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- **Revenue Growth**: Currency-neutral net sales up 4% YoY, driven by Americas and EAAA regions.
- **Margin Expansion**: Adjusted gross profit margin +208 bps to 39.5%, supported by automation and product mix.
- **Healthcare Success**: Billings +29% YoY, outperforming expectations with One Interface strategy.
- **Automation Investment**: Extending U.S. robotics to Europe/Australia, with new rubber innovation for 2026.
- **Financial Health**: $0.61 EPS, 27% YoY growth; liquidity at $482 million.
- **Guidance Update**: Full-year net sales $1.375-$1.390 billion, targeting 38.5% gross margin.
- **Risk Management**: Tariffs expected to dilute Q4 margin by 50 bps, offset by pricing and productivity.

**【CEO Summary Section】**
- Currency-neutral net sales grew 4% year-over-year, driven by strong performance in the Americas and EAAA regions.
- Adjusted gross profit margin expanded by 208 basis points to 39.5%, fueled by favorable product mix, manufacturing efficiencies, and automation investments.
- Healthcare segment billings surged 29%, with double-digit growth in both Americas and EAAA, supported by the One Interface selling strategy.
- Introduced new product collections, including Horizon's carpet tile and LVT styles, targeting diverse price points and design versatility.
- Automation investments in U.S. facilities are being extended to Europe and Australia, with a new rubber flooring innovation planned for early 2026.
- Corporate office billings increased 5%, and education billings remained up high single digits year-to-date despite a slight quarterly decline.
- Backlog grew 17% year-to-date, reflecting strong demand across all regions.

**【CFO Financial Commentary】**
- Third-quarter net sales: $364.5 million (5.9% as reported, 4.2% currency-neutral), exceeding guidance.
- Adjusted EBITDA: $66.2 million (23.7% year-over-year increase).
- Adjusted EPS: $0.61 (27% YoY growth).
- Operating cash flow: $76.7 million; liquidity: $482 million.
- Full-year 2025 guidance updated to $1.375-$1.390 billion in net sales, with a 38.5% adjusted gross profit margin target.
- Tariffs diluted gross profit margin by 30 basis points in Q3, expected to dilute by 50 basis points in Q4.
- Capital expenditures for 2025: $45 million, with potential $10 million increase in 2026 for automation and innovation.

**【Q&A Key Highlights】**
- **Healthcare Outperformance**: CEO attributed 29% global healthcare billings growth to expanded product portfolio and seamless One Interface selling execution.
- **Margin Strategy**: CFO emphasized balancing volume growth with margin preservation, targeting 38.5% gross profit margin for FY2025.
- **Automation Impact**: Automation investments reduced waste and improved service levels, with plans to replicate U.S. success in Europe and Australia.
- **Tariff Management**: Tariffs offset through pricing and productivity, but expected to dilute margin by 50 basis points in Q4.
- **CapEx Allocation**: 2026 CapEx may increase by $10 million to support Nora Rubber innovation and global automation initiatives.
- **Share Repurchases**: Stock buybacks ($0.7 million in Q3) reflect capital allocation flexibility, prioritizing business growth and margin expansion.

Interface, Inc. (TILE) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

TILE

TILE fundamentals

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