Champion Homes (SKY) Q3 2026 earnings summary

Executive summary

• Net sales for Q3 fiscal 2026 rose 1.8% year-over-year to $656.6 million, driven by higher average selling prices despite lower unit volumes in the U.S. and modest growth in Canada.

• Net income attributable to the company was $54.3 million, down 11.7% from the prior year, primarily due to lower gross margins and higher SG&A expenses.

• Adjusted EBITDA dropped 10.2% to $74.8 million, with margin down 150 basis points to 11.4%.

• The company completed the acquisition of Iseman Homes, enhancing its retail footprint, and continued integration of Regional Homes.

• Leadership transitions included the appointment of a new CFO and Chair of the Board, and the retirement of the former CFO.

Financial highlights

• Gross profit declined 4.9% to $172.2 million, with gross margin compressing by 190 basis points to 26.2% due to higher material costs and lower sales volume.

• SG&A expenses rose to $109.7 million, mainly from the Iseman Homes acquisition; SG&A as a percentage of sales remained flat at 16.7%.

• Operating income fell 14.2% to $62.5 million.

• Net income attributable to non-controlling interest increased 29.3% to $1.7 million, reflecting the minority share in Champion Financing.

• For the nine months, net sales grew 8.1% to $2.04 billion, and net income attributable to the company rose 9.4% to $177.2 million.

Outlook and guidance

• Q4 revenue expected to be up low single digits year-over-year, with gross margin anticipated in the 25%-26% range.

• Manufacturing backlog decreased to $266.0 million from $312.6 million year-over-year, as production outpaced new orders.

• Cautious consumer sentiment, seasonally lower winter demand, and potential weather disruptions may impact results.

• Management anticipates sufficient liquidity and compliance with debt covenants for the next year and beyond.