# Quanex Building Products (NX) Q3 2025 Financial Results Summary
On September 4, 2025, Quanex Building Products Corporation (NYSE:NX) announced its financial results for the third quarter ended July 31, 2025. Below is a summary of the key financial metrics and developments reported by the company.
## Financial Highlights
– **Net Sales**:
– $495.3 million in Q3 2025, a **76.7% increase** from $280.3 million in Q3 2024.
– Excluding Tyman acquisition, net sales would have grown by **1.4%**.
– **Gross Margin**:
– $138.0 million, up from $70.9 million in the previous year.
– **Gross Margin %**: 27.9% in Q3 2025, compared to 25.3% in Q3 2024.
– **Net (Loss) Income**:
– Reported a net loss of $276.0 million, a decline compared to the net income of $25.4 million in Q3 2024.
– **Diluted EPS**:
– -$6.04 in Q3 2025 compared to $0.77 in the same quarter last year.
– **Adjusted Net Income**:
– $31.6 million in Q3 2025 vs. $26.9 million in Q3 2024.
– **Adjusted Diluted EPS**:
– $0.69 in Q3 2025 compared to $0.81 in Q3 2024.
– **Adjusted EBITDA**:
– $70.3 million versus $42.0 million a year prior.
– **Adjusted EBITDA Margin %**:
– 14.2% in Q3 2025, decreased from 15.0% in Q3 2024.
– **Cash Provided by Operating Activities**:
– $60.7 million in Q3 2025, increased from $46.4 million in Q3 2024.
– **Free Cash Flow**:
– $46.2 million, up from $40.1 million in the same quarter last year.
## Operational Review
– **Segment Performance**:
– **Hardware Solutions** reported net sales of $227.1 million, increasing by **201.0%**.
– **Extruded Solutions** saw sales of $174.4 million, a **29.6% increase** over last year.
– **Custom Solutions** achieved $102.3 million, marking a **40.7% growth**.
– The net income drop was mainly attributed to a $302.3 million non-cash goodwill impairment due to business re-segmentation and macroeconomic challenges.
## Balance Sheet & Liquidity
– **Total Debt**:
– $733.7 million.
– Improved leverage ratio of Net Debt to LTM Adjusted EBITDA decreased to **2.6x**.
– **Liquidity**:
– Increased to $337.7 million with $66.3 million in cash on hand.
– **Share Repurchases**:
– The company repurchased 100,000 shares for approximately $2.1 million at an average price of $20.54 per share during Q3 2025.
– Remaining share repurchase authorization stands at approximately $33.6 million.
## Dividend Declaration
– **Dividends** declared remained stable at **$0.08 per share**, matching the amount from Q3 2024.
## Guidance and Outlook
– Quanex updated its full-year guidance for fiscal 2025, estimating net sales approximately around **$1.82 billion** with an expected Adjusted EBITDA of around **$235 million**.
– The company remains focused on:
– Continuing synergies from the Tyman acquisition.
– Generating positive cash flow to pay down debt.
– Opportunistically repurchasing stock.
### Conclusion
The results reflect a mixed performance for Quanex Building Products in Q3 2025, showing significant growth in sales while facing challenges with net losses largely due to non-cash charges and operational issues. The company’s strategy to strengthen its balance sheet and adapt to market conditions suggests a cautious yet optimistic approach to future operations.
| Three Months Ended July 31, | Nine Months Ended July 31, | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| Net sales | $ 495,273 | $ 280,345 | $ 1,347,795 | $ 785,701 |
| Cost of sales | 357,305 | 209,441 | 986,129 | 597,127 |
| Selling, general and administrative | 71,270 | 36,509 | 208,253 | 103,579 |
| Restructuring charges | 1,367 | – | 10,207 | – |
| Depreciation and amortization | 33,882 | 10,953 | 77,814 | 32,999 |
| Asset impairment charges | 302,284 | – | 302,284 | – |
| Operating (loss) income | (270,835) | 23,442 | (236,892) | 51,996 |
| Interest expense | (14,218) | (878) | (42,344) | (2,896) |
| Other, net | 855 | 9,474 | 1,925 | 10,520 |
| (Loss) income before income taxes | (284,198) | 32,038 | (277,311) | 59,620 |
| Income tax benefit (expense) | 8,191 | (6,688) | 6,934 | (12,644) |
| Net (loss) income | (276,007) | 25,350 | (270,377) | 46,976 |
| (Loss) earnings per common share, basic | (6.04) | 0.77 | (5.83) | 1.43 |
| (Loss) earnings per common share, diluted | (6.04) | 0.77 | (5.83) | 1.42 |
| Weighted average common shares outstanding: Basic | 45,691 | 32,876 | 46,395 | 32,857 |
| Diluted | 45,691 | 33,106 | 46,395 | 33,087 |
| Cash dividends per share | 0.08 | 0.08 | 0.24 | 0.24 |
| July 31, 2025 | October 31, 2024 | |
|---|---|---|
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $ 66,272 | $ 97,744 |
| Restricted Cash | 1,654 | 5,251 |
| Accounts receivable, net | 201,837 | 197,689 |
| Inventories | 272,222 | 275,550 |
| Income taxes receivable | – | 5,937 |
| Prepaid and other current assets | 41,339 | 29,097 |
| Total current assets | 583,324 | 611,268 |
| Property, plant and equipment, net | 405,510 | 402,466 |
| Operating lease right-of-use assets | 147,829 | 126,715 |
| Deferred tax assets | 3,654 | 3,845 |
| Goodwill | 271,459 | 574,711 |
| Intangible assets, net | 558,768 | 597,909 |
| Other assets | 2,133 | 2,874 |
| Total assets | $ 1,972,677 | $ 2,319,788 |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
| Current liabilities: | ||
| Accounts payable | $ 126,486 | $ 124,404 |
| Accrued liabilities | 95,378 | 103,623 |
| Income taxes payable | 1,273 | 6,620 |
| Current maturities of long-term debt | 26,313 | 25,745 |
| Current operating lease liabilities | 15,243 | 12,475 |
| Total current liabilities | 264,693 | 272,867 |
| Long-term debt | 695,605 | 737,198 |
| Noncurrent operating lease liabilities | 138,246 | 117,560 |
| Deferred income taxes | 143,576 | 162,304 |
| Other liabilities | 13,166 | 19,113 |
| Total liabilities | 1,255,286 | 1,309,042 |
| Stockholders’ equity: | ||
| Common stock | 512 | 513 |
| Additional paid-in-capital | 699,106 | 701,008 |
| Retained earnings | 148,795 | 430,405 |
| Accumulated other comprehensive loss | (30,501) | (46,428) |
| Treasury stock at cost | (100,521) | (74,752) |
| Total stockholders’ equity | 717,391 | 1,010,746 |
| Total liabilities and stockholders’ equity | $ 1,972,677 | $ 2,319,788 |
