Mohawk Industries’ third-quarter results were met with a negative market reaction, reflecting investor concerns over deteriorating margins and persistent demand softness. Management highlighted that while sales and product mix benefited from premium residential and commercial offerings, higher input costs and temporary plant shutdowns weighed on profitability. CEO Jeff Lorberbaum noted, “Our adjusted earnings per share of $2.67 reflected benefits from ongoing productivity and restructuring initiatives... offset by higher input costs and temporary plant shutdown.” Across its geographies, consumer uncertainty and postponed renovation projects, particularly in the U.S., remained key challenges.
Is now the time to buy MHK? Find out in our full research report (it’s free for active Edge members).
Mohawk Industries (MHK) Q3 CY2025 Highlights:
- Revenue: $2.76 billion vs analyst estimates of $2.71 billion (1.4% year-on-year growth, 1.6% beat)
- Adjusted EPS: $2.67 vs analyst estimates of $2.64 (1.2% beat)
- Adjusted EBITDA: $359.4 million vs analyst estimates of $363 million (13% margin, 1% miss)
- Adjusted EPS guidance for Q4 CY2025 is $1.95 at the midpoint, below analyst estimates of $2.13
- Operating Margin: 5%, down from 7.8% in the same quarter last year
- Market Capitalization: $7.27 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Mohawk Industries’s Q3 Earnings Call
- John Lovallo (UBS) asked what changed since prior expectations for Q4 outperformance. CFO James Brunk highlighted that weakening conditions, persistent high interest rates, and lower consumer confidence led to revised, more cautious outlooks for revenue and margins.
- Matthew Bouley (Barclays) asked about the timing and effectiveness of tariff-related price increases. President Paul De Cock explained that announced increases will take time to be fully realized due to inventory dynamics, with the company expecting equilibrium by early next year.
- Collin Verron (Deutsche Bank) inquired about the lag between input cost relief and margin impact. Brunk responded that raw material cost benefits will take 3–4 months to cycle through inventory, with expectations for easing in 2026 but ongoing inflation in wages and energy.
- Susan Maklari (Goldman Sachs) questioned the momentum of new products and their potential to drive outperformance. CEO Jeff Lorberbaum cited ongoing innovation in ceramics, LVT, and laminate, but noted all segments face a challenging macro backdrop.
- Philip Ng (Jefferies) asked if domestic production gives Mohawk a cost advantage due to tariffs. De Cock confirmed that U.S.-produced laminate and ceramics are now more competitive, with channel partners shifting toward these offerings.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will closely monitor (1) the pace at which tariff-related price increases are absorbed and reflected in margins, (2) the effectiveness and realized savings from ongoing restructuring and cost reduction actions, and (3) signs of demand stabilization or improvement, especially in U.S. residential remodeling and European construction markets. Execution on new product rollouts and market share gains in tariff-advantaged categories will also be critical markers for progress.
Mohawk Industries currently trades at $116.51, down from $128.85 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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