Financial Performance - In Q4 2025, Mohawk Industries reported net earnings of $42 million and adjusted net earnings of $124 million, with an adjusted EPS of $2.00[1][2] - Net sales for Q4 2025 were $2.7 billion, reflecting a 2.4% increase as reported but a 3.3% decrease on an adjusted basis compared to Q4 2024[1][2] - For the full year 2025, net sales totaled $10.8 billion, a decrease of 0.5% as reported and 1.3% on an adjusted basis compared to 2024[2] - Adjusted net earnings attributable to Mohawk Industries, Inc. for the twelve months ended December 31, 2025, were $559.3 million, down from $617.2 million in 2024, reflecting a decline of 9.4%[23] - Adjusted diluted earnings per share for the twelve months ended December 31, 2025, were $8.96, compared to $9.70 in 2024, a decrease of 7.7%[23] - Earnings before income taxes for Q4 2025 were $66.0 million, a decline from $108.5 million in Q4 2024[32] - Adjusted earnings before income taxes remained stable at $149.5 million for both Q4 2025 and Q4 2024[32] Cash Flow and Capital Management - The company generated free cash flow of approximately $621 million in 2025 and repurchased about 1.3 million shares for approximately $150 million[3] - Capital spending in 2025 was reduced to $435 million, approximately 30% below depreciation levels, in response to market conditions[6] - Total debt as of December 31, 2025, was $2,030.5 million, with net debt standing at $1,174.4 million after accounting for cash and cash equivalents[24] Segment Performance - The Global Ceramic Segment saw net sales increase by 6.1% as reported, while the Flooring North America Segment experienced a 4.8% decrease in net sales[7][8] - The Global Ceramic segment reported net sales of $1,070.0 million for the three months ended December 31, 2025, an increase from $1,008.2 million in 2024[22] - Flooring NA segment experienced a decline in net sales to $892.5 million for the three months ended December 31, 2025, down from $937.2 million in 2024, a decrease of 4.9%[22] - Flooring segment operating income for Q4 2025 was $44.6 million, down from $60.9 million in Q4 2024[31] - Adjusted segment operating income as a percentage of net sales decreased to 8.8% in Q4 2025 from 10.0% in Q4 2024[31] Future Outlook - Mohawk anticipates first quarter 2026 adjusted EPS to be between $1.75 and $1.85, excluding any restructuring or one-time charges[10] - Mohawk expects improvements in sales and earnings for 2026, contingent on economic conditions and the recovery of residential remodeling[11] Tax and Accounting Adjustments - Income tax expense increased to $24.0 million in Q4 2025 from $18.3 million in Q4 2024[33] - Adjusted income tax expense as a percentage of adjusted earnings before income taxes was 17.1% in Q4 2025, slightly down from 17.8% in Q4 2024[33] - The company identified an immaterial error affecting prior financial statements, resulting in a $42.1 million reduction in reported accounts receivable[34][35] - The company recorded expenses of $9.5 million for the year ended 2023 and $3.0 million for the year ended 2024 due to prior period corrections[35] Non-GAAP Measures - The company emphasizes the use of non-GAAP measures to provide insights into growth trends and long-term profitability[36][38] - Certain items are excluded from non-GAAP measures to avoid obscuring underlying business trends, including restructuring and legal settlements[37][38] Asset Growth - Total assets increased to $13,687.3 million as of December 31, 2025, up from $12,736.5 million in 2024, representing a growth of 7.5%[21] - Consolidated net sales for the twelve months ended December 31, 2025, were $10,785.4 million, a slight decrease of 0.5% from $10,836.9 million in 2024[22] Gross Profit and Operating Income - Gross profit for the three months ended December 31, 2025, was $622.2 million, slightly up from $620.6 million in 2024[28] - Adjusted operating income for the three months ended December 31, 2025, was $152.1 million, compared to $159.8 million in 2024, a decrease of 4.7%[30]

Core Viewpoint - Mohawk Industries reported mixed financial results for Q4 2025, with net earnings of $42 million and adjusted net earnings of $124 million, reflecting ongoing challenges in the housing market and increased input costs [1][2][3]. Financial Performance - Q4 2025 net sales were $2.7 billion, a 2.4% increase year-over-year, but a 3.3% decrease on an adjusted basis [1][2]. - For the full year 2025, net earnings were $370 million, with an EPS of $5.93, while adjusted net earnings were $559 million, with an adjusted EPS of $8.96 [2]. - The company generated free cash flow of approximately $621 million in 2025 and repurchased about 1.3 million shares for approximately $150 million [3]. Market Conditions - The company faced macroeconomic challenges, including weak consumer confidence and low housing turnover, which affected sales volume [4][5]. - U.S. existing home sales remained stagnant, although December saw a slight increase compared to the previous year [4]. - In Europe, interest rates and inflation have eased, contributing to stable consumer savings and steady employment [4]. Segment Performance - The Global Ceramic Segment saw a 6.1% increase in net sales, while the Flooring North America Segment experienced a 4.8% decrease [6][8][20]. - The Flooring Rest of the World Segment reported a 6.5% increase in net sales, but a 3.5% decrease when adjusted for constant days and exchange rates [7][20]. Strategic Actions - The company implemented various strategies to stimulate sales, including innovative product launches and marketing initiatives [5]. - Capital expenditures were reduced to $435 million, approximately 30% below depreciation levels, in response to market conditions [5]. - Mohawk anticipates that lower interest rates will encourage investments in commercial construction and renovation [4][10]. Future Outlook - The company expects continued competitive market conditions in Q1 2026, with adjusted EPS projected between $1.75 and $1.85 [9]. - Mohawk anticipates improvements in sales and earnings for 2026, contingent on economic conditions and the recovery of residential remodeling [10].

Core Insights - Mohawk Industries, Inc. (MHK) is set to report its fourth-quarter results for 2025 on February 12, after market close [1] - In the last reported quarter, adjusted earnings per share (EPS) missed the Zacks Consensus Estimate by 0.4%, while net sales exceeded expectations by 1.1% [1] - Year-over-year, net sales grew by 1.4%, but adjusted EPS declined by 7.9% [1] Earnings Performance - MHK's earnings surpassed expectations in three of the last four quarters, with an average surprise of 4.2% [2] - The Zacks Consensus Estimate for fourth-quarter EPS remains unchanged at $1.98, reflecting a 1.5% increase from the previous year's EPS of $1.95 [3] Sales Trends - The fourth-quarter top-line performance is expected to improve year-over-year, driven by contributions from the Global Ceramic (40.1% of Q3 2025 net sales) and Flooring Rest of the World (26% of Q3 2025 net sales) segments [4] - The Global Ceramic segment is anticipated to benefit from premium collections, commercial sales, and expanded distribution [4] - The Flooring Rest of the World segment is expected to see growth due to strong performance in panels and insulation, with increased plant utilization [4] Segment Performance - The model predicts fourth-quarter net sales for Global Ceramic to rise by 6.4% to $1.07 billion, while Flooring North America is expected to decline by 1.2% to $926.4 million, and Flooring Rest of World is projected to increase by 1.1% to $699.7 million [7] Margin Expectations - The bottom line is expected to improve compared to the previous year due to favorable pricing strategies aimed at offsetting cost pressures from tariffs and macroeconomic challenges [8] - Productivity gains and improved profitability from strategic efforts, such as closing high-cost facilities and streamlining distribution, are also expected to enhance margins [8] - Adjusted EPS is projected to be in the range of $1.90-$2.00, compared to $1.95 reported a year ago [9] - The adjusted gross margin is expected to expand by 40 basis points to 24.8%, while the adjusted EBITDA margin is projected to increase by 500 basis points to 13.8% [10] Earnings Prediction - The model does not predict an earnings beat for Mohawk this time, as the company has an Earnings ESP of 0.00% and a Zacks Rank of 4 (Sell) [11]

Core Viewpoint - The carpet industry in northwest Georgia, particularly companies like Shaw Industries and Mohawk, has been significantly impacted by the use of PFAS (per- and polyfluoroalkyl substances), leading to environmental contamination and health concerns among local residents. The industry's reliance on these chemicals for stain resistance has resulted in widespread pollution and legal challenges as communities seek accountability for the health risks associated with PFAS exposure. Group 1: Industry Practices and Historical Context - The carpet industry has utilized PFAS for decades, with companies like Shaw Industries and Mohawk relying on these chemicals for stain resistance in carpet production [3][27][35] - 3M's announcement in 2000 to reformulate Scotchgard due to health concerns marked a pivotal moment for the industry, as it highlighted the dangers of PFAS accumulation in human blood [1][34] - The lack of stringent regulations allowed carpet manufacturers to continue using PFAS and related chemicals, contributing to significant environmental pollution [4][12][19] Group 2: Environmental and Health Impact - The contamination from carpet mills has led to PFAS being detected in local water sources, with levels exceeding EPA health advisories [5][60][69] - Residents in the region have reported health issues, including elevated PFAS levels in their blood, raising concerns about potential links to various health problems [7][81][90] - Studies have shown that the Conasauga River, affected by carpet industry runoff, has some of the highest recorded PFAS levels in surface water globally [69][76] Group 3: Legal and Regulatory Challenges - Numerous lawsuits have been filed against carpet manufacturers and chemical suppliers, with communities seeking compensation for the health and environmental damages caused by PFAS [97][100] - The regulatory response has been slow, with federal and state agencies struggling to implement effective measures to address PFAS contamination [16][101] - The carpet industry has faced increasing scrutiny and pressure to reformulate products and address past practices, yet challenges remain in fully eliminating PFAS from production processes [86][87]

Core Insights - The International Surface Event (tise) 2026 concluded successfully, showcasing the latest trends and products in the flooring, stone, and tile industries, while fostering collaboration among leading brands and professionals [1][16] Industry Highlights - The event featured prominent brands such as Mohawk, Shaw, Mannington, and Engineered Floors, unveiling innovative products and providing insights into future market trends [3] - Dedicated pavilions and immersive show floor experiences were designed to cater to various business types, focusing on technology, materials, and market opportunities [4][6] Networking and Educational Opportunities - tise 2026 introduced new networking programs, including Retail Roundtables for discussing business strategies and a dedicated tise LIVE Theatre for trend presentations and educational sessions [7][8] - The event also included specialized areas like the Natural Stone Theatre and The Learning Lab, which focused on sustainability, design trends, and legal updates in the industry [8] Recognition and Awards - The National Installer of the Year Competition highlighted the skills of flooring installers, with winners recognized for their craftsmanship in various installation categories [10][15] Future Outlook - tise is set to return to the Mandalay Bay Convention Center from February 1-4, 2027, continuing its role as a key platform for industry professionals [13]

Core Insights - The International Surface Event (tise) has announced the winners of the "What's Hot – Best of tise 2026 Awards," recognizing companies that excel in innovation and industry standards [1][3][4] Industry Overview - tise serves as a premier platform for industry professionals to discover new products during the peak buying cycle, featuring over 650 brands across more than 155 product categories [2][8] - The event highlights both traditional and innovative products, with dedicated pavilions for flooring, stone, tile, machinery, and installation products [2] Awards Highlights - The awards celebrate products, services, and solutions that enhance industry efficiency, creativity, safety, and innovation [3] - Notable winners in the Surfaces category include: - Style & Design: Karastan - Technology: Rara AI - Innovation: Mohawk - Sustainability: Nox - Disruption: Mohawk - Carpet: Couristan - Wood: AHF - Laminate: Stanton - Resilient: Mannington [6] - In the Tile + Stone category, winners include: - Style & Design: Cambria - Technology: Aardwolf - Innovation: GranQuartz - Sustainability: Full Circle Water - Disruption: Thryve - Tile: Arizona Tile - Stone: Vermont Quarries [7] Event Details - The awards will return to tise next year from February 2-4, 2026, with information available for submissions for the 2027 awards [7]

Core Insights - The International Surface Event (tise) has announced the winners of the "What's Hot – Best of tise 2026 Awards," recognizing outstanding products and innovations in the flooring, stone, and tile industries [1][3]. Industry Overview - tise serves as a premier gathering for industry professionals, showcasing over 650 brands across more than 155 product categories, including flooring, stone, tile, machinery, and installation products [2]. - The event emphasizes innovation and discovery, making it a key destination during the peak buying cycle of the year [2]. Awards Highlights - The "What's Hot - Best of tise" awards honor products that enhance industry efficiency, creativity, safety, and innovation [3]. - Winners in the Surfaces category include: - Style & Design: Karastan - Technology: Rara AI - Innovation: Mohawk - Sustainability: Nox - Disruption: Mohawk - Carpet: Couristan - Wood: AHF - Laminate: Stanton - Resilient: Mannington - Best Large Booth: AHF - Best Small Booth: Cali [6]. - Winners in the Tile + Stone category include: - Style & Design: Cambria - Technology: Aardwolf - Innovation: GranQuartz - Sustainability: Full Circle Water - Disruption: Thryve - Best Small Booth: Wilson Industrial Electric - Best Large Booth: Full Circle Water - Tile: Arizona Tile - Stone: Vermont Quarries [7]. Future Events - The awards will return to tise next year from February 2-4, 2026, with details for submissions for "What's Hot - Best of tise" 2027 available on the official website [7]. About tise - tise is a significant event that unites various stakeholders in the flooring, stone, and tile industries, including retailers, distributors, contractors, and designers, providing a platform for product showcases, seminars, and networking opportunities [8].

Core Insights - Chicago Partners Investment Group LLC increased its stake in Mohawk Industries by 230.0% in Q3, owning 6,180 shares valued at $734,000 [2] - Institutional investors and hedge funds collectively own 78.98% of Mohawk Industries [3] Institutional Activity - Goldman Sachs raised its stake by 14.1% in Q1, now holding 344,797 shares valued at $39,369,000 after acquiring 42,655 additional shares [3] - UBS AM increased its stake by 0.6% in Q1, owning 193,977 shares worth $22,148,000 after acquiring 1,175 shares [3] - Wealth Enhancement Advisory Services LLC grew its position by 190.5% in Q2, now owning 15,031 shares valued at $1,666,000 [3] - Farther Finance Advisors LLC increased its stake by 85.6% in Q2, now holding 2,437 shares valued at $255,000 [3] Insider Activity - Insider Suzanne L. Helen sold 2,700 shares at an average price of $109.00, totaling $294,300, reducing her ownership by 3.82% [4] - Corporate insiders sold 17,600 shares valued at $1,945,754 in the last ninety days, with insiders owning 17.40% of the stock [4] Analyst Ratings - Barclays set a price target of $121.00 for Mohawk Industries [5] - Raymond James reissued a "strong-buy" rating with a price target of $150.00, up from $140.00 [5] - Jefferies Financial Group lowered its price target from $134.00 to $128.00, maintaining a "hold" rating [5] - The consensus rating for Mohawk Industries is "Moderate Buy" with an average price target of $133.83 [6] Company Performance - Mohawk Industries reported Q3 earnings of $2.67 per share, missing the consensus estimate by $0.01, with revenue of $2.76 billion, exceeding expectations [8] - The company's quarterly revenue increased by 1.4% year-over-year [8] - Mohawk Industries has a market cap of $7.46 billion, a PE ratio of 17.97, and a debt-to-equity ratio of 0.21 [7] Company Overview - Mohawk Industries is a global flooring manufacturer, producing a wide range of floor covering products for residential and commercial applications [9] - The company has a vertically integrated platform, controlling product quality and supply chain efficiency [9]

Core Insights - Mohawk Industries, Inc. announced the retirement of Chief Financial Officer James F. Brunk, effective April 1, 2026, with Nicholas P. Manthey set to succeed him [1][2][3] Group 1: Leadership Transition - James F. Brunk has served as CFO for 20 years, contributing to Mohawk's growth as a global leader in flooring [2] - Brunk will assist in a senior advisory role post-retirement to ensure a smooth transition [2] - Nicholas P. Manthey has been with Mohawk since 2020 and has a strong background in finance, having previously worked at Bridgestone and Intel [3] Group 2: Company Overview - Mohawk Industries is a leading global flooring manufacturer, operating in approximately 180 countries [4] - The company has expanded its operational footprint with manufacturing facilities across North America, Europe, South America, Oceania, and Asia [4] - Mohawk's product offerings include ceramic tile, carpet, laminate, wood, stone, and vinyl flooring, supported by a vertically integrated manufacturing and distribution process [4]

Core Viewpoint - Mohawk Industries (MHK) is given a hold rating due to significant near-term challenges in residential demand and pricing, while the commercial segment, particularly ceramics, is performing well with new premium product launches [1] Company Analysis - The investment approach focuses on understanding the core economics of a business, including competitive moat, unit economics, reinvestment runway, and management quality, which are essential for long-term free cash flow generation and shareholder value creation [1] - The company is currently managing its own funds, which were seeded from friends and family, indicating a personal investment strategy [1] Industry Insights - The analyst emphasizes a focus on sectors with strong secular tailwinds, suggesting that the broader industry context is important for identifying long-term investment opportunities [1]