Apogee Enterprises reports third-quarter net sales increased 2.1% to $348.6 million

Apogee Enterprises, Inc., a provider of architectural building products and services, and a high-performance coated material like Chromaluxe, reported its results for the third quarter of fiscal 2026, ended Nov. 29, 2025. The company reported the following selected financial results:

“I’m proud of our team’s disciplined execution and agility during this transition,” said Donald Nolan, executive chair and CEO. “Despite a challenging environment, we delivered results in line with expectations and remain focused on serving customers with innovative products and exceptional service. Our strong operational foundation and balance sheet position us to navigate near-term challenges and drive sustainable long-term value.”

Consolidated Results (Third Quarter Fiscal 2026 compared to Third Quarter Fiscal 2025)

• Consolidated net sales increased 2.1%, to $348.6 million, driven by $18.4 million of inorganic sales contribution from the acquisition of UW Solutions and favorable product mix, partially offset by lower volume.
• Gross margin decreased to 23.8%, compared to 26.1%, primarily due to the impact of lower volume and price, and higher aluminum, restructuring and health insurance costs, partially offset by lower incentive compensation expense.
• Selling, general, and administrative (SG&A) expense as a percent of net sales decreased to 16.7%, compared to 17.7%. The decrease was primarily due to lower acquisition-related costs and lower incentive compensation expense, partially offset by higher amortization expense related to the UW Solutions acquisition and CEO transition costs.
• Operating income declined to $24.9 million from $28.6 million, and operating margin decreased 130 basis points to 7.1%.
• Adjusted EBITDA increased to $46.1 million, compared to $45.8 million, and adjusted EBITDA margin decreased to 13.2%, compared to 13.4%. The decrease in adjusted EBITDA margin was primarily driven by lower volume and price, higher aluminum and health insurance costs, partially offset by lower incentive compensation expense and benefits from cost savings related to Fortify Phase 2.
• Interest expense increased to $3.2 million, primarily due to a higher average debt balance resulting from the acquisition of UW Solutions in November 2024.
• Other income was $2.5 million, compared to $0.1 million. The change was primarily due to a $2.1 million gain related to a New Market Tax Credit recognized in the current period.
• Income tax expense as a percentage of earnings before income tax was 31.4%, compared to 24.1%. The increase in the effective tax rate was primarily driven by an increase in tax expense for discrete items.

Segment Results

Architectural Metals 

Architectural Metals net sales were $124.4 million, compared to $138.0 million, primarily due to lower volume, partially offset by favorable price and product mix. Adjusted EBITDA was $16.8 million, or 13.5% of net sales, compared to $17.5 million, or 12.7% of net sales. The higher adjusted EBITDA margin was primarily driven by favorable productivity including cost savings related to Fortify Phase 2, lower incentive compensation expense, and favorable price and product mix, partially offset by lower volume.

Architectural Services 

Architectural Services net sales were $105.2 million compared to $104.9 million, primarily due to increased volume. Adjusted EBITDA was $10.2 million, or 9.7% of net sales, compared to $10.0 million, or 9.5% of net sales. The increase in adjusted EBITDA margin was primarily driven by lower incentive compensation expense, partially offset by project mix. Segment backlog¹ at the end of the quarter was $774.7 million, compared to $792.3 million at the end of the second quarter.

Architectural Glass 

Architectural Glass net sales were $70.9 million, compared to $70.2 million, primarily due to increased volume and favorable mix, partially offset by lower price driven by end-market demand. Adjusted EBITDA was $11.5 million, or 16.3% of net sales, compared to $13.2 million, or 18.8% of net sales. The decrease in adjusted EBITDA margin was primarily driven by lower price and higher material costs, partially offset by higher volume, favorable mix and lower incentive compensation expense.

Performance Surfaces 

Performance Surfaces net sales were $53.0 million, compared to $33.2 million. Net sales included $18.4 million of inorganic sales contribution from the acquisition of UW Solutions and organic growth of 4.3%. Adjusted EBITDA was $11.9 million, or 22.5% of net sales compared to $7.8 million, or 23.6% of net sales. The decrease in adjusted EBITDA margin was primarily driven by the dilutive impact of lower adjusted EBITDA margin from UW Solutions and unfavorable productivity, partially offset by favorable product mix and price.

As previously announced, in the first quarter of fiscal 2026, the company began the second phase of Project Fortify (referred to as “Project Fortify Phase 2” or “Phase 2”) to drive further cost efficiencies, primarily in the Architectural Services and Architectural Metals Segments. The company is expanding the scope of Phase 2 to include further restructuring actions, primarily in Architectural Metals and Corporate. With the expanded scope, the company now expects the actions of Phase 2 to incur a total of approximately $28 million to $29 million in pre-tax charges, and deliver estimated annualized pre-tax cost savings of approximately $25 million to $26 million. During the third quarter, the Company incurred $5.1 million of pre-tax costs associated with Phase 2. The company expects the actions associated with Phase 2 to be substantially completed by the end of the fourth quarter of fiscal 2026.