noodls browser compatibility check

The security settings of your browser are blocking the execution of scripts.

To use noodls, javascript support must be enabled. Please change your browser's security settings to enable javascript.

If you have changed your browser's security settings, you can click here.

related announcements

Company News

Geosyntec Consultants Inc

Rudy Bonaparte Recognized as ASCE Distinguished Member
Vanasse Hangen Brustlin Inc

New Center for Women and Families Breaks Ground
ASLA - American Society of[...]

Landscape Architects Urge Planning Commission to Reject Monumental Arch

UFP Industries Inc.

11/04/2026 | Press release | Distributed by Public on 11/04/2026 10:44

Quarterly Report for Quarter Ending September 26, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

UFP Industries, Inc. is a holding company with subsidiaries in North America, Europe, Asia, and Australia that design, manufacture, and supply products made from wood, wood and non-wood composites, and other materials to three segments: retail, packaging, and construction. We are headquartered in Grand Rapids, Michigan. Our business segments are functionally interdependent and are supported by common corporate services, such as accounting and finance, information technology, human resources, marketing, purchasing, transportation, legal and compliance, among others. We regularly invest in automation and implement best practices to improve the efficiency of our manufacturing facilities across each of the segments. The results and improvements from these investments are shared among the segments. This exchange of ideas drives faster innovation for new products, processes, and product improvements.

Importantly, our structure allows us to evaluate market conditions and opportunities, while effectively allocating capital and resources to the appropriate segments and business units. We believe that the diversification and manner in which we operate our business segments provides an inherent hedge against the inevitable business cycles that our markets experience and over which we have little control. Accordingly, our goal is to provide stable earnings and cash flows to our shareholders. Our diversification and operating practices also mitigate the impact of volatile lumber market conditions experienced by traditional lumber companies.

This report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that are based on management's beliefs, assumptions, current expectations, estimates and projections about the markets we serve, the economy and the Company itself. Words like "anticipates," "believes," "confident," "estimates," "expects," "forecasts," "likely," "plans," "projects," "should," variations of such words, and similar expressions identify such forward-looking statements. These statements do not guarantee future performance and involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. We do not undertake to update forward-looking statements to reflect facts, circumstances, events, or assumptions that occur after the date the forward-looking statements are made. Actual results could differ materially from those included in such forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainty. Among the factors that could cause actual results to differ materially from forward-looking statements are the following: fluctuations in currency and inflation; fluctuations in the price of lumber; adverse or unusual weather conditions; adverse economic conditions in the markets we serve; changes in tariffs, import/export regulations, and other trade policies, including the timing and amount of tariff refunds; concentration of sales to customers; the success of vertical integration strategies; excess capacity or supply chain challenges; inbound and outbound transportation costs and our ability to pass those costs through to customers; alternatives to replace treated wood products; government regulations, particularly involving environmental and safety regulations; our ability to make successful business acquisitions; cybersecurity breaches; artificial intelligence; and potential pandemics. Certain of these risk factors as well as other risk factors and additional information are included in our reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission.

OVERVIEW

Our results for the third quarter of 2026 include the following highlights:

●

Our net sales increased 11% compared to the third quarter of 2025, consisting of a 4% increase in organic unit sales (excluding growth from acquisitions within the last 12 months), a 5% increase in selling prices, and a 2% increase attributable to acquisitions. Organic unit sales increased 9% in our packaging segment, 4% in our construction segment, and remained flat in our retail segment. Acquired businesses contributed 6% and 1% unit increases in our packaging and retail segments, respectively. Overall selling prices increased in our ProWood and Factory Built business units, driven by the pass-through of higher commodity lumber costs to our customers.

UFP INDUSTRIES, INC.

●

Our gross profit decreased by $18 million, or 7%, compared to the same period of the prior year. By segment, gross profit decreased by $8 million in Packaging, $7 million in Retail, and $3 million in Corporate, while Construction and All Other remained flat. The overall decrease in our gross profit is primarily due to higher transportation costs across most business units, totaling $19 million, net of fuel surcharges, and a decrease of $6 million from acquired businesses. These impacts were partially offset by improvements in our Commercial, Deckorators, Edge and Factory Built business units.

●

Our operating profits decreased $19 million, or 22%, compared to the third quarter of 2025. The overall decrease is a result of the decrease in gross profit mentioned above and an $8 million increase in selling, general, and administrative ("SG&A") expenses, partially offset by a $7 million increase in net gains on the disposition and impairment of assets and foreign currency gains. The increase in SG&A is primarily due to acquired businesses and wages and benefits.

●

Our cash flows from operations were $235 million in the first nine months of 2026 compared to $399 million during the first nine months of 2025. The $165 million decline resulted from a decrease in net earnings and non-cash expenses of $69 million and an increase in our investment in net working capital since year end that was $95 million higher in the first nine months of 2026 than it was in the first nine months of 2025. We anticipate that this increase in net working capital will convert to cash in the fourth quarter as we move past the typical seasonal peak in our net working capital.

●

Our Cash and cash equivalents at the end of September 2026 was $677 million compared to $1.0 billion at the end of September 2025. The decline in our cash is primarily due to business acquisitions, share repurchases, and investment in net working capital. Our unused borrowing capacity under our revolving credit facility and a shelf agreement with certain lenders along with our cash resulted in total liquidity of approximately $2 billion at the end of the third quarter of 2026.

HISTORICAL LUMBER PRICES

We experience significant fluctuations in the cost of commodity lumber products from primary producers ("Lumber Market"). The following table presents the Random Lengths framing lumber composite price:


		Random Lengths Composite
		Average $/MBF
		2026			2025
January		$	400		$	434
February			436			442
March			443			479
April			486			485
May			484			453
June			491			431
July			525			426
August			518			433
September			494			384

Third quarter average		$	512		$	414
Year-to-date average		$	475		$	441

Third quarter percentage change			23.7	%
Year-to-date percentage change			7.7	%

UFP INDUSTRIES, INC.

In addition, a Southern Yellow Pine ("SYP") composite price, which we prepare and use, is presented below. Our purchases of this species comprise approximately 75% of our total lumber purchases.


		Random Lengths SYP
		Average $/MBF
		2026			2025
January		$	392		$	386
February			415			401
March			422			424
April			484			446
May			445			445
June			453			381
July			482			351
August			450			347
September			431			320

Third quarter average		$	454		$	339
Year-to-date average		$	442		$	389

Third quarter percentage change			33.9	%
Year-to-date percentage change			13.6	%

Finally, a Spruce Pine Fir ("SPF") composite price, which we prepare and use, is presented below. Our purchases of this species comprise approximately 11% of our total lumber purchases.


		Random Lengths SPF
		Average $/MBF
		2026			2025
January		$	430		$	480
February			457			479
March			464			526
April			491			504
May			496			446
June			508			444
July			543			462
August			547			484
September			526			422

Third quarter average		$	539		$	456
Year-to-date average		$	496		$	472

Third quarter percentage change			18.2	%
Year-to-date percentage change			5.1	%

Lumber prices increased during the third quarter of 2026 due to mill curtailments and higher duties on Canadian lumber, partially offset by weak overall demand resulting from lower consumer sentiment and greater economic uncertainty.

A change in lumber prices impacts profitability of products sold with fixed and variable prices, as discussed below.

UFP INDUSTRIES, INC.

IMPACT OF THE LUMBER MARKET ON OUR OPERATING RESULTS

We generally price our products to pass lumber costs through to our customers so that our profitability is based on the value-added manufacturing, distribution, engineering, and other services we provide. As a result, our dollar sales levels (and working capital requirements) are impacted by the lumber costs of our products. Lumber costs were 43.8% and 41.4% of our total net sales in the first nine months of 2026 and 2025, respectively.

Our gross margins are impacted by (1) the relative level of the Lumber Market (i.e. whether prices are higher or lower from comparative periods), and (2) the trend in the market price of lumber (i.e. whether the price of lumber is increasing or decreasing within a period or from period to period). Additionally, as explained below, product categories can be priced differently. Some of our products have fixed selling prices, while the selling prices of other products are indexed to the reported Lumber Market with a fixed dollar adder to cover conversion costs and profits. Consequently, the level and trend of the Lumber Market impact our products differently.

Below is a general description of the primary ways in which our products are priced.

●

Products with fixed selling prices. These products include value-added products, such as manufactured items, sold within all segments. Prices for these products are generally fixed at the time of the sales quotation for a specified period of time. In order to reduce any exposure to adverse trends in the price of component lumber products, we attempt to lock in costs with our suppliers or purchase necessary inventory for these sales commitments. The time period limitation eventually allows us to periodically re-price our products for changes in lumber costs from our suppliers.

●

Products with selling prices indexed to the reported Lumber Market with a fixed dollar "adder" to cover conversion costs and profit. These products primarily include treated lumber, panel goods, other commodity-type items, and trusses sold to the manufactured housing industry. For these products, we estimate customers' needs and carry appropriate levels of inventory. Because lumber costs are incurred in advance of final sale prices, subsequent increases or decreases in the market price of lumber impact our gross margins. We believe our sales of these products are at their highest relative level in our second quarter, primarily due to pressure-treated lumber sold in our retail segment.

For each of the product pricing categories above, our margins are exposed to changes in the trend of lumber prices. As a result of the balance in our net sales to each of our end markets, we believe our gross profit is more stable compared to our competitors who are less diversified.

The greatest risk associated with changes in the trend of lumber prices is on the following products:

●

Products with significant inventory levels with low turnover rates, whose selling prices are indexed to the Lumber Market. In other words, the longer the period of time these products remain in inventory, the greater the exposure to changes in the price of lumber. This includes treated lumber, which comprised approximately 21% of our total net sales in the first nine months of 2026. This exposure is less significant with remanufactured lumber, panel goods, other commodity-type items, and trusses sold to the manufactured housing market due to the higher rate of inventory turnover. We attempt to mitigate the risk associated with treated lumber through managed inventory programs with our vendors. We estimate that 17% of our total purchases for the first nine months of 2026 were transacted under these programs. (Please refer to the "Risk Factors" section of our annual report on form 10-K, filed with the United States Securities and Exchange Commission.)

●

Products with fixed selling prices sold under long-term supply arrangements, particularly those involving multi-family construction projects. We attempt to mitigate this risk through our purchasing practices and longer vendor commitments.

UFP INDUSTRIES, INC.

In addition to the impact of Lumber Market trends on gross margins, changes in the level of the market cause fluctuations in gross margins when comparing operating results from period to period. This is explained in the following example, which assumes the price of lumber has increased from period one to period two, with no changes in the trend within each period.


		Period 1			Period 2
Lumber cost		$	300		$	400
Conversion cost			50			50
= Product cost			350			450
Adder			50			50
= Sell price		$	400		$	500
Gross margin			12.5	%		10.0	%

As is apparent from the preceding example, the level of lumber prices does not impact our overall profits but does impact our margins. Gross margins and operating margins are negatively impacted during periods of high lumber prices; conversely, we experience margin improvement when lumber prices are relatively low.

IMPACT OF TARIFFS ON OUR OPERATING RESULTS

The trade landscape continues to evolve. Since we do not own any foreign sawmills and have excellent relationships with our mill partners, we believe we are currently in a strong position to adapt quickly to tariffs without material adverse financial impact after a short adjustment period. We will continue to monitor the market and intend to make decisions quickly to minimize disruption. As of September 26, 2026, 84% of our lumber purchases were from domestic suppliers, 10% were imported from Canada, and 6% were imported from other international suppliers.

In February 2026, the U.S. Supreme Court ruled that the International Emergency Economic Powers Act ("IEEPA"), which the U.S. administration relied on to impose certain tariffs, does not authorize the administration to impose tariffs. As a result of this ruling, the U.S. Court of International Trade ("CIT") issued an order directing the U.S. Customs and Border Protection ("CBP") agency to begin formalizing a process for refunds. As of September 26, 2026, we have received $22 million in tariff refunds and have an additional $1 million recorded as a receivable related to the expected refund of tariffs previously paid under the IEEPA, including applicable interest. Of this amount, $9 million was recorded as a reduction to cost of goods sold, $1 million was recorded as interest income, $2 million was recorded as a reduction to inventory, and $11 million will be refunded to customers and was recorded as a liability. During the third quarter, we collected $22 million in tariff refunds, paid $3 million in refunds to customers, and recorded the $2 million inventory reduction as a decrease in our cost of goods sold. In September, we recorded an additional $0.3 million in tariff refunds receivable which was recorded as a reduction to cost of goods sold.

IMPACT OF HIGHER TRANSPORTATION COSTS ON OUR OPERATING RESULTS

A combination of macroeconomic and geopolitical events and capacity constraints in the flatbed carrier market have contributed to an increase in our input costs across the enterprise, primarily related to fuel and transportation. We estimate that we incurred an additional $22 million and $56 million of these costs for the three and nine months ended September 26, 2026, respectively, which adversely impacted our profitability, reflecting an increase in fuel costs and flatbed carrier rates as a result of many small carriers exiting the market. This has increased our cost in the "spot" market with market rates up 30% for the three and nine months ended September 26, 2026, respectively, excluding fuel. These market conditions have resulted in $6 million and $15 million in additional fuel costs and $16 million and $41 million in higher flatbed carrier costs for the three and nine months ended September 26, 2026, respectively. Our efforts to pass through these higher costs to our customers have been primarily concentrated on fuel through surcharges and increased product pricing, which resulted in an offset totaling approximately $3 million and $7 million for the three and nine months ended September 26, 2026, respectively. We plan to negotiate with our customers to pass through the remaining increase in our transportation costs, however, there are factors beyond our control, including contract terms and market conditions, that may impact our ability to be successful in these efforts. Please see "Risk Factors" below for more information.

UFP INDUSTRIES, INC.

BUSINESS COMBINATIONS AND ASSET PURCHASES

We completed three acquisitions in the first nine months of 2026 and completed two in fiscal 2025. The annual historical sales attributable to these acquisitions are approximately $183 million in aggregate. These business combinations are not significant to our quarterly results and thus proforma results for 2026 and 2025 are not presented. See Notes to the Unaudited Interim Condensed Consolidated Financial Statements, Note F, "Business Combinations" for additional information.

RESULTS OF OPERATIONS

The following table presents, for the periods indicated, the components of our Unaudited Condensed Consolidated Statements of Earnings as a percentage of net sales.


	Three Months Ended				Nine Months Ended
	September 26,		September 27,		September 26,		September 27,
	2026		2025		2026		2025
Net sales	100.0	%	100.0	%	100.0	%	100.0	%
Cost of goods sold	85.9		83.2		84.8		83.1
Gross profit	14.1		16.8		15.2		16.9
Selling, general, and administrative expenses	10.3		10.9		10.6		10.6
Net (gain) loss on disposition and impairment of assets	(0.2)		0.2		(0.1)		0.1
Other losses (gains), net	-		-		-		-
Earnings from operations	4.0		5.7		4.7		6.1
Interest and other	(0.4)		(0.6)		(0.4)		(0.5)
Earnings before income taxes	4.4		6.4		5.1		6.6
Income taxes	1.1		1.5		1.3		1.5
Net earnings	3.4		4.8		3.8		5.1
Less net earnings attributable to noncontrolling interest	-		-		-		-
Net earnings attributable to controlling interest	3.3	%	4.8	%	3.8	%	5.1	%

Note: Actual percentages are calculated and may not sum to total due to rounding.

As a result of the impact of the level of lumber prices on the percentages displayed in the table above (see Impact of the Lumber Market on Our Operating Results), we believe it is useful to compare our change in units sold with our change in gross profit, selling, general, and administrative expenses, and operating profits as presented in the following table.



		Percentage Change						Percentage Change
		Three Months Ended						Nine Months Ended
		September 26,			September 27,			September 26,			September 27,
		2026			2025			2026			2025
Units sold		6.0	%		(4.0)	%		1.0	%		(3.0)	%
Gross profit		(6.8)			(12.0)			(8.6)			(14.5)
Selling, general, and administrative expenses		4.7			(7.3)			1.0			(8.2)
Earnings from operations		(21.6)			(25.4)			(22.0)			(26.2)

The following table presents, for the periods indicated, our selling, general, and administrative (SG&A) costs as a percentage of gross profit. Over time, we believe this ratio provides an enhanced view of our effectiveness in managing these costs given our strategies to enhance our capabilities and improve our value-added product offering and recognizing the higher relative level of SG&A these strategies require. This ratio also mitigates the impact of changing lumber prices. The increase in the ratio of SG&A as a percentage of gross profit from the prior year is primarily due to the impact of higher transportation costs, which have reduced our gross profit.



	Three Months Ended				Nine Months Ended
		September 26,		September 27,		September 26,		September 27,
		2026		2025		2026		2025
Gross profit	$	244,921	$	262,681	$	771,045	$	843,611
Selling, general, and administrative expenses		178,091		170,030		536,694		531,279
SG&A as percentage of gross profit		72.7%		64.7%		69.6%		63.0%

UFP INDUSTRIES, INC.

Operating Results by Segment:

Our business segments consist of Retail, Packaging and Construction, which align with the end markets we serve. Among other advantages, this structure allows for a specialized and consistent sales approach, more efficient use of resources and capital, and quicker introduction of new products and services. We manage the operations of our individual locations primarily through a market-centered reporting structure under which each location is included in a business unit, and business units are included in our Retail, Packaging, and Construction segments. The exception to this market-centered reporting and management structure is our International segment, which comprises our packaging operations in Mexico, Canada, Spain, India, and Australia and sales and buying offices in other parts of the world. Our International segment and Ardellis (our insurance captive) are included in "All Other" in the table below. The "Corporate" segment includes purchasing, transportation, corporate ventures, and administrative functions that serve our operating segments. Operating results of Corporate primarily consist of over (under) allocated costs and net sales to external customers initiated by UFP Purchasing, which manages supplier relationships and purchases lumber and other materials, UFP Transportation, which owns, leases and operates transportation equipment, and UFP Real Estate, which owns and leases real estate. Inter-company lease and service charges are assessed to our operating segments for the use of these assets and services at fair market value rates.

The following tables present our operating results, for the periods indicated, by segment (in thousands).


		Three Months Ended September 26, 2026

		Retail			Packaging			Construction		All Other		Corporate			Total
Net sales		$	634,514		$	465,845		$	552,423	$	78,029	$	2,025		$	1,732,836
Cost of goods sold			560,963			406,791			461,118		64,512		(5,469)			1,487,915
Gross profit			73,551			59,054			91,305		13,517		7,494			244,921
Selling, general, and administrative expenses			52,240			45,987			63,324		9,618		6,922			178,091
Net loss (gain) on disposition and impairment of assets			801			150			20		165		(4,320)			(3,184)
Other (gains) losses, net			(336)			-			107		50		37			(142)
Earnings from operations		$	20,846		$	12,917		$	27,854	$	3,684	$	4,855		$	70,156


		Three Months Ended September 27, 2025

		Retail			Packaging			Construction		All Other		Corporate			Total
Net sales		$	593,985		$	394,949		$	496,465	$	72,482	$	1,746		$	1,559,627
Cost of goods sold			513,763			327,528			405,262		59,251		(8,858)			1,296,946
Gross profit			80,222			67,421			91,203		13,231		10,604			262,681
Selling, general, and administrative expenses			49,032			45,831			58,943		9,226		6,998			170,030
Net loss (gain) on disposition and impairment of assets			9,983			(5,970)			(59)		63		(1,559)			2,458
Other losses (gains), net			462			-			(3)		203		60			722
Earnings from operations		$	20,745		$	27,560		$	32,322	$	3,739	$	5,105		$	89,471

UFP INDUSTRIES, INC.


	Nine Months Ended September 26, 2026

	Retail		Packaging		Construction		All Other		Corporate		Total
Net sales	$	1,984,433	$	1,318,183	$	1,544,713	$	223,461	$	6,250	$	5,077,040
Cost of goods sold		1,715,673		1,138,422		1,285,463		185,352		(18,915)		4,305,995
Gross profit		268,760		179,761		259,250		38,109		25,165		771,045
Selling, general, and administrative expenses		171,003		136,770		189,080		28,684		11,157		536,694
Net loss (gain) on disposition and impairment of assets		2,649		86		70		240		(7,579)		(4,534)
Other losses, net		123		-		659		399		51		1,232
Earnings from operations	$	94,985	$	42,905	$	69,441	$	8,786	$	21,536	$	237,653


	Nine Months Ended September 27, 2025

	Retail		Packaging		Construction		All Other		Corporate		Total
Net sales	$	1,989,592	$	1,233,626	$	1,563,995	$	197,806	$	5,501	$	4,990,520
Cost of goods sold		1,714,335		1,026,049		1,281,803		160,706		(35,984)		4,146,909
Gross profit		275,257		207,577		282,192		37,100		41,485		843,611
Selling, general, and administrative expenses		163,029		136,748		185,454		28,086		17,962		531,279
Net loss (gain) on disposition and impairment of assets		11,090		(4,713)		272		2,679		(3,116)		6,212
Other losses (gains), net		780		-		268		451		(193)		1,306
Earnings from operations	$	100,358	$	75,542	$	96,198	$	5,884	$	26,832	$	304,814

The following tables present the components of our operating results, for the periods indicated, as a percentage of net sales by segment.


		Three Months Ended September 26, 2026

		Retail		Packaging		Construction		All Other		Corporate	Total
Net sales		100.0	%	100.0	%	100.0	%	100.0	%	N/A	100.0	%
Cost of goods sold		88.4		87.3		83.5		82.7		-	85.9
Gross profit		11.6		12.7		16.5		17.3		-	14.1
Selling, general, and administrative expenses		8.2		9.9		11.5		12.3		-	10.3
Net loss (gain) on disposition and impairment of assets		0.1		-		-		0.2		-	(0.2)
Other (gains) losses, net		(0.1)		-		-		0.1		-	-
Earnings from operations		3.3	%	2.8	%	5.0	%	4.7	%	-	4.0	%

Note: Actual percentages are calculated and may not sum to total due to rounding.

UFP INDUSTRIES, INC.


		Three Months Ended September 27, 2025

		Retail		Packaging		Construction		All Other		Corporate	Total
Net sales		100.0	%	100.0	%	100.0	%	100.0	%	N/A	100.0	%
Cost of goods sold		86.5		82.9		81.6		81.7		-	83.2
Gross profit		13.5		17.1		18.4		18.3		-	16.8
Selling, general, and administrative expenses		8.3		11.6		11.9		12.7		-	10.9
Net loss (gain) on disposition and impairment of assets		1.7		(1.5)		-		0.1		-	0.2
Other losses (gains), net		0.1		-		-		0.3		-	-
Earnings from operations		3.5	%	7.0	%	6.5	%	5.2	%	-	5.7	%

Note: Actual percentages are calculated and may not sum to total due to rounding.


		Nine Months Ended September 26, 2026

		Retail		Packaging		Construction		All Other		Corporate	Total
Net sales		100.0	%	100.0	%	100.0	%	100.0	%	N/A	100.0	%
Cost of goods sold		86.5		86.4		83.2		82.9		-	84.8
Gross profit		13.5		13.6		16.8		17.1		-	15.2
Selling, general, and administrative expenses		8.6		10.4		12.2		12.8		-	10.6
Net loss (gain) on disposition and impairment of assets		0.1		-		-		0.1		-	(0.1)
Other losses, net		-		-		-		0.2		-	-
Earnings from operations		4.8	%	3.3	%	4.5	%	3.9	%	-	4.7	%

Note: Actual percentages are calculated and may not sum to total due to rounding.


		Nine Months Ended September 27, 2025

		Retail		Packaging		Construction		All Other		Corporate	Total
Net sales		100.0	%	100.0	%	100.0	%	100.0	%	N/A	100.0	%
Cost of goods sold		86.2		83.2		82.0		81.2		-	83.1
Gross profit		13.8		16.8		18.0		18.8		-	16.9
Selling, general, and administrative expenses		8.2		11.1		11.9		14.2		-	10.6
Net loss (gain) on disposition and impairment of assets		0.6		(0.4)		-		1.4		-	0.1
Other losses (gains), net		-		-		-		0.2		-	-
Earnings from operations		5.0	%	6.1	%	6.2	%	3.0	%	-	6.1	%

Note: Actual percentages are calculated and may not sum to total due to rounding.

UFP INDUSTRIES, INC.

NET SALES

We design, manufacture and market wood and wood-alternative products, primarily used to enhance outdoor living environments; for national home centers and other retailers; for engineered wood components, structural lumber, and other products for factory-built and site-built residential and commercial construction; customized interior fixtures used in a variety of retail stores, commercial, and other structures; and structural wood packaging, components and packing materials for various industries. Our strategic long-term sales objectives include:

●	Maximizing unit sales growth while achieving return on investment goals. The following table presents estimates, for the periods indicated, of our percentage change in net sales attributable to changes in overall selling prices versus changes in units shipped by segment.


		% Change
		Third Quarter 2026 versus Third Quarter 2025
		in Sales		in Selling Prices		in Units		Acquisition Unit Change		Organic Unit Change
Retail		6.8	%	5.8	%	1.0	%	1.0	%	-	%
Packaging		18.0	%	3.0	%	15.0	%	6.0	%	9.0	%
Construction		11.3	%	7.3	%	4.0	%	-	%	4.0	%
All Other		7.7	%	3.7	%	4.0	%	-	%	4.0	%
Corporate		16.0	%	-	%	16.0	%	-	%	16.0	%
Total Sales		11.1	%	5.1	%	6.0	%	2.0	%	4.0	%

		% Change
		Year-to-Date 2026 versus Year-to-Date 2025
		in Sales		in Selling Prices		in Units		Acquisition Unit Change		Organic Unit Change
Retail		(0.3)	%	2.7	%	(3.0)	%	1.0	%	(4.0)	%
Packaging		6.9	%	(0.1)	%	7.0	%	3.0	%	4.0	%
Construction		(1.2)	%	(0.2)	%	(1.0)	%	-	%	(1.0)	%
All Other		13.0	%	1.0	%	12.0	%	-	%	12.0	%
Corporate		13.6	%	-	%	13.6	%	-	%	13.6	%
Total Sales		1.7	%	0.7	%	1.0	%	1.0	%	-	%

●	Expanding geographically in our higher margin core businesses.

●

Increasing our sales of "value-added" products and enhancing our product offerings with new or improved products. Value-added products generally consist of fencing, decking, lattice, and other specialty products sold in the Retail segment; structural and protective packaging and machine-built pallets sold in the Packaging segment; engineered wood components, customized interior fixtures, manufactured and assembled concrete forms sold in the Construction segment; and "wood alternative" products. Engineered wood components include roof trusses, wall panels, and floor systems. Wood-alternative products consist of products manufactured with wood and non-wood composites, metals and plastics sold in each of our segments. Although we consider the treatment of dimensional lumber and panels with certain chemical preservatives a value-added process, treated lumber is not presently included in the value-added sales totals. Remanufactured lumber and panels that are components of finished goods are also generally categorized as "commodity-based" products. We estimate that approximately 81% of our sales consist of products we manufacture at our locations, while 19% of our sales consist of products manufactured by suppliers that we inventory and distribute to customers.

UFP INDUSTRIES, INC.

The following table presents, for the periods indicated, our percentage of value-added and commodity-based sales to total sales by our segments:


		Three Months Ended September 26, 2026						Three Months Ended September 27, 2025
		Value-Added			Commodity-Based			Value-Added			Commodity-Based
Retail		52.2	%		47.8	%		52.6	%		47.4	%
Packaging		77.4	%		22.6	%		75.4	%		24.6	%
Construction		83.0	%		17.0	%		81.8	%		18.2	%
All Other		74.1	%		25.9	%		74.6	%		25.4	%
Corporate		71.9	%		28.1	%		81.6	%		18.4	%
Total Sales		69.6	%		30.4	%		68.5	%		31.5	%

		Nine Months Ended September 26, 2026						Nine Months Ended September 27, 2025
		Value-Added			Commodity-Based			Value-Added			Commodity-Based
Retail		51.6	%		48.4	%		52.2	%		47.8	%
Packaging		76.4	%		23.6	%		75.1	%		24.9	%
Construction		82.9	%		17.1	%		80.8	%		19.2	%
All Other		74.5	%		25.5	%		76.6	%		23.4	%
Corporate		76.4	%		23.6	%		76.1	%		23.9	%
Total Sales		68.4	%		31.6	%		67.6	%		32.4	%

Note: Certain prior year product reclassifications and the change in designation of certain products as "value-added" resulted in a change in prior year's sales.

Our overall unit sales of value-added products were up 11% in the third quarter and up 3% in the first nine months of 2026 compared to the prior year. Our overall unit sales of commodity-based products were down 5% third quarter and down 5% in the first nine months of 2026 compared to the prior year.

●

Developing new products. We define new products as those that will generate sales of at least $1 million per year within 4 years of launch and are still growing and gaining market penetration and meet our internal definition of value-added products. New product sales in the third quarter and first nine months of 2026 increased 43% and 32%, respectively. The increase in the third quarter was primarily attributable to sales of Venture and Surestone™ decking products in our Retail segment, mixed-material products for a key national customer in our Packaging segment, and exterior siding, cladding, and light-gauge metal components, in our Construction segment. Approximately $20.8 million of new product sales for the first nine months of 2025, while they continue to be sold, were sunset in 2026 and excluded from the table below because they no longer meet the definition above. Our short-term goal is to achieve annual new product sales of at least $560 million in 2026. For the first nine months of 2026, new product sales totaled $423 million. Our long-term goal is for new products to comprise at least 10% of our total net sales.

The table below presents new product sales in thousands:



		New Product Sales by Segment
		Three Months Ended
		September 26,		% of Segment			September 27,		% of Segment			% Change
		2026		Net Sales			2025		Net Sales			in Sales
Retail		$	70,601	11.1	%			54,531	9.2	%		29.5	%
Packaging			52,848	11.3	%			38,480	9.7	%		37.3	%
Construction			26,613	4.8	%			12,038	2.4	%		121.1	%
All Other			170	0.2	%			42	0.1	%		304.8	%
Corporate			625	30.9	%			765	43.8	%		(18.3)	%
Total New Product Sales			150,857	8.7	%			105,856	6.8	%		42.5	%

Note: Certain prior year product reclassifications and the change in designation of certain products as "new" resulted in a change in prior year's sales.

UFP INDUSTRIES, INC.

		New Product Sales by Segment
		Nine Months Ended
		September 26,		% of Segment			September 27,		% of Segment			% Change
		2026		Net Sales			2025		Net Sales			in Sales
Retail		$	198,122	10.0	%		$	166,184	8.4	%		19.2	%
Packaging			154,870	11.7	%			117,461	9.5	%		31.8	%
Construction			67,837	4.4	%			35,819	2.3	%		89.4	%
All Other			705	0.3	%			262	0.1	%		169.1	%
Corporate			1,723	27.6	%			2,090	38.0	%		(17.6)	%
Total New Product Sales			423,257	8.3	%			321,816	6.4	%		31.5	%

Note: Certain prior year product reclassifications and the change in designation of certain products as "new" resulted in a change in prior year's sales.

Retail Segment

Net sales in the third quarter of 2026 increased by 7% compared to the same period of 2025 due to a 6% increase in selling prices and a 1% increase due to acquisitions. Organic unit changes within this segment consisted of a 21% increase in Deckorators primarily due to market share gains, offset by a 4% decrease in ProWood. The decline in ProWood volume is primarily due to weaker consumer sentiment and economic uncertainty resulting in softening demand to complete repair and remodel projects.

Year over year sales in our Deckorators business unit increased 34%, comprised of a 69% increase in wood-plastic composite decking and a 70% increase in our mineral-based-composite decking (sold under the Surestone tradename). An acquired business contributed 10% to our sales growth in Deckorators and 44% to our sales growth in wood-plastic composite decking. Our railing sales increased 2% for the quarter.

Our unit sales to big box customers, which we believe are more closely correlated with repair and remodel activity, decreased approximately 4%, while our unit sales to independent retailers increased approximately 9% due increased sales in our Deckorators business unit.

Gross profit decreased by $7 million, or 8%, to $74 million in the third quarter of 2026 compared to the same period of 2025. The change in gross profit was attributable to the following:

●

The gross profit of our Deckorators business unit increased by $2 million despite higher transportation costs. This business unit continues to make progress optimizing new capacity and we anticipate a higher profit contribution on growth in future quarters.

●

The gross profit of our Edge business unit improved by $2 million as a result of cost savings from the prior year closure of the Bonner, MT facility and restructuring of this business unit which led to operational improvements.

●

The gross profit of our ProWood pressure-treated products decreased by $11 million, due to higher transportation costs, and higher material costs that were not fully passed through to customers as a result of falling lumber prices in the third quarter.

SG&A increased by $3 million, or 7%, in the third quarter of 2026 compared to the same period of 2025. The increase is the result of a $1 million increase from acquired operations and a $2 million increase in expenses across several other categories. Accrued bonus totaled $9 million for the quarter.

Earnings from operations remained flat in the third quarter of 2026 compared to the same period of 2025, as a result of the factors mentioned above, offset by the decrease of $9 million in the net loss on disposition and impairment of assets. The year over year change was a result of $1 million in losses on the sale of machinery and equipment in the current year compared with $10 million in net losses in the prior year comprised of machinery and equipment impairment charges of $11 million, lease impairment charges of $2 million and intangible asset impairment charges of $2 million, partially offset by a gain on the sale of machinery and equipment totaling $5 million. Additionally, we realized a $1 million increase in foreign currency gains.

UFP INDUSTRIES, INC.

Net sales in the first nine months of 2026 remained flat compared to the same period of 2025, due to a 4% decrease in organic units, offset by a 3% increase in selling prices and 1% increase due to acquisitions. Organic unit changes within this segment consisted of decreases of 13% in Edge and 6% in ProWood, partially offset by a 12% increase in Deckorators.

Within Deckorators, our mineral-based-composite decking sales increased by 45% as consumers continue to see the benefits of its superior product attributes, and wood-plastic composite decking increased by 57%. An acquired business contributed an additional 8% in sales growth to Deckorators and 34% in sales growth to wood-plastic composite decking. These increases were partially offset by an 8% decrease in railing sales. Unit sales to big box customers decreased approximately 6%, while unit sales to independent retailers remained flat.

Gross profit decreased $6 million in the first nine months of 2026 compared to the same period in 2025. The components of gross profit were as follows:

●

The gross profit of our Edge business unit improved by $6 million as a result of cost savings from the prior year closure of the Bonner, MT facility and restructuring of this business unit which led to operational improvements.

●

The gross profit of our Deckorators business unit increased by $5 million despite higher transportation costs. This business unit continues to make progress optimizing new capacity and we anticipate a higher profit contribution on growth in future quarters.

●

The gross profit of our ProWood business unit decreased $17 million, primarily due to a decline in unit sales and higher transportation costs.

SG&A increased by approximately $8 million, or 5%, in the first nine months of 2026 compared to the same period of 2025. The increase was due to a $2 million increase due to acquired operations, and a $6 million increase in expenses across several other categories. Accrued bonus expense totaled $32 million for the first nine months of 2026.

Earnings from operations decreased in the first nine months of 2026 compared to the same period of 2025 by $5 million, or 5%, as a result of the factors mentioned above as well as an $8 million decrease in the net loss on disposition and impairment of assets, comprised of losses on the sales of property and equipment totaling $3 million in the current year and $11 million in 2025. Prior year losses were comprised of machinery and equipment impairment charges of $11 million, lease impairment charges of $3 million and intangible asset impairment charges of $2 million, partially offset by a gain on the sale of machinery and equipment totaling $5 million. Additionally, we realized $1 million in foreign currency losses in the prior year compared with none in the current year.

Packaging Segment

Net sales in the third quarter of 2026 increased 18% compared to the same period of 2025, due to a 9% increase in organic unit sales, a 6% contribution from business acquisitions, and a 3% increase in selling prices. Organic unit changes consist of increases of 14% in Structural Packaging, 5% in Protective Packaging, and 1% in PalletOne. Acquisitions contributed an additional 18% in unit sales to PalletOne.

Gross profit decreased by $8 million, or 12%, in the third quarter of 2026 compared to the same period of 2025. The change in gross profit was attributable to the following:

●

The gross profit of our PalletOne business unit decreased by $4 million primarily due to transportation costs and inefficiencies in acquired operations. We anticipate improvements in these operations in future quarters.

●

The gross profit of our Structural Packaging business unit decreased by $2 million due to an increase in transportation costs.

●

The gross profit of our Protective Packaging business unit decreased by $2 million compared to the same period of 2025, resulting from unabsorbed manufacturing overhead costs associated with two new greenfield locations.

UFP INDUSTRIES, INC.

SG&A remained flat in the third quarter of 2026 compared to the same period of 2025. Accrued bonus expense decreased approximately $2 million relative to the same period of 2025 and totaled $7 million for the quarter. The decrease was offset by a $1 million increase due to acquired operations and a $1 million increase in expenses across several other categories.

Earnings from operations decreased in the third quarter of 2026 compared to the same period of 2025 by $15 million, or 53%, due to the factors discussed above, as well as a $6 million decrease in the net gain on disposition and impairment of assets, which was comprised of a gain on the sale of machinery and equipment totaling $6 million in the third quarter of 2025.

Net sales in the first nine months of 2026 increased 7% compared to the same period of 2025, due to organic unit growth of 4% and acquired businesses which contributed 3% to unit growth. Organic unit changes consist of an 8% increase in Protective Packaging and a 7% increase in Structural Packaging, partially offset by a 3% decrease in PalletOne. Acquisitions contributed an additional 10% in unit sales growth to PalletOne.

Gross profit decreased by $28 million, or 13%, for the first nine months of 2026 compared to the same period in 2025. The change in gross profit was attributable to the following.

●

The gross profit of our PalletOne business unit decreased by $16 million primarily due to weak demand, higher material and transportation costs, and inefficiencies in acquired operations.

●

The gross profit of our Structural Packaging business unit decreased by $8 million primarily due to higher transportation costs.

●

The gross profit of our Protective Packaging business unit decreased $4 million compared to the same period of 2025, resulting from unabsorbed manufacturing overhead costs associated with two new greenfield locations.

SG&A remained flat for first nine months of 2026 compared to the same period of 2025. Accrued bonus expense decreased $6 million and totaled $19 million for the nine months of 2026. The decrease was offset by a one-time write off on an earnout liability in 2025 for $2 million, a $2 million increase due to acquired businesses, and a $2 million increase in expenses across several other categories.

Earnings from operations decreased in the first nine months of 2026 compared to the same period 2025 by $33 million, or 43%, due to the factors discussed above, as well as a $5 million decrease in the net gain on disposition and impairment of assets, which was comprised of a gain on the sale of machinery and equipment totaling $5 million in 2025.

Construction Segment

Net sales in the third quarter of 2026 increased 11% compared to the same period of 2025 due to a 7% increase in selling prices and a 4% increase in organic unit sales. We experienced organic unit sales increases of 20% in Commercial, 12% in Site Built, and 6% in Concrete-Forming. The increases were partially offset by a decrease of 10% in Factory Built due to weaker demand for manufactured housing and the loss of lower margin commodity business. The increase in Site Built is due to increased sales of light gauge metal and cladding, and higher wood component sales in the West.

Gross profit remained flat in the third quarter of 2026 compared to the same period of 2025. The components of gross profit were as follows:

●

The gross profit of our Commercial unit increased by $5 million due to sales growth and a decrease in material costs as a percentage of net sales as a result of mix improvements.

●

The gross profit of our Factory-Built business unit increased by $1 million due to an improvement in mix to more value-added sales.

●

The gross profit of our Concrete-Forming business unit remained flat as sales growth was offset by higher material and freight costs.

UFP INDUSTRIES, INC.

●

The gross profit of our Site-Built housing business unit decreased by $6 million, primarily due to higher material costs and competitive pricing pressure in our engineered wood components business because of continued weak demand for single-family housing due to affordability challenges and economic uncertainty.

SG&A increased by approximately $4 million, or 7%, in the third quarter of 2026 compared to the same period of 2025. The increase was a result of an increase in salaries, wages, and benefits of $2 million, bad debt expense of $1 million, and $1 million of increases in expenses across several other categories. Accrued bonus expense totaled $10 million for the quarter.

Earnings from operations decreased in the third quarter of 2026 compared to the same period of 2025 by $5 million, or 14%, due to the factors mentioned above.

Net sales in the first nine months of 2026 decreased 1% compared to the same period of 2025 and consisted of a 1% decrease in unit organic sales. Organic unit changes within this segment consisted of decreases of 7% in Factory Built and 2% in Site Built, partially offset by increases of 15% in Commercial and 8% in Concrete Forming.

Gross profit decreased by $23 million, or 8%, for the first nine months of 2026 compared to the same period of 2025. The change in our gross profit was attributable to the following:

●

The gross profit of our Site-Built housing business unit decreased by $41 million, primarily due to weak demand and competitive pricing as housing starts have declined primarily due to affordability challenges and economic uncertainty.

●

The gross profit of our Commercial business unit increased by $16 million due to higher volumes and productivity and mix improvements.

●

The gross profit of our Concrete-Forming business unit increased by $1 million due to an increase in unit sales.

●

The gross profit of our Factory-Built business unit increased by $1 million due to a shift toward value-added sales.

SG&A increased by approximately $4 million, or 2%, in the first nine months of 2026 compared to the same period of 2025. The increase was due to increases in salaries, wages, and benefits of $6 million, $1 million in professional fees, $1 million in travel expenses, and $2 million of increases across several other categories. The increase in SG&A was partially offset by a $6 million decrease in accrued bonus expense, which totaled $25 million for the first nine months of 2026.

Earnings from operations decreased in the first nine months of 2026 compared to the same period of 2025 by $27 million, or 28%, due to the factors mentioned above.

All Other Segment

Our All Other reportable segment consists of our International and Ardellis (our insurance captive) segments that are not significant.

UFP INDUSTRIES, INC.

Corporate

The corporate segment consists of over (under) allocated costs that are not significant and net sales to external customers initiated by UFP Purchasing, UFP Transportation, and UFP Real Estate. In 2026 we modified our cost allocation methods to more closely approximate actual costs incurred.

INCOME TAXES

Effective tax rates differ from statutory federal income tax rates, primarily due to provisions for foreign, state and local income taxes and permanent tax differences. Our effective tax rate was 23.7% in the third quarter of 2026 compared to 23.8% in the same period of 2025 and was 24.8% in the first nine months of 2026 compared to 22.9% for the same period in 2025. The slight decrease in our effective tax rate for the third quarter was primarily due to an increase in the benefit we recognized for tax credits, partially offset by a decrease in our tax deduction from stock-based compensation accounted for as a permanent difference. The increase in our effective tax rate for the first nine months of 2026 was primarily due to a decrease in our tax deduction from stock-based compensation accounted for as a permanent difference.

OFF-BALANCE SHEET TRANSACTIONS

We have no significant off-balance sheet transactions.

LIQUIDITY AND CAPITAL RESOURCES

The table below presents, for the periods indicated, a summary of our cash flow statement (in thousands):


		Nine Months Ended
		September 26,			September 27,
		2026			2025
Cash from operating activities		$	234,516		$	399,122
Cash used in investing activities			(236,100)			(217,211)
Cash used in financing activities			(245,124)			(352,045)
Effect of exchange rate changes on cash			176			2,234
Net change in all cash and cash equivalents			(246,532)			(167,900)
Cash, cash equivalents, and restricted cash, beginning of period			925,071			1,179,594
Cash, cash equivalents, and restricted cash, end of period		$	678,539		$	1,011,694

In general, we fund our growth through a combination of operating cash flows, our revolving credit facility, and issuance of long-term notes payable at times when interest rates are favorable. We have not issued equity to finance growth except in the case of a large acquisition that occurred many years ago. We manage our capital structure by attempting to maintain a targeted ratio of debt to equity and debt to earnings before interest, taxes, depreciation and amortization. We believe this is one of many important factors to maintaining a strong credit profile, which in turn helps ensure timely access to capital when needed.

Seasonality has a significant impact on our working capital due to our primary selling season which occurs during the period from March to September. Consequently, our working capital typically increases during our first and second quarters resulting in negative or modest cash flows from operations during those periods. Conversely, we tend to experience a substantial decrease in working capital once we move beyond our peak selling season which typically results in significant cash flows from operations in our third and fourth quarters.

Due to the seasonality of our business and the effects of the Lumber Market, we believe our cash cycle (days of sales outstanding plus days supply of inventory less days of payables outstanding) is a good indicator of our working capital management. As indicated in the table below, our cash cycle decreased to 63 days from 64 days during the third quarter of 2026 and increased to 62 days from 61 days during the first nine months of 2026 compared to the same periods of the prior year.

UFP INDUSTRIES, INC.


	Three Months Ended				Nine Months Ended
	September 26,		September 27,		September 26,		September 27,
	2026		2025		2026		2025
Days of sales outstanding		36		36		35		35
Days supply of inventory		39		40		40		39
Days of payables outstanding		(12)		(12)		(13)		(13)
Days in cash cycle		63		64		62		61

The increase in our days supply of inventory for the first nine months of 2026 is due to slower inventory turns in our Retail segment as a result of an increase in safety stock and weaker than anticipated demand in the first quarter. Days supply of inventory normalized during the second and third quarters. We continue to focus on past due account balances with customers, and the percentage of our accounts receivable that are current was 94% at the end of the third quarter of 2026 and 2025.

In the first nine months of 2026, our cash flows from operations were $235 million which consisted of net earnings of $193 million and $142 million of non-cash expenses, partially offset by a $100 million increase in working capital since the end of December 2025 due to seasonal demand. Our cash flows from operations decreased by $165 million compared to the same period of 2025 primarily due to the decline in our net earnings as well as the increase in our investment in net working capital since year end, which was $95 million higher in the first nine months of 2026 compared to the first nine months of 2025. We anticipate the seasonal increase in net working capital in 2026 will be converted to cash early in the fourth quarter.

Purchases of property, plant, and equipment comprised $123 million of our cash used in investing activities during the first nine months of 2026. Outstanding purchase commitments on existing capital projects totaled approximately $159 million on September 26, 2026. Capital spending primarily consists of several projects to expand capacity to manufacture new and value-added products, primarily in our Packaging segment and Deckorators business units, to achieve efficiencies through automation in all segments, and make improvements to a number of facilities. We intend to fund capital expenditures and purchase commitments through our operating cash flows for the balance of the year. Cash used for acquisitions during the first nine months of 2026 totaled $123 million (refer to Note F to our unaudited interim condensed consolidated financial statements).

Cash flows used in financing activities during the first nine months of 2026 primarily consisted of the following:

●

We repurchased 2,250,939 shares of our common stock for $189 million during the first nine months of 2026 at an average price of $84.05 per share. Of this amount, 14,956 shares were repurchased in order to settle tax withholding obligations of long-term stock incentive plan participants' awards upon vesting. These shares were purchased at an average price of $97.51 per share, totaling $1.5 million. Of the total shares repurchased, $183 million of the repurchases were settled in cash by September 26, 2026, and $6 million were accrued on September 26, 2026 and settled in fiscal October 2026.

●

Dividends paid during the first nine months of 2026 were $60 million. The quarterly dividend of $0.36 per share represents a 3% increase from the quarterly dividend of $0.35 per share paid in 2025.

On September 26, 2026, we had no amount outstanding on our $750 million revolving credit facility, and we had approximately $708 million in remaining availability after considering $42 million in outstanding letters of credit under the revolving credit facility. Financial covenants on the unsecured revolving credit facility and unsecured notes include minimum interest tests and a maximum leverage ratio. The agreements also restrict the amount of additional indebtedness we may incur and the amount of assets that may be sold. We were in compliance with all of our covenant requirements as of September 26, 2026. In October 2026, we extended the maturity of our revolving credit facility for an additional five-year term (see Note K, "Subsequent Events").

At the end of the third quarter of 2026, we had approximately $2.0 billion in total liquidity, consisting of our cash, remaining availability under our revolving credit facility, and a shelf agreement with certain lenders providing up to $575 million in remaining borrowing capacity.

UFP INDUSTRIES, INC.

ENVIRONMENTAL CONSIDERATIONS AND REGULATIONS

See Notes to Unaudited Interim Condensed Consolidated Financial Statements, Note E, "Commitments, Contingencies, and Guarantees."

CRITICAL ACCOUNTING POLICIES

In preparing our consolidated financial statements, we follow accounting principles generally accepted in the United States. These principles require us to make certain estimates and apply judgments that affect our financial position and results of operations. We continually review our accounting policies and financial information disclosures. There have been no material changes in our policies or estimates since December 27, 2025.

FORWARD OUTLOOK

Our long-term financial goals include:

●

Growing our annual unit sales by 7 to 10 percent (including smaller tuck-in acquisitions) with at least 10 percent of all sales coming from new products;

●

Achieving and sustaining a 12.5 percent adjusted EBITDA margin by continuing to enhance our capabilities and grow our portfolio and sales of value-added products, expanding geographically in our higher margin business units, and achieving operating improvements;

●

Earning an incremental return on new investment over our hurdle rate of 15 percent; and

●

Maintaining a conservative capital structure.

We believe improvements in demand in the end markets we serve and effectively executing our strategies will allow us to achieve our long-term goals. However, in the short-term, demand in our markets has contracted due to a variety of macro-economic and geopolitical factors, which will continue to impact our results and vary depending on the severity and duration of this cycle. As a result of these more challenging conditions, we have developed and are executing plans to reduce or eliminate capacity at locations that are not meeting our profitability targets and reduce our SG&A costs. At the beginning of 2025, we announced that our goal through these actions was to improve our operating profits by $60 million by the end of 2026. We are on track to meet or exceed this goal by year end. Additionally, we anticipate:

●

Core SG&A will be approximately $572 million for the year. In addition, we anticipate sales incentives will be 4% of gross profit (3% of gross profit in 2025), bonus expense will range from 17% to 18% of pre-bonus operating profits (17% of pre-bonus operating profits in 2025), and vesting expense associated with incentive shares granted in prior years will total $22 million ($28 million in 2025).

●

Depreciation, amortization and other non-cash expenses will be approximately $202 million for the year.

●

An annual effective tax rate between 25% and 26%.

The following factors should be considered when evaluating our future sales and gross profit:

●

We anticipate lumber prices will remain near current levels, and experience typical seasonal trends, until there is a substantial change in the balance of supply and demand. Transportation constraints may also cause lumber prices to remain elevated, mitigating a typical decline in prices as the peak selling season comes to an end. In the event new tariffs are enacted on imports, we anticipate lumber prices will increase accordingly. We believe we are currently in a strong position to adapt quickly to new tariffs without adverse financial impact after a short adjustment period. Approximately 84% of our purchases of lumber are from domestic sources.

●

A combination of macroeconomic and geopolitical events and capacity constraints in the flatbed carrier market have resulted in an increase in certain of our input and transportation costs. We anticipate that these costs will remain elevated for the foreseeable future. While our intention and operating practices are to pass these costs on to customers in our pricing, there are a variety of factors beyond our control that may impact our ability to be successful in these efforts.

UFP INDUSTRIES, INC.

●

Retail sales accounted for 39% of our net sales for the first nine months of 2026. When evaluating future demand for the segment, we analyze data such as the same-store sales growth of national home improvement retailers and forecasts of home remodeling activity. Based on this data, we currently anticipate market demand to be down low single digits for the remainder of 2026. We anticipate market growth and share gains in our composite decking and railing products will contribute approximately $80 million of sales growth in our Deckorators business unit in 2026. This is below our original $100 million goal, reflecting anticipated market share growth in railing products that did not materialize and loss of a small railing customer. Market share growth within railing products remains a key objective for 2027 supported by the recent launch of our Align Aluminum Railing and Drop Lock technology. Our current backlog of ordered but unshipped Surestone™ decking is approximately $18 million as we continue to make progress optimizing capacity. We anticipate recent investments in equipment to improve the manufacturing throughput and lower the cost of our Surestone™ decking products will result in margin improvements in those products in future quarters as new capacity is optimized and once the higher cost inventory is sold.

●

Packaging sales accounted for 26% of our net sales for the first nine months of 2026. When evaluating future demand, we consider a number of metrics, including the Purchasing Managers Index (PMI), durable goods manufacturing, and U.S. real GDP. We currently believe overall demand in the markets we serve to be down low single digits for the remainder of 2026, primarily due to softening demand in our PalletOne business unit. We anticipate share gains in each of our business units will help mitigate weaker demand.

●

Construction sales accounted for 30% of our net sales for the first nine months of 2026.

The Site-Built business unit accounted for approximately 10% of our net sales for the first nine months of 2026. Approximately one-third of site-built customers are multifamily builders. The industry consensus estimate of national housing starts for 2026 is 1.34 million, with estimates generally predicting mid-single digit to high-single digit declines and multi-family showing weaker performance compared to single-family. We anticipate demand in the regions we operate to be down mid-single digits for the remainder of 2026. Despite the weak near-term demand outlook, our backlog has increased as a result of several newly awarded projects for which contracts are in place, with projected margins generally consistent with those of other recent projects. As of September 26, 2026 and September 27, 2025, we estimate that our backlog of orders in our Site-Built housing business unit were $117 million and $53 million, respectively. The increase was primarily related to multi-family projects in the Northeast.

The Factory-Built housing business unit accounted for 12% of our net sales for the first nine months of 2026. When evaluating future demand, we analyze data from production and shipments of manufactured housing. Year to date industry production is down 4%. We currently believe overall demand will be down low to mid-single digits for the remainder of 2026.

The Commercial and Concrete Forming business units accounted for approximately 8% of our net sales for the first nine months of 2026. When evaluating future demand, we analyze data from non-residential construction spending. We anticipate modest growth in overall demand of these business units for the remainder of 2026.

Capital Allocation:

We believe the strength of our cash flow generation and conservative capital structure provide us with sufficient resources to grow our business and also fund returns to our shareholders. We plan to continue to pursue a balanced and return-driven approach to capital allocation across dividends, share buybacks, capital investments and acquisitions.

●

On October 21, 2026, our board approved a quarterly cash dividend of $0.36 per share, which represents a 3% increase from the 2025 dividend rate. This dividend is payable on December 15, 2026, to shareholders of record on December 1, 2026. We continue to consider our payout ratio and yield when determining the appropriate dividend rate and have a long-term objective of increasing our dividend in line with our earnings growth.

●

On May 29, 2026, our board authorized the repurchase of up to $300 million worth of our shares through April 30, 2027. This share authorization supersedes and replaces our prior share repurchase authorizations. Our objective is to repurchase our stock at sufficient amounts to offset issuances under our share-based compensation plans. In addition, we will allocate more of our free cash flow to opportunistically buy shares when the price trades at pre-determined levels we believe are at a significant discount to intrinsic value. Through November 4, 2026, we have approximately $191 million of remaining availability under this authorization.

UFP INDUSTRIES, INC.

●

Our targeted range for capital expenditures for 2026 is $150 to $175 million and will continue to be impacted by extended lead times required for most equipment and rolling stock as well as the time required for site selection in the case of investments in new locations. Priority continues to be given to projects that enhance the working environments of our plants, take advantage of automation opportunities, and drive strategies that have strong long-term growth potential for new and value-added products. Certain planned capital projects have been canceled as we evaluated acquisition opportunities as an alternative means of adding capacity rather than investing in greenfield operations.

●

We continue to pursue a healthy pipeline of acquisition opportunities of companies that are a strong strategic fit and enhance our capabilities while providing higher margin, return, and growth potential.

UFP Industries Inc. published this content on November 04, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 04, 2026 at 16:45 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]

related announcements

Company News

Construction and Engineering

UFP Industries Inc.

Quarterly Report for Quarter Ending September 26, 2026 (Form 10-Q)