Preliminary brief— based on press release only. Full analysis including management tone and Q&A will be added when the transcript is available.

SHW · Q1 2025 Earnings

Sherwin-Williams

Reported April 28, 2026

30-second summary

Sherwin-Williams opened FY2026 with revenue of $5.67B (+6.8% YoY), running above the "mid-single digit %" Q1 guide, with Paint Stores same-store sales at +2.4% and gross margin expanding to 49.1% from 48.2% in Q1 FY2025. Adjusted EPS of $2.35 keeps the year on track for the reaffirmed $11.50–$11.90 range, but the press release explicitly framed the demand environment as "little to no recovery in most end markets this year" — a more pessimistic phrasing than the prior-quarter "third year of no help" framing. The print confirms operational execution is working; the forward narrative is now openly defensive.

Headline numbers

EPS

Q1 FY2025

$2.35

Revenue

Q1 FY2025

$5.67B

+6.8% YoY

Gross margin

Q1 FY2025

49.1%

Operating margin

Q1 FY2025

12.0%

Key financials

Q1 FY2025

Metric	Q1 FY2025	YoY	Q4 FY2025	QoQ
Revenue	$5.67B	+6.8%	$5.60B	+1.3%
EPS	$2.35	—	$2.23	+5.4%
Gross margin	49.1%	—	48.5%	+60bps
Operating margin	12.0%	—	11.4%	+60bps

Guidance

Management reaffirms full-year EPS and revenue guidance while raising price/mix assumptions; Q1 slightly beat mid-single digit sales growth guidance at 6.8% YoY.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Net sales growth	Q1 FY2025	up mid-single digit %	6.8%	+0.8pts above mid-single digit floor	Beat

New guidance

Metric	Period	Guide	YoY
Net sales growth	Q2 FY2026	mid-single digit %	+4% to +6% YoY (implied)

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Net new stores (Paint Stores Group)	FY2026	80 to 100	Withdrawn — no replacement	—	Withdrawn
Dividend increase	FY2026	1.3% to $3.20 per share	Withdrawn — no replacement	—	Withdrawn
Long-term debt-to-EBITDA leverage	FY2026	2.0 to 2.5 times	Withdrawn — no replacement	—	Withdrawn

Reaffirmed unchanged this quarter: Diluted net income per share (GAAP) ($10.70 to $11.10), Adjusted diluted net income per share ($11.50 to $11.90), Net sales growth (low to mid-single digit %), Effective tax rate (Low twenty percent)

Segment KPIs

Q1 FY2025

Segment	Q1 FY2025	YoY
Paint Stores Group	$3.05B	+3.7%
Consumer Brands Group	$0.91B	+19.2%
Performance Coatings Group	$1.71B	+6.5%

Other KPIs

Q1 FY2025

Segment	Q1 FY2025
Same-Store Sales Growth (PSG)	2.4%
Paint Stores Group Segment Margin	18.3%
Consumer Brands Group Adjusted Segment Margin	23.4%
Performance Coatings Group Adjusted Segment Margin	16.5%
EBITDA	$998.2 million
EBITDA Margin	17.6%
Paint Stores Group Total Stores	4,847
Operating Cash Flow	$139.1 million

Management tone

The Q1 FY2026 earnings call transcript was not available for this brief. Tone analysis is drawn from press release commentary in Q1 FY2026 compared against the qualitative statements captured in prior-quarter guidance materials.

The forward demand language in the Q1 FY2026 press release has hardened versus the prior quarter's framing. Prior-quarter commentary characterized the year as one where "the market is not going to give us much help" and "the third year in a row" of no help — resigned but neutral. Q1's "we continue to expect little to no recovery in most end markets this year, given current customer sentiment and the leading indicators we monitor" is more pessimistic and more specific — it cites monitored leading indicators as the evidentiary base, a forward-looking framing not a backward-looking one. The shift signals the mid-year update in July is more likely to carry incremental caution than upside, even with Q1 having beaten the sales guide.

The pricing posture in the press release has pivoted to active. With price/mix now moving to "the high end of our prior low-single digit range" and explicit readiness to "implement additional increases if necessary," pricing is being positioned as the active offset to raw material inflation. The combination of "continued volatility in the raw material environment" plus willingness to take incremental price is a tactical step beyond the prior-quarter posture, which had emphasized outperforming the market and "providing guidance that we believe is very realistic given this backdrop."

The most defensible signal is gross margin: 49.1% in Q1 FY2026 vs. 48.2% in Q1 FY2025 — a 90bps YoY expansion that directly validates the watch-list question from last quarter. But the simultaneous withdrawal of the net new store guidance (80–100), with a net decrease of 6 stores in Q1 against a 4,847 base, is the operational data point that contradicts the prior-quarter "extremely aggressive" share-capture rhetoric. That commitment is harder to reconcile with a Q1 where the store count actually shrank and the store-growth disclosure quietly disappeared.

The non-recovery framing carries one notable hedge: the statement that "we expect to provide an update on our full year guidance when we report our second quarter results in July." Reaffirming the FY guide on Q1 without revision — while having beaten the Q1 sales guide by ~80bps — implies contingency is being held for the second half. The asymmetry is unfavorable: a Q1 beat that doesn't flow to a guide raise is consistent with offsetting H2 pressure (tariffs, raw materials, or the "little to no recovery" softening into something worse).

Recurring themes management leaned on this quarter:

Tariff exposure and raw material cost inflation managementMargin expansion through supply chain efficiencies and simplification rather than pricingMarket share gains in challenged end markets (residential repaint, protective & marine, packaging)SG&A cost discipline offsetting volume softnessDelayed commercial/property maintenance recovery extending into 2026Souvenir acquisition as platform for Latin America growth acceleration

Risks management surfaced:

Tariff policy volatility and potential raw material cost increasesPersistent softness in commercial construction completions and delayed CapEx spendingWeaker DIY demand in North America amid consumer pressureAuto refinish pressures from lower insurance claims and core account softnessMortgage rates remaining elevated at 6.5-7% range constraining new residential demandHeavy equipment and transportation demand weakness in general industrialTiming uncertainty on large multi-year commercial projects

Answers to last quarter's watch list

Q1 FY2026 organic Paint Stores same-store sales — Came in at +2.4%, up from +1.2% in Q1 FY2025. Modest sequential improvement YoY but well below the +3%+ pace that would signal real reacceleration.

Continue monitoring

Gross margin expansion proof — Q1 gross margin at 49.1% vs. Q1 FY2025's 48.2% — YoY up 90bps and consistent with the FY2026 "gross margin expansion" commitment. This is the cleanest positive data point in the print.

Resolved positively

Suvinil organic isolation — The press release did not isolate Suvinil from organic Consumer Brands growth. Segment revenue at +19.2% YoY remains overwhelmingly acquisition-flattered with organic trajectory not separately disclosed. The ex-Suvinil cut bulls would want was not provided.

Resolved negatively

Adjusted EPS tracking against $11.50–$11.90 — Q1 adj. EPS of $2.35 is consistent with the FY midpoint of $11.70 (Q1 is typically ~20% of full-year EPS for SHW; $2.35 annualized at typical seasonality implies the range is intact). FY range reaffirmed with no narrowing.

Continue monitoring

401k match durability and headcount actions — Not addressed in the press release. No Q1 FY2026 transcript was available this quarter for confirmation.

Continue monitoring

Net new store delivery against 80–100 target — PSG net store change in Q1 was -6 (a net contraction), AND the FY2026 store-count guide was withdrawn from disclosure. This is the most concerning operational signal in the print: a reversed store-expansion cadence paired with the disappearance of the guidance.

Resolved negatively

What to watch into next quarter

Q2 FY2026 revenue landing within "mid-single digit %" — implied range is ~$6.56B–$6.69B vs. Q2 FY2025's $6.31B. Sub-$6.50B Q2 print would mean the Q1 beat was timing, not trend

Whether the FY guide is narrowed, cut, or raised in the July print — an update was explicitly committed to in Q2. Given the Q1 beat without a raise, a narrowing toward the midpoint without a low-end increase would confirm the "little to no recovery" pessimism. A cut would mean tariffs/raw materials moved against the company

Net new store cadence resuming — Q1 actually shrank the base by 6 stores against the (withdrawn) 80–100 target. Q2 needs to show a meaningful positive net-add number to keep any path to the prior guide credible; another negative or flat quarter would mean store expansion is being quietly slowed or reversed

Paint Stores same-store sales sustaining at or above +2.4% — Watch whether Q2 builds on the +2.4% Q1 print or slips back toward the +1% area

Gross margin holding 49%+ YoY — Q1 at 49.1% beat Q1 FY2025's 48.2%. The FY gross margin expansion thesis needs Q2 to come in at or above Q2 FY2025's level; flat or down would signal pricing isn't fully offsetting raw material pressure

Raw material inflation hitting low-single-digit high end vs. moving above the range — the "additional price increases if necessary" language is the tell. If raws move above low-single-digit %, expect incremental pricing announcements and possible mid-year FY guide adjustments

Sources

Sherwin-Williams Q1 2026 press release, filed via SEC EDGAR: https://www.sec.gov/Archives/edgar/data/89800/000008980026000036/shwearningsrelease1q2026.htm
Sherwin-Williams Q4 2025 / FY2025 press release (for prior FY guidance baselines): https://www.sec.gov/Archives/edgar/data/89800/000008980026000003/shw2025yeearningsrelease.htm

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