TopBuild Reports Third Quarter 2025 Results; Raises Guidance to Include Recent Acquisitions

Core Insights - TopBuild Corp. reported third quarter sales of $1.4 billion, reflecting a 1.4% increase, and an adjusted EBITDA margin of 19.8% [1][2][5] - The company raised its 2025 sales outlook to a range of $5.35 to $5.45 billion, with adjusted EBITDA expected between $1.01 to $1.06 billion, incorporating contributions from recent acquisitions [1][3][14] Financial Performance - For the three months ended September 30, 2025, reported sales were $1,393,158, compared to $1,373,268 in the same period of 2024, with a gross profit of $418,920 [5][22] - The gross margin decreased to 30.1% from 30.7% year-over-year, while SG&A expenses increased to $203,910, representing 14.6% of sales [5][22] - Net income for the third quarter was $142,226, down from $168,960 in the prior year, with diluted earnings per share of $5.04 [5][22] Segment Performance - Installation Services segment sales were $858 million, a slight increase of 0.2%, while Specialty Distribution sales rose by 1.4% to $609 million [8][27] - Year-to-date, the company completed acquisitions totaling approximately $1.2 billion in annual revenue, enhancing its insulation and commercial roofing businesses [3][10] Acquisitions and Growth Strategy - TopBuild has prioritized acquisitions, spending approximately $851.2 million year-to-date, with additional acquisitions expected to close in the fourth quarter [10][11] - Recent acquisitions include Progressive Roofing and Specialty Products and Insulation, which are expected to contribute significantly to future growth [3][11] Market Outlook - The company remains optimistic about long-term fundamentals despite current challenges in residential construction due to weak consumer confidence [4] - The strength in commercial and industrial markets is viewed as a positive indicator for future opportunities [4]