Masco (NYSE:MAS) executives highlighted market share gains, restructuring actions, and a shift in segment reporting while outlining expectations for modest sales growth and margin expansion in 2026, according to the company’s fourth-quarter and full-year 2025 earnings call.
Fourth-quarter results largely in line with expectations
For the fourth quarter, Masco reported net sales down 2% (down 3% in local currency), driven primarily by lower volumes. Adjusted operating profit was $259 million, with an operating margin of 14.4%, and adjusted earnings per share were $0.82.
Segment performance: Plumbing grew; Decorative Architectural declined
Plumbing Products posted fourth-quarter sales growth of 3% in local currency (5% reported, helped by currency). North American plumbing sales rose 4% in local currency, driven by favorable pricing and “solid growth” in Delta Faucet and Watkins Wellness, while international sales increased 1% in local currency, led by Germany and partly offset by weakness in China. Segment operating margin was 16.3% and included the impact of higher tariff and commodity costs.
Management emphasized brand momentum and channel performance at Delta Faucet, citing strength in trade and e-commerce. CEO John Nuti also noted Hansgrohe continued to gain share with premium products and highlighted sustainability-related awards.
Decorative Architectural Products sales fell 15% in the quarter. Masco said overall paint sales declined double digits due to lower volume, including impacts from prior-year inventory timing and a customer transition in the primer and applicator business. Excluding those factors, paint sales were down mid-single digits; DIY paint declined high single digits while Pro paint grew low single digits. Segment operating margin was 13.9%.
Westenberg added that Decorative Architectural profitability was also hurt by “significantly higher tariff and glass anti-dumping duty costs” at Liberty Hardware, including a 323% duty rate affecting shower door sourcing.
Full-year 2025: Profitability held up as sales declined
For full-year 2025, Masco reported net sales down 3% (down 2% excluding currency and the divestiture of Kichler). Adjusted operating profit was about $1.3 billion, with a 16.8% operating margin. Adjusted EPS was $3.96, and return on invested capital was 41%.
Westenberg said the 2024 divestiture of Kichler reduced 2025 sales by 2% year over year, while currency was a 1% benefit. Full-year gross margin was 35.5%, reflecting higher tariff and commodity costs, while SG&A was 18.7% of sales, in line with the prior year.
Masco generated free cash flow of over $850 million, which the CFO said was “a bit stronger than anticipated,” resulting in nearly 100% free cash flow conversion. The company returned $832 million to shareholders through dividends and share repurchases, including $571 million of repurchases for the full year.
Restructuring, leadership changes, and Liberty integration
Late in 2025, Masco began implementing restructuring actions “to a greater extent than in the past,” aimed at streamlining operations, reducing headcount, and optimizing its footprint. The company recorded approximately $18 million in charges in the fourth quarter and expects about $50 million in additional charges in 2026. Westenberg said benefits are included in 2026 guidance, with the “full benefit” expected in 2027 and 2028.
Nuti also discussed a new executive committee structure with dual corporate and business unit representation, describing the changes as intended to get “closer to the business” and better leverage Masco’s scale without centralizing the company. He said Behr now reports directly to him, citing its relationship with Masco’s largest customer.
Masco also announced the integration of Liberty Hardware into the Delta Faucet Company, noting that more than half of Liberty sales are branded Delta and that the product portfolios are complementary. As a result, Liberty will be reported within the Plumbing Products segment going forward; management said it has recast 2025 segment information in the earnings deck appendix for comparability.
2026 outlook: flat market assumptions, margin expansion, and tariff mitigation
For 2026, Masco expects global repair-and-remodel markets to be “roughly flat,” with its own sales flat to up low single digits. The company guided to operating margin of approximately 17% (up from 16.8% in 2025) and EPS of $4.10 to $4.30, assuming a 202 million diluted share count and a 24.5% effective tax rate.
Westenberg said Masco expects margin contraction in the first half of 2026 and expansion in the second half as it laps tariff impacts and mitigation actions take hold.
- Plumbing Products: 2026 sales expected up low single digits, with segment margin around 18% (up from a comparable 2025 margin of 17.6% including Liberty).
- Decorative Architectural: 2026 sales expected roughly flat, with Pro paint up mid-single digits and DIY down mid-single digits; segment margin around 19% (roughly in line with a comparable 2025 margin of 18.9%).
Tariffs remained a major focus. Westenberg said Masco now estimates an annualized tariff cost impact of about $200 million before mitigation (down from $270 million discussed after the third quarter), reflecting a 10% reduction in China tariffs and sourcing changes. Of that $200 million, about $80 million relates to current 20% China tariffs, with the remainder tied to other country tariffs, 50% tariffs on steel, aluminum, and copper, and glass anti-dumping duties. He said Masco expects the full $200 million to impact 2026 but anticipates mitigation actions will offset the direct cost impact.
On China sourcing, Westenberg said Masco expects to import about $400 million from China in 2026 subject to reciprocal tariffs, down from $450 million in 2025, and expects exposure to fall below $300 million by the end of 2026—more than a 60% reduction from peak exposure in 2018.
Executives also addressed commodity inflation—particularly copper—saying plumbing saw mid-single-digit inflation in the fourth quarter and that mid-single-digit inflation is embedded in 2026 guidance. Westenberg noted commodity costs typically hit Masco’s P&L with about a six-month lag.
On capital allocation, Masco said it expects about $600 million of available free cash flow in 2026 for repurchases or acquisitions, following approximately $190 million in planned capital expenditures. The board approved a 3% dividend increase to $1.28 per share for 2026, marking the company’s 13th consecutive annual dividend increase, and authorized a new $2 billion share repurchase program.
About Masco (NYSE:MAS)
Masco Corporation is a global leader in the design, manufacture and distribution of branded home improvement and building products. Founded in 1929 and headquartered in Livonia, Michigan, the company has evolved from a small door‐bell manufacturer into a diversified enterprise serving both residential and commercial markets. Over its history, Masco has grown through a combination of organic innovation and strategic acquisitions, building a portfolio of well-recognized brands.
The company’s product offerings are organized into two primary segments.
