Mohawk Industries prepares for recovery

Mohawk Industries ended the fiscal year 2025 with consolidated net sales of $10.8 billion (-0.5% on 2024). The Global Ceramic Segment reported net sales of $4.3 billion (+1.5% versus 2024), accounting for 39.8% of the Group’s total net sales.

Mohawk Industries has concluded another challenging year for the global flooring industry, successfully navigating a complex market environment to close 2025 with net sales essentially stable with respect to 2024. This performance was supported by a strong fourth quarter, which saw net sales of $2.7 billion, up 2.4% as reported versus the prior year. Consequently, the American multinational ended the fiscal year with consolidated net sales of $10.8 billion (a decrease of 0.5% as reported, or 1.3% on an adjusted basis, compared to 2024). Approximately 55% of 2025 sales were in the US, 30% were in Europe and 15% were in other geographies.

Profitability was impacted by market pricing pressures and increased input costs. For 2025, adjusted net earnings were $559 million (a 9.4% decrease from the previous year), while the operating result fell to $489.8 million compared to $693.5 million in 2024.

The Group generated free cash flow of approximately $621 million and repurchased approximately 1.3 million shares as part of its stock buyback programme. In response to market weakness, capital spending was reduced to $435 million.

Commenting on the fourth quarter and full year performance, Chairman and CEO Jeff Lorberbaum stated that the results for the quarter were in line with expectations.

“Across our markets, commercial demand remained stable, while the residential segment showed continued weakness, particularly in the US, where sluggish new home construction impacted our volume. We responded to increased input costs – including the impact of US tariffs, covering the cost as planned – with a series of actions, including productivity gains, restructuring initiatives and an improved product mix.”

Overall, Lorberbaum noted that:

“the fourth quarter reflected a continuation of macroeconomic factors our industry has faced since the second half of 2022. With weak consumer confidence, many large discretionary investments such as home renovations continued to be postponed. Furthermore, housing turnover in our major regions remains at historical lows due to affordability challenges and economic uncertainty. On a positive note, US existing home sales in December increased, supported by mortgage rates at their lowest levels since autumn 2022. We anticipate that these lower rates combined with potential government actions will benefit housing turnover.”

The Global Ceramic Segment

At the end of 2025, the Global Ceramic Segment reported net sales of $4.3 billion (+1.5% versus 2024), accounting for 39.8% of the Group’s total net sales. This confirms its position as the world’s largest manufacturer of ceramic tile, with facilities in the USA, Mexico, Brazil, Italy, Spain, Bulgaria, Poland and Russia, and a brand portfolio including American Olean, Daltile, Marazzi, Ragno, Emilgroup, Eliane, Elizabeth, Vitromex, Kai and Kerama Marazzi. The segment’s EBIT also improved, rising from $249.5 million in 2024 to $266.7 million in 2025 (+6.9%).

The full-year results were bolstered by a positive trend in the fourth quarter, during which the segment generated net sales of $1.07 billion (+6.1%) and an operating margin of 6.1%. Productivity gains and an improved price mix partially offset headwinds from higher input costs and lower sales volume.

2026 outlook

As signalled by the Chairman of Mohawk Industries, market conditions in the early months of 2026 have remained similar to the fourth quarter of 2025. Although home renovation remains soft in the United States, the NAHB Remodeling Market Index has shown improvement in the last two quarters. In this scenario, the Group confirms it is proceeding with its strategy based on productivity, cost reductions, innovative premium product introductions and price increases to strengthen competitiveness and drive sales and profitability.

“However, the extent of our growth this year will depend on economic conditions, interest rates, geopolitical events and, most importantly, the degree to which residential remodeling recovers,” concluded Lorberbaum.