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Atkore Inc. (ATKR)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 net sales were $735.0M, down 10.6% y/y; Adjusted EBITDA was $99.9M and Adjusted EPS was $1.63, finishing toward the top end of May ranges; organic volume grew 2% y/y while pricing remained a headwind .
  • Management raised FY2025 Adjusted EPS guidance to $6.25–$6.75 and narrowed Adjusted EBITDA to $390–$410M (midpoint maintained at $400M); Q4 outlook: net sales $720–$750M, Adjusted EBITDA $75–$95M, Adjusted EPS $1.05–$1.35, tax rate 20–23% .
  • Wall Street consensus for Q3 was broadly met: EPS beat modestly ($1.63 vs $1.58*), revenue was slightly below ($735.0M vs $736.9M*); sequential pricing improvement noted in steel conduit; tariffs are reducing import volumes, aiding domestic share recapture over time .
  • CEO Bill Waltz announced his decision to retire, with a succession process underway; management emphasized continuity and confidence in Atkore’s strategy and execution .

What Went Well and What Went Wrong

What Went Well

  • Delivered net sales, Adjusted EBITDA and Adjusted EPS “towards the top end” of prior ranges; organic volume +2% y/y; productivity gains supported results .
  • Sequential pricing improvement in steel conduit for a second quarter; demand tailwinds in certain verticals (data centers) and improving S&I segment margins (+60 bps y/y to 14.4%) .
  • FY2025 Adjusted EPS midpoint raised to $6.50 and dividend declared at $0.33 per share, reinforcing capital return commitment .
  • Quote: “We delivered strong performance… achieving net sales, adjusted EBITDA and adjusted EPS toward the top end of the ranges we presented in May.” — CEO Bill Waltz .

What Went Wrong

  • Pricing pressure was the dominant headwind; average selling prices declined across products, reducing gross margin to 23.4% (from 34.0% y/y) and compressing Electrical segment EBITDA margin to 15.6% (from 30.1%) .
  • GAAP diluted EPS fell to $1.25 (from $3.33 y/y) given lower gross profit; consolidated Adjusted EBITDA declined 51.5% y/y .
  • Aluminum tariffs (raised to 50%) and copper cost volatility elevated input costs; pricing has not kept pace with raw-material inflation, particularly copper .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Net Sales ($USD Millions)$661.6 $701.7 $735.0
GAAP Diluted EPS ($)$1.31 $(1.46) $1.25
Adjusted Diluted EPS ($)$1.63 $2.04 $1.63
Adjusted EBITDA ($USD Millions)$99.2 $116.4 $99.9
Gross Margin (%)25.9% 26.4% 23.4%

Segment breakdown

Segment MetricQ1 2025Q2 2025Q3 2025
Electrical Net Sales ($USD Millions)$465.4 $492.7 $521.3
Electrical Adjusted EBITDA ($USD Millions)$92.4 $90.9 $81.2
Electrical Adjusted EBITDA Margin (%)19.9% 18.5% 15.6%
Safety & Infrastructure Net Sales ($USD Millions)$196.7 $209.3 $214.0
Safety & Infrastructure Adjusted EBITDA ($USD Millions)$15.6 $36.1 $30.7
Safety & Infrastructure Adjusted EBITDA Margin (%)7.9% 17.2% 14.4%

KPIs

KPIQ1 2025Q2 2025Q3 2025
Net Debt ($USD Millions)$454.9 $435.5 $433.4
TTM Adjusted EBITDA ($USD Millions)$657.3 $561.8 $455.6
Cash from Operations (YTD, $USD Millions)$74.4 $160.9 (six months) $192.4 (nine months)
Free Cash Flow (YTD, $USD Millions)$33.1 $97.3 (six months) $107.4 (nine months)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDA ($M)FY2025$375–$425 $390–$410 Narrowed range; midpoint maintained
Adjusted Diluted EPS ($)FY2025$5.75–$6.85 $6.25–$6.75 Raised midpoint
Net Sales ($M)Q4 2025N/A$720–$750 New item
Adjusted EBITDA ($M)Q4 2025N/A$75–$95 New item
Adjusted Diluted EPS ($)Q4 2025N/A$1.05–$1.35 New item
Tax Rate (%)FY2025N/A19–21 New item; impacted by Q2 impairment
Tax Rate (%)Q4 2025N/A20–23 New item
Capital Expenditures ($M)FY2025N/A$100–$125 Affirmed
Stock Repurchases ($M)FY2025≥$150 ≥$150 Maintained; $100M spent YTD
Dividend ($/share)Next Pay Date$0.33 (Aug 29, 2025) $0.33 (paid Aug 29) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 and Q2)Current Period (Q3 2025)Trend
Pricing vs CostQ1/Q2: Pricing declines drove y/y gross margin compression; productivity partially offset; Adjusted EBITDA down y/y .Second consecutive quarter of sequential steel conduit pricing improvement; copper volatility; pricing still lags input costs .Sequential improvement in steel; ongoing cost pressure.
Tariffs & ImportsPrior focus on domestic sourcing; S&I strength; no specific tariff detail in press releases .Tariffs reduced imported steel/PVC conduit volumes; steel tariff from 25% to 50% (Mexico/Canada); aluminum raised to 50% .Tariffs increasingly supportive of domestic share; aluminum creates cost headwinds.
End-Market DemandQ1: Mid-single-digit growth in metal framing/cable management/construction services . Q2: Organic volume +5% y/y; S&I margins improved .Mixed sentiment; pockets of strength (data centers, solar), water municipal demand improving .Mixed near-term; constructive medium-term in electrification verticals.
FY2026 HeadwindsNot discussed in Q1; limited in Q2 .~$50M net headwinds expected (price carryover, aluminum tariffs); potential mitigation via productivity and volume .New explicit headwind framing for FY2026.
Capital AllocationQ1/Q2: Dividend $0.32 (Q1), ongoing buybacks; strong FCF profile .FY25 buybacks ≥$150M; balanced framework (capex, dividend, M&A, buybacks) .Consistent commitment to returns.
LeadershipNot applicable.CEO retirement announced; succession process underway; continuity emphasized .Leadership transition, low operational disruption signaled.

Management Commentary

  • “We delivered strong performance… achieving net sales, adjusted EBITDA and adjusted EPS toward the top end of the ranges we presented in May… We grew organic volume 2% year-over-year and recognized solid productivity improvements.” — Bill Waltz, CEO .
  • “We are maintaining our full-year adjusted EBITDA midpoint of $400,000,000 and are raising the midpoint of our adjusted EPS to $6.5…” — Bill Waltz .
  • “Pricing has not kept pace with raw material cost increases… particularly copper… adjusted EBITDA margins compressed year over year in our Electrical segment.” — John Deitzer, CFO .
  • “Imported steel conduit and PVC conduit volumes have both declined year-over-year… tariffs could provide an opportunity for volume recapture.” — John Pregenzer, COO .

Q&A Highlights

  • Volume visibility and macro: Demand visibility remains short-cycle with ~two-week backlog; mixed sentiment across non-residential; distributors holding lighter inventories amid price volatility (PVC, copper) .
  • Tariffs and imports: Significant double-digit declines in imported steel and PVC conduit volumes in Q3; steel tariffs at 50% are effective; PVC imports also down, while values claimed by importers can be “subjective” .
  • FY2026 setup: ~$(50)M net unmitigated gross-margin headwinds anticipated, largely the carryover of 2025 pricing declines and aluminum tariffs; productivity and volume growth to offset partially .
  • Capital returns: FY2025 buybacks target ≥$150M, with $100M spent year-to-date; four-pillar framework (capex/dividend/buybacks/M&A) reiterated .
  • Solar & water: Solar outlook constructive; torque tube margins supported by productivity; municipal water demand improving; residential plumbing channels remain softer .

Estimates Context

MetricQ1 2025Q2 2025Q3 2025
Revenue Consensus Mean ($USD)$680.8M*$697.7M*$736.9M*
Revenue Actual ($USD)$661.6M $701.7M $735.0M
Primary EPS Consensus Mean ($)$1.567*$1.712*$1.579*
Adjusted Diluted EPS Actual ($)$1.63 $2.04 $1.63
EBITDA Consensus Mean ($USD)$99.3M*$103.8M*$99.9M*
Adjusted EBITDA Actual ($USD)$99.2M $116.4M $99.9M

Values with asterisks retrieved from S&P Global.

Implications:

  • Q3: EPS modest beat; revenue slight miss; Adjusted EBITDA in line, noting potential definitional differences versus consensus “EBITDA” .
  • Q2: Broad beats on both EPS and revenue; Q1: EPS beat; revenue miss .

Key Takeaways for Investors

  • Pricing headwinds persist but are moderating in steel conduit; sequential pricing improvements and tariffs are reducing import competition, supporting share recapture and margins over time .
  • FY2025 guidance tightened and EPS raised; Q4 setup implies continued margin pressure but stable volume; watch aluminum tariff pass-through and copper volatility .
  • Electrical segment margin compression remains the central risk; S&I shows resilience with margin gains and construction services strength .
  • Capital deployment is supportive: ≥$150M buybacks in FY25, steady dividends, and capex to bolster domestic production and service levels .
  • CEO transition introduces headline risk but management emphasizes continuity; strategy and operations remain focused on electrification growth vectors (data centers, solar, municipal water) .
  • Near-term trading: Expect sensitivity to tariff developments and commodity prices; beats/misses versus consensus are likely driven by pricing vs cost dynamics and S&I execution .
  • Medium-term thesis: Domestic manufacturing footprint plus tariff tailwinds and secular electrification demand underpin volume growth potential; mitigating actions targeted against FY2026 headwinds .

Why Results Moved

  • Lower average selling prices across PVC and steel conduits drove the bulk of gross profit and margin compression; freight costs also increased, while volume was slightly positive .
  • Sequential pricing improvement in steel and productivity gains helped offset part of the pricing headwinds; S&I margin benefited from construction services and cable management strength .
  • Tariffs reduced import volumes in steel and PVC, aiding domestic demand for Atkore products; aluminum tariffs created cost challenges, with limited pass-through so far .