Scotts Miracle-Gro Reports $125 Million Net Loss and Decrease in Sales for December 2025

The Scotts Miracle-Gro Company reported a net loss of $125.0 million for the three months ended December 27, 2025, compared to a net loss of $69.5 million for the same period in the previous year. The company's net sales decreased by 3.3% to $354.4 million from $366.6 million, primarily due to lower sales volume in its U.S. Consumer segment, particularly in fertilizer, grass seed, plant food, and controls products. The gross margin improved slightly to 25.0% from 24.1%, attributed to increased pricing and lower manufacturing costs, despite the overall decline in sales.

In terms of operational performance, Scotts Miracle-Gro's loss from continuing operations before income taxes was $63.3 million, a significant improvement from a loss of $90.9 million in the prior year. The company also reported a decrease in selling, general, and administrative expenses, which fell to $106.0 million from $113.5 million, driven by lower short-term variable cash incentive compensation and share-based compensation expenses. The equity in loss of unconsolidated affiliates increased to $13.1 million from $9.9 million, primarily due to losses associated with Bonnie Plants, LLC and FLUENT.

Strategically, the company has classified its Hawthorne business as held for sale, reflecting a significant shift in its operations. This decision resulted in a non-cash pre-tax charge of $104.8 million related to the valuation adjustment of the Hawthorne business. The company anticipates completing the sale within twelve months. Additionally, Scotts Miracle-Gro has authorized a share repurchase program for up to $500 million, although no repurchases have been made as of the reporting date.

On the operational front, the company reported a decrease in cash used in operating activities to $370.4 million from $445.3 million year-over-year, indicating improved cash flow management. The company’s total assets decreased to $3.034 billion from $3.170 billion, while total liabilities also decreased to $3.535 billion from $3.650 billion. The company’s leverage ratio stood at 4.03, within the limits set by its credit agreements, and it maintained a healthy interest coverage ratio of 5.05.

Looking ahead, Scotts Miracle-Gro continues to monitor macroeconomic conditions, including inflation and geopolitical uncertainties, which may impact its operational and financial performance. The company remains focused on its core consumer lawn and garden business while navigating the challenges posed by market dynamics.