The quarter beat on the metric that matters most for ongoing operations, despite a revenue miss. Published consensus was roughly $0.78 for adjusted EPS and $1.65 billion for revenue; the company delivered adjusted EPS of $0.95 but sales of $1.611 billion, making this a profit beat paired with a roughly 2% top-line miss.
| Metric | Q2 2026 | Q2 2025 / prior guide | Read |
|---|---|---|---|
| Net sales | $1.611B (Financial Highlights) | $1.459B; prior guide $1.590B-$1.615B | +10.4% year over year, near the high end of company guidance |
| Comparable sales | +9% (Financial Highlights) | — | Broad-based demand growth |
| Adjusted operating income | $124M (Non-GAAP reconciliation) | $55M; prior guide $90M-$100M | Above company guidance by $24M at the midpoint |
| Adjusted diluted EPS | $0.95 (Non-GAAP reconciliation) | $0.33; prior guide $0.65-$0.75 | Above company guidance and published consensus |
| FY26 sales guide | $7.10B-$7.18B (Forecasted Non-GAAP Financial Information) | Prior guide $7.03B-$7.13B | Midpoint raised from $7.08B to $7.14B |
| FY26 adjusted operating-income guide | $560M-$590M (Forecasted Non-GAAP Financial Information) | Prior guide $550M-$580M | Midpoint raised from $565M to $575M |
The headline GAAP profit is not a clean measure of recurring performance. GAAP diluted EPS was $2.18 versus $0.20 a year ago, but the company received more than $140 million of IEEPA tariff refunds and excluded $1.25 per share from adjusted EPS. The underlying result is still substantially better: adjusted operating income rose to $124 million from $55 million, while adjusted EPS increased to $0.95 from $0.33. (Non-GAAP reconciliation)
The quality of the operating improvement is better than the sales miss suggests. Comparable sales increased 9%, regular-price selling improved, and adjusted operating income exceeded the company’s own $90 million-$100 million forecast. That indicates better margin and execution, not merely stronger demand, although the filing does not provide enough detail to separate pricing, mix, and cost effects precisely.
The raised full-year outlook is the clearest forward signal. Management lifted the FY26 sales midpoint by about $60 million and the adjusted operating-income midpoint by $10 million, while guiding third-quarter sales to $1.570 billion-$1.600 billion and operating income to $10 million-$20 million. (Forecasted Non-GAAP Financial Information) The increase is modest rather than transformational, but it confirms that the first-half momentum was strong enough to offset the quarter’s revenue miss versus outside consensus.
Net read: a beat, with one important caveat. Revenue came in below the market’s roughly $1.65 billion expectation, but the adjusted profit outperformance, 9% comparable-sales growth, and higher full-year operating outlook more than compensate. The result is better than expected operationally; the tariff refund explains the outsized GAAP headline, not the core earnings beat.
Read the original 8-K on SEC EDGAR ↗