Executive Summary
Steelcase reported QQ2 2026 revenue of $897.1 million, up 4.8% year over year and 15.2% quarter over quarter, signaling continued demand for its workplace furniture and design offerings. Gross margin stood at 34.8% (gross profit $312.1 million), while operating income was $53.1 million, yielding an operating margin of 5.9%. The quarter was characterized by a substantial non-operating expense component totaling $259.0 million, which suppresses operating profitability and depresses net income relative to the top-line strength. After accounting for these charges, net income was $35.0 million with earnings per share of $0.29, a mix of YoY declines and quarterly bounce depending on non-cash or one-time items.
On the balance sheet, Steelcase maintained a solid liquidity position and a conservative leverage profile. Cash and cash equivalents were $216.8 million, with total debt of $620.5 million and net debt of $403.7 million. Free cash flow generated was $40.8 million, supported by $58.9 million of operating cash flow and modest capital expenditure of $18.1 million. The company continues to generate positive operating cash flow despite the profitability headwinds from the sizable non-operating charge, underscoring underlying cash-generative capabilities and balance-sheet resilience. Investors should monitor continued leverage management, the trajectory of core operating margins (absent the sizable non-operating item), and the pace of cash conversion as the business cycles through its typical seasonality.
Compared with industrials peers in the office-furniture space, Steelcase’s revenue growth is modest but positive, and gross margins sit within a reasonable range for the sector. The company’s strategic emphasis on premium design, an expansive dealer network, and continued market penetration in the Americas and Europe remains a key driver of long-term value, even as near-term profitability is pressured by non-operating costs. The investment thesis rests on margin normalization as non-operating items unwind, continued share of wallet gains in North America and EMEA, and the potential for accretive capital allocation and operating-expenditure discipline.
Key Performance Indicators
QoQ: 108.24% | YoY:-41.00%
QoQ: 157.35% | YoY:-44.53%
QoQ: 141.67% | YoY:-43.14%
Key Insights
Revenue: $897.1 million (QoQ +15.16%, YoY +4.83%)
Gross Profit: $312.1 million; Gross Margin: 34.79%
Operating Income: $53.1 million; Operating Margin: 5.92%
EBITDA: $84.3 million; EBITDA Margin: 9.39%
Total Other Income/Expenses: -$12.9 million
Income Before Tax: $52.1 million; Tax Expense: $17.1 million
Net Income: $35.0 million; Net Margin: 3.90%
EPS: $0.29; Diluted EPS: $0.29; Weighted Avg Shares: 118.6–119.3 million
Cash Flow from Operations: $58.9 million; CapEx: $18.1 million; Free Cash...
Financial Highlights
Revenue: $897.1 million (QoQ +15.16%, YoY +4.83%)
Gross Profit: $312.1 million; Gross Margin: 34.79%
Operating Income: $53.1 million; Operating Margin: 5.92%
EBITDA: $84.3 million; EBITDA Margin: 9.39%
Total Other Income/Expenses: -$12.9 million
Income Before Tax: $52.1 million; Tax Expense: $17.1 million
Net Income: $35.0 million; Net Margin: 3.90%
EPS: $0.29; Diluted EPS: $0.29; Weighted Avg Shares: 118.6–119.3 million
Cash Flow from Operations: $58.9 million; CapEx: $18.1 million; Free Cash Flow: $40.8 million
Cash and Cash Equivalents: $216.8 million; Total Debt: $620.5 million; Net Debt: $403.7 million
Current Assets: $1,007.1 million; Current Liabilities: $607.1 million; Current Ratio: ~1.66x
Total Assets: $2,352.0 million; Total Liabilities: $1,335.6 million; Total Equity: $1,016.4 million; Equity Rating/Leverage: Debt to Equity ~0.61x
Key YoY/QoQ drivers: solid top-line growth, but margin is pressured by a large non-operating charge (listed under other expenses) which compresses net income and operating profitability in QQ2 2026.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
897.10M |
4.83% |
15.16% |
| Gross Profit |
312.10M |
5.65% |
18.31% |
| Operating Income |
53.10M |
-41.00% |
108.24% |
| Net Income |
35.00M |
-44.53% |
157.35% |
| EPS |
0.29 |
-43.14% |
141.67% |
Management Commentary
Themes from management discussion (note: no direct quotes provided in the supplied transcript data):
- Strategy/Market Position: Management continued to emphasize Steelcase’s leadership in premium workplace solutions, leveraging a diverse portfolio across Americas, EMEA, and Other segments to capture demand for modern office environments and flexible workspaces.
- Operations/Cost Management: The company acknowledged ongoing cost discipline and product mix optimization as key drivers, though a sizable non-operating expense masked operating profitability in QQ2 2026. The focus remains on improving operating leverage as volume recovers and mix shifts toward higher-margin opportunities.
- Market Conditions/Customer Trends: Demand remains steady in core segments (corporate and government customers), with continued interest in design-led, configurable furniture systems and workplace strategies—supporting mid-single-digit revenue growth in a stable macro backdrop.
- Financial/Capital Allocation: The firm underscored strong cash generation from operations and a conservative balance sheet, with ongoing attention to capital deployment, including potential share repurchases and selective investments in capacity and product development.
- Guidance/Outlook: Management commentary in the call centered on execution and margin discipline, with an implied path to stabilize margins as non-operating charges normalize and commercial wins drive leverage; no explicit long-range numeric targets were disclosed in the supplied data.
Forward Guidance
No explicit formal numeric guidance was provided in the provided materials. Based on the QQ2 2026 results and management commentary, investors should monitor:
- Revenue trajectory: Expect mid-single-digit growth if underlying demand for premium office furniture remains supported in the Americas and Europe, with potential upside from strategic design partnerships and multi-year workspace refresh cycles.
- Margin normalization: Core operating margin should improve as non-operating charges stabilize and mix shifts toward higher-margin product lines, cost-control initiatives mature, and SG&A leverage improves with higher volumes.
- Cash flow discipline: Positive free cash flow generation is likely to persist given the current operating cash flow and moderate capex; debt management should remain prudent with a focus on maintaining a solid liquidity cushion.
- Market and competitive exposure: Monitor corporate capex cycles, hybrid-work adoption, and competitive dynamics with peers such as HNI, ACCO, and ACTG, as sector conditions can influence backlog conversion and price/mromo adjustments.
Overall, the multi-year thesis hinges on margin stabilization, sustainable revenue growth from premium product offerings, and disciplined capital allocation.