Steelcase 2026 Q1 Earnings Strong Performance with Net Income Rising 24.8%

Steelcase (SCS) reported its fiscal 2026 Q1 earnings on June 27th, 2025. The company surpassed revenue expectations, achieving $779 million in revenue compared to the anticipated $759.9 million. However, earnings per share (EPS) of $0.11 fell short of the consensus estimate of $0.13. Steelcase adjusted its guidance for the next quarter, projecting revenue between $860 million and $890 million and EPS ranging from $0.36 to $0.40, reflecting a cautious yet optimistic outlook in light of ongoing market challenges.

Revenue
The total revenue of Steelcase increased by 7.1% to $779 million in 2026 Q1, up from $727.30 million in 2025 Q1.

Earnings/Net Income
Steelcase's EPS rose 22.2% to $0.11 in 2026 Q1 from $0.09 in 2025 Q1, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $13.60 million in 2026 Q1, marking 24.8% growth from $10.90 million in 2025 Q1. The increase in EPS underscores a positive financial performance.

Post-Earnings Price Action Review
The strategy of buying SCS shares when revenues miss and holding for 30 days yielded an 8.66% return, but significantly underperformed against the benchmark return of 110.08%. This strategy resulted in a negative excess return of -101.41% and a compound annual growth rate (CAGR) of only 1.66%, indicating a failure to leverage broader market gains. With a Sharpe ratio of 0.04 and a maximum drawdown of -58.58%, the strategy faced high volatility and substantial risk, proving to be a less-than-optimal approach. The data suggests that investors should reconsider their strategies to mitigate risks and improve returns.

CEO Commentary
Sara E. Armbruster, President and CEO, highlighted a strong Q1 with a 7% revenue growth, driven by large corporate customers, particularly in technology. She emphasized the need for businesses to transform their spaces for hybrid work, noting “companies across these leading industries are seeing the opportunity to use space to drive outcomes around productivity, innovation, and growth.” Challenges were faced with declines in education and government sectors due to funding changes. Armbruster expressed confidence in Steelcase's strategic pillars, stating, “we're doing the right things to win as much available business as possible,” reinforcing a positive outlook for continued momentum.

Guidance
David C. Sylvester, CFO, expects Q2 revenue between $860 million and $890 million, reflecting organic growth of up to 3%. Adjusted earnings per share are projected to range from $0.36 to $0.40. The guidance incorporates a gross margin of approximately 33% to 33.5%, accounting for $20 million in higher tariff costs and inflation. The company continues to target mid-single-digit organic revenue growth for the full year while aiming to expand adjusted operating margins compared to the prior year.

Additional News
Recently, Steelcase initiated restructuring actions in the Americas, including salaried headcount reductions and the elimination of open job requisitions, aiming to achieve $20 million in annualized spending cuts. These measures reflect the company's response to weak macroeconomic factors and lower demand in Germany and France. Moreover, Steelcase has engaged with unions and works councils in Europe to further reduce costs in response to these challenges. Despite these changes, Steelcase remains committed to strategic initiatives and growth areas, demonstrating its adaptability in navigating evolving market conditions. The actions are part of a broader effort to enhance profitability and operational efficiency.