Owens Corning 2025 Q3 Earnings Net Loss Widens 253.9% Amid Market Challenges

Owens Corning (OC) reported fiscal 2025 Q3 results that missed expectations, with revenue declining 2.9% year-over-year to $2.68 billion and a net loss of $494 million, compared to a $321 million profit in 2024 Q3. The company also issued a weak Q4 revenue forecast, projecting a mid-to-high teens decline to $2.1–$2.2 billion.

Revenue

The company’s total revenue fell to $2.68 billion, reflecting softer demand across key markets. The Roofing segment generated $1.24 billion, up 15% year-over-year, while Insulation revenue stood at $941 million, a 0.5% decline. The Doors segment reported $545 million, down 4.9%, amid weaker new construction activity and a $780 million goodwill impairment charge.

Earnings/Net Income

Owens Corning swung to a loss of $5.92 per share in Q3 2025, compared to $3.69 per share in 2024 Q3, marking a 260.4% negative change. The net loss of $494 million reflects a 253.9% deterioration year-over-year, underscoring the impact of challenging market dynamics.

Post-Earnings Price Action Review

Shares of Owens Corning fell 2.52% in the latest trading day, 10.93% over the past week, and 18.81% month-to-date following the earnings report. The stock’s sharp decline reflects investor disappointment with the company’s results and weak guidance, as well as broader concerns about the U.S. residential construction market. Despite structural improvements and operational efficiency, the market appears to be pricing in prolonged demand challenges and margin pressures.

CEO Commentary

Chair and CEO Brian Chambers emphasized the company’s resilience amid weak U.S. residential demand, highlighting structural improvements and operational efficiency. He noted progress in maximizing performance, investing in growth (e.g., new Alabama and Kansas City facilities), and long-term value creation. Leadership remains optimistic about future cycles but acknowledged near-term headwinds.

Guidance

Owens Corning expects Q4 2025 revenue to decline mid-to-high teens to $2.1–$2.2 billion, with adjusted EBITDA margins of 16–18%. The company anticipates reduced tariff exposure and continued margin improvements but faces ongoing inflationary pressures and inventory challenges. Long-term targets include mid-20% annual EBITDA margins, $5 billion in free cash flow by 2028, and cost synergy capture exceeding $125 million by mid-2026.

Additional News

Owens Corning announced new investments, including a $6 million-square Alabama asphalt shingle plant and a Kansas City fiberglass line, to enhance production capacity. The company also returned over $700 million to shareholders via dividends and buybacks in 2025’s first three quarters. However, a $780 million non-cash goodwill impairment charge in the Doors segment, driven by weaker discretionary spending and new construction activity, weighed on results.

Financial Health & Valuation

Owens Corning maintains a gross margin of 29.47% and a current ratio of 1.52, reflecting stable liquidity. However, its Altman Z-Score of 2.34 signals financial stress, and insider selling trends persist. The stock trades at a P/E ratio of 32.13 and a P/S ratio of 0.96, near multi-year lows, with analyst price targets averaging $168.14.

Risks & Outlook

Sector-specific risks include volatile construction demand and potential tariff impacts, while a beta of 1.45 highlights stock volatility. Management’s focus on operational efficiency and strategic investments aims to mitigate these challenges, but near-term earnings pressure and margin compression remain concerns.