Spectrum Brands’ third quarter performance in 2025 was defined by a sharper-than-expected revenue decline, yet the market responded positively due to robust cost-reduction efforts and a substantial non-GAAP earnings beat. Management attributed the sales softness primarily to supply chain disruptions from paused shipments out of China and ongoing category weakness in Global Pet Care and Home and Personal Care. CEO David Maura emphasized that, despite these challenges, the company successfully offset tariff and inflationary pressures through vendor concessions, internal cost cuts, and targeted pricing actions. As Maura noted, “We have offset substantially all of this [tariff] exposure through a combination of vendor concessions, painful internal cost reductions, supply base reconfiguration and diversification, and lastly, pricing actions.”
Is now the time to buy SPB? Find out in our full research report (it’s free for active Edge members).
Spectrum Brands (SPB) Q3 CY2025 Highlights:
- Revenue: $733.5 million vs analyst estimates of $741.3 million (5.2% year-on-year decline, 1.1% miss)
- Adjusted EPS: $2.61 vs analyst estimates of $0.91 (significant beat)
- Adjusted EBITDA: $63.4 million vs analyst estimates of $63.88 million (8.6% margin, 0.7% miss)
- Operating Margin: 4%, up from 2.8% in the same quarter last year
- Organic Revenue fell 6.6% year on year vs analyst estimates of 5.2% declines (144.8 basis point miss)
- Market Capitalization: $1.32 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 Spectrum Brands’s Q3 Earnings Call
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Chris Carey (Wells Fargo Securities) pressed for details on potential outcomes for the Home and Personal Care business. CEO David Maura declined to comment on M&A specifics but stated, “We are excited to resume strategic discussions around finding a strategic solution for the business.”
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Chris Carey (Wells Fargo Securities) followed up on Global Pet Care’s competitive positioning, to which Maura described stabilization from new leadership and better shelf space, noting “shipments have been improving pretty consistently.”
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Bob Labick (CJS Securities) asked about retail pricing increases and consumer acceptance. Maura highlighted minimal price hikes due to internal cost cuts and vendor negotiations, with the largest increases in appliances.
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Ian Zaffino (Oppenheimer) questioned tariff policy reversals. Maura responded that he does not expect tariffs to revert to zero and has focused on current realities rather than hypothetical changes.
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Steve Powers (Deutsche Bank) asked about the S/4HANA ERP rollout’s impact on strategic options. Maura said the system enhances efficiency and does not impede potential separations or partnerships.
Catalysts in Upcoming Quarters
Going forward, the StockStory team will closely monitor (1) the pace and effectiveness of new product rollouts in pet care and home and garden, (2) continued progress in cost and supply chain optimization, and (3) strategic developments involving the Home and Personal Care segment. Additional focus will be on potential acquisition activity and whether inventory normalization translates into sustained category growth.
Spectrum Brands currently trades at $54.67, up from $53.24 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).
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