10-Q · April 22, 2026
Masco posted a quarter with top-line and EPS beats: net sales rose to $1,918 million (up 6% YoY; +4% ex-currency) and diluted net income per share was $1.05 (vs $0.87). Operating profit improved to $316 million (up 10%)…
Earnings analysis · 10-Q
MAS earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
Masco delivered strong second-quarter profitability, with diluted EPS up 25% to $1.60 and operating margin up 350 basis points to 23.6%, but revenue declined 3% to $1.992 billion as North American volume weakened.…
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Masco delivered strong second-quarter profitability, with diluted EPS up 25% to $1.60 and operating margin up 350 basis points to 23.6%, but revenue declined 3% to $1.992 billion as North American volume weakened. Results were materially aided by approximately $95 million of IEEPA tariff refunds, which tempers the apparent margin strength. First-half operating cash flow was $417 million versus $77 million of capex, while the company funded $596 million of share repurchases and added $300 million of term-loan borrowings.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.6
What stood out
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EPS growth materially outpaced sales
Diluted EPS rose 25% year over year to $1.60 from $1.28, while net income increased 18% to $318 million from $270 million despite a 3% sales decline.
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Substantial margin expansion
Gross margin expanded 600 basis points year over year to 43.6%, and operating margin increased 350 basis points to 23.6%; operating profit rose 14% to $470 million.
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Plumbing profit resilience
Plumbing Products operating profit grew 24% to $352 million even as revenue fell 3% to $1.337 billion. The segment benefited from lower tariffs, including IEEPA refunds, cost savings and pricing.
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Strong first-half cash conversion
First-half operating cash flow was $417 million and capital expenditures were $77 million, implying approximately $340 million of cash flow after capex over the six-month period.
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Large shareholder-return program
The company repurchased approximately 7.8 million shares for approximately $596 million in the first six months, with approximately $1.5 billion remaining under its authorization at June 30, 2026.
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Liquidity and credit capacity intact
Liquidity remains substantial: cash and cash investments were approximately $548 million, the $1.0 billion revolver had no borrowings outstanding, and the company was compliant with its covenants.
What to watch
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Volume-led sales contraction
Quarterly net sales declined 3% to $1.992 billion, driven by a 5% reduction from lower North America sales volume; pricing added only 1% and international volume added 1%.
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Profit uplift tied to tariff refunds
Approximately $95 million of second-quarter operating benefit came from IEEPA tariff refunds, principally in Plumbing Products. This non-recurring benefit was central to the 600-basis-point gross-margin expansion.
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Decorative segment remains pressured
Decorative Architectural Products revenue declined 4% to $655 million, while its operating profit was flat at $147 million, indicating continued volume and commodity-cost pressure.
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Restructuring charges continue
Masco incurred approximately $12 million of restructuring charges in the quarter and expects approximately $50 million during full-year 2026 as it consolidates operations and reduces headcount.
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Buybacks increased leverage and reduced cash
Cash and cash investments declined by approximately $99 million to $548 million from $647 million at December 31, 2025, while $300 million was outstanding under the new delayed-draw term loan at a 4.499% weighted-average interest rate.
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No formal risk-factor update; tariff exposure persists
Item 1A states there were no material changes to risk factors from the 2025 Form 10-K. Nonetheless, management cites elevated tariffs, particularly China-related Plumbing tariffs, and lower demand; tariff refunds supplied approximately $95 million of first-half benefit.
Management's outlook
The 10-Q does not provide quantitative EPS or revenue guidance. Management expects approximately $50 million of restructuring charges during full-year 2026 and currently anticipates using approximately $1.0 billion of cash, including term-loan funds, for 2026 share repurchases.
Earlier filings 4
10-Q · April 24, 2024
Masco reported Q1 net sales of $1,926 million, down $53 million (≈3%) year-over-year, while gross margin expanded to 35.6% (up 180 bps) and diluted EPS improved to $0.97 (up $0.07). Operating profit was $318 million (up…
10-K · February 8, 2024
Masco reported FY2023 net sales of $7,967 million, down 8% from 2022, driven by an 11% decline in sales volume, but delivered margin expansion (gross margin 35.6%, operating margin 16.9%) and strong cash generation…
10-Q · April 26, 2023
Masco reported Q1 net sales down 10% year-over-year to $1,979 million while gross margin expanded to 33.8% (up 180 bps). Operating profit fell to $315 million (down 11%) and diluted EPS was $0.90 (down $0.07 from…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.