MillerKnoll (MLKN) Q1 2027 earnings summary

Executive summary

• Q1 FY 2027 net sales were $923.4 million, down 3.4% year-over-year, while orders increased 3.2% to $913.9 million, with softness in North America Contract and Global Retail segments but strong order growth in International Contract and Global Retail.

• Adjusted EPS was $0.53 (up 17.8% year-over-year), or $0.42 excluding a $0.11 per share net benefit from tariff refunds, exceeding guidance due to disciplined execution and cost management.

• Gross margin rose to 41.7% (up 320–330 bps), driven by pricing actions and $16.5 million in tariff refunds.

• Operating expenses increased due to higher compensation, restructuring, and store expansion costs, but cost discipline and restructuring initiatives yielded $3–$5 million in OPEX savings.

• Internal demand indicators and project funnel additions were up year-over-year, with optimism for future growth despite current revenue headwinds.

Financial highlights

• Consolidated net sales: $923.4 million, down 3.4% year-over-year; consolidated orders: $913.9 million, up 3.2%.

• Gross margin increased to 41.7% (reported), 41.8% (adjusted); adjusted operating margin improved to 7.1% from 6.3%.

• Adjusted EPS: $0.53 ($0.42 excluding tariff refunds); cash from operations: $49.1 million; capital expenditures: $32.5 million in Q1.

• Net debt to EBITDA ratio: 2.75x; available liquidity: $580.4 million.

• Quarterly dividend declared: $0.1875 per share, annual yield 3.7%.

Outlook and guidance

• Q2 FY 2027 net sales expected at $972 million–$1.012 billion; adjusted EPS: $0.43–$0.49; gross margin guidance: 38.3%–39.3%.

• FY 2027 net sales guidance lowered to $3.88 billion–$4.03 billion (3% growth at midpoint); adjusted EPS maintained at $1.85–$2.15.

• Guidance includes $0.07 per share negative impact from new U.S.-Canada tariffs and $6 million per quarter in incremental new store expenses.

• Plans to open 14–18 new retail stores in FY2027, with 5–7 in Q2.