Mohawk (MHK) Q3 2026 Earnings Report

The call was balanced. Mohawk demonstrated strong cash generation, share repurchases, price and productivity execution, retail share gains, and progress in commercial and selected flooring businesses. However, these positives were offset by broadly soft demand, declining volumes, significant energy and input-cost inflation, pressure in Global Ceramic margins, weakness in residential construction and Europe, and lower fourth-quarter earnings guidance.

For the fourth quarter, management anticipates single digit adjusted net sales growth versus the prior year, with 4 fewer shipping days versus the prior year and 3 fewer days versus the third quarter of the current year; 61 versus 65 shipping days represents about a 6% headwind, and adjusted net sales are expected to be up low single digits on a days and FX adjusted basis. Total underlying inflation on a year over year basis is expected to be similar to the third quarter and management expects to fully offset inflation through price, mix, and productivity actions, with adjusted earnings per share between $1.35 and $1.45 and a 23.5% tax rate. For 2027, management is planning for market volumes to decline, underlying cost of sales inflation to remain up mid single digits in the fourth quarter and into early 27, and continued strong free cash flow; baseline capital expenditure needs are approximately $375 million annually, the new share repurchase authorization is $500 million, and the long term net debt to adjusted EBITDA target is up to 2x.