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Sep 27
HNI Q3 2025 Earnings Report
HNI Corporation reported solid third quarter 2025 results with increased net sales and strong operating margins, driven by profit transformation initiatives and productivity gains.
Key Takeaways
HNI Corporation announced net sales of $683.8 million and net income of $41.2 million for the third quarter ended September 27, 2025. The company achieved a GAAP diluted EPS of $0.88 and a non-GAAP diluted EPS of $1.10, with strong year-over-year results driven by productivity and operating expense control. Operating margin reached its highest third-quarter level on a non-GAAP basis.
Consolidated net sales increased 1.7% year-over-year to $683.8 million, with organic net sales up 2.6%.
GAAP diluted EPS was $0.88 (-10% YoY) and non-GAAP diluted EPS was $1.10 (+7% YoY).
Non-GAAP operating margin expanded 10 basis points to 10.8%, reaching an all-time high for the third quarter.
The company reduced debt by $120 million during the quarter, ahead of the anticipated Steelcase acquisition, resulting in a gross debt leverage of 0.9x.
HNI
HNI
HNI Revenue by Segment
Revenue by Segment
Workplace Furnishings Revenue
CapyFin.comResidential Building Products Revenue
CapyFin.com Forward Guidance
HNI Corporation expects strong sales growth in the fourth quarter of 2025, with double-digit diluted non-GAAP EPS growth for the full year 2025 and elevated earnings growth visibility through 2026.
Positive Outlook
- Workplace Furnishings net sales are expected to increase at a high single-digit rate year-over-year in Q4 2025.
- Residential Building Products net sales are expected to increase at a high-single digit rate year-over-year in Q4 2025.
- Fourth quarter 2025 non-GAAP diluted EPS is expected to increase slightly from 2024 levels, driven by price-cost, volume growth, and productivity benefits.
- The Corporation's outlook for 2025 full year earnings reflects expectations for mid-teens percent diluted non-GAAP EPS growth.
- KII synergies and the ramp-up of the Mexico facility are expected to contribute $0.75 to $0.80 to diluted non-GAAP EPS in 2025-2026.
Challenges Ahead
- Increased investment levels and insurance-related expenses are expected to partially offset Q4 2025 non-GAAP diluted EPS growth.
- Ongoing tariff-driven volatility and continuing macro uncertainty are noted as risks.
- The Corporation is unable to provide a reconciliation of forward-looking non-GAAP measures to future GAAP EPS without unreasonable effort due to uncertainty.
- Potential variability of costs and expenses, impairments, and financial impacts from legal/regulatory changes could impact diluted EPS.
- The pending Steelcase acquisition introduces risks related to closing, integration, and potential adverse reactions from customers/employees.
Revenue & Expenses
Visualization of income flow from segment revenue to net income