Owens Corning Inc. (NYSE: OC) shares climbed in premarket trading Wednesday after the building materials company posted second-quarter results that came in ahead of Wall Street's expectations. The beat was driven by stronger-than-expected earnings and revenue, giving investors something to cheer about even as the company flagged a looming cost hit tied to the Iran conflict.
Owens Corning Beats Q2 Estimates, But Iran Conflict Looms Over Q3
MarketDash
Owens Corning (NYSE: OC) stock rose after Q2 adjusted EPS of $3.93 and revenue of $2.76B beat Wall Street expectations, but the company warned of a $40 million cost hit next quarter due to the Iran conflict.
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Second-Quarter Results
Adjusted earnings came in at $3.93 per share, comfortably above the analyst consensus of $3.08. Revenue reached $2.76 billion, roughly flat from a year ago but still ahead of the $2.65 billion analysts had penciled in.
Adjusted EBITDA slipped 6% year-over-year to $660 million, with the adjusted EBITDA margin narrowing to 24% from 26% a year earlier. Operating cash flow improved to $398 million from $327 million in the same quarter last year, and free cash flow totaled $199 million. The company ended the quarter with $271 million in cash and cash equivalents.
Roofing And Insulation Offset Doors Weakness
The Roofing segment generated $1.31 billion in sales, up 1% from a year earlier, with EBITDA of $441 million and a 34% margin. Insulation sales rose 4% to $971 million, producing EBITDA of $213 million and a 22% margin.
The Doors segment was the laggard, with revenue of $513 million, down 7% year-over-year. EBITDA totaled $57 million, with an 11% margin.
Portfolio Changes And Capital Returns
Owens Corning completed the sale of its Glass Reinforcements business on April 30, a move that advances its strategy to focus on residential building products in North America and Europe. The company said the divestiture is expected to improve margins, strengthen cash flow resilience, and support long-term growth.
On July 29, the company named Jonathan Collins as executive vice president and chief financial officer, effective Aug. 10.
During the quarter, Owens Corning returned $264 million to shareholders through dividends and share repurchases. It bought back 1.7 million shares for $200 million and had 10.8 million shares remaining under its existing authorization at quarter-end.
Outlook
Looking ahead, Owens Corning expects third-quarter revenue of $2.6 billion to $2.7 billion, compared with the analyst consensus of $2.68 billion. The company also guided for an enterprise adjusted EBITDA margin of 20% to 22%.
Management noted that discretionary remodeling and residential new construction activity are expected to remain under pressure. Roofing demand from seasonal storms is likely to track historical trends, but elevated distributor inventory built during the second quarter is expected to reduce third-quarter purchases. The company expects North American nonresidential construction to remain stable, with gradual improvement in its core European markets.
One notable headwind: Owens Corning said inflationary pressures related to the Iran conflict are expected to increase third-quarter costs by about $40 million.
On the cost-saving front, the company exceeded its cost-synergy target for the Doors business, achieving $135 million in enterprise run-rate savings versus its $125 million mid-2026 goal. It remains on track to deliver an additional $75 million in structural cost savings through network optimization and operational improvements.
OC Price Action: Owens Corning shares were trading up 3.07% at $150.00 during premarket trading on Wednesday, according to market data.
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