Hayward (HAYW) Q4 2025 earnings summary

Executive summary

• Q4 and FY2025 net sales grew 7% year-over-year, with Q4 net sales at $349.4M and FY2025 at $1.122B, driven by positive pricing, favorable currency, and resilient aftermarket demand representing 85% of sales.

• Gross margin reached a record 48% for FY2025, with Q4 gross margin at 48.5%, reflecting operational efficiencies and lower warranty costs.

• Adjusted EBITDA increased 8% for FY2025 to $299.3M, and adjusted diluted EPS rose 15% to $0.77; diluted EPS up 26% to $0.68.

• Strong cash flow enabled net leverage reduction from 2.8x to 1.9x, supporting investments in innovation, automation, and customer experience.

• Centennial year marked by product innovation, operational excellence, and strategic growth initiatives.

Financial highlights

• Q4 2025: Net sales $349.4M (+7% YoY), gross profit $169.3M (+10%), gross margin 48.5% (+160 bps), adjusted EBITDA $102.9M (+4%), adjusted diluted EPS $0.29 (+7%).

• FY2025: Net sales $1.122B (+7%), gross profit $538.7M (+11%), gross margin 48.0% (+170 bps), adjusted EBITDA $299.3M (+8%), adjusted diluted EPS $0.77 (+15%), diluted EPS $0.68 (+26%).

• Free cash flow for FY2025 was $225M (+20%), reaching nearly 150% of net income.

• Net cash from operating activities increased 21% to $256.0M for FY2025.

Outlook and guidance

• FY2026 net sales expected to grow ~4% over FY2025.

• Adjusted diluted EPS guidance for FY2026 is $0.82–$0.86, representing 6–12% growth.

• Free cash flow projected at ~$200M, exceeding 100% of net income; CapEx to increase to ~$40M, focused on U.S. manufacturing upgrades and automation.

• Gross margins expected to modestly expand, with greater gains in the second half of 2026.

• Assumptions include net interest expense ~$45M and effective tax rate ~24%.