Q3 FY2026
Filed Nov 6, 2026Interface Q3 2026 net sales rose 0.6% to $366.7 million and adjusted EPS rose 11.5% to $0.68, while GAAP EPS fell 14.1% to $0.67; full-year net sales outlook lowered, earnings outlook reaffirmed
Adjusted profit lines grew, with adjusted gross margin up 103 bps and adjusted EPS up 11.5%, but net sales grew only 0.6%, GAAP net income and GAAP EPS declined year over year, EAAA currency-neutral orders fell 6.8%, and the full-year net sales range was lowered.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, Q3 2026 (three months ended 10/4/2026)GAAP | $366.7M | – | 0.6% |
| Currency-neutral net sales, Q3 2026non-GAAP | $366M | – | 0.4% |
| Cost of sales, Q3 2026GAAP | $218.0M | – | – |
| Gross profit, Q3 2026GAAP | $148.7M | – | – |
| Gross profit margin, Q3 2026GAAP | 40.6% | – | 116 bps |
| Adjusted gross profit margin, Q3 2026non-GAAP | 40.6% | – | 103 bps |
| SG&A expenses, Q3 2026GAAP | $92.4M | – | 2.4% |
| SG&A expenses as % of net sales, Q3 2026GAAP | 25.2% | – | 44 bps |
| Adjusted SG&A expenses, Q3 2026non-GAAP | $91.5M | – | 1.7% |
| Adjusted SG&A expenses as % of net sales, Q3 2026non-GAAP | 25.0% | – | 28 bps |
| Interest expense, net, Q3 2026GAAP | $2.25M | – | – |
| Other expense, net, Q3 2026GAAP | $1.13M | – | – |
| Income before income tax expense, Q3 2026GAAP | $52.93M | – | – |
| Income tax expense, Q3 2026GAAP | $13.71M | – | – |
| Operating income, Q3 2026GAAP | $56.3M | – | 5.5% |
| Adjusted operating income (AOI), Q3 2026non-GAAP | $57.2M | – | 5.7% |
| Net income, Q3 2026GAAP | $39.2M | – | (15.0)% |
| Adjusted net income, Q3 2026non-GAAP | $39.9M | – | 11.1% |
| Earnings per diluted share, Q3 2026GAAP | $0.67 | – | (14.1)% |
| Earnings per basic share, Q3 2026GAAP | $0.68 | – | – |
| Adjusted earnings per diluted share, Q3 2026non-GAAP | $0.68 | – | 11.5% |
| Adjusted EBITDA, Q3 2026non-GAAP | $69.3M | – | 4.7% |
| Currency-neutral orders, Q3 2026 year-over-year changeother | 0.8% | – | – |
| Operating cash flow, Q3 2026GAAP | $86.30M | – | – |
| Capital expenditures, Q3 2026GAAP | −$9.08M | – | – |
| Net sales, nine months 2026 (ended 10/4/2026)GAAP | $1.09B | – | 5.4% |
| Currency-neutral net sales, nine months 2026non-GAAP | $1.07B | – | 3.5% |
| Cost of sales, nine months 2026GAAP | $639.9M | – | – |
| Gross profit margin, nine months 2026GAAP | 41.5% | – | 267 bps |
| Adjusted gross profit margin, nine months 2026non-GAAP | 41.5% | – | 238 bps |
| SG&A expenses, nine months 2026GAAP | $290M | – | 5.9% |
| SG&A expenses as % of net sales, nine months 2026GAAP | 26.5% | – | 12 bps |
| Adjusted SG&A expenses, nine months 2026non-GAAP | $288.7M | – | 6.9% |
| Adjusted SG&A expenses as % of net sales, nine months 2026non-GAAP | 26.4% | – | 36 bps |
| Interest expense, net, nine months 2026GAAP | $7.29M | – | – |
| Other expense, net, nine months 2026GAAP | $3.62M | – | – |
| Income tax expense, nine months 2026GAAP | $38.41M | – | – |
| Operating income, nine months 2026GAAP | $163.6M | – | 27.1% |
| Adjusted operating income (AOI), nine months 2026non-GAAP | $164.9M | – | 21.7% |
| Net income, nine months 2026GAAP | $114.2M | – | 24.6% |
| Adjusted net income, nine months 2026non-GAAP | $115.3M | – | 34.1% |
| Earnings per diluted share, nine months 2026GAAP | $1.95 | – | 25.8% |
| Earnings per basic share, nine months 2026GAAP | $1.97 | – | – |
| Adjusted earnings per diluted share, nine months 2026non-GAAP | $1.97 | – | 35.9% |
| Adjusted EBITDA, nine months 2026non-GAAP | $203.8M | – | 21.3% |
| Adjusted EBITDA, last twelve months ended 10/4/2026non-GAAP | $253.6M | – | – |
| Operating cash flow, nine months 2026GAAP | $138.2M | – | – |
| Capital expenditures, nine months 2026GAAP | −$31.61M | – | – |
| Net leverage ratio (net debt to LTM adjusted EBITDA), as of 10/4/2026non-GAAP | 0.2x | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| AMS (Q3 2026)Currency-neutral net sales were $219.6 million, up 0.5% year over year. Operating income was $41.2 million (prior year $40.4 million, up 1.8%) and AOI was $41.2 million (prior year $40.5 million, up 1.9%). The release prints currency-neutral orders of 6.2% growth in the AMS section; no further driver is stated for AMS. | $219.4M | – | 0.3% |
| EAAA (Q3 2026)Currency-neutral net sales were $146.4 million, up 0.3% year over year. Operating income was $15.1 million (prior year $12.9 million, up 17.0%) and AOI was $16.0 million (prior year $13.7 million, up 17.0%). The release prints currency-neutral orders decreased 6.8% year over year in the EAAA section. The CEO refers to softer conditions in EMEA in the quarter. | $147.4M | – | 1.0% |
| AMS (nine months 2026)Currency-neutral net sales were $662.4 million, up 3.8%. Operating income was $126.1 million (prior nine months $108.4 million, up 16.3%) and AOI was $126.1 million (prior nine months $109.2 million, up 15.5%). | $662.7M | – | 3.9% |
| EAAA (nine months 2026)Currency-neutral net sales were $411.2 million, up 2.9%. Operating income was $37.5 million (prior nine months $20.2 million, up 85.5%) and AOI was $38.8 million (prior nine months $26.3 million, up 47.3%). The release prints a currency impact of $(19.6) million on EAAA net sales for the nine months. | $430.8M | – | 7.8% |
Full Fiscal Year 2026 (updated outlook in the 10/4/2026 release) outlook
- RevenueNet sales $1.440 to $1.455 billion (previous outlook: $1.455 to $1.485 billion)
- Gross marginAdjusted gross profit margin 40.4% of net sales (previous outlook: 40.6% of net sales)
- Operating expensesAdjusted SG&A expenses $387 million (previous outlook: $395 million)
- Tax rateAdjusted effective income tax rate 25.0% (previous outlook: 26.0%)
- NoteAdjusted interest & other expenses $14 million (previous outlook: $15 million)
- NoteCapital expenditures $60 million (previous outlook: $60 million)
- NoteFully diluted weighted average share count 58.5 million shares (previous outlook: 58.6 million shares)
- NoteGuidance includes $15.6 million of IEEPA tariff refunds received in Q2 2026
- NoteThe company states it is reaffirming its full fiscal year earnings guidance; no EPS figure is printed in the outlook table
- NoteThe company states it is revising its full fiscal year net sales outlook to reflect softer conditions in Europe
- NoteThe release states all figures are approximate
Capital returns
- Share repurchases, nine months 2026: $(20,795) thousand (prior nine months $(5,143) thousand). The release prints a dash for Q3 2026 repurchases (none shown) and $(857) thousand in Q3 2025.
- Tax withholding payments for share-based compensation, nine months 2026: $(13,990) thousand (prior nine months $(8,372) thousand). The Q3 2026 figure is printed as a dash.
- Dividends paid, Q3 2026: $(1,734) thousand (prior year Q3 $(1,170) thousand).
- Dividends paid, nine months 2026: $(5,355) thousand (prior nine months $(2,397) thousand).
- Borrowings of long-term debt, nine months 2026: $101,768 thousand (prior nine months $4,579 thousand). Repayments of long-term debt, nine months 2026: $(153,502) thousand (prior nine months $(380) thousand).
What drove it
- Company explanation for Q3 adjusted gross profit margin up 103 bps: favorable pricing and product mix combined with manufacturing efficiencies, partly offset by higher raw material and tariff-related costs.
- Company explanation for Q3 adjusted SG&A up $1.5 million: higher inflation and marketing costs.
- CEO explanation for modest Q3 net sales growth: certain Retail and nora deliveries shifted into future periods.
- CEO statement that Americas momentum helped offset softer conditions in EMEA in the quarter.
- CEO statement that Healthcare billings increased 5% on top of 29% growth in the prior-year quarter; Education and Corporate Office each grew in the low single digits. The release gives no dollar revenue for these market categories.
- Filing footnote: Q3 2025 income tax expense included a non-cash credit from the remeasurement of German deferred tax assets and liabilities after German tax legislation enacted in July 2025. Q3 2025 income tax expense was $2,344 thousand; Q3 2026 was $13,712 thousand. The release does not state a cause for the change in GAAP net income beyond these figures.
- Q3 2026 non-GAAP adjustments per the reconciliation: restructuring, asset impairment, severance and other, net of $0.9 million at operating income level; no warehouse fire recovery or purchase accounting amortization in Q3 2026. Q3 2025 included purchase accounting amortization of $0.5 million, restructuring of $0.3 million, a warehouse fire recovery of $(0.6) million and a deferred tax rate change credit of $(10.4) million.
Concerns
- GAAP net income fell 15.0% to $39.2 million and GAAP diluted EPS fell 14.1% to $0.67 year over year; the prior-year quarter contained the German deferred tax credit described in the filing.
- Net sales grew only 0.6% in the quarter, and the CEO attributes part of the modest growth to Retail and nora deliveries shifting into future periods.
- EAAA currency-neutral orders decreased 6.8% year over year in Q3 2026, and the release cites softer conditions in Europe.
- The full-year net sales outlook was lowered to $1.440 to $1.455 billion from $1.455 to $1.485 billion, citing softer conditions in Europe.
- Q3 2026 cost of sales fell in dollar terms but the release cites higher raw material and tariff-related costs as an offset to gross margin gains.
- Operating cash flow for Q3 2026 was $86,299 thousand, but working capital changes in Q3 2026 include inventories of $(15,570) thousand and accounts receivable of $32,061 thousand as printed.
What to watch
- Timing of the Retail and nora deliveries the CEO said shifted into future periods, and their effect on Q4 2026 net sales.
- EMEA demand, given the company's statement that conditions in Europe softened and its reduction of the full-year net sales range.
- EAAA currency-neutral orders, which decreased 6.8% in Q3 2026 after the prior-year period.
- Full-year adjusted gross profit margin guidance of 40.4%, below the prior 40.6%, and whether raw material and tariff costs continue to offset pricing and mix.
- Adjusted SG&A guidance of $387 million (prior $395 million) against the nine-month adjusted SG&A of $288.7 million.
- Whether the $15.6 million of IEEPA tariff refunds received in Q2 2026 remain part of the full-year figures as stated.
- Repurchases: none printed in Q3 2026, against $(20,795) thousand for nine months 2026.
Balance sheet and cash flow
- Cash and cash equivalents: $81.1 million at 10/4/2026 (balance sheet $81,077 thousand), compared with $71.3 million at 12/28/2025 (up 13.7% as printed). The comparison is to fiscal year end, not to the prior year.
- Total debt: $130.2 million at 10/4/2026, compared with $181.6 million at 12/28/2025 (decline of 28.3% as printed). The release describes this as total debt, net.
- Net debt (total debt minus cash): $49.1 million at 10/4/2026, compared with $110.3 million at 12/28/2025 (decline of 55.4% as printed).
- Total debt divided by last twelve months net income: 0.9x. Net leverage ratio (net debt divided by LTM adjusted EBITDA): 0.2x.
- Balance sheet at 10/4/2026: total assets $1,267,543 thousand (12/28/2025: $1,206,522 thousand); shareholders' equity $713,546 thousand (12/28/2025: $640,674 thousand); inventories, net $305,382 thousand (12/28/2025: $275,014 thousand); accounts receivable, net $176,715 thousand (12/28/2025: $174,457 thousand).
- Current portion of long-term debt $8,791 thousand and long-term debt $121,422 thousand at 10/4/2026; at 12/28/2025 these were $8,778 thousand and $172,801 thousand.
- Cash provided by operating activities: $86,299 thousand in Q3 2026 (prior year Q3 $76,729 thousand) and $138,187 thousand for nine months 2026 (prior nine months $118,596 thousand). Capital expenditures: $(9,080) thousand in Q3 2026 and $(31,607) thousand for nine months 2026.
Analysis
Interface reported third quarter 2026 net sales of $366.7 million, up 0.6% year over year (0.4% currency neutral, per the non-GAAP figure of $366.0 million). Growth was modest. The CEO attributes part of the quarter's limited growth to certain Retail and nora deliveries shifting into future periods, and cites softer conditions in EMEA offset by momentum in the Americas. Segment figures show AMS net sales of $219.4 million (up 0.3%) and EAAA net sales of $147.4 million (up 1.0%). EAAA currency-neutral orders decreased 6.8%, while the release prints AMS currency-neutral orders up 6.2%. Global billings growth is described qualitatively; Healthcare is stated to have grown 5% on top of 29% growth in the prior-year quarter.
Profitability presents a split picture. GAAP gross profit margin rose to 40.6% from 39.4%, and the company attributes the adjusted gross margin increase of 103 bps to favorable pricing and product mix combined with manufacturing efficiencies, partly offset by higher raw material and tariff-related costs. SG&A expenses rose 2.4% to $92.4 million on a GAAP basis; the company attributes the adjusted SG&A increase of $1.5 million to higher inflation and marketing costs. GAAP operating income rose 5.5% to $56.3 million and AOI rose 5.7% to $57.2 million. EAAA operating income rose 17.0% to $15.1 million, and the segment's AOI rose 17.0% to $16.0 million.
Below the operating line, GAAP net income fell 15.0% to $39.2 million and GAAP diluted EPS fell 14.1% to $0.67. Income tax expense rose to $13,712 thousand from $2,344 thousand. The filing states that the prior-year quarter included a non-cash credit to income tax expense following the July 2025 German tax legislation remeasurement; the release does not explain the Q3 2026 tax charge. Adjusted diluted EPS rose 11.5% to $0.68 and adjusted net income rose 11.1% to $39.9 million. Year to date, GAAP diluted EPS rose 25.8% to $1.95 and adjusted diluted EPS rose 35.9% to $1.97. Nine-month GAAP operating income rose 27.1% to $163.6 million.
The balance sheet and cash flow strengthened compared with year end 2025. Total debt fell to $130.2 million from $181.6 million, net debt fell to $49.1 million from $110.3 million, and the net leverage ratio is printed as 0.2x. Cash rose to $81.1 million from $71.3 million. Nine-month operating cash flow was $138,187 thousand, against $118,596 thousand in the prior-year period. The company repurchased $20.8 million of stock in the first nine months (prior nine months $5.1 million) and paid dividends of $5,355 thousand. No repurchases are shown for Q3 2026.
On guidance, the company reaffirmed its full-year earnings outlook and lowered its full-year net sales range to $1.440 to $1.455 billion from $1.455 to $1.485 billion, citing softer conditions in Europe. The adjusted gross margin outlook moved to 40.4% from 40.6%, adjusted SG&A to $387 million from $395 million, the adjusted tax rate to 25.0% from 26.0%, and adjusted interest and other expense to $14 million from $15 million. Capital expenditures were held at $60 million. The outlook includes $15.6 million of IEEPA tariff refunds received in Q2 2026. No full-year EPS figure is printed in the outlook table, so the reaffirmed earnings guidance cannot be quantified from the filing.
Management, verbatim
Our operating discipline enabled us to drive adjusted earnings growth ahead of our expectations, even with modest net sales growth in the quarter as certain Retail and nora deliveries shifted into future periods.
Laurel Hurd, Chief Executive Officer
Our backlog is solid, our balance sheet is healthy, and we remain focused on margin expansion and cost discipline.
Bruce Hausmann, Chief Financial Officer
We are reaffirming our full-year earnings outlook and remain confident in the strength of our business.
Laurel Hurd, Chief Executive Officer
Not in the filing
stated, not guessed- Full-year 2026 EPS guidance figure: the release says earnings guidance is reaffirmed but prints no EPS range.
- Full-year actual results are not yet reported, so no comparison of actuals against the prior outlook is possible.
- Consensus estimates, analyst expectations and share price reaction are not in the documents.
- Free cash flow is not printed; no value is given.
- Year-over-year changes for cost of sales, gross profit, interest, other expense, income tax, pre-tax income, operating cash flow and capital expenditures are not printed and are left null.
- Balance sheet comparisons are printed against 12/28/2025 (fiscal year end), not against a prior-year period; prior-year balance sheet changes are not provided on a year-over-year basis.
- Prior quarter (Q2 2026) figures are not printed in this release; qoq_change fields are null.
- Healthcare, Education and Corporate Office revenue in dollars is not reported; only percentage growth in billings is given.
- The filing does not state a driver for the AMS net sales change or the EAAA operating income change beyond the figures.
- Dollar amount of Q3 2026 IEEPA tariff refunds in quarterly results is not separately printed; only the $15.6 million in the guidance note is given.
- Segment orders are printed as percentages without dollar order values.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.