Simpson Manufacturing (NYSE:SSD) reported third-quarter 2026 net sales of $638.1 million, up 2.3% from a year earlier, as pricing more than offset relatively flat global sales volumes amid continued housing-market pressure.
President and Chief Executive Officer Mike Olosky said the company’s global volumes were flat in the quarter and had declined 1.3% over the trailing 12 months, compared with a 1.9% decline in U.S. housing starts. Pricing contributed 2.5% to quarterly sales growth. The company also said its exit from certain business in 2025 reduced year-over-year global volume comparisons by 30 basis points.
“We believe on a volume and revenue basis, we are outperforming the majority of our relevant end markets,” Olosky said.
Regional Results and End Markets
North American sales rose 3.8% to $502 million, including an approximately $10 million benefit from pricing actions. The company said North American volumes outperformed the trailing 12-month decline in single-family housing starts by about 400 basis points.
Residential business volumes increased at a low-single-digit rate despite housing softness, while the multifamily business remained a relative bright spot, aided by customer conversions, new-product adoption and engagement with builders and pro dealers. The commercial business posted high-single-digit volume growth, supported by cold-formed steel and anchoring solutions. Olosky cited opportunities in data centers and other large projects.
OEM volumes increased by double digits, with broad-based growth including momentum in mass timber applications. Component manufacturer volumes rose mid-single digits, driven by new customer wins and expansion with existing accounts. Simpson introduced its next-generation software platform at the Building Component Manufacturers Conference, where Olosky said customer interest was strong.
The company expects growth in the component manufacturer software business to moderate in the near term while customers evaluate the new platform, followed by acceleration as adoption builds.
National retail volumes declined at a mid-single-digit rate, reflecting softer demand for larger home-improvement projects such as additions, decks and pergolas. Chief Financial Officer Matt Dunn said retail point-of-sale sales were up in the low-single-digit range in dollars during the third quarter, though volumes were slightly lower.
European sales declined 3.4% to $129.9 million, including a 5% volume decline and an approximately $1.6 million foreign-currency translation headwind. Sales declined 2.1% on a local-currency basis. Olosky said higher interest rates, economic headwinds and political and fiscal uncertainty in France pressured regional construction activity, though the company continued to win mass-timber projects.
Margins, Earnings and Costs
Consolidated gross profit increased 1.4% to $291.6 million, while gross margin decreased 40 basis points to 45.7%. The margin decline reflected higher material, depreciation and freight expenses.
The company said steel prices have risen more than 50% from a year ago and have reached their highest level in more than four years. Simpson expects to announce additional price actions in the coming weeks in response to rising steel costs and other inflationary pressures.
Dunn said the company generally seeks to use pricing to preserve its gross-margin percentage over the medium and long term, although quarterly results can vary. He added that Simpson expects its raw-steel inventory levels and cost per pound to rise as it returns to the market for steel purchases, using a more gradual purchasing approach than in the past.
Operating expenses fell 6.3% to $150.5 million, aided by lower personnel-related costs and professional fees. SG&A headcount was down about 6% year over year. Consolidated operating income was $141 million, up 0.2%, though the prior-year quarter included a $12.9 million gain from the sale of the company’s Gallatin, Tennessee, facility.
Operating margin was 22.1%, compared with 22.6% a year earlier. North American operating margin improved to 27.3% from 25.9%, while Europe’s operating margin declined to 11.8% from 12.0%.
Net income totaled $109.1 million, or $2.68 per diluted share, compared with $107.4 million, or $2.58 per diluted share, in the prior-year quarter. Adjusted EBITDA rose 7.4% to $167.2 million, representing a 26.2% margin.
Cash Flow, Buybacks and Outlook
Simpson generated $173.3 million of operating cash flow in the quarter. As of Sept. 30, the company had $491.3 million in cash and cash equivalents and $308 million in debt, resulting in a net cash position of $183.3 million. Inventory declined $82.3 million from year-end to $511.9 million, while North American inventory pounds on hand fell 31.5%.
During the quarter, Simpson spent $11.9 million on capital expenditures, paid $12.3 million in dividends, repurchased $66.3 million of common stock and repaid $25 million on its revolver. The board declared a quarterly dividend of $0.30 per share, payable Jan. 28, 2027, to shareholders of record Jan. 7, 2027.
The board also approved a new $1 billion share-repurchase authorization with no expiration date, replacing the prior $200 million authorization. Dunn said the authorization provides flexibility for repurchases while preserving optionality for potential acquisitions, though no active M&A opportunities were identified.
- Full-year 2026 operating margin guidance: 20.0% to 20.5%
- Expected U.S. housing starts: down low single digits from 2025
- Expected European market: flat to slightly declining
- Expected 2026 capital expenditures: $80 million to $90 million
- Expected fourth-quarter gain from vacant-land sale: approximately $11 million
Management expects volumes to be down slightly for the remainder of the year as housing starts decelerate. The company also expects fourth-quarter pricing to provide less than a 1% benefit before any newly announced price actions take effect. Simpson said it remains committed to maintaining operating income margin at or above 20%, growing faster than relevant end markets and increasing earnings per share faster than sales over time.
About Simpson Manufacturing (NYSE:SSD)
Simpson Manufacturing Co, Inc develops, manufactures and sells structural solutions for residential, commercial and industrial construction. Its products are designed to connect and reinforce wood, concrete and other building materials, supporting applications ranging from new construction to repair, remodeling and retrofit projects.
The company is best known for its Simpson Strong-Tie brand, which offers structural connectors, fasteners, anchors, specialty products, adhesives and related installation systems.
