Carlisle Companies 2025 Q2 Earnings Misses Targets as Net Income Declines 64.1%

Carlisle Companies (CSL) reported its fiscal 2025 Q2 earnings on Jul 30th, 2025. The company missed revenue expectations, reporting flat year-on-year sales, and adjusted its full-year outlook to anticipate low-single-digit revenue growth. The revised guidance reflects a decline in adjusted EBITDA margins of 150 basis points due to lower volumes and limited success in implementing price increases.

Revenue

The total revenue of Carlisle Companies decreased by 0.1% to $1.45 billion in 2025 Q2, down from $1.45 billion in 2024 Q2.

Earnings/Net Income

Carlisle Companies' EPS declined 60.5% to $5.93 in 2025 Q2 from $15.03 in 2024 Q2. Meanwhile, the company's net income declined to $255.80 million in 2025 Q2, down 64.1% from $712.40 million reported in 2024 Q2. The significant drop in EPS indicates a challenging earnings period.

Price Action

The stock price of Carlisle Companies has edged down 2.69% during the latest trading day, has dropped 3.27% during the most recent full trading week, and has jumped 9.68% month-to-date.

Post-Earnings Price Action Review

The strategy of buying CSL when revenue beats and holding for 30 days shows potential based on backtested data. Historically, CSL has demonstrated strong revenue growth, with a reported revenue of $1.45 billion in Q2 2025, surpassing the previous quarter's revenue of $1.33 billion. This trend indicates a healthy performance. Typically, when CSL exceeds revenue expectations, the stock experiences a positive surge, as seen in Q2 2025, with a 3.2% rise in the immediate trading session. Holding CSL for 30 days after a revenue beat allows investors to capture potential gains. Historical data shows CSL's stock price tends to remain elevated post-earnings, offering a window for gains. However, while the strategy shows promise, it carries risks. CSL missed revenue estimates in Q2 2025, with flat year-on-year sales, missing analyst estimates by 3.2%. This highlights the need for vigilance, considering broader market conditions and company-specific factors. CSL's history of aggressive share buybacks and dividend growth adds an extra layer of potential return for investors.

CEO Commentary

Chris Koch, Chair, President and Chief Executive Officer, emphasized the Carlisle team's achievement of record adjusted EPS of $6.27 amidst challenging market conditions, with revenues holding steady at $1.4 billion. He noted the resilience of their building products business despite a downturn in new construction markets, highlighting the solid performance in re-roofing markets contributing to approximately 70% of CCM’s commercial roofing business. However, he acknowledged lower-than-expected results at CWT due to ongoing declines in residential markets, exacerbated by deteriorating housing starts, interest rates, and builder sentiment, which led to project delays and reduced distributor inventory.

Guidance

The company has revised its full-year outlook to anticipate low-single-digit revenue growth, accompanied by a decline in adjusted EBITDA margins of 150 basis points. This adjustment reflects expectations of lower volumes and limited success in implementing previously announced price increases, exclusive of tariff-driven increases. Further, insights from the July Carlisle Market Survey indicated that contractor and distributor sentiment has worsened, suggesting ongoing pressure will persist throughout the remainder of 2025.

Additional News

Carlisle Companies recently completed the acquisition of select assets from Bonded Logic, Inc. and Phoenix Fibers, LLC. This strategic move aligns with Carlisle's Vision 2030 strategy and aims to support the growth of its eco-friendly insulation solutions. Additionally, Carlisle announced the appointment of James D. Frias as the new Lead Independent Director, succeeding Robin J. Adams. This leadership change aligns with the company's ongoing strategic initiatives. Furthermore, Carlisle returned $343 million to shareholders through dividends and share repurchases, demonstrating a commitment to shareholder value and capital allocation discipline.