. Despite these challenges, American Woodmark remains focused on growing share and expanding its digital transformation efforts, including the implementation of ERP and automation strategies.
Investor Questions and Responses
During the question-and-answer session, key shareholders and investors raised concerns about the company's exposure to tariffs, especially with regards to Mexican imports, and the impact of promotional activities on sales volumes. The management team provided reassurances that they are prepared to adapt to any changes in regulatory policies and that promotional activities have remained consistent year-over-year. Additionally, investors were interested in understanding the company's guidance on sales trends for the second half of the year and the potential for a turnaround in fiscal year 2026. The management team expressed cautious optimism, acknowledging the challenges in the current environment but expressing confidence in the company's long-term growth prospects.
Implications for Investors
American Woodmark's earnings call provides valuable insights into the challenges and opportunities facing the housing industry and the company's strategy for navigating these market conditions. Investors should closely monitor the company's operational performance, particularly its ability to maintain operational excellence and cost management in the face of declining sales volumes. Additionally, the company's digital transformation efforts and share repurchase programs are key initiatives to watch, as they could contribute to long-term growth and value creation for shareholders.
In conclusion, American Woodmark's second fiscal quarter earnings call highlights the company's resilience in the face of challenging market conditions and its focus on strategic initiatives to drive future growth. Investors should continue to monitor the company's financial performance and strategic initiatives as it navigates the evolving landscape of the housing industry.