8-K: Hayward Holdings Beats Q4, FY25; Strong 2026 Outlook

Hayward Holdings, Inc. announced strong financial results for the fourth quarter and full fiscal year 2025, outperforming expectations and providing positive 2026 guidance.

Summary

• Net Sales for the fourth quarter of fiscal 2025 increased 7% year-over-year to $349.4 million.
• Net Income for the fourth quarter of fiscal 2025 increased 25% year-over-year to $68.4 million.
• Adjusted EBITDA for the fourth quarter of fiscal 2025 increased 4% year-over-year to $102.9 million.
• Diluted EPS for the fourth quarter of fiscal 2025 increased 24% year-over-year to $0.31.
• Full fiscal year 2025 Net Sales increased 7% year-over-year to $1,122.2 million.
• Full fiscal year 2025 Net Income increased 28% year-over-year to $151.6 million.
• Full fiscal year 2025 Adjusted EBITDA increased 8% year-over-year to $299.3 million.
• Full fiscal year 2025 Diluted EPS increased 26% year-over-year to $0.68.
• Net cash provided by operating activities for full fiscal year 2025 increased 21% year-over-year to $256.0 million.
• For Fiscal Year 2026, Hayward expects net sales to increase approximately 4% from Fiscal Year 2025.
• For Fiscal Year 2026, Hayward expects adjusted diluted earnings per share of $0.82 to $0.86, representing an increase of approximately 6% to 12%.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a very positive report, demonstrating strong financial performance, effective operational management, and a confident outlook for continued growth in a favorable industry environment. The company exceeded expectations and provided solid guidance.

Positives

• Delivered a strong fourth quarter, outperforming expectations and building momentum.
• Achieved solid in-quarter demand and strong participation in Early Buy programs for the upcoming 2026 pool season.
• Expanded gross profit margins by 160 basis points to 48.5% in Q4 2025, primarily due to higher net prices, lower warranty expenses, and operational efficiencies.
• Operating income increased by 14% in Q4 2025 to $87.3 million, with operating margin expanding 160 basis points to 25.0%.
• Interest expense, net, decreased by 14% to $11.7 million in Q4 2025, driven by lower interest rates and increased interest income on cash deposits.
• Net income margin expanded 290 basis points to 19.6% in Q4 2025.
• North America segment net sales increased by 8% to $308.7 million in Q4 2025, driven by positive net price.
• Europe & Rest of World segment income increased by 28% to $6.2 million in Q4 2025.
• Gross profit margin for full fiscal year 2025 increased to 48.0%, a 170 basis point increase compared to Fiscal Year 2024, driven by positive pricing, lower warranty costs, and improved manufacturing efficiency.
• Operating margin for full fiscal year 2025 was 20.8%, a 90 basis point increase from Fiscal Year 2024.
• Net income margin for full fiscal year 2025 expanded 220 basis points to 13.5%.
• Adjusted EBITDA margin for full fiscal year 2025 increased by 30 basis points to 26.7%.
• Impressive cash flow generation further strengthened the balance sheet and enabled a meaningful reduction in net leverage.
• Ended Fiscal Year 2025 with cash and cash equivalents of $329.6 million and $125.5 million available under revolving credit facilities.
• Well-positioned to capitalize on long-term growth drivers of the pool industry, including an increasing installed base, favorable secular demand trends in outdoor living, sunbelt migration, and technology adoption.
• Benefits from increasing adoption of its industry-leading SmartPad pool equipment products in both new construction and the aftermarket, which represents approximately 85% of net sales.

Negatives

• Modest decrease in volume partially offset net sales increase in North America for Q4 2025.
• Net sales in Europe & Rest of World decreased by 1% in Q4 2025, primarily due to a decrease in volume and net price.
• Selling, general, and administrative (SG&A) expense increased by 14% to $67.0 million in Q4 2025, mainly due to increased variable compensation, strategic investments, and a securities class action litigation settlement.
• Adjusted EBITDA margin decreased 80 basis points to 29.4% in Q4 2025.
• SG&A expense increased by 14% to $246.9 million for full fiscal year 2025, mainly caused by higher variable compensation, wage inflation, investments in teams, and a full year of expense from the ChlorKing acquisition.

Risks

• Business depends on the performance of distributors, builders, buying groups, retailers, and servicers.
• Demand for products may be adversely affected by unfavorable economic and business conditions.
• Operates in markets with high levels of competition.
• Future success depends on developing, manufacturing, and attaining market adoption of new products and maintaining product quality and reliability.
• Ability to keep pace with rapidly evolving technological developments and standards, including artificial intelligence (AI), and effectively develop and deploy such technologies.
• Results of operations and cash flows may fluctuate from quarter to quarter.
• A loss of, or material cancellation, reduction, or delay in purchases by one or more of largest customers.
• Exposure to credit risk on accounts receivable.
• Risks arising from international business operations.
• Past growth may not be indicative of future growth.
• Inability to identify, finance, and complete suitable acquisitions.
• Negative impacts of litigation and other claims.
• Future impairment of goodwill and intangible assets.
• Exchange rate fluctuations, cost increases and other inflation, changes in effective tax rate or exposure to additional income tax liabilities.
• Ability to attract, develop, and retain highly qualified personnel, including key members of management.
• Disruptions in the financial markets.
• Significant disruption or breach of technology infrastructure or that of vendors or third parties, or failure to maintain the security of confidential information.
• Difficulties in operating or implementing the new ERP system or human resources information system.
• Misuse of technology-enabled products.
• Failure to maintain an effective system of internal controls.
• Dependence on key suppliers, including single-source suppliers and sole-source suppliers.
• Ability to manage product inventory in an effective and efficient manner.
• Product manufacturing disruptions, including as a result of catastrophic or other events beyond control.
• Tariffs and other trade restrictions and the cost of raw materials.
• Compliance with, and potential liabilities under, employment, environmental, health, transportation, safety, and other governmental laws and regulations.
• Risks related to handling of personal information.
• Employees, commercial partners, and vendors may engage in misconduct or other improper activities.
• Violations of the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act, and other anti-corruption laws.
• Failure to comply with international trade compliance regulations, and changes in U.S. government sanctions.
• Changes in laws, regulations, government policies or regulatory interpretations.
• Climate change and legal or regulatory responses thereto, and increasing scrutiny from stakeholders on environmental, social, and other sustainability matters.
• Ability to obtain, maintain, and enforce intellectual property and proprietary rights.
• Protection of trademarks or trade names.
• Reliance on access to intellectual property owned by third parties.
• Claims that employees, consultants or advisors have wrongfully used or disclosed alleged trade secrets or other proprietary information or claims asserting ownership of intellectual property that is regarded as own.
• Ability to enforce intellectual property rights in all jurisdictions.
• Other risks related to indebtedness, corporate structure, and ownership of common stock.
• Other factors described in the Risk Factors section of the Annual Report on Form 10-K for the year ended December 31, 2025.

Future Outlook

Hayward expects Fiscal Year 2026 net sales to increase approximately 4% from Fiscal Year 2025, and adjusted diluted earnings per share to be between $0.82 and $0.86, representing an increase of approximately 6% to 12%. The company anticipates continued sales and earnings growth driven by solid execution, positive price realization, and continued technology adoption. Hayward is confident in its long-term outlook for profitable growth and robust cash flow generation, benefiting from the increasing installed base of pools, favorable secular demand trends in outdoor living, sunbelt migration, and increasing adoption of its SmartPad pool equipment products.

Management Comments

• "Hayward delivered a strong fourth quarter, outperforming expectations and building on our momentum." Kevin Holleran, President and Chief Executive Officer.
• "Our team executed at a high level across the organization, driving an exceptional finish to 2025, with solid in-quarter demand and strong participation in our Early Buy programs for the upcoming 2026 pool season." Kevin Holleran.
• "Full year net sales increased 7% year-over-year, reflecting solid performance across both our North America and Europe & Rest of World segments, as well as the strength of our aftermarket model." Kevin Holleran.
• "We expanded margins through operational efficiencies and successful mitigation of new tariffs and other inflationary pressures, while continuing to invest strategically in product innovation and customer support." Kevin Holleran.
• "Impressive cash flow generation further strengthened our balance balance sheet and enabled a meaningful reduction in net leverage." Kevin Holleran.
• "With industry-leading products, a customer-centric approach, and ongoing investments in technology and operational efficiency, Hayward is well positioned to capitalize on the long-term growth drivers of the pool industry and continue delivering value for our stockholders." Kevin Holleran.

Industry Context

StockSavvy.ai notes that Hayward Holdings operates within the resilient pool equipment and outdoor living sector, which benefits from consistent aftermarket demand (approximately 85% of net sales), favorable demographic shifts like sunbelt migration, and increasing technology adoption (e.g., SmartPad products). The company's performance reflects a strong position in a market driven by an expanding installed base of pools and a focus on energy-efficient and sustainable solutions, aligning with broader consumer trends towards home improvement and smart home integration.

Comparison to Industry Standards

• The filing does not provide specific comparisons to other comparable companies, projects, or industry-wide results.

Legal Proceedings

• A settlement in principle related to the securities class action litigation resulted in $1.5 million in adjustments to SG&A expense for Q4 2025 and $4.3 million for FY 2025. Additional expenses are expected to be paid by the company's insurance carriers pursuant to its retention amount.

Stakeholder Impact

• Shareholders: Positive financial results, strong cash flow, reduced net leverage, and positive 2026 guidance suggest increased shareholder value and confidence.
• Employees: Increased variable compensation and strategic investments in selling and customer service teams indicate positive impact. Retention payments for key employees acquired in the ChlorKing acquisition were also noted.
• Customers: Investments in product innovation and customer support, along with industry-leading products and a customer-centric approach, aim to enhance customer satisfaction and product offerings.
• Suppliers: The company's dependence on key suppliers, including single-source and sole-source suppliers, is identified as a potential risk factor.

Next Steps

• Hayward will hold a conference call to discuss the results on February 25, 2026, at 9:00 a.m. (ET).
• An earnings presentation will be posted to the Investor Relations section of the company's website prior to the conference call.
• A replay of the conference call will be available approximately three hours after the call through the archived webcast on the Hayward website or by dialing (844) 512-2921 or (412) 317-6671 (access code: 13758285) until 11:59 p.m. Eastern Time on March 11, 2026.

Key Dates

Recommendation

The company delivered robust financial results for both the fourth quarter and the full fiscal year 2025, significantly exceeding expectations across key metrics like net sales, net income, and EPS. Management highlighted strong execution, margin expansion through operational efficiencies, and impressive cash flow generation leading to reduced net leverage. The positive 2026 guidance, projecting continued sales and EPS growth, coupled with favorable long-term industry dynamics (growing installed pool base, outdoor living trends, technology adoption), positions Hayward Holdings for sustained profitable growth. The settlement of securities class action litigation also removes a potential overhang. These factors collectively indicate a strong investment opportunity.

Keywords

Pool Equipment, Outdoor Living, Industrial Flow Control, Financial Results, Earnings, Guidance, SmartPad, Aftermarket, North America, Europe, SEC Filing, Hayward Holdings