Apogee Enterprises (APOG) Q2 2026 earnings summary

Executive summary

• Net sales rose 4.6% year-over-year to $358.2 million, driven by the UW Solutions acquisition and growth in Architectural Services and Performance Surfaces, while declines were seen in Architectural Glass and Metals.

• Adjusted diluted EPS declined to $0.98, down 31.9% year-over-year, impacted by lower EBITDA, higher interest expense, and cost pressures.

• Adjusted EBITDA margin decreased to 12.4% from 15.5% due to lower price/volume, unfavorable mix, and higher material, tariff, and health insurance costs.

• Operating income fell to $26.9 million, with operating margin down 480 basis points to 7.5%.

• Strategic initiatives, including Project Fortify Phase 2 and Apogee Management System, are underway to drive cost efficiencies and productivity.

Financial highlights

• Net sales increased 4.6% to $358.2 million for the quarter, with $24.9 million from the UW Solutions acquisition.

• Adjusted EBITDA was $44.4 million, down 16.5% year-over-year.

• Gross margin declined to 23.1% from 28.4% year-over-year.

• Net cash from operating activities was $57.1 million for the quarter; $37.3 million year-to-date.

• $11 million returned to shareholders via dividends in the first half.

Outlook and guidance

• Fiscal 2026 net sales expected between $1.39 billion and $1.42 billion; adjusted diluted EPS guidance revised to $3.60–$3.90, including a $0.35–$0.45 EPS headwind from tariffs.

• Effective tax rate projected at 27%; capital expenditures expected between $35 million and $40 million.

• Net sales to be evenly split between Q3 and Q4; Q3 EPS similar to Q2, improving in Q4.

• Project Fortify Phase 2 expected to incur $24–26 million in pre-tax charges and deliver $13–15 million in annualized pre-tax cost savings by Q4 FY26.

• Guidance lowered due to competitive pricing, glass price/volume pressures, and higher aluminum and health insurance costs.