Floor & Decor (FND) Q2 2025 earnings summary

Executive summary

• Net sales for Q2 2025 rose 7.1% year-over-year to $1,214 million, driven by new store openings and a 0.4% increase in comparable store sales, the first positive comp since Q4 2022.

• Diluted EPS increased 11.5% to $0.58, reaching the high end of expectations, with net income at $63.2 million.

• Opened three new warehouse format stores in Q2, totaling 257 locations, up 11.7% year-over-year; on track for 20 new stores in 2025.

• Pro sales and design services outpaced company averages, with pros accounting for 50% of sales and design services driving higher average tickets and gross margins.

• The company operated five design studios in 38 states as of quarter-end.

Financial highlights

• Gross profit increased 8.5% year-over-year, with gross margin rate up 60 bps to 43.9% due to lower supply chain costs.

• Adjusted EBITDA rose 9.7% to $150.2 million, with margin up to 12.4%.

• Operating income grew 14.8% year-over-year to $81.9 million, with operating margin at 6.8%.

• Selling and store operating expenses rose 10.2%, mainly from new store openings, while G&A expenses as a percentage of sales decreased by 30 bps.

• Net cash provided by operating activities was $155.3 million for the first half, down from $341.5 million in the prior year, mainly due to changes in inventory and payables.

Outlook and guidance

• Fiscal 2025 sales expected between $4,660 million and $4,750 million, up 5–7% year-over-year.

• Comparable store sales guidance: down 2% to flat; average ticket up low to mid-single digits, transactions down low to mid-single digits.

• Gross margin rate expected at 43.5–43.7%, with Q2 representing the high for the year due to distribution center costs.

• Adjusted EBITDA forecasted at $520–$550 million; diluted EPS between $1.75 and $2.

• 20 new warehouse format stores planned for 2025, with similar plans for 2026, subject to market conditions.