Revenue beat, but tariff costs force a lower profit outlook

Revenue materially exceeded expectations, but earnings only landed around consensus. Second-quarter revenue was $295.3 million versus published estimates clustered near $271 million, while adjusted EPS of $0.54 was roughly in line with the approximately $0.52–$0.54 expectation. The demand story is strong, but the revenue upside did not convert into profit upside.

The core problem is margin compression, not demand. Revenue rose 15.6%, with both residential and multi-family/commercial sales up roughly 15%, and backlog reached a record $1.38 billion (Press Release — Revenue and Backlog). But gross margin fell to 37.3% as aluminum costs increased approximately 77%, the Colombian peso strengthened about 14%, and tariffs added roughly $17 million of expense to SG&A (Gross Profit discussion; SG&A discussion). Adjusted EBITDA consequently dropped 35% year over year to $51.7 million, a much weaker conversion of sales into earnings (Adjusted EBITDA discussion).

The full-year EBITDA outlook was cut, which is the clearest negative surprise. Management narrowed revenue guidance to $1.08 billion–$1.12 billion from the prior $1.06 billion–$1.13 billion range, leaving the midpoint essentially unchanged. However, Adjusted EBITDA guidance fell to $220 million–$230 million from $225 million–$245 million, reducing the midpoint by $10 million, or roughly 4%, despite strong backlog and revenue visibility (Full Year 2026 Guidance). The company attributes the reduction to sustained aluminum inflation and a stronger Colombian peso, while expecting pricing and automation benefits to arrive later.

Cash generation is a second pressure point. Second-quarter operating cash flow was only about $4.4 million, while first-half operating cash flow fell to $11.1 million from $64.8 million a year earlier, reflecting taxes, tariff-related payments, inventory purchases and working-capital investment (Cash Flow statement). Liquidity remains substantial at approximately $360 million, but debt rose to $225.4 million and cash declined to $80.8 million from $100.9 million at year-end (Liquidity discussion; Balance Sheet).

Net read: strong demand beat, but the market is left with lower near-term earnings power. The revenue upside and record backlog confirm that orders remain healthy, while the redomiciliation and 10% headcount reduction are largely known developments (Redomiciliation and Automation discussion). Against that, an in-line EPS result, sharply lower margins, weak cash conversion and a reduced EBITDA outlook make this a modestly negative update versus expectations.