GMS Inc. Reports 0.2% Increase in Net Sales but 58.2% Decline in Net Income for Fiscal Year 2025

GMS Inc. reported a modest increase in net sales for the fiscal year ending April 30, 2025, reaching $5.51 billion, a 0.2% rise from the previous year. This growth was primarily driven by contributions from recent acquisitions, which helped offset challenges posed by a deflationary pricing environment in steel framing and softening market conditions. However, the company experienced a significant decline in net income, which fell by 58.2% to $115.5 million, largely due to a $42.5 million impairment of goodwill and increased operating expenses related to recent acquisitions and inflationary pressures.

In fiscal 2025, GMS completed three acquisitions, including Howard & Sons Building Materials, Yvon Building Supply, and R.S. Elliott Specialty Supply, expanding its geographic footprint and product offerings. The company also opened four new greenfield locations in South Carolina, Massachusetts, Oregon, and Ontario, Canada. These strategic moves are part of GMS's ongoing efforts to enhance its market share in core products such as wallboard, ceilings, and steel framing, as well as to grow its complementary product lines.

Operationally, GMS's workforce comprised 7,113 employees as of April 30, 2025, with approximately 8% unionized. The company reported a gross profit of $1.72 billion, resulting in a gross margin of 31.2%, down from 32.3% in the prior year. The decline in gross margin was attributed to increased selling, general, and administrative expenses, which rose to $1.27 billion, reflecting the costs associated with acquisitions and inflation. Additionally, the company noted a decrease in sales volume for wallboard and steel framing products, which were impacted by lower demand in both commercial and residential construction markets.

Looking ahead, GMS anticipates continued challenges in the commercial construction sector due to economic uncertainties and financing difficulties. The company expects that inflationary pressures on labor and materials will persist, potentially affecting demand for its products. Despite these headwinds, GMS remains optimistic about the long-term fundamentals of the housing market, including a structural undersupply of homes and ongoing repair and remodeling activities, which could support future growth. The company is committed to executing its growth strategy through further acquisitions and expanding its product offerings to better serve its customer base.