Steelcase SCS 2026Q1 Earnings Preview Upside Ahead on Strong Order Growth

Forward-Looking Analysis
Steelcase Inc. anticipates its first-quarter fiscal 2026 revenue to range between $760 million and $785 million, indicating a growth of 4% to 8% over the previous year. On an organic basis, the growth is projected at 5% to 9%. The earnings per share are expected to be in the range of $0.10 to $0.14, with adjusted earnings per share estimated between $0.13 to $0.17. The gross margin is forecasted at approximately 33%, factoring in $9 million of higher tariff costs compared to the prior year. The company projects operating expenses between $230 million and $235 million, including $4.3 million for amortization of purchased intangible assets. Steelcase is targeting mid-single digit organic revenue growth and modest improvement in adjusted operating income margin for fiscal 2026, supported by pricing actions to mitigate tariff and inflationary impacts. A stable macroeconomic environment is assumed, with continued order growth, particularly from large corporate customers, and benefits from a strong beginning backlog. The effective tax rate is projected at 27%.

Historical Performance Review
In the fourth quarter of fiscal 2025, Steelcase reported revenue of $788 million, a 2% increase from the prior year. Net income rose to $27.6 million, with earnings per share reaching $0.24. The gross profit for the quarter was $251.3 million. The company experienced significant order growth, particularly in the Americas, which contributed to improved financial performance, despite challenges in the international segment.

Additional News
Steelcase's fiscal 2025 results show a 4% order growth, driven by a 6% increase in the Americas. The company improved its gross margin by 110 basis points due to cost reduction initiatives. Operating income margin reached 5%, an increase of 130 basis points from the previous year. Steelcase returned $84 million to shareholders and strengthened its liquidity by $73 million. The fiscal 2026 targets include mid-single digit organic revenue growth and modest adjusted operating margin expansion. The company recorded a net income of $120.7 million and adjusted earnings per share of $1.12, exceeding targets. The backlog at the end of the fourth quarter was approximately $694 million, 11% higher than the previous year.

Summary & Outlook
Steelcase's financial health appears robust, with steady revenue, net income growth, and improved margins in fiscal 2025. The company's strategic initiatives and cost reduction efforts contribute to a positive outlook. Key growth catalysts include strong order growth and pricing actions to offset tariff and inflationary impacts. Challenges remain in the international segment, but the company's strong balance sheet and strategic focus support a bullish stance on future prospects. As Steelcase continues to capture market share, particularly in the Americas, it is well-positioned to achieve its mid-term financial targets.