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

SHW · Q3 2024 Earnings

Sherwin-Williams

Reported October 28, 2025

30-second summary

Sherwin-Williams delivered Q3 revenue of $6.36B (+3.2% YoY) — a clear step up from Q2's +0.7% — with Paint Stores Group same-store sales improving to +3.6% and segment margin expanding to 24.9%. Management narrowed FY adjusted EPS to $11.25–$11.45 (high end -$0.05, low end +$0.05, midpoint flat at $11.35), a symmetric tightening rather than a cut. The Suvinil acquisition closed October 1 and is now in the FY guide, though management explicitly flagged it as immaterial to Q4 EPS given one-time closing costs and purchase accounting items. The print is operational stabilization with cautious forward signaling: demand is firming, but management is not yet willing to call it.

Headline numbers

EPS

Q3 FY2024

$3.59

Revenue

Q3 FY2024

$6.36B

+3.2% YoY

Gross margin

Q3 FY2024

49.2%

Operating margin

Q3 FY2024

16.7%

Key financials

Q3 FY2024

Metric	Q3 FY2024	YoY	Q2 FY2024	QoQ
Revenue	$6.36B	+3.2%	$6.31B	+0.7%
EPS	$3.59	—	$3.38	+6.2%
Gross margin	49.2%	—	49.4%	-20bps
Operating margin	16.7%	—	15.6%	+110bps

Guidance

Company narrowed full-year GAAP and adjusted EPS guidance by $0.05 on the high end despite Q3 revenue beat, signaling cautious execution risk in H2 as demand stabilizes.

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
Revenue YoY growth	Q3 FY2025	Up or down low-single digit %	3.2%	+3.2% YoY, within low-single digit range	Beat

New guidance

Metric	Period	Guide	YoY
Net sales growth	Q4 FY2025	Up low to mid-single digit %	—
Effective tax rate	FY2025	Low twenty percent	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Diluted net income per share (GAAP)	FY2025	$10.11 to $10.41	$10.16 to $10.36	Low end +$0.05, high end -$0.05; midpoint flat at $10.26	Lowered
Adjusted diluted net income per share	FY2025	$11.20 to $11.50	$11.25 to $11.45	Low end +$0.05, high end -$0.05; midpoint -$0.025 from $11.35 to $11.325	Lowered

Reaffirmed unchanged this quarter: Net sales growth (Up low-single digit %)

Segment KPIs

Q3 FY2024

Segment	Q3 FY2024	YoY
Paint Stores Group	$3.837B	+5.1%
Consumer Brands Group	$0.77B	-2.6%
Performance Coatings Group	$1.75B	+1.7%

Other KPIs

Q3 FY2024

Segment	Q3 FY2024
Paint Stores Group Same-Store Sales Growth	3.6%
Paint Stores Group Segment Margin	24.9%
Consumer Brands Group Adjusted Segment Margin	23.3%
Performance Coatings Group Adjusted Segment Margin	16.9%
Adjusted EBITDA	$1.36 billion
Adjusted EBITDA Margin	21.4%
Paint Stores Group Total Store Count	4,834
Operating Cash Flow (9M 2025)	$2.36 billion

Management tone

Narrative arc: Q2 "softer for longer; doubling restructuring" → Q3 "narrowing the guide; demand stabilizing but choppy"

Two quarters ago management warned demand would "continue if not deteriorate in the second half" and doubled the restructuring program in response. This quarter the language firmed — FY net sales guidance shifted from "up or down low-single digit %" to "up low-single digit %," and Q3 actuals at +3.2% landed at the upper end of the prior range. The press release frames the quarter as "solid" execution in "a demand environment that remains softer for longer," with gross margin expansion, moderating SG&A growth, and adjusted EBITDA margin expansion.

Per CEO Heidi Petz in the press release: Paint Stores Group "sales grew in every end market, led by protective and marine, residential repaint and commercial, and segment margin expanded." Consumer Brands sales were "better than expected." Performance Coatings growth was "driven by Packaging and Automotive Refinish, with adjusted segment margin remaining in our targeted range" — though that targeted range now sits 110bps below prior-year Q3.

The competitive posture remains aggressive — management cites a "unique competitive environment" and continued investment in growth. The press release also flags that PCG margin contraction reflects "unfavorable region and business sales mix" and "increased expenses to support higher sales" — i.e., the cost of pursuing share in PCG is showing up in margin before it shows up in volume leverage.

No Q3 FY2025 earnings call transcript was available for this brief; tone analysis is limited to press-release language and CEO commentary therein.

Recurring themes management leaned on this quarter:

Strategic market share consolidation (Kelly Moore, PPG, True Value/Do It Best) positioning as 'now or never' momentOpportunistic SG&A investment acceleration when gross margins exceed expectations, with moderating pace expected post-Q4Demand remains choppy but foundational macro recovery ('when, not if') remains intact; pacing highly uncertainElevated feedstock costs (propylene +50% YoY, epoxy resins up, healthcare inflation) justifying 5% price increase with expected 50-60% historical realization rateResidential repaint momentum (5 consecutive quarters mid-single-digit growth) as proof of pre-market investment strategy successGlobal supply chain normalization driving consumer brands margin expansion via fixed cost absorption and operational efficiency

Risks management surfaced:

Hurricane recovery timing and magnitude remain unpredictable; second hurricane compressed Q4 recovery windowExtended holiday shutdowns among industrial customers could suppress Q4 performanceFirst half 2025 demand expected to remain choppy; macro inflection timing cannot be predicted with precisionPropylene feedstock costs up nearly 50% YoY with potential tariff impacts on epoxy resins; visibility limited to 1-2 quartersDIY market remains soft; insurance claims down double digits in North America auto refinish (claims reluctance structural vs. transitory still unclear)

Answers to last quarter's watch list

Consumer Brands segment trajectory — Adjusted segment margin expanded 40bps YoY to 23.3% (vs. 22.9% prior-year Q3). Revenue decline moderated to -2.6%. Pricing power and cost control held; this is not where the deterioration is.

Resolved positively

Paint Stores same-store sales — Came in at +3.6%, well above the +0.8% Q2 print and the sub-zero threshold that would have triggered a guidance reset. Segment revenue grew 5.1% and reported margin expanded to 24.9%. The franchise reaccelerated.

Resolved positively

Restructuring specifics — The press release reaffirms the doubled program with $0.32/share of severance and other restructuring expenses now baked into FY guidance, but does not quantify incremental savings or headcount actions on the print.

Continue monitoring

Performance Coatings volume inflection — Revenue returned to growth at +1.7% YoY, but adjusted segment margin contracted 110bps YoY to 16.9% from 18.0% on unfavorable region/business mix and increased expenses to support higher sales. Volume is back but earnings leverage is not. Status: Mixed

FY adjusted EPS bracket — The bracket was narrowed symmetrically to $11.25–$11.45 (low +$0.05, high -$0.05), with midpoint flat at $11.35. Suvinil is explicitly guided immaterial to Q4 EPS. Status: Resolved neutrally

What to watch into next quarter

Q4 revenue landing within "low to mid-single digit" — Q3 came in at +3.2% (low single digit); Q4 guide ranges through mid-single digit. Sub-3% Q4 growth would suggest the Q3 reacceleration was not a genuine inflection

Suvinil contribution disclosure — the acquisition closed October 1 and is guided to add low-single-digit % to Q4 consolidated net sales with immaterial Q4 EPS impact. Q4 disclosure should isolate Suvinil revenue so the organic trajectory is visible

PCG margin trajectory — adjusted segment margin contracted 110bps YoY in Q3. Watch whether the region/business mix headwind persists into Q4 or whether volume leverage begins to recover the gap

Paint Stores same-store sales sustaining above +3% — Q3's +3.6% needs to hold or expand to validate the "competitive inflection" thesis. A drop back toward +1% would mean Q3 was not durable share capture

Gross margin durability — Q3 expanded 10bps YoY to 49.2%. Watch Q4 for whether YoY expansion continues given input-cost commentary in the press release citing raw material pressure

Sources

Sherwin-Williams Q3 2025 press release, filed via SEC EDGAR: https://www.sec.gov/Archives/edgar/data/89800/000008980025000124/shwearningsrelease3q2025.htm
Sherwin-Williams Q2 2025 press release (for prior guidance baselines): https://www.sec.gov/Archives/edgar/data/89800/000008980025000112/shwearningsrelease2q2025.htm

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