Ferguson Enterprises (FERG) Q2 2026 earnings summary

Executive summary

• Q2 2026 net sales reached $8.8 billion, up 4.6% year-over-year, driven by 3.8% organic growth and 1% from acquisitions.

• Adjusted operating profit rose 2.9% to $932 million; diluted EPS increased 5.3% to $3.39, with reported EPS up to $3.43.

• Eight acquisitions year-to-date, including a definitive agreement to acquire FloWorks for $1.6 billion, expected to close in Q3.

• Returned $375 million to shareholders via dividends and buybacks; net debt-to-EBITDA at 1.3x.

• Raised full-year guidance for net sales and operating margin.

Financial highlights

• Q2 gross margin was 31.0%, down 20 bps year-over-year; adjusted operating margin was 10.7%.

• Adjusted EBITDA for Q2 was $994 million, up 3.2% year-over-year.

• Half-year net sales were $16.2 billion (+4.2% YoY); adjusted operating profit $1.58 billion (+5.1% YoY).

• Free cash flow for H1 was ~$45 million, impacted by higher working capital and tax payments.

• Net debt to adjusted EBITDA stood at 1.3x, reflecting a strong balance sheet.

Outlook and guidance

• Full-year 2026 guidance raised to mid-single digit net sales growth and adjusted operating margin of 9.5%-9.8%.

• Capital expenditures expected at $375–$425 million; effective tax rate expected at ~26%.

• Guidance excludes the impact of the pending FloWorks acquisition, expected to close in Q3.