H.B. Fuller 2025 Q2 Earnings Revenue and Net Income Decline

H.B. Fuller (FUL) reported its fiscal 2025 Q2 earnings on June 26th, 2025. The company posted a 2.1% decline in total revenue to $898.10 million, falling short of market expectations. Similarly, net income saw an 18.4% drop, underscoring a challenging quarter. Despite these setbacks, H.B. Fuller has raised its guidance for fiscal 2025, with optimistic projections for net revenue and adjusted EPS, suggesting a brighter outlook. The company anticipates adjusted EPS growth of 7% to 12%.

Revenue

H.B. Fuller experienced a 2.1% decrease in total revenue, reporting $898.10 million for 2025 Q2 compared to $917.11 million in the same period last year. The Hygiene, Health and Consumable Adhesives segment generated $397.48 million, and Engineering Adhesives contributed $276.42 million. Meanwhile, Building Adhesive Solutions achieved $224.20 million, culminating in the total revenue figure. Each segment's revenue reflects the current market dynamics.

Earnings/Net Income

H.B. Fuller's earnings per share (EPS) fell by 17.2% to $0.77 in 2025 Q2, down from $0.93 in the previous year. The net income also declined by 18.4%, reaching $41.84 million compared to $51.30 million in 2024 Q2. This decline indicates a challenging period for the company.

Price Action

The stock price of H.B. Fuller has edged up 2.33% during the latest trading day, has jumped 14.58% during the most recent full trading week, and has jumped 14.33% month-to-date.

Post-Earnings Price Action Review

The strategy of purchasing FUL shares when revenues exceed expectations and holding for 30 days resulted in a 28.60% return, which underperformed the benchmark by 64.50%. This approach experienced considerable volatility, evidenced by a maximum drawdown of -42.52%, and a Sharpe ratio of 0.18, highlighting the associated risks. Despite the underperformance, this strategy underscores the complexities of market movements and the inherent challenges in achieving consistent returns. It serves as a reminder of the volatile nature of stock markets and the importance of adapting strategies to evolving market conditions.

CEO Commentary

Celeste Beeks Mastin, President, CEO & Director, highlighted the strong financial performance of H.B. Fuller, attributing it to disciplined execution in a dynamic environment. She noted, "We are performing better than the underlying markets," with a focus on positive organic revenue growth despite a slightly negative volume. The company is prioritizing a portfolio transformation towards higher growth and margin markets, while managing costs effectively. Mastin expressed optimism regarding ongoing margin expansion and profit growth, stating, "We are pleased with our strong first half performance," and emphasized the team's capability to navigate economic uncertainties.

Guidance

H.B. Fuller updated its guidance for fiscal 2025, expecting net revenue to decline by 2% to 3% year-on-year, with organic revenue flat to up 2%. Adjusted EBITDA is projected to range between $615 million to $630 million, reflecting growth of 4% to 6% year-on-year. The company anticipates fully diluted shares outstanding to be between 55 million to 56 million, leading to adjusted EPS guidance of $4.10 to $4.30, equating to year-on-year growth of 7% to 12%. Operating cash flow is expected to be between $300 million and $325 million.

Additional News

H.B. Fuller recently announced a quarterly dividend, reaffirming its commitment to returning value to shareholders. The company has also experienced a significant surge in stock value, rising by 10% following the revised fiscal year 2025 outlook. This positive market reaction is driven by the company's enhanced earnings per share (EPS) projection and a narrower revenue decline than initially anticipated. In the broader financial community, analysts have set an average one-year price target of $62.75 for H.B. Fuller, suggesting a potential upside of 12.13% from its current stock price. This reflects growing investor confidence in the company's strategic direction.