Steelcase (SCS) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 adjusted EPS was $1.12, exceeding targets, with net income of $120.7M and strong order growth, especially in the Americas.

• Q4 marked the 11th consecutive quarter of gross margin expansion, with over 500 basis points improvement since fiscal 2022.

• Strategic priorities include workplace transformation, expanding in education, healthcare, and SMBs, and strengthening profitability through operational efficiencies.

• Large corporate and government customers drove demand, with positive signals from corporate real estate and increased office leasing activity.

• Steelcase is focused on modernizing workplaces and leveraging its leadership in the global office furniture market.

Financial highlights

• Fiscal 2025 revenue was $3.17B, with adjusted operating income of $158.4M and a 5.0% margin; Q4 revenue was $788M, with adjusted EPS of $0.26, including $0.11 from favorable tax items.

• Adjusted EBITDA for fiscal 2025 was $262M (8.3% of revenue); net income was $121M, up from $81M in FY2024.

• Free cash flow for the year was $102M, with $84M returned to shareholders and $149M in operating cash flow.

• Total liquidity at year-end was $558M, exceeding total debt of $447M.

• Q4 gross margin improved 70 bps to 31.9%; fiscal 2025 gross margin improved 110 bps to 33.1%.

Outlook and guidance

• Fiscal 2026 targets mid-single-digit organic revenue growth and modest adjusted operating margin improvement, with Q1 revenue expected at $760M–$785M and adjusted EPS at $0.13–$0.17.

• International segment targeted for break-even adjusted operating income in fiscal 2026, with H1 losses offset by H2 profitability.

• Capital expenditures and capitalized cloud computing costs for fiscal 2026 targeted at $70M–$80M.

• Mid-term (3–4 years) targets include 4–6% average annual organic revenue growth, 6–7% adjusted operating income margin, and free cash flow at ~5% of revenue.

• Operational cost reductions of $50M+ from FY2023 are targeted.