GMS (GMS) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 net sales were $5.51 billion, up marginally year-over-year, with organic sales down 5.8% due to macroeconomic headwinds and soft demand in key end markets.

• Fourth quarter net sales were $1.3 billion, with organic sales down 8.3% per day, but results were at the high end of expectations.

• Net income for fiscal 2025 was $115.5 million, down 58.2% year-over-year, impacted by a $42.5 million non-cash goodwill impairment charge.

• $55 million in annualized cost reductions were implemented in fiscal 2025, exceeding initial targets.

• Three strategic acquisitions and four new greenfield locations contributed to platform expansion.

Financial highlights

• Adjusted EBITDA for fiscal 2025 was $500.9 million (9.1% margin), with free cash flow of $336.1 million (67% of adjusted EBITDA).

• Fourth quarter adjusted EBITDA was $109.8 million (8.2% margin); free cash flow was $183.4 million (167% of adjusted EBITDA).

• Q4 2025 gross profit was $416.2 million, gross margin 31.2%, down 70 bps year-over-year.

• SG&A expenses for Q4 were $315.1 million, with adjusted SG&A as a percentage of sales up 130 bps to 23.1%.

• Q4 2025 net income per diluted share was $0.67; full year was $2.92.

Outlook and guidance

• Fiscal Q1 2026 net sales expected to be down low to mid single digits, with organic sales down mid to high single digits year-over-year.

• Adjusted EBITDA for Q1 2026 guided to $132–$137 million, with margins of 9.5%-9.8%.

• Full year 2026 capital expenditures expected at $40–$45 million; free cash flow projected at 60%-65% of adjusted EBITDA.

• Wallboard volumes expected flat to up slightly in single-family, down 25%-30% in multifamily, and down low teens in commercial.

• Management is cautiously optimistic the business is nearing the bottom of the cycle and expects pent-up demand to materialize as macro conditions improve.