AWI三季度营收创纪录但调整后EPS不及预期、全年盈利指引下调，盘前一度跌约6%

----- awi-20261027.htm -----
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
October 27, 2026
ARMSTRONG WORLD INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania
1-2116
23-0366390
(State or other jurisdiction
of incorporation or organization)
(Commission
File Number)
(IRS Employer
Identification No.)
2500 Columbia Avenue P.O. Box 3001
Lancaster
,
Pennsylvania
17603
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code:
(717)
397-0611
NA
(Former name or former address if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value per share
AWI
New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻
Section 2 - Financial Information
Item 2.02 Results of Operations and Financial Condition.
On October 27, 2026, Armstrong World Industries, Inc. (the "Company") issued a press release announcing its third quarter 2026 consolidated financial results. The full text of the press release is attached hereto as Exhibit 99.1.
The information in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1, is being furnished herewith and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Act”), or the Exchange Act, except as expressly set forth by specific reference in such filing.
Section 7 – Regulation FD
Item 7.01 Regulation FD Disclosure.
On October 27, 2026, the Company issued a press release announcing that it will report its third quarter 2026 consolidated financial results via a webcast and conference call on October 27, 2026 at 10:00 a.m. Eastern Time which can be accessed through the “Investors” section of the Company’s website, www.armstrong.com. During this report, the Company will reference a slide presentation, a copy of which is attached hereto as Exhibit 99.2 and incorporated herein by reference.
The information in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.2, is being furnished herewith and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Act, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Section 9 – Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
No. 99.1
Press Release of Armstrong World Industries, Inc. dated October 27, 2026
No. 99.2
Earnings Call Presentation Third Quarter 2026 dated October 27, 2026
No. 104
Cover Page Interactive Data File (embedded within the Inline XBRL document)
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ARMSTRONG WORLD INDUSTRIES, INC.
By:
/s/ Jessica M. Cicali
Jessica M. Cicali
Senior Vice President, General Counsel, Chief Compliance Officer & Secretary
Date: October 27, 2026
3

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EX-99.1
2
awi-ex99_1.htm
EX-99.1
EX-99.1
Exhibit 99.1
Armstrong World Industries Reports
Third-Quarter 2026 Results
•
Record third-quarter Net Sales with double-digit growth in Architectural Specialties and solid Mineral Fiber results driven by both Average Unit Value ("AUV") and volume growth
•
Operating Income up 12% and Adjusted EBITDA up 11%
•
Diluted Net Earnings Per Share and Adjusted Diluted Net Earnings Per Share both up 10%
•
2026 guidance updated to reflect stronger Net Sales growth and accelerating inflationary pressures
(All comparisons are versus the prior-year period unless otherwise stated)
LANCASTER, Pa., Oct. 27, 2026 -- Armstrong World Industries, Inc. (NYSE:AWI), an Americas leader in the design and manufacture of innovative interior and exterior architectural applications including ceilings, specialty walls and exterior metal solutions, today reported third-quarter 2026 financial results highlighted by double-digit net sales and adjusted EBITDA growth.
"Strong demand for our broad portfolio of Architectural Specialties solutions and solid Mineral Fiber AUV and volume performance drove another quarter of record top-line results. In relatively stable end market conditions, our growth initiatives continue to enable us to deliver profitable growth ahead of the market," said AWI President and CEO, Mark Hershey. "Despite rapidly rising inflationary pressures, as well as timing-related mix headwinds impacting Mineral Fiber sales, our teams delivered double-digit adjusted EBITDA growth along with adjusted EBITDA margin expansion in both segments. Across the enterprise, we have responded to accelerating cost pressures, while remaining squarely focused on delivering our updated full-year outlook and advancing our attractive growth initiatives."
Third-Quarter Consolidated Results
(Dollar amounts in millions except per-share data)
For the Three Months Ended September 30,
2026
2025
Change
Net sales
$
475.8
$
425.2
11.9%
Operating income
$
131.2
$
117.2
11.9%
Operating income margin (Operating income as a % of net sales)
27.6
%
27.6
%
0bps
Net earnings
$
91.9
$
86.3
6.5%
Diluted net earnings per share
$
2.17
$
1.98
9.6%
Additional Non-GAAP* Measures
Adjusted EBITDA
$
164
$
148
11.0%
Adjusted EBITDA margin (Adjusted EBITDA as a % of net sales)
34.5
%
34.7
%
(30)bps
Adjusted net earnings
$
96
$
89
7.2%
Adjusted diluted net earnings per share
$
2.26
$
2.05
10.2%
* The Company uses non-GAAP adjusted measures in managing the business and believes the adjustments provide meaningful comparisons of operating performance between periods and are useful alternative measures of performance. Reconciliations of the most comparable generally accepted accounting principles in the United States ("GAAP") measure are found in the tables at the end of this press release. Excluding per share data, non-GAAP figures are rounded to the nearest million and
corresponding percentages are rounded to the nearest decimal based on unrounded figures. Basis point changes are calculated based on unrounded margin percentages and rounded to the nearest ten basis points.
Consolidated net sales for the third quarter of 2026 increased 11.9% from the prior-year quarter due to higher volumes of $35 million and favorable AUV of $16 million. Architectural Specialties net sales increased $33 million and Mineral Fiber net sales increased $18 million from the prior-year quarter. Architectural Specialties segment net sales improved due to a $25 million increase in organic net sales and an $8 million inorganic contribution. Mineral Fiber net sales growth was driven by favorable AUV and an increase in sales volumes.
Consolidated operating income increased 11.9% in the third quarter of 2026 compared to the prior-year period, primarily due to a $13 million margin benefit from sales volume growth, a $9 million margin benefit from favorable AUV and a $4 million increase in equity earnings from the Worthington Armstrong Joint Venture ("WAVE"). These benefits were partially offset by a $10 million increase in manufacturing costs, including input cost inflation, predominantly driven by higher freight and raw material costs, and an inorganic increase from our 2026 and 2025 acquisitions.
Operating and adjusted EBITDA margins in the third quarter of 2026 as compared to the prior-year quarter were pressured by higher input cost inflation, mix headwinds within Mineral Fiber and the ongoing impact of tariffs.
Third-Quarter Segment Results
Mineral Fiber
(Dollar amounts in millions)
For the Three Months Ended September 30,
2026
2025
Change
Net sales
$
292.1
$
274.0
6.6%
Operating income
$
106.0
$
98.7
7.4%
Adjusted EBITDA*
$
129
$
119
7.6%
Operating income margin
36.3
%
36.0
%
30bps
Adjusted EBITDA margin*
44.0
%
43.6
%
40bps
Mineral Fiber net sales increased $18 million in the third quarter of 2026 compared to the prior-year due to $16 million of favorable AUV and $2 million of higher sales volumes. The improvement in AUV was driven by favorable like-for-like price and, to a lesser extent, favorable mix. The increase in volumes was driven primarily by timing-related demand from our Canadian customers and partially due to benefits from our growth initiatives.
Mineral Fiber operating income increased 7.4% primarily due to a $9 million margin benefit from favorable AUV, a $4 million increase in WAVE equity earnings and a $3 million decrease in selling, general and administrative ("SG&A") expenses, primarily driven by higher incentive compensation expense in the prior-year period. These benefits were partially offset by an $8 million increase in manufacturing costs, primarily driven by freight and raw material inflation.
Architectural Specialties
(Dollar amounts in millions)
For the Three Months Ended September 30,
2026
2025
Change
Net sales
$
183.7
$
151.2
21.5%
Operating income
$
25.8
$
19.3
33.7%
Adjusted EBITDA*
$
36
$
28
25.5%
Operating income margin
14.0
%
12.8
%
120bps
Adjusted EBITDA margin*
19.4
%
18.8
%
60bps
2
Third quarter 2026 Architectural Specialties net sales increased $33 million compared to the prior-year quarter due to a $25 million increase in organic net sales driven by strong growth across most of our specialty product categories and an $8 million inorganic contribution.
Architectural Specialties operating income increased 33.7% due to a $9 million margin benefit from higher organic net sales, inclusive of the negative impact of lower project margins related to elevated metal costs. The benefit of increased organic sales was partially offset by a $2 million inorganic impact, primarily driven by SG&A expenses.
Unallocated Corporate
Unallocated Corporate operating loss was $1 million in the third quarter of 2026 and 2025.
Cash Flow
Year-to-date cash flows from operating activities in 2026 decreased $23 million or 10% in comparison to the prior-year period. The unfavorable change in operating cash flows was primarily due to unfavorable timing-related changes in receivables and higher income tax payments, partially offset by favorable timing-related changes in accounts payable and accrued expenses and an increase in net earnings. Year-to-date cash flows used for investing activities increased $52 million in comparison to the prior-year period. The unfavorable change in investing cash flows was primarily due to cash paid for the acquisition of Eventscape, partially offset by an increase in dividends from WAVE.
Share Repurchase Program
In the third quarter of 2026, the Company repurchased 0.4 million shares of common stock for a total cost of $75 million, excluding the cost of commissions and taxes, at an average price of $174.36 per share. As of September 30, 2026, there was $1.1 billion remaining under the existing authorized share repurchase program**.
** In July 2016, the Board of Directors of the Company approved a share repurchase program authorizing the repurchase of outstanding shares of common stock (the "Program"). Pursuant to additional authorization and extensions of the Program approved by the Board of Directors, the Company is authorized to repurchase up to $2.5 billion of outstanding shares of common stock through December 2029. Since inception and through September 30, 2026, the Company has repurchased 16.6 million shares under the Program for a total cost of $1.4 billion, excluding commissions and taxes, or an average of $82.74 per share.
Updating 2026 Outlook
“We delivered double-digit growth in both net sales and adjusted EBITDA for the total company in the third quarter, with adjusted EBITDA margin expansion in both segments despite ongoing input cost and tariff pressures,” said Chris Calzaretta, AWI Senior Vice President and CFO. “Our updated outlook for 2026 reflects an increase in organic Architectural Specialties net sales, the impact of accelerating costs for both segments, net of mitigation efforts, as well as mix headwinds in Mineral Fiber and softer contributions from recent acquisitions. We expect to deliver strong full-year growth across all key metrics, demonstrating our resilient business model, focus on operational efficiency, and disciplined approach to capital allocation, all of which position us well for continued shareholder value creation.”
For the Year Ended December 31, 2026
(Dollar amounts in millions except per-share data)
2025 Actual
Current Guidance
VPY Growth %
Net sales
$
1,621
$
1,788
to
$
1,803
10%
to
11%
Adjusted EBITDA*
$
555
$
602
to
$
612
8%
to
10%
Adjusted diluted net earnings per share*
$
7.41
$
8.30
to
$
8.40
12%
to
13%
Adjusted free cash flow*
$
346
$
380
to
$
390
10%
to
13%
3
Earnings Webcast
Management will host a live webcast conference call at 10:00 a.m. ET today, to discuss third-quarter 2026 results. This event will be available on the Company's website. The call and accompanying slide presentation can be found on the investor relations section of the Company's website at www.armstrong.com. The replay of this event will be available on the website for up to one year after the date of the call.
Uncertainties Affecting Forward-Looking Statements
Disclosures in this release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, those relating to future financial and operational results, market and broader economic conditions and guidance. Those statements provide our future expectations or forecasts and can be identified by our use of words such as “anticipate,” “estimate,” “expect,” “project,” “position,” “deliver,” “intend,” “plan,” “believe,” “outlook,” “target,” “predict,” “mitigate,” “may,” “will,” “would,” “could,” “should,” “seek,” and other words or phrases of similar meaning in connection with any discussion of future operating or financial performance. This includes annual guidance. Forward-looking statements, by their nature, address matters that are uncertain and involve risks because they relate to events and depend on circumstances that may or may not occur in the future. As a result, our actual results may differ materially from our expected results and from those expressed in our forward-looking statements. A more detailed discussion of the risks and uncertainties that could cause our actual results to differ materially from those projected, anticipated or implied is included in the “Risk Factors” and “Management’s Discussion and Analysis” sections of our reports on Form 10-K and Form 10-Q filed with the U.S. Securities and Exchange Commission (“SEC”), including our quarterly report for the quarter ended September 30, 2026, that the Company expects to file with the SEC today. Forward-looking statements speak only as of the date they are made. We undertake no obligation to update any forward-looking statements beyond what is required under applicable securities law.
About Armstrong and Additional Information
Armstrong World Industries, Inc. (AWI) is an Americas leader in the design and manufacture of innovative interior and exterior architectural applications including ceilings, specialty walls and exterior metal solutions. For more than 165 years, Armstrong has delivered products and capabilities that enable architects, designers and contractors to transform building design and construction with elevated aesthetics, acoustics and sustainable attributes. With $1.6 billion in revenue in 2025, AWI has approximately 4,100 employees and a manufacturing network of 24 facilities, plus seven facilities dedicated to its WAVE joint venture.
More details on the Company’s performance can be found in its report on Form 10-Q for the quarter ended September 30, 2026 that the Company expects to file with the SEC today.
Contacts
Investors & Media: Theresa Womble, VP, Investor Relations and Corporate Communications
tlwomble@armstrong.com or (717) 396-6354
Investors: Morgan Leitzel, Manager, Investor Relations
mcleitzel@armstrong.com or (717) 396-2240
4
Reported Financial Results
(Amounts in millions, except per share data)
SELECTED FINANCIAL RESULTS
Armstrong World Industries, Inc. and Subsidiaries
(Unaudited)
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net sales
$
475.8
$
425.2
$
1,357.7
$
1,232.5
Cost of goods sold
285.1
246.7
816.7
728.3
Gross profit
190.7
178.5
541.0
504.2
Selling, general and administrative expenses
91.3
90.1
273.4
252.1
(Gain) loss related to change in fair value of contingent consideration, net
(0.1
)
0.1
0.8
0.5
(Gain) on sales of fixed assets, net
-
(0.9
)
-
(0.8
)
Equity (earnings) from unconsolidated affiliates, net
(31.7
)
(28.0
)
(92.4
)
(86.5
)
Operating income
131.2
117.2
359.2
338.9
Interest expense
7.5
8.2
22.6
25.3
Other non-operating (income), net
(0.7
)
(0.5
)
(3.1
)
(1.9
)
Earnings before income taxes
124.4
109.5
339.7
315.5
Income tax expense
32.5
23.2
84.3
72.3
Net earnings
$
91.9
$
86.3
$
255.4
$
243.2
Diluted net earnings per share of common stock
$
2.17
$
1.98
$
5.98
$
5.56
Average number of diluted common shares outstanding
42.3
43.6
42.7
43.7
SEGMENT RESULTS
Armstrong World Industries, Inc. and Subsidiaries
(Unaudited)
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net Sales
Mineral Fiber
$
292.1
$
274.0
$
837.5
$
786.1
Architectural Specialties
183.7
151.2
520.2
446.4
Total net sales
$
475.8
$
425.2
$
1,357.7
$
1,232.5
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Segment operating income (loss)
Mineral Fiber
$
106.0
$
98.7
$
296.8
$
281.6
Architectural Specialties
25.8
19.3
64.5
59.7
Unallocated Corporate
(0.6
)
(0.8
)
(2.1
)
(2.4
)
Total consolidated operating income
$
131.2
$
117.2
$
359.2
$
338.9
5
SELECTED BALANCE SHEET INFORMATION
Armstrong World Industries, Inc. and Subsidiaries
Unaudited
September 30, 2026
December 31, 2025
Assets
Current assets
$
427.0
$
391.5
Property, plant and equipment, net
629.4
630.7
Other non-current assets
948.0
902.5
Total assets
$
2,004.4
$
1,924.7
Liabilities and shareholders’ equity
Current liabilities
$
294.0
$
267.4
Non-current liabilities
816.6
756.6
Shareholders' equity
893.8
900.7
Total liabilities and shareholders’ equity
$
2,004.4
$
1,924.7
SELECTED CASH FLOW INFORMATION
Armstrong World Industries, Inc. and Subsidiaries
(Unaudited)
For the Nine Months Ended September 30,
2026
2025
Net earnings
$
255.4
$
243.2
Other adjustments to reconcile net earnings to net cash provided by operating activities
16.2
40.0
Changes in operating assets and liabilities, net
(49.5
)
(37.7
)
Net cash provided by operating activities
222.1
245.5
Net cash (used for) provided by investing activities
(34.8
)
16.8
Net cash (used for) financing activities
(228.0
)
(252.0
)
Effect of exchange rate changes on cash and cash equivalents
(0.6
)
0.5
Net (decrease) increase in cash and cash equivalents
(41.3
)
10.8
Cash and cash equivalents at beginning of year
112.7
79.3
Cash and cash equivalents at end of period
$
71.4
$
90.1
6
Supplemental Reconciliations of GAAP to non-GAAP Results (unaudited)
(Amounts in millions, except per share data)
To supplement its consolidated financial statements presented in accordance with accounting principles generally accepted in the United States (“GAAP”), the Company provides additional measures of performance adjusted to exclude the impact of certain discrete expenses and income including adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA"), adjusted diluted earnings per share ("EPS") and adjusted free cash flow. Investors should not consider non-GAAP measures as a substitute for GAAP measures. The Company excludes certain acquisition-related expenses (i.e. impact of adjustments related to the fair value of inventory, third-party professional fees and changes in the fair value of contingent consideration for acquisitions). The Company also excludes all acquisition-related intangible amortization from adjusted net earnings and in calculations of adjusted diluted EPS. Examples of other excluded items have included plant closures, restructuring charges and related costs, separation costs and other cost reduction initiatives, environmental site expenses and environmental insurance recoveries, endowment level charitable contributions, the impact of defined benefit plan settlements, gains and losses on sales or impairment of fixed assets, and certain other gains and losses. The Company also excludes income/expense from its U.S. Retirement Income Plan (“RIP”) in the non-GAAP results as it represents the actuarial net periodic benefit credit/cost recorded. For all periods presented, the Company was not required and did not make cash contributions to the RIP based on guidelines established by the Pension Benefit Guaranty Corporation, nor does the Company expect to make cash contributions to the plan in 2026. Adjusted free cash flow is defined as cash from operating and investing activities, adjusted to remove the impact of cash used or proceeds received for acquisitions and divestitures, environmental site expenses and environmental insurance recoveries. Management's adjusted free cash flow measure includes returns of investment from WAVE and cash proceeds received from the settlement of company-owned life insurance policies, which are presented within investing activities on our condensed consolidated statement of cash flows. The Company uses these adjusted performance measures in managing the business, including communications with its Board of Directors and employees, and believes that they provide users of this financial information with meaningful comparisons of operating performance between current results and results in prior periods. The Company believes that these non-GAAP financial measures are appropriate to enhance understanding of its past performance, as well as prospects for its future performance. The Company also uses adjusted EBITDA and adjusted free cash flow (with further adjustments, when necessary) as factors in determining at-risk compensation for senior management. These non-GAAP measures may not be defined and calculated the same as similar measures used by other companies. Non-GAAP financial measures utilized by the Company may not be comparable to non-GAAP financial measures used by other companies. A reconciliation of these adjustments to the most directly comparable GAAP measures is included in this release and on the Company’s website. These non-GAAP measures should not be considered in isolation or as a substitute for the most comparable GAAP measures.
In the following charts, numbers may not sum due to rounding. Excluding adjusted diluted EPS, non-GAAP figures are rounded to the nearest million and corresponding percentages are rounded to the nearest decimal based on unrounded figures. Basis point changes are calculated based on unrounded margin percentages and rounded to the nearest ten basis points.
7
Consolidated Results – Adjusted EBITDA
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net sales
$
476
$
425
$
1,358
$
1,233
Net earnings
$
92
$
86
$
255
$
243
Add: Income tax expense
33
23
84
72
Earnings before income taxes
$
124
$
110
$
340
$
316
Add: Interest/other income and expense, net
7
8
20
23
Operating income
$
131
$
117
$
359
$
339
Add: RIP expense (1)
1
1
2
2
Add: Acquisition-related impacts (2)
-
1
3
1
Add: Severance and cost reduction actions
-
-
3
-
Add: Environmental expense
-
-
1
-
(Less): Gain on sale of fixed assets, net (3)
-
(1
)
-
(1
)
Adjusted operating income
$
132
$
118
$
368
$
341
Add: Depreciation and amortization
32
30
92
90
Adjusted EBITDA
$
164
$
148
$
460
$
431
Operating income margin
27.6
%
27.6
%
26.5
%
27.5
%
Adjusted EBITDA margin
34.5
%
34.7
%
33.9
%
35.0
%
(1) RIP expense represents only the plan service cost that is recorded within Operating income. For all periods presented, we were not required to and did not make cash contributions to our RIP.
(2) Represents the impact of third-party professional fees and changes in fair value of contingent consideration.
(3) During the third quarter of 2025, we recorded a gain on sale of a parcel of land at a Mineral Fiber plant.
Mineral Fiber
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net sales
$
292
$
274
$
838
$
786
Operating income
$
106
$
99
$
297
$
282
Add: Acquisition-related impacts (1)
-
-
1
-
Add: Severance and cost reduction actions
-
-
2
-
Add: Environmental expense
-
-
1
-
(Less): Gain on sale of fixed assets, net (2)
-
(1
)
-
(1
)
Adjusted operating income
$
106
$
98
$
300
$
281
Add: Depreciation and amortization
22
22
66
65
Adjusted EBITDA
$
129
$
119
$
366
$
345
Operating income margin
36.3
%
36.0
%
35.4
%
35.8
%
Adjusted EBITDA margin
44.0
%
43.6
%
43.8
%
43.9
%
(1) Represents the impact of changes in fair value of contingent consideration.
(2) During the third quarter of 2025, we recorded a gain on sale of a parcel of land at a Mineral Fiber plant.
8
Architectural Specialties
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net sales
$
184
$
151
$
520
$
446
Operating income
$
26
$
19
$
65
$
60
Add: Acquisition-related impacts (1)
-
1
2
1
Add: Severance and cost reduction actions
-
-
1
-
Adjusted operating income
$
26
$
20
$
68
$
60
Add: Depreciation and amortization
10
9
26
25
Adjusted EBITDA
$
36
$
28
$
94
$
86
Operating income margin
14.0
%
12.8
%
12.4
%
13.4
%
Adjusted EBITDA margin
19.4
%
18.8
%
18.0
%
19.2
%
(1) Represents the impact of third-party professional fees and changes in fair value of contingent consideration.
Unallocated Corporate
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Operating (loss)
$
(1
)
$
(1
)
$
(2
)
$
(2
)
Add: RIP expense (1)
1
1
2
2
Adjusted operating (loss)
$
-
$
-
$
(1
)
$
(1
)
Add: Depreciation and amortization
-
-
-
-
Adjusted EBITDA
$
-
$
-
$
(1
)
$
(1
)
(1) RIP expense represents only the plan service cost that is recorded within Operating loss. For all periods presented, we were not required to and did not make cash contributions to our RIP.
Consolidated Results – Adjusted Free Cash Flow
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Net cash provided by operating activities
$
96
$
123
$
222
$
246
Net cash provided by (used for) investing activities
10
4
(35
)
17
Net cash provided by operating and investing activities
$
106
$
127
$
187
$
262
Add: Acquisitions, net of cash acquired
-
8
65
7
Add: Contingent consideration in excess of acquisition-date fair value (1)
-
-
2
1
(Less): Proceeds from sale of facilities (2)
-
(1
)
-
(1
)
(Less): Non-recurring cash tax benefit due to 2025 federal tax reform (3)
-
(10
)
-
(10
)
Adjusted Free Cash Flow
$
106
$
123
$
254
$
259
(1) Contingent consideration payments related to acquisitions that were recorded as components of net cash provided by operating activities.
(2) Proceeds related to the 2025 sale of a parcel of land at a Mineral Fiber plant.
(3) Represents the cash tax benefit from retroactive application of domestic research and development expense deductions for prior years, realized in 2025 as a one-time reduction in cash taxes paid resulting from 2025 federal tax reform.
9
Consolidated Results – Adjusted Diluted Earnings Per Share (EPS)
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
2026
2025
2026
2025
Total
Per Diluted
Share
Total
Per Diluted
Share
Total
Per Diluted
Share
Total
Per Diluted
Share
Net earnings
$
92
$
2.17
$
86
$
1.98
$
255
$
5.98
$
243
$
5.56
Add: Income tax expense
33
23
84
72
Earnings before income taxes
$
124
$
110
$
340
$
316
(Less)/Add: RIP (credit) cost (1)
-
-
(1
)
1
Add: Acquisition-related impacts (2)
-
1
3
1
Add: Acquisition-related amortization (3)
5
4
13
12
Add: Severance and cost reduction actions
-
-
3
-
Add: Environmental expense
-
-
1
-
(Less): Gain on sale of fixed assets, net (4)
-
(1
)
-
(1
)
Adjusted net earnings before income taxes
$
129
$
113
$
358
$
329
(Less): Adjusted income tax expense (5)
(34
)
(24
)
(89
)
(75
)
Adjusted net earnings
$
96
$
2.26
$
89
$
2.05
$
269
$
6.31
$
253
$
5.80
Adjusted diluted EPS change versus prior year
10.2%
8.8%
Diluted shares outstanding
42.3
43.6
42.7
43.7
Effective tax rate
26%
21%
25%
23%
(1) RIP (credit) cost represents the entire actuarial net periodic pension (credit) cost recorded as a component of earnings. For all periods presented, we were not required to and did not make cash contributions to our RIP.
(2) Represents the impact of third-party professional fees and changes in fair value of contingent consideration.
(3) Represents acquisition-related intangible amortization, including customer relationships, developed technology, software, trademarks and brand names, non-compete agreements and other intangibles.
(4) During the third quarter of 2025, we recorded a gain on sale of a parcel of land at a Mineral Fiber plant.
(5) Adjusted income tax expense is calculated using the effective tax rate multiplied by the adjusted net earnings before income taxes.
Adjusted EBITDA Guidance
For the Year Ending December 31, 2026
Low
High
Net earnings
$
335
to
$
340
Add: Income tax expense
112
113
Earnings before income taxes
$
446
to
$
453
Add: Interest expense
30
30
Add: Other non-operating (income), net
(4
)
(4
)
Operating income
$
472
to
$
479
Add: RIP expense (1)
2
2
Add: Acquisition-related impacts (2)
3
3
Add: Severance and cost reduction actions
3
3
Add: Environmental expense
1
1
Adjusted operating income
$
481
to
$
488
Add: Depreciation and amortization
121
124
Adjusted EBITDA
$
602
to
$
612
(1) RIP expense represents only the plan service cost that is recorded within Operating income. We do not expect to make cash contributions to our RIP.
(2) Represents the impact of third-party professional fees and changes in fair value of contingent consideration.
10
Adjusted Diluted Net Earnings Per Share Guidance
For the Year Ending December 31, 2026
Low
Per Diluted
Share
(1)
High
Per Diluted
Share
(1)
Net earnings
$
335
$
7.89
to
$
340
$
7.99
Add: Income tax expense
112
113
Earnings before income taxes
$
446
to
$
453
(Less): RIP (credit) (2)
(1
)
(1
)
Add: Acquisition-related amortization (3)
17
18
Add: Acquisition-related impacts (4)
3
3
Add: Severance and cost reduction actions
3
3
Add: Environmental expense
1
1
Adjusted earnings before income taxes
$
469
to
$
477
(Less): Adjusted income tax expense (5)
(117
)
(119
)
Adjusted net earnings
$
352
$
8.30
to
$
357
$
8.40
(1) Adjusted diluted EPS guidance for 2026 is calculated based on approximately 42.5 million diluted shares outstanding.
(2) RIP (credit) represents the entire actuarial net periodic pension (credit) to be recorded as a component of net earnings. We do not expect to make any cash contributions to our RIP.
(3) Represents acquisition-related intangible amortization, including customer relationships, developed technology, software, trademarks and brand names, non-compete agreements and other intangibles.
(4) Represents the impact of third-party professional fees and changes in fair value of contingent consideration.
(5) Income tax expense is based on an adjusted effective tax rate of approximately 25%, multiplied by adjusted earnings before income taxes.
Adjusted Free Cash Flow Guidance
For the Year Ending December 31, 2026
Low
High
Net cash provided by operating activities
$
354
to
$
367
Add: Return of investment from joint venture
118
120
Less: Capital expenditures
(100
)
(105
)
Add: Proceeds from company owned life insurance, net
7
7
Add: Contingent consideration in excess of acquisition-date fair value (1)
2
2
Adjusted Free Cash Flow
$
380
to
$
390
(1) Contingent consideration payments related to acquisitions that were recorded as components of net cash provided by operating activities.
11

----- awi-ex99_2.htm -----
EX-99.2
3
awi-ex99_2.htm
EX-99.2
October 27, 2026 3rd Quarter 2026
Earnings Presentation Exhibit 99.2
Safe Harbor Statement Disclosures in this presentation contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, those relating to future financial and operational results, market and broader economic conditions and guidance. Those statements provide our future expectations or forecasts and can be identified by our use of words such as “anticipate,” “estimate,” “expect,” “project,” “position,” “deliver,” “intend,” “plan,” “believe,” “outlook,” “target,” “predict,” “mitigate,” “may,” “will,” “would,” “could,” “should,” “seek,” and other words or phrases of similar meaning in connection with any discussion of future operating or financial performance. This includes annual guidance. Forward-looking statements, by their nature, address matters that are uncertain and involve risks because they relate to events and depend on circumstances that may or may not occur in the future. As a result, our actual results may differ materially from our expected results and from those expressed in our forward-looking statements. A more detailed discussion of the risks and uncertainties that could cause our actual results to differ materially from those projected, anticipated or implied is included in the “Risk Factors” and “Management’s Discussion and Analysis” sections of our reports on Form 10-K and Form 10-Q filed with the U.S. Securities and Exchange Commission (“SEC”), including our quarterly report for the quarterly period ended September 30, 2026, that the Company expects to file with the SEC today. Forward-looking statements speak only as of the date they are made. We undertake no obligation to update any forward-looking statements beyond what is required under applicable securities law. In addition, we will be referring to non-Generally Accepted Accounting Principles (“GAAP”) financial measures within the meaning of SEC Regulation G. A reconciliation of the differences between these measures with the most directly comparable financial measures calculated in accordance with GAAP are included within this presentation and available on the Investor Relations page of our website at www.armstrong.com. The guidance in this presentation is only effective as of the date given, October 27, 2026, and will not be updated or affirmed unless and until we publicly announce updated or affirmed guidance.
Basis of Presentation Explanation Results throughout this presentation are presented on a normalized basis. We remove the impact of certain discrete expenses and income in certain measures including adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), adjusted diluted earnings per share (“EPS”) and adjusted free cash flow. The Company excludes certain acquisition related expenses (i.e. – impact of adjustments related to the fair value of inventory, third-party professional fees and changes in the fair value of contingent consideration for acquisitions). The Company also excludes all acquisition-related intangible amortization from adjusted net earnings and in calculations of adjusted diluted EPS. Examples of other excluded items have included plant closures, restructuring charges and related costs, impairments, separation costs and other cost reduction initiatives, environmental site expenses and environmental insurance recoveries, endowment level charitable contributions, the impact of defined benefit plan settlements, gains and losses on sales or impairment of fixed assets, and certain other gains and losses. The Company also excludes income/expense from its U.S. Retirement Income Plan (“RIP”) in the non-GAAP results as it represents the actuarial net periodic benefit credit/cost recorded. For all periods presented, the Company was not required to and did not make cash contributions to the RIP based on guidelines established by the Pension Benefit Guaranty Corporation, nor does the Company expect to make cash contributions to the plan in 2026. Adjusted free cash flow is defined as cash from operating and investing activities, adjusted to remove the impact of cash used or proceeds received for acquisitions and divestitures, environmental site expenses and environmental insurance recoveries. Management's adjusted free cash flow measure includes returns of investment from the Worthington Armstrong Venture (“WAVE”) and cash proceeds received from the settlement of company-owned life insurance policies, which are presented within investing activities on our consolidated statement of cash flows. Investors should not consider non-GAAP measures as a substitute for GAAP measures. Excluding adjusted diluted EPS, non-GAAP figures are rounded to the nearest million and corresponding percentages are rounded to the nearest decimal based on unrounded figures. Basis point changes are calculated based on unrounded margin percentages and rounded to the nearest ten basis points. Operating Segments: “MF”: Mineral Fiber, “AS”: Architectural Specialties, “UC”: Unallocated Corporate. We define “organic” as total company and/or AS results excluding the impact of the February 2026 acquisition of Event Scape Inc. and Eventscape U.S. Holdings Inc. (collectively, “Eventscape”), the December 2025 acquisition of FGM-Parallel LLC (“Parallel”) and the September 2025 acquisition of Geometrik Manufacturing, Inc. (“Geometrik”). All dollar figures throughout the presentation are in $ millions, expect per share data, and all comparisons are versus prior year unless otherwise noted. Figures may not sum due to rounding.
GAAP and non-GAAP Financial Results AWI Consolidated Results Q3 2026 Q3 2025 YTD 2026 YTD 2025 Net sales $475.8 $425.2 $1,357.7 $1,232.5 Net earnings $91.9 $86.3 $255.4 $243.2 Operating income $131.2 $117.2 $359.2 $338.9 Adj. EBITDA* $164 $148 $460 $431 Operating income margin (operating income % of net sales) 27.6% 27.6% 26.5% 27.5% Adj. EBITDA margin* (Adj. EBITDA % of net sales) 34.5% 34.7% 33.9% 35.0% Diluted net earnings per share $2.17 $1.98 $5.98 $5.56 Adj. diluted net earnings per share* $2.26 $2.05 $6.31 $5.80 Net cash provided by operating & investing activities $106.3 $126.5 $187.3 $262.3 Adj. free cash flow* $106 $123 $254 $259 Net cash provided by operating & investing activities % of net sales 22.3% 29.8% 13.8% 21.3% Adj. free cash flow margin* (Adj. free cash flow % of net sales) 22.4% 28.9% 18.7% 21.0% Segment Results Q3 2026 Q3 2025 MF AS UC MF AS UC Net sales $292.1 $183.7 - $274.0 $151.2 - Operating income (loss) $106.0 $25.8 (0.6) $98.7 $19.3 ($0.8) Adj. EBITDA* $129 $36 - $119 $28 - Operating income margin (Operating income % of net sales) 36.3% 14.0% NM 36.0% 12.8% NM Adj. EBITDA margin* (Adj. EBITDA % of net sales) 44.0% 19.4% NM 43.6% 18.8% NM 4 *Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure. “NM”: Not meaningful.
$476M (+12% VPY) Net Sales $164M (+11% VPY) Adj. EBITDA* $2.26 (+10% VPY) Adj. Diluted EPS* $106M (-13% VPY) Adj. Free Cash Flow* 3rd Quarter 2026 Key Takeaways Double-Digit Sales and Adj. EBITDA* Growth Net Sales up 12% and Adj. EBITDA* up 11%
Total company Adj. EBITDA margin* of 34.5% Mineral Fiber segment Adj. EBITDA* up 8%
Adj. EBITDA margin* expansion of 40bps to 44.0%, with favorable AUV1, continued contributions from WAVE2 equity earnings and positive volumes Architectural Specialties segment Adj. EBITDA* up 25%
Adj. EBITDA margin* of 19.4% with EBITDA margin* expansion of 60bps; AS Organic Adj. EBITDA margin* of 20.4% with EBITDA margin* expansion of 160bps Updating 2026 Guidance for All Key Metrics Expect 10% to 11% Net Sales growth, 8% to 10% Adj. EBITDA* growth, 12% to 13% Adj. Diluted EPS* growth, and 10% to 13% Adj. Free Cash Flow* growth *Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure. 1. Average Unit Value (“AUV”). Includes both like-for-like price and mix impacts. 2. Worthington Armstrong Venture (“WAVE”). 3. Recent acquisitions include Eventscape, Parallel and Geometrik.
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure.​ Excludes the change in depreciation and amortization throughout the presentation.​ | 2. Includes raw material, energy and freight impacts, in addition to inventory valuation impacts.​ Mineral Fiber Q3 2026 Results AUV Growth and Contributions from WAVE Drive Solid Results Third consecutive quarter of Mineral Fiber volume growth Top-line AUV growth of 6% driven by both favorable like-for-like price and, to a lesser extent, mix AUV margin benefit muted by mix impact of higher sales to lower-AUV channels Input costs driven by higher freight and raw material inflation SG&A favorability primarily driven by higher incentive compensation expense in the prior-year period Adj. EBITDA margin* of 44.0% Q3 Mineral Fiber Key Highlights Adj. EBITDA* VPY Q1 Q2 Q3 2025 Adj. EBITDA* $105 $121 $119 AUV 9 12 9 Volume 1 3 1 Manufacturing1 (1) 0 (1) Input Costs2 (3) (4) (7) SG&A1 (2) (5) 3 WAVE Equity Earnings 1 2 4 2026 Adj. EBITDA* $109 $129 $129 % Change 4% 7% 8% Net Sales Growth VPY +7%
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure.​ Excludes the change in depreciation and amortization throughout the presentation. Architectural Specialties Q3 2026 Results Double-Digit Top and Bottom-Line Growth Higher sales driven by strong growth across product categories and recent acquisitions Sales margin benefit muted by the impact of elevated metal and freight costs and recent acquisitions Manufacturing primarily driven by recent acquisitions … SG&A split between organic and recent acquisitions Adj. EBITDA margin* of 19.4% and AS Organic Adj. EBITDA margin* of 20.4% Pricing, backlog and continued strong order intake support fourth-quarter organic growth and improved profitability Q3 Architectural Specialties
Key Highlights Net Sales Growth VPY +22% Adj. EBITDA* VPY Q1 Q2 Q3 2025 Adj. EBITDA* $24 $34 $28 Sales 7 9 12 Manufacturing1 (7) (2) (2) SG&A1 (3) (4) (3) 2026 Adj. EBITDA* $21 $37 $36 % Change (12%) 10% 25%
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure.​ 1. Excludes the change in depreciation and amortization throughout the presentation.​ | 2. Includes raw material, energy and freight impacts, in addition to inventory valuation impacts.​ Q3 2026 Consolidated Company Key Metrics Positive Volume & AUV Drive Strong Sales with Adj. EBITDA* Growth Q3 2025 Q3 2026 Variance Net Sales $425 $476 12% Adj. EBITDA* $148 $164 11% Adj. EBITDA Margin* (Adj. EBITDA % of Net Sales) 34.7% 34.5% (30bps) AWI Organic Adj. EBITDA Margin* (Adj. EBITDA % of Net Sales) 34.7% 35.1% 40bps Adj. Diluted Net Earnings Per Share* $2.05 $2.26 10% Adj. EBITDA* Bridge VPY 1 1 2
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure.​ 1. Excludes the change in depreciation and amortization throughout the presentation.​ | 2. Includes raw material, energy and freight impacts, in addition to inventory valuation impacts.​ Year-to-Date 2026 Consolidated Company Key Metrics Double-Digit Sales Growth with High-Single-Digit Adj. EBITDA* Growth YTD 2025 YTD 2026 Variance Net Sales $1,233 $1,358 10% Adj. EBITDA* $431 $460 7% Adj. EBITDA Margin* (Adj. EBITDA % of Net Sales) 35.0% 33.9% (110bps) AWI Organic Adj. EBITDA Margin* (Adj. EBITDA % of Net Sales) 35.0% 34.5% (40bps) Adj. Diluted Net Earnings Per Share* $5.80 $6.31 9% Adj. EBITDA* Bridge VPY 1 1 2
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure.​ 1. Includes cash earnings, working capital, and other current assets and liabilities and proceeds from company-owned officer life insurance.​ 2. Excludes excise taxes. Adjusted Free Cash Flow* Funds All Capital Allocation Priorities 2026 Year-to-Date Capital Deployment 2026 Year-to-Date Adj. Free Cash Flow*
Down 2% VPY 2025 Adj. Operating cash flow
and other1 CapEx Interest
Paid WAVE Dividends 2026 CapEx Acquisitions Share Repurchases2 Cash Dividends Income Tax Payments
*Non-GAAP measure. See appendix for reconciliation to nearest GAAP measure. 1. Additional assumptions available on the following page. Updated Full Year 2026 Guidance Commentary1 $1,788M to $1,803M Net Sales 10% to 11% YoY Prior: $605M to $620M Adjusted EBITDA* 9% to 12% YoY Adjusted Diluted EPS* Prior: $8.30 to $8.50 12% to 15% YoY $8.30 to $8.40 12% to 13% YoY Adjusted Free Cash Flow* 10% to 14% YoY Prior: $1,770M to $1,800M 9% to 11% YoY $602M to $612M 8% to 10% YoY Prior: $380M to $395M $380M to $390M 10% to 13% YoY Reflects stronger Net Sales growth and accelerating inflationary pressures Expect Mineral Fiber volume up
~1% on strong execution and growth initiatives … market conditions remain unchanged Expect Mineral Fiber AUV growth ~5.5% … Softer mix partially offset by stronger price versus prior expectations Expect WAVE equity earnings to grow mid-single digits Expect Organic AS low-teens top line growth … Organic AS Adj. EBITDA Margin* of ~20% Expect Organic Total Company Adj. EBITDA Margin* to expand modestly
Appendix
Full Year 2026 Assumptions Segment Net Sales Adjusted EBITDA Margin* Mineral Fiber ~6.5% growth (prior: ~7%) 43-44% (prior: ~44%) Architectural Specialties 18-19% growth (prior: 15-17%) ~19% Consolidated Metrics Full Year 2026 Capital expenditures $100M to $105M (prior: $100M to $110M) Depreciation and amortization $121M to $124M (prior: $119M to $124M) Interest expense ~$30M (prior: $29M to $31M) Book / cash tax rate ~25% / ~23% (prior: ~25% / ~22%) Shares outstanding ~42.5M Cash return of investment from joint venture $118M to $120M (prior: $114M to $122M) Shipping Days vs Prior Year 2025 2026 Q1 (1) - Q2 - - Q3 - - Q4 - - Full Year (1) - *Non-GAAP measure.
Adjusted EBITDA
Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, 2026 2025 2026 2025 Net sales $476 $425 $1,358 $1,233 Net earnings $92 $86 $255 $243 Add: Income tax expense 33 23 84 72 Earnings before income taxes $124 $110 $340 $316 Add: Interest/other income and expense, net 7 8 20 23 Operating income $131 $117 $359 $339 Add: RIP expense1 1 1 2 2 Add: Acquisition-related impacts2 - 1 3 1 Add Severance and cost reduction actions - - 3 - Add: Environmental expense - - 1 - (Less): Gain on sale of fixed assets, net3 - (1) - (1) Adjusted operating income $132 $118 $368 $341 Add: Depreciation and amortization 32 30 92 90 Adjusted EBITDA $164 $148 $460 $431 Operating income margin 27.6% 27.6% 26.5% 27.5% Adjusted EBITDA margin 34.5% 34.7% 33.9% 35.0% Adjusted Diluted EPS
Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, 2026 2025 2026 2025 Net earnings $92 $86 $255 $243 Add: Income tax expense 33 23 84 72 Earnings before income taxes $124 $110 $340 $316 (Less)/Add: RIP (credit) cost4 - - (1) 1 Add: Acquisition-related impacts2 - 1 3 1 Add: Acquisition-related amortization5 5 4 13 12 Add: Severance and cost reduction actions - - 3 - Add: Environmental expense - - 1 - (Less): Gain on sale of fixed assets, net3 - (1) - (1) Adjusted net earnings before income taxes $129 $113 $358 $329 (Less): Adjusted income tax expense6 (34) (24) (89) (75) Adjusted net earnings $96 $89 $269 $253 Diluted shares outstanding 42.3 43.6 42.7 43.7 Effective tax rate 26% 21% 25% 23% Diluted net earnings per share $2.17 $1.98 $5.98 $5.56 Adjusted diluted net earnings per share $2.26 $2.05 $6.31 $5.80 RIP expense represents only the plan service cost that is recorded within Operating income. For all periods presented, we were not required to and did not make cash contributions to our RIP. Represents the impact of third-party professional fees and changes in fair value of contingent consideration. During the third quarter of 2025, we recorded a gain on sale of a parcel of land at a Mineral Fiber plant. RIP (credit) cost represents the entire actuarial net periodic pension (credit) cost recorded as a component of earnings. For all periods presented, we were not required to and did not make cash contributions to our RIP. Represents acquisition-related intangible amortization, including customer relationships, developed technology, software, trademarks and brand names, non-compete agreements and other intangibles. Adjusted income tax expense is calculated using the effective tax rate multiplied by the adjusted net earnings before income taxes.
Adjusted Free Cash Flow Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, 2026 2025 2026 2025 Net cash provided by operating activities $96 $123 $222 $246 Net cash provided by (used for) investing activities $10 $4 ($35) $17 Net cash provided by operating and investing activities $106 $127 $187 $262 Add: Acquisitions, net of cash acquired - 8 65 7 Add: Contingent consideration in excess of acquisition-date fair value1 - - 2 1 (Less): Proceeds from sale of facilities2 - (1) - (1) (Less): Non-recurring cash tax benefit due to 2025 federal tax reform3 - (10) - (10) Adjusted free cash flow $106 $123 $254 $259 Contingent consideration payments related to acquisitions that were recorded as components of net cash provided by operating activities. Proceeds related to the 2025 sale of a parcel of land at a Mineral Fiber plant. Represents the cash tax benefit from retroactive application of domestic research and development expense deductions for prior years, realized in 2025 as a one-time reduction in cash taxes paid resulting from 2025 federal tax reform.
Segment Adj. EBITDA Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, MF AS UC UNALLOCATED CORPORATE MF AS UC UNALLOCATED CORPORATE 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 Net sales $292 $274 $184 $151 - - $838 $786 $520 $446 - - Operating income (loss) $106 $99 $26 $19 ($1) ($1) $297 $282 $65 $60 ($2) ($2) Add: RIP expense1 - - - - 1 1 - - - - 2 2 Add: Acquisition-related impacts2 - - - 1 - - 1 - 2 1 - - Add: Severance and cost reduction actions - - - - - - 2 - 1 - - - Add: Environmental expense - - - - - - 1 - - - - - (Less): Gain on sale of fixed assets, net3 - (1) - - - - - (1) - - - - Adjusted operating income (loss) $106 $98 $26 $20 - - $300 $281 $68 $60 ($1) ($1) Add: Depreciation and amortization 22 22 10 8 - - 66 65 26 25 - - Adjusted EBITDA $129 $119 $36 $28 - - $366 $345 $94 $86 - - Operating income margin (Operating income % of net sales) 36.3% 36.0% 14.0% 12.8% NM NM 35.4% 35.8% 12.4% 13.4% NM NM Adjusted EBITDA margin (Adjusted EBITDA % of net sales) 44.0% 43.6% 19.4% 18.8% NM NM 43.8% 43.9% 18.0% 19.2% NM NM RIP expense represents only the plan service cost that is recorded within Operating income. For all periods presented, we were not required to and did not make cash contributions to our RIP. Represents the impact of third-party professional fees and changes in fair value of contingent consideration. During the third quarter of 2025 we sold a parcel of land at a Mineral Fiber plant. “NM”: Not meaningful.
Recent acquisitions include the February 2026 acquisition of Eventscape, the December 2025 acquisition of Parallel and the September 2025 acquisition of Geometrik. Represents the impact of third-party professional fees and changes in fair value of contingent consideration. AS Organic Adj. EBITDA Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, Total AS Recent Acquisitions1 AS Organic UNALLOCATED CORPORATE Total AS Recent Acquisitions1 AS Organic UNALLOCATED CORPORATE 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 Net sales $184 $151 $8 - $176 $151 $520 $446 $25 - $495 $446 Operating income $26 $19 ($2) - $28 $19 $65 $60 ($5) - $69 $60 Add: Acquisition-related impacts2 - 1 - - - 1 2 1 1 - 1 1 Add: Severance and cost reduction actions - - - - - - 1 - - - 1 - Adjusted operating income $26 $20 ($2) - $28 $20 $68 $60 ($3) - $71 $60 Add: Depreciation and amortization 10 8 2 - 8 8 26 25 3 - 23 25 Adjusted EBITDA $36 $28 ($0) - $36 $28 $94 $86 ($0) - $94 $86 Operating income margin (Operating income % of net sales) 14.0% 12.8% (25.3%) - 15.9% 12.8% 12.4% 13.4% (18.5%) - 14.0% 13.4% Adjusted EBITDA margin (Adjusted EBITDA % of net sales) 19.4% 18.8% (1.9%) - 20.4% 18.8% 18.0% 19.2% (0.8%) - 19.0% 19.2%
Recent acquisitions include the February 2026 acquisition of Eventscape, the December 2025 acquisition of Parallel and the September 2025 acquisition of Geometrik. RIP expense represents only the plan service cost that is recorded within Operating income. For all periods presented, we were not required to and did not make cash contributions to our RIP. Represents the impact of third-party professional fees and changes in fair value of contingent consideration. During the third quarter of 2025 we sold a parcel of land at a Mineral Fiber plant. AWI Organic Adj. EBITDA Reconciliation For the Three Months Ended September 30, For the Nine Months Ended September 30, Total AWI Recent Acquisitions1 AWI Organic UNALLOCATED CORPORATE Total AWI Recent Acquisitions1 AWI Organic UNALLOCATED CORPORATE 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 Net sales $476 $425 $8 - $467 $425 $1,358 $1,233 $25 - $1,333 $1,233 Operating income $131 $117 ($2) - $133 $117 $359 $339 ($5) - $364 $339 Add: RIP expense2 1 1 - - 1 1 2 2 - - 2 2 Add: Acquisition-related impacts3 - 1 - - - 1 3 1 1 - 2 1 Add: Severance and cost reduction actions - - - - - - 3 - - - 3 - Add: Environmental expense - - - - - - 1 - - - 1 - (Less): Gain on sales of fixed assets, net4 - (1) - - - (1) - (1) - - - (1) Adjusted operating income $132 $118 ($2) - $134 $118 $368 $341 ($3) - $371 $341 Add: Depreciation and amortization 32 30 2 - 30 30 92 90 3 - 89 90 Adjusted EBITDA $164 $148 ($0) - $164 $148 $460 $431 ($0) - $460 $431 Operating income margin (Operating income % of net sales) 27.6% 27.6% (25.3%) - 28.5% 27.6% 26.5% 27.5% (18.5%) - 27.3% 27.5% Adjusted EBITDA margin (Adjusted EBITDA % of net sales) 34.5% 34.7% (1.9%) - 35.1% 34.7% 33.9% 35.0% (0.8%) - 34.5% 35.0%
2026 Adj. EBITDA Guidance Reconciliation Full Year 2026 Low High Net earnings $335 $340 Add: Income tax expense 112 113 Earnings before income taxes $446 $453 Add: Interest expense 30 30 Add: Other non-operating (income), net (4) (4) Operating income $472 $479 Add: RIP expense1 2 2 Add: Acquisition-related impacts2 3 3 Add: Severance and cost reduction actions 3 3 Add: Environmental expense 1 1 Adjusted operating income $481 $488 Add: Depreciation and amortization 121 124 Adjusted EBITDA $602 $612 2026 Adj. Diluted EPS
Guidance Reconciliation Full Year 2026 Low High Net earnings $335 $340 Add: Income tax expense 112 113 Earnings before income taxes $446 $453 (Less): RIP (credit)4 (1) (1) Add: Acquisition-related amortization5 17 18 Add: Acquisition-related impacts2 3 3 Add: Severance and cost reduction actions 3 3 Add: Environmental expense 1 1 Adjusted earnings before income taxes $469 $477 (Less): Adjusted income tax expense6 (117) (119) Adjusted net earnings $352 $357 Diluted net earnings per share $7.89 $7.99 Adjusted diluted net earnings per share7 $8.30 $8.40 2026 Adj. Free Cash Flow Guidance Reconciliation Full Year 2026 Low High Net cash provided by operating activities $354 $367 Add: Return of investment from joint venture 118 120 (Less): Capital expenditures (100) (105) Add: Proceeds from company owned life insurance, net 7 7 Add: Contingent consideration in excess of acquisition-date fair value3 2 2 Adjusted Free Cash Flow $380 $390 RIP expense represents only the plan service cost that is recorded within Operating income. We do not expect to make cash contributions to our RIP. Represents the impact of third-party professional fees and changes in fair value of contingent consideration. Contingent consideration payments related to acquisitions that were recorded as components of net cash provided by operating activities. RIP (credit) represents the entire actuarial net periodic pension (credit) recorded as a component of net earnings. We do not expect to make any cash contributions to our RIP. Represents acquisition-related intangible amortization, including customer relationships, developed technology, software, trademarks and brand names, non-compete agreements and other intangibles. Adjusted income tax expense is based on an adjusted effective tax rate of approximately 25%, multiplied by adjusted earnings before income taxes. Adjusted diluted EPS guidance for 2026 is calculated based on approximately 42.5 million diluted shares outstanding.