Builders FirstSource Reports 6% Decline in Q1 2025 Net Sales, Completes Major Acquisitions

Builders FirstSource, Inc. reported a decline in financial performance for the first quarter of 2025, with net sales totaling $3.66 billion, a decrease of 6.0% from $3.89 billion in the same period of 2024. The company's gross margin also fell to $1.12 billion, representing 30.5% of net sales, down from 33.4% a year earlier. Net income for the quarter was $96.3 million, or $0.85 per share, compared to $258.8 million, or $2.12 per share, in the prior year. The decrease in revenue and profitability was attributed to a combination of lower sales in the multi-family and single-family customer segments, commodity price deflation, and one fewer selling day.

In terms of operational changes, Builders FirstSource completed significant acquisitions during the quarter, acquiring Alpine Lumber Company and O.C. Cluss Lumber Company for approximately $828 million. These acquisitions are expected to enhance the company's market presence and expand its product offerings. The company also repurchased 0.1 million shares of its common stock at an average price of $131.51 per share, totaling $12.8 million. This buyback is part of a broader strategy to return value to shareholders, with an additional $500 million share repurchase authorization announced in April 2025.

The company operates approximately 595 locations across 43 states, and as of March 31, 2025, it reported a total of 110,514,818 shares of common stock outstanding. Builders FirstSource's customer base and engagement metrics reflect a challenging market environment, with a noted decrease in housing starts. According to the U.S. Census Bureau, total housing starts were 0.3 million in the first quarter of 2025, down 1.6% from the previous year. The company anticipates that macroeconomic factors, including interest rates and inflation, may continue to impact demand in the near term.

Looking ahead, Builders FirstSource remains optimistic about the long-term outlook for the housing industry, citing an underbuilt market relative to historical levels. The company plans to focus on strategic acquisitions and operational efficiencies to navigate current market challenges. Builders FirstSource aims to maintain a strong liquidity position, with $1.1 billion available through its revolving credit facility and cash on hand, while also managing working capital effectively to support growth initiatives.