Champion Homes (SKY) Q3 2025 earnings summary

Executive summary

• Net sales for the quarter rose 15.3% year-over-year to $645 million, driven by higher U.S. home sales and average selling prices, with homes sold up 14.1% to 6,646 units and backlog at $313 million, up 8% from last year.

• Net income increased 31% to $62 million ($1.06 per diluted share), with adjusted EBITDA up 25.7% to $83.3 million, reflecting improved gross margins and higher volumes.

• The acquisition of Regional Homes contributed significantly to revenue and volume growth, especially in the U.S. segment.

• CEO transition completed, with Tim Larson emphasizing continuity in strategy, customer-centric innovation, and omnichannel growth.

• Backlog increased 7.6% year-over-year but declined 26.9% sequentially to $313 million.

Financial highlights

• Gross profit margin improved to 28.1% from 25.3% year-over-year, with gross profit up 28% to $181 million.

• Operating income for the quarter was $72.8 million, up from $56.2 million a year ago.

• Diluted EPS for the quarter was $1.06, up from $0.81 in the prior year.

• SG&A increased to $108 million, or 16.8% of sales, reflecting higher sales volumes and investments in people and technology.

• Cash and cash equivalents reached $581.8 million at quarter-end.

Outlook and guidance

• Fourth quarter revenue expected to increase by low double digits year-over-year, in line with consensus and typical winter seasonality.

• Gross margins anticipated to normalize to 26%-27% as lower input cost benefits fade and product mix fluctuates.

• Management expects continued strong demand for affordable housing, supported by demographic trends and market share gains.

• The company anticipates maintaining compliance with debt covenants and sufficient liquidity for operations and strategic initiatives.

• Optimism for medium- and long-term demand, with early spring selling season showing positive signs.