Friedman Industries 2026 Q1 Earnings Strong Performance as Net Income Surges 95.9%

Friedman Industries (NASDAQ/GS: FRD) reported its fiscal 2026 Q1 earnings on August 7, 2025. The company delivered results that significantly outperformed the prior year, with both revenue and earnings rising sharply. Management highlighted improved margins and strong sales volume as key drivers, and the company provided cautious guidance for the upcoming quarter due to softening prices.

Friedman Industries reported total revenue of $134.78 million for the first quarter of fiscal 2026, a 17.7% increase from $114.55 million in the same period a year ago. The growth was primarily driven by the flat-roll segment, which contributed $124.07 million in revenue. The tubular segment added $10.71 million, while there were no contributions from the "Other" category. This performance reflects a strategic focus on expanding capacity utilization across key facilities.

Net earnings for the quarter soared to $5.03 million, a 95.9% increase compared to $2.57 million in the prior year. Earnings per share (EPS) rose from $0.37 to $0.71, reflecting a robust 91.9% growth. The earnings surge was attributed to improved margins and strong sales volume, underscoring the company’s effective operational execution.

The stock price of Friedman Industries edged up 1.98% on the latest trading day and 1.78% over the most recent full trading week. However, it dropped 7.66% month-to-date. A post-earnings trading strategy of buying shares after a revenue drop on the report date and holding for 30 days generated a compound annual growth rate (CAGR) of 44.54%, underperforming the benchmark by 7.70 percentage points. The strategy exhibited a low-risk profile with a Sharpe ratio of 0.88, but it also reflected high volatility, as indicated by the 50.59% volatility level.

CEO Michael J. Taylor expressed optimism about the first-quarter performance, crediting stronger customer demand and successful commercial efforts for the 12% year-over-year increase in tons sold. He emphasized the company’s improved margins and solid sales volume, which drove net earnings to $5.0 million. Taylor highlighted Friedman’s strong financial position and confidence in its ability to capitalize on both short-term and long-term opportunities.

Looking ahead, the company expects second-quarter sales volume to be slightly higher than the first quarter as it continues efforts to increase facility capacity utilization. However, due to softer HRC prices at the end of Q1 and into Q2, it anticipates lower margins in Q2 of fiscal 2026 compared to Q1.

In addition to its earnings report, Friedman Industries announced the release of its unaudited financial statements for the quarter ended June 30, 2025. The company reported operating cash flow of $15.5 million and reduced debt by $14.7 million. As of June 30, 2025, the working capital balance stood at $117.5 million. The flat-roll segment posted earnings from operations of $8.8 million, while the tubular segment, which saw a sales volume decline from 10,000 tons in the prior year to 9,000 tons, recorded a profit of $1.3 million—compared to a $1.2 million loss in the same period a year ago. The company also recognized a $0.3 million gain on hedging activities in the quarter.

Friedman Industries, headquartered in Longview, Texas, operates two reportable segments: flat-roll and tubular products. The company’s hedging strategy uses hot-rolled coil futures to manage price risk and is accounted for using mark-to-market methods. The company’s outlook for the second quarter includes slightly higher sales volume despite anticipated margin pressure due to softening HRC prices. The company is preparing for both short-term and long-term opportunities, with management expressing confidence in the team’s ability to drive growth.