Leggett Platt 2025 Q2 Earnings Strong Performance with Net Income Swinging 108.7% Positive

Leggett & Platt (LEG) reported its fiscal 2025 Q2 earnings on Jul 31st, 2025. The company demonstrated a notable turnaround with net income swinging 108.7% positive, marking a return to profitability with EPS of $0.38 compared to a loss of $4.39 per share in the previous year. Despite challenges, Leggett & Platt's strategic initiatives have been effective, allowing the company to sustain profitability, even amidst macroeconomic headwinds. The results were generally in line with expectations, maintaining its 2025 guidance for revenues and adjusted EPS.

Revenue
Revenue for Leggett & Platt declined by 6.3%, reaching $1.06 billion in 2025 Q2, compared to $1.13 billion in 2024 Q2.

Earnings/Net Income
Leggett & Platt's earnings per share (EPS) of $0.38 signifies a substantial recovery, alongside net income of $52.50 million, reflecting a positive turnaround. This EPS result indicates the company's effective cost management and strategic adjustments.

Post-Earnings Price Action Review
Leggett & Platt's post-earnings strategy of purchasing shares on the day of quarterly releases and holding for 30 days resulted in moderate returns, falling short of broader market performance. Over three years, this approach yielded an annualized return of 4.5%, underperforming the S&P 500's 7.8% return. While this method captured some growth, especially shortly after earnings releases, it encountered volatility and lagged during broader market downturns. This suggests that relying solely on earnings releases for investment decisions may not offer robust risk-adjusted returns in dynamic market conditions.

CEO Commentary
Karl Glassman, President and CEO, expressed satisfaction with the quarter, highlighting profitability improvement amid ongoing macroeconomic challenges. He noted the successful reduction of debt and a favorable amendment of the credit facility, indicating enhanced financial stability. Glassman emphasized confidence in the company’s resilience and the effectiveness of its strategic initiatives, reaffirming guidance for the year. He acknowledged challenges in demand, particularly in residential markets and automotive sectors, but maintained that the diversified portfolio and focused execution would support long-term shareholder value.

Guidance
Leggett & Platt maintains its guidance for 2025, expecting revenues between $4.0 billion and $4.3 billion and adjusted EPS between $1.00 and $1.20. The company anticipates a volume decline in the low single to low double digits, with an adjusted EPS now expected to be $0.88 to $1.17. The EBIT margin is projected to be between 5.9% and 6.8%, while the adjusted EBIT margin is expected to range from 6.5% to 6.9%.

Additional News
Leggett & Platt is advancing its strategic initiatives by planning to complete the sale of its Aerospace business by the end of 2025, focusing on streamlining operations and enhancing long-term growth. The company also amended its credit facility agreement, reducing the facility size from $1.2 billion to $1.0 billion and extending maturity to July 2030, reflecting confidence in its financial strategy. Additionally, Leggett & Platt announced maintaining its second-quarter dividend of $0.05 per share, demonstrating consistent shareholder returns amidst restructuring efforts.