Spectrum Brands Holdings, Inc. (NYSE:SPB) reported fiscal first-quarter results on Thursday that exceeded analyst profit forecasts, lifting its shares by more than 2% in premarket trading, despite ongoing pressure on consumer demand from broader macroeconomic conditions.
The company posted adjusted earnings of $1.40 per share for the quarter ended December 28, 2025, significantly ahead of the analyst consensus of $0.76 per share. Revenue totalled $677 million, beating expectations of $668.88 million, although sales declined 3.3% from $700.2 million recorded in the same quarter last year. On an organic basis, net sales fell 6.0% when excluding favourable foreign exchange impacts.
The decline in revenue was mainly linked to softer demand across several product categories and the effect of customers in the Home and Garden segment accelerating seasonal inventory purchases in the prior year. However, the company reported improved performance in its Global Pet Care division, where major Companion Animal brands returned to growth and outperformed broader market trends.
“We are pleased with our results this quarter, particularly that our most profitable and largest Adjusted EBITDA contributing business, Global Pet Care, returned to growth,” said David Maura, Chairman and Chief Executive Officer. “Our Net Sales and Adjusted EBITDA exceeded expectations despite the ongoing macroeconomic challenges that continue to impact overall consumer demand.”
Net income from continuing operations increased 19.5% to $29.4 million, compared with $24.6 million in the same period last year. Spectrum Brands generated operating cash flow of $67.7 million and adjusted free cash flow of $59.7 million during the quarter.
By segment, Global Pet Care sales rose 8.3% to $281.6 million. Home & Garden sales declined 19.8% to $73.9 million, while Home & Personal Care revenue fell 7.6% to $321.5 million.
Gross profit margin declined by 110 basis points to 35.7%, primarily reflecting lower sales volumes, increased trade spending and higher tariff-related costs. These pressures were partly offset by pricing initiatives, cost reduction measures and operational efficiency improvements.
During the quarter, Spectrum Brands repurchased approximately 0.6 million shares for $36 million and announced a new $300 million share buyback authorisation. The company ended the period with net debt leverage of 1.65 times adjusted EBITDA.
Management reaffirmed its fiscal 2026 outlook, forecasting net sales to remain flat or increase by low single-digit percentages, alongside low single-digit growth in adjusted EBITDA. The company also expects to convert roughly 50% of adjusted EBITDA into adjusted free cash flow.