Core & Main (CNM) Q1 2026 earnings summary

Executive summary

• Achieved record Q1 FY2025 results with net sales up 9.8% to $1,911 million and adjusted EBITDA of $224 million, driven by strong municipal and non-residential growth, volume gains, and successful acquisitions.

• Market share gains and resilient end market demand, particularly in water infrastructure repair and upgrades, supported performance.

• Gross margin improved sequentially due to margin initiatives and M&A synergies, with minimal tariff impact.

• Continued investment in talent, training, and local relationships to drive long-term growth and market share gains.

• Share repurchases totaled $39 million in Q1, with $285 million remaining under authorization.

Financial highlights

• Net sales grew 10% year-over-year to $1,911 million, with gross profit up 9% to $510 million and gross margin at 26.7%, down 20 bps year-over-year.

• Adjusted EBITDA increased 3% to $224 million; margin declined 80 bps to 11.7%.

• Net income for Q1 FY2025 was $105 million, up from $101 million in Q1 2024; diluted EPS rose 6% to $0.52.

• SG&A expenses increased 14% to $293 million, mainly from acquisitions and inflation.

• Operating cash flow was $77 million; net debt at $2,284 million with net leverage of 2.4x; liquidity at $1.1 billion.

Outlook and guidance

• Reaffirmed full-year guidance: net sales of $7,600–$7,800 million and adjusted EBITDA of $950–$1,000 million; margin expected at 12.5%–12.8%.

• Operating cash flow guidance of $570–$650 million.

• Sales growth of 4%–7% anticipated for FY2025, excluding the effect of one less selling week.

• End markets expected to be roughly flat for the year, with stronger first half and more uncertainty in the second half due to tariffs, inflation, and interest rates.

• Gross margin expansion anticipated through private label, sourcing, and pricing initiatives.