BlueLinx Q1 2026 Earnings Report

BlueLinx EPS Results

• Actual EPS: N/A
• Consensus EPS: -$0.72
• Beat/Miss: N/A
• One Year Ago EPS: N/A

BlueLinx Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $714.84 million
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

BlueLinx Announcement Details

• Quarter: Q1 2026
• Date: 5/5/2026
• Time: After Market Closes
• Conference Call Date: Wednesday, May 6, 2026
• Conference Call Time: 10:00AM ET

BlueLinx (NYSE:BXC) Corporation is a leading distributor of building products in the United States, serving professional builders, contractors and industrial customers. The company offers a comprehensive portfolio that includes lumber, engineered wood products, plywood, oriented strand board, siding, railing, millwork and specialty construction materials. Through its nationwide network of distribution centers, BlueLinx provides inventory management, delivery and supply-chain solutions designed to help customers streamline operations and reduce carrying costs.

Founded in 2004 as a spin-off from Georgia-Pacific’s distribution business, BlueLinx has developed a broad product line that spans both residential and commercial construction markets. The company sources materials from major manufacturers and leverages its buying scale to secure competitive pricing. In addition to core building supplies, BlueLinx offers complementary products such as windows, doors and trim to support projects from framing through finishing.

Headquartered in Marietta, Georgia, BlueLinx maintains more than 60 distribution centers across the continental U.S., allowing for efficient regional coverage and timely customer service. Its logistics capabilities include fleet management and just-in-time delivery, ensuring materials arrive on schedule and in full. The company’s geographic footprint enables it to respond quickly to fluctuations in local housing and commercial construction activity.

BlueLinx operates under a customer-focused leadership team committed to operational excellence and sustainable growth. By combining extensive industry expertise with tailored supply-chain solutions, the company aims to strengthen its position as a trusted partner for building professionals nationwide.

BlueLinx Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: BlueLinx reported first-quarter net sales of $731 million and adjusted EBITDA of $23.5 million (up ~20% year‑over‑year), with adjusted net income of $0.21 per share and Disdero contributing meaningful sales and EBITDA.
• Positive Sentiment: The company is accelerating its specialty product mix shift — specialty categories represented about 70% of net sales and ~80% of gross profit — and expanded branded assortment with rollouts like Westlake TruExterior and additions such as Deckorators/MoistureShield and Disdero.
• Positive Sentiment: Balance sheet and capital return remain strong with approximately $659 million available liquidity, net leverage of 0.7x, no material debt maturities until 2029, and ongoing share buybacks (≈$5 million YTD; ~$54 million remaining authorization).
• Negative Sentiment: Management warned the macro backdrop is weak — persistently soft housing demand, price deflation in some categories and competitive pricing pressure — and expects more muted performance for the remainder of 2026.
• Negative Sentiment: Operating and free cash flow were negative in Q1 (≈-$57 million operating cash flow; -$60 million free cash flow) driven by seasonal working capital build ahead of the spring selling season, which management expects to weigh on 2026 cash generation.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by, and welcome to the BlueLinx Holdings First Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode, and today's call is being recorded. We will begin with opening remarks and introductions. At this time, I would like to turn the conference over to your host, Investor Relations Officer, Tom Morabito. Please go ahead.

[Tom Morabito, Investor Relations Officer at BlueLinx]

Thank you, Operator, and welcome to the BlueLinx First Quarter 2026 Earnings Call. Joining me on today's call is Shyam Reddy, our Chief Executive Officer, and Kelly Wall, our Chief Financial Officer and Treasurer. At the end of today's prepared remarks, we will take questions. Our first quarter news release and Form 10-Q were issued yesterday after the close of the market, along with our webcast presentation, and these items are available in the Investors section of our website. We encourage you to follow along with the detailed information on the slides during our webcast. Today's discussion contains forward-looking statements. Actual results may differ significantly from those forward-looking statements due to various risks and uncertainties, including the risks described in our most recent SEC filings. Today's presentation includes certain non-GAAP and adjusted financial measures that we believe provide helpful context for investors evaluating our business.

[Tom Morabito, Investor Relations Officer at BlueLinx]

Reconciliations to the closest GAAP financial measure can be found in the appendix of our presentation. Now I'll turn it over to Shyam.

[Shyam Reddy, CEO at BlueLinx]

Thanks, Tom. Good morning, everyone. We are off to a good start in 2026 as our first quarter results reflect our ability to compete effectively and deliver positive performance despite market headwinds, unforeseen cost inflation, and competitive pricing pressure. Our disciplined approach to executing our channel and product strategies enabled us to manage margins and to continue growing volumes across multiple product categories and key customer channels. During the first quarter, revenues increased 3% year-over-year, driven primarily by Disdero Lumber Company specialty sales and higher volumes in our key specialty product categories, which helped offset ongoing pricing pressure in specialty and structural products and margin pressure in specialty products. Specialty and structural gross margins were 18.1% and 10.9% respectively, reflecting the strength of our customer value proposition and effective inventory management.

[Shyam Reddy, CEO at BlueLinx]

Our specialty product strategy continues to deliver results with engineered wood, siding, millwork, industrial, outdoor living products, and other specialty products representing 70% of net sales and approximately 80% of gross profit in the quarter. While overall market conditions remain soft, our deliberate alignment of key supplier-branded product expansion with strategic channel growth initiatives is enabling us to drive better commercial outcomes and allocate working capital more effectively. Last week's announcement of Westlake Royal's TruExterior siding and trim products in 12 BlueLinx markets, including six of the country's top 50 MSAs, reinforces our commitment to this alignment. As you can see, our commercial strategic focus and our customer value proposition are accelerating our product and geographic expansion efforts with key vendors.

[Shyam Reddy, CEO at BlueLinx]

We continue to see positive momentum across our commercial growth vectors, the multifamily channel, builder pull-through initiatives, and national accounts business, all of which are key elements of our channel strategy. These efforts are helping us drive incremental volumes, convert projects and customers to key brands we carry, and strengthen our position as a preferred growth partner for suppliers. While multifamily sales typically involve longer inventory cycles and lower gross margins due to direct sales and competitive pricing, this channel remains an important source of demand and a critical component of our long-term growth strategy to support total housing starts at scale. Operationally, our results also reflect disciplined inventory management. Our ability to quickly adjust inventory levels to market conditions demonstrates the strength of our commercial execution and operating discipline. As market conditions improve, we expect these institutional capabilities to support stronger cash flow generation.

[Shyam Reddy, CEO at BlueLinx]

From a strategic accelerant perspective, we continue to make meaningful progress in our AI and digital transformation initiatives, with particular focus on enhancing our master data platform and optimizing our Oracle Transportation Management system. We also remain committed to supporting the advanced digital platforms of our largest customers and leveraging AI-driven solutions to improve productivity and efficiency across the organization as we continue to explore and develop AI and digital tools for commercial sales, operational excellence, and e-commerce. Finally, our financial position remains strong, with $659 million in available liquidity at the end of the quarter, providing us with the flexibility to reinvest in the business, pursue growth opportunities, and continue navigating a challenging market environment. Overall, we believe our disciplined execution, resilient operating model, and focused strategy position us well as we move through 2026.

[Shyam Reddy, CEO at BlueLinx]

We also returned capital to shareholders by repurchasing $3 million of shares in Q1, and the total current availability under our share repurchase authorizations is nearly $56 million as of quarter end. This demonstrates our commitment to returning capital to our shareholders and our continued confidence in the company's long-term growth strategy. Now, for a few more highlights on our first quarter results. We generated net sales of $731 million and adjusted EBITDA of $23.5 million for a 3.2% adjusted EBITDA margin, a significant improvement on a year-over-year basis. Disdero contributed nearly $21 million of the net sales and over $2 million in adjusted EBITDA. Adjusted net income was $1.7 million or $0.21 per share.

[Shyam Reddy, CEO at BlueLinx]

Specialty product net sales increased nearly 7% year-over-year due to solid volumes across the board, with Disdero's product portfolio and our engineered wood products and siding leading the way. Unfortunately, price deflation and margin compression in several categories offset the benefit of our net sales and our volume increases in the business. Although structural product revenues decreased nearly 5% year-over-year, due largely to price declines in lumber and panels, we were able to offset the impact by driving higher lumber volumes and gross margins. As a result, we delivered higher structural gross profit on a year-over-year basis. Our strategic sales and product expansion efforts led to higher volumes and increased net sales at solid margins. 18% volume growth in multifamily and over 3% volume growth with key national accounts demonstrated another quarter of key channel growth tied to disciplined execution of our strategy.

[Shyam Reddy, CEO at BlueLinx]

Our builder pull-through programs, tied to partnerships with strategic customers, led to key channel and specialty product growth. Our differentiated value proposition led to geographic and product expansion with key suppliers, with meaningful year-over-year growth across multiple product lines that align with our channel growth strategy. For example, our EWP and siding volumes and sales were both up low single digits on a year-over-year basis, despite consistently declining housing starts. As I mentioned a minute ago, the addition of Westlake Royal's TruExterior siding and trim products significantly adds to our specialty product assortment, while demonstrating another example of geographic and branded SKU expansion with a key supplier. We also delivered solid gross margin performance, despite difficult market conditions, cost inflation, and a competitive pricing environment, with specialty products at 18.1% and structural products at 10.9%.

[Shyam Reddy, CEO at BlueLinx]

Our focus on the product and channel strategy fueled by our operational and business excellence initiatives, such as effective pricing, value-added services, strong customer service, branded product expansion gains, and disciplined inventory management, all helped drive this performance. The macroeconomic backdrop for building products distribution continues to depress demand for projects tied to new builds and repair and remodel activity. Historically low levels of consumer confidence and persistently high inflation, economic uncertainty, and geopolitical volatility are also suppressing the cyclical housing tailwind from materializing, which I expect to continue through 2026. These soft market conditions have led to lower volumes in certain traditional customer channels and highly competitive market pricing. At the same time, however, the K-shaped economy continues to provide opportunities in certain parts of the country across all customer channels, another reason why our scale and geographic footprint help smooth out our overall performance.

[Shyam Reddy, CEO at BlueLinx]

In any event, we have overcome market challenges by increasing volumes and maintaining solid margins via intentional growth tied to our channel and our product strategies. We're also actively managing our cost structure, passing along cost increases, optimizing inventory, and prioritizing high-margin categories to optimize performance in an otherwise challenging market that we don't expect to abate anytime soon. Overall, we are off to a good start in 2026, as demonstrated by our solid financial performance for the quarter. We will continue to execute our strategy through the current cycle, which will position us for better-than-market growth when the housing recovery occurs. To wrap up, I want to thank all of our associates for their commitment to our customers, our suppliers, each other, and the communities we all serve. Now I'll turn it over to Kelly, who will provide more details on our financial results and our capital structure.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Thanks, Shyam, good morning, everyone. Let's first go through the consolidated highlights for the quarter. Overall, both specialty products and structural products delivered solid volumes and gross margins in what continues to be a challenging macro environment. Net sales for the first quarter of 2025 were $731 million, up over 3% year-over-year. Total gross profit was $116 million, and gross margin was 15.9%, up from 15.7% in the prior year period. SG&A was $96 million, up $2 million from last year's first quarter. This increase was mainly due to the addition of Disdero, offset by $1.9 million of business interruption insurance received in the quarter.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Given the difficult demand environment and continued pressure on wages and other operating costs, we remain focused on rigorous expense management and on identifying opportunities to further improve efficiency. Net loss for the quarter was $1.5 million or $0.18 per share, primarily due to higher net interest expense and higher depreciation and amortization. Adjusted net income was $1.7 million or $0.21 per share. Our effective income tax rate for the quarter was not meaningful given the level of our pre-tax income and the impact of several small discrete items. Adjusted EBITDA was $23.5 million, up approximately 20% from the first quarter of 2025 due to increased sales, including the Disdero, improved overall gross margins and disciplined expense management.

[Kelly Wall, CFO and Treasurer at BlueLinx]

While we are very pleased with a year-over-year increase in adjusted EBITDA in the first quarter, we do not expect similar performance over the balance of 2026, reflecting ongoing demand pressures in a still soft housing environment. These pressures include affordability constraints and elevated mortgage rates, muted consumer confidence, ongoing political uncertainty and interest rate volatility dampening the typical spring selling season, and continued cost inflation and the challenges associated with passing those costs on in a soft market. Turning now to the first quarter results for specialty products. Net sales for specialty products were $512 million in the first quarter, up nearly 7% year-over-year. This increase was driven by the Disdero sales in higher volumes in most product categories, partially offset by year-over-year pricing pressure in nearly all categories.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Gross profit from specialty product sales was $93 million, up over 3% year-over-year. Specialty gross margin was 18.1%, down from last year's 18.7%. Excluding a $2.4 million duty-related benefit in Q1 of 2025, gross margin was down 10 basis points from last year. Sequentially, specialty gross margins were flat when compared to Q4 of 2025. For the second quarter of the current year, we expect specialty product gross margin to be in the range of 17.5%-18.5%, with daily sales volumes higher than the first quarter of 2026 due to normal seasonal patterns and lower than the second quarter of 2025. Moving on to structural products.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Net sales were $219 million for structural products in the first quarter, down nearly 5% compared to the prior year period. This decrease was primarily due to lower pricing for both lumber and panels when compared to last year, offsetting the higher lumber volumes we generated. Gross profit from structural products was $24 million, an increase of 12% year-over-year, and structural gross margin was 10.9%, up from 9.3% in the same period last year. Sequentially, structural gross margin increased 90 basis points. This increase was primarily driven by higher lumber and panel market pricing, with lumber and panel prices 16% and 4% higher versus the fourth quarter.

[Kelly Wall, CFO and Treasurer at BlueLinx]

We expect Q2 gross margin for structural products to be in the range of 9.5%-10.5%, which has been positively impacted by sequentially higher lumber and panel prices from the end of 2025 through early Q2 of the current year. We also expect daily sales volumes to be higher than the first quarter of 2026 due to normal seasonal patterns and slightly lower than the second quarter of 2025. Turning now to our balance sheet. Our liquidity continues to be very strong. At the end of the quarter, cash and cash equivalents were $319 million, a decrease of $67 million from Q4, largely due to the seasonal changes in working capital.

[Kelly Wall, CFO and Treasurer at BlueLinx]

When considering our cash on hand and undrawn revolver capacity of $340 million, available liquidity was approximately $659 million at the end of the quarter. Total debt, excluding our real property financing leases, was $377 million, and net debt was $58 million. Our net leverage ratio was 0.7x trailing four-quarter adjusted EBITDA, and we have no material outstanding debt maturities until 2029. Additionally, given the strength of our balance sheet and continued strong liquidity, we remain well-positioned to support our strategic initiatives. These strategic initiatives include continued growth with our largest customers and in the multifamily channel, with this focus also benefiting our traditional dealer customers.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Demand pull-through efforts to drive strategic product sales that benefit our customers, continued specialty product expansion with key suppliers, our business and digital transformation efforts, and other organic and inorganic growth initiatives. Moving on to working capital and free cash flow. During the first quarter, we had negative operating cash flow of $57 million and free cash flow of negative $60 million, primarily due to the seasonal changes in working capital ahead of the spring building season. Turning to capital allocation. During the quarter, we incurred $2.6 million of CapEx, primarily related to investments in our facilities, technology, and fleet. For 2026, we plan to manage our CapEx in a manner that reflects current market conditions and allows us to maintain a strong balance sheet.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Our remaining capital investments will focus on facility maintenance and improvements, further replacement of trucks and trailers, and the technology improvements that support our business and digital transformation. Also, during the first quarter, we repurchased $3 million of shares.

[Kelly Wall, CFO and Treasurer at BlueLinx]

From the end of the quarter through April 21st, we have repurchased additional shares, bringing the total dollar amount purchased year-to-date to $5 million. As of today, we have a total of $54 million remaining under our share repurchase authorizations. Our guiding principles for capital allocation remain consistent with prior quarters. We intend to maintain a strong balance sheet, which enables us to invest in our business through economic cycles, expand our geographic footprint, and pursue a disciplined inorganic growth strategy as demonstrated by our acquisition of Disdero, and opportunistically return capital to shareholders through share repurchases. We also plan to maintain a long-term net leverage ratio of 2x or less.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Overall, we are pleased with our solid first quarter 2026 results, particularly in light of current market conditions, but remain more muted in our expectations for the remainder of 2026, given that the housing environment remains soft. Operator, we will now take questions.

[Operator]

At this time, I would like to remind everyone in order to ask a question, press star, then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Jeffrey Stevenson with Loop Capital. Please go ahead.

[Zack Pacheco, Analyst at Loop Capital]

Good morning. This is Zack Pacheco on for Jeff. Thanks for taking my question. First, maybe just how much restocking ahead of the spring selling season contributed to the strong specialty products volume growth during the quarter in categories maybe such as EWP?

[Shyam Reddy, CEO at BlueLinx]

Good morning, Zack. When you say restocking, are you talking about on the part of our customers?

[Zack Pacheco, Analyst at Loop Capital]

Yes.

[Shyam Reddy, CEO at BlueLinx]

Okay. Yeah. I wouldn't necessarily characterize it as some unusual restocking or even historical restocking. Our EWP, you know, growth is tied to very specific product and channel efforts that we're driving in key segments. For example, our builder pull-through programs that are being aligned with strategic dealer customers are driving EWP growth in some markets, for instance. We've wrapped around creative pricing and rebate programs to differentiate ourselves from our competitors. Even in a soft market, we're able to grab share.

[Shyam Reddy, CEO at BlueLinx]

'Cause if you look over the last five years and even over last year to this year, single-family housing starts continue to decline and repair and remodel activity continues to be, you know, either volatile or soft or projected to continue to be soft over time. It really has more to do with very specific actions we're taking to gain share or otherwise grab a greater share of the existing wallet even if the overall market is shrinking due to soft market conditions.

[Zack Pacheco, Analyst at Loop Capital]

Okay. Very helpful. Thank you. Secondly, just any color on the impact of UFP's acquisition of MoistureShield on the business and I guess, you know, the opportunity to grow and expand with the Deckorators line of products? Thanks.

[Shyam Reddy, CEO at BlueLinx]

Yeah. One more just to add to my last point too. There are very specific larger, as part of our channel strategy, you know, we're focused on larger customers as well so we can grow faster at scale to not only support their growth efforts, but also drive product expansion efforts. We have been expanding stocking programs with certain key partners. There is a twofold answer to your prior question. On the second question, I'm sorry. Repeat. Oh, yeah.

[Zack Pacheco, Analyst at Loop Capital]

Yeah.

[Shyam Reddy, CEO at BlueLinx]

The Deckorators, the acquisition of MoistureShield.

[Zack Pacheco, Analyst at Loop Capital]

Yep.

[Shyam Reddy, CEO at BlueLinx]

Thank you. Yeah, honestly, I think that's a great positive story for us. You know, Deckorators is viewed as the number three largest outdoor living or decking product supplier. It's obviously a very well-known branded product carried throughout the country. Between it and MoistureShield, we now have- we've expanded the branded assortment within our portfolio that's viewed as a top-tier brand. It fits squarely within our specialty mix shift strategy, if you will, in terms of growing one of our key five specialty product categories.

[Zack Pacheco, Analyst at Loop Capital]

Understood. I'll pass it on. Thanks.

[Shyam Reddy, CEO at BlueLinx]

Thank you.

[Operator]

Your next question comes from the line of Reuben Garner with The Benchmark Company. Please go ahead.

[Reuben Garner, Analyst at The Benchmark Company]

Thank you. Good morning, everyone.

[Shyam Reddy, CEO at BlueLinx]

Good morning.

[Reuben Garner, Analyst at The Benchmark Company]

I was wondering if you could kind of discuss what favorable changes kinda happened in the gross margin profile since your guide, I guess it was middle of February. The specialty guide, I think you were looking for 17%-18% margins. The month of March, you probably would've had to deal with some transportation, diesel related inflationary pressures, and yet you were able to come in above that range. Can you talk about what the positive factors were, and was there any price cost or incremental price cost pressure that in that March period that you were able to overcome with other factors?

[Kelly Wall, CFO and Treasurer at BlueLinx]

Yes, it's Kelly. I think, first I'll talk about structural because that was the biggest driver of our margin improvement in the quarter. On the structural side, we finished the quarter at a 10.9% margin. You know, that's up 160 basis points from last year. We've benefited significantly through the quarter with a rising commodity pricing environment for both lumber and panels, mostly on the lumber side. But if you go back to the end of Q4, that increase in commodity pricing really has continued into, the end of April, it's kind of flattened out a bit and come back some during the last week or so.

[Kelly Wall, CFO and Treasurer at BlueLinx]

But in a rising commodity pricing environment, we're able to expand margins just by virtue of the fact of market pricing being higher than the inventory levels that we're carrying. So that was a large driver of the margin improvement on the structural side, which, you know, we weren't anticipating that prolonged kind of consistent increase in the commodity pricing that we experienced. On the specialty side, it's continued efforts really to serve our customers and price in, you know, the value-added services that we've been providing really across all categories. We had price increases quarter-to-quarter in all categories except for one. And the one that we didn't see price increases, it was, you know, less than a 1% decline.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Again, we're very focused on continuing to not only match, you know, products that our customers need, but also services that we're able to provide that allow us to drive margin, combined with just an increased focus on making sure that we're pricing effectively given, you know, the availability of products in the market.

[Shyam Reddy, CEO at BlueLinx]

Yeah. Just to add to that, obviously, we're very pleased with the Disdero acquisition, which supports our specialty mix shift strategy. As you may recall, it's a 100% specialty wood distributor that services high-end homes across the country. We've been able to leverage Disdero's strengths to again, support our specialty mix shift and provide, you know, not only from, you know, from our earlier marks, strong EBITDA contribution, but meaningful net sales at stable higher margins despite softness in the market. At the same time, pricing has stabilized, and, you know, within our ranges, we've done a good job kind of managing those margins.

[Shyam Reddy, CEO at BlueLinx]

But all of that said, you know, in my remarks, I made it clear that we continue to face margin pressure, within specialty products, slightly due to competitive pricing in certain categories. But again, given our value-added services and our go-to-market strategy, we are mitigating against those risks. And to add to the structural commentary that Kelly shared, in addition to taking advantage of lower cost, in a rising price environment in a relatively short period of time, we also, and I say this every quarter, we have a very strong competitive inventory management system that's institutionalized here that allows us access to wood, with, you know, from a favorable cost perspective when you've got macro-level constraints that might make it difficult for others to get competitively priced wood.

[Shyam Reddy, CEO at BlueLinx]

So at the end of the day, that gives us a chance to, in some cases, enhance, you know, sell wood at higher margins. So all that comes together to give us a good margin profile that smooths out the performance over the course of the quarter.

[Reuben Garner, Analyst at The Benchmark Company]

You mentioned that pricing was stabilizing, but you still have a competitive environment in some categories. Can you talk about which specific product categories within specialty are kind of more stable now than they were, say, in January, February, and then which ones are still seeing kind of sequential competitive pressures?

[Shyam Reddy, CEO at BlueLinx]

I mean, look, EWP continues to be competitive. Fortunately, it has an inherent higher margin profile. But it's very competitive out there in terms of winning projects and so on. We're making it up with good volume with key strategic customers while at the same time managing through the pricing competitiveness given our value-added services. There's a little bit of even the pricing is stabilized, and in some categories is up. In others it's a little bit down. We're managing through the, you know, the price declines with more than adequate or sufficient volume increases tied to our value-added services to help us gain share. We're able to manage through the competitive environment very successfully given the channel focus. That's one.

[Shyam Reddy, CEO at BlueLinx]

Siding continues to, you know, to be pressured as well, especially on the fiber cement side. In some cases, you know, as we drive multifamily growth, I've said, quarter-over-quarter that multifamily tends to have a lower margin profile, especially as it relates to a chunk of it being direct business. But we still continue to believe that by operating at scale to solve for total housing starts as opposed to just single housing starts is really important to the long-term growth thesis for this company, primarily because affordability and other factors are making multifamily, well, multifamily a really good solve for housing, at least over the next few years.

[Reuben Garner, Analyst at The Benchmark Company]

Okay, last one for me. A little tricky to look at history over the last decade, a lot of moving parts. I wanna say that the first quarter is usually the low water mark for the year for revenue and margins. Is there any reason why this year that wouldn't hold true? I mean, I know you can't predict the demand environment in the second half, but if there isn't a turn for the worse in the housing market, would that hold true this year, or are there other factors at play?

[Kelly Wall, CFO and Treasurer at BlueLinx]

Yeah, that typically is what you'd see. I'd say one thing that's different at the start of this year is the performance from a margin perspective for structural, I think is a big driver that could cause it maybe to look a little different this year than it has in the past. You know, our comments on the call, we said that we do expect the remaining three quarters to continue to be pressured by what is a weaker end market than what we had anticipated at our prior call.

[Kelly Wall, CFO and Treasurer at BlueLinx]

You know, as we think about the rest of the year, you know, typically we would see higher earnings in Q2 and Q3, and then lower again in Q4. Again, yeah, Q1 is probably a bit higher than what we'd normally expect. As we go through the course of this year, I expect we return back to a more typical pattern.

[Shyam Reddy, CEO at BlueLinx]

Yeah. I would agree with that. I mean, even if you look at Q1 selling activity and listings and the fact that despite there being a demand for housing, inventory levels continue to rise with very tepid buying activity. On the existing sales front, that's problematic. Obviously, you see the numbers when it comes to single-family housing starts, permits, and multi-family. We're outperforming the market on multi-family. But as I said earlier, you know, there's the, you know, that profile is very different than the other, and we had a low base to start from to begin with. Although we're pleased with the performance. But overall, the seasonal patterns hold true.

[Shyam Reddy, CEO at BlueLinx]

I think they will continue to hold true given the way housing works in the country as it relates to, you know, to school, you know, when your kids are in school and summer vacations and so on. I don't think that changes. I do believe based on what we're seeing, not necessarily just from a macro perspective, the indicators heading into this summer selling or spring summer selling season this year don't seem to be any different than they were last year. I continue to believe that we will have, You know, I don't think the conditions will abate over the course of the year. I think the earliest would be in 2027, number one.

[Shyam Reddy, CEO at BlueLinx]

Number two, there's nothing that suggests that what we saw in Q1 is that anyone should extrapolate from it per se. It is pure consistent execution of our strategy. We are very disciplined around the cadence and the actions and the activities underway at BlueLinx in order to execute on this channel and product strategy to grow volumes at solid margin levels and continue to support our customers where they need to be given current market conditions. That's what's leading to our performance. The soft market conditions won't go away.

[Reuben Garner, Analyst at The Benchmark Company]

I said the last one, I'm gonna sneak one more in. Are there any categories within specialty where you're seeing price increases from the manufacturers that are that are sticking to you guys for whatever reason, but are difficult to pass on to your customers?

[Shyam Reddy, CEO at BlueLinx]

Yeah. I would say we've been hit with more than supplier increases for more than 40 vendors, right? There are just. And there'll be multiple price increases that come through that we got to push through. From a two-step distribution standpoint, supplier increases are typically accepted. It just, there are notification periods and there are, you know, suppliers will give us notice, give us time to give our customers notice. Of course the supplier cost, the price increases are pushed through. In many cases, they're announced to the market, right? On the part of our suppliers. It's twofold from a communication standpoint.

[Shyam Reddy, CEO at BlueLinx]

Depending on the customers, you know, and arrangements you may have in place, it may take more time to pass those price increases through. But generally speaking, that can also be done in collaboration with your suppliers to minimize the impact to the business from a two-step standpoint, from a BXC, BlueLinx perspective.

[Reuben Garner, Analyst at The Benchmark Company]

Got it. Thanks, guys. I'll pass it on. Good luck.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Great. Thank you.

[Shyam Reddy, CEO at BlueLinx]

Thanks.

[Operator]

Your last question comes from the line of Kurt Yinger with D.A. Davidson. Please go ahead.

[Kurt Yinger, Analyst at D.A. Davidson]

Great. Thanks and congrats on the strong quarter, guys.

[Kelly Wall, CFO and Treasurer at BlueLinx]

Thanks, Kurt.

[Kurt Yinger, Analyst at D.A. Davidson]

Just wanted to go back to the TruExterior announcement and sort of a two-parter here. First, is there any way for us to maybe size what the contributions from that expansion might look like as, you know, you get product on the ground and think about start selling that through over the next, call it several quarters? Secondly, with that move, are there any kind of associated changes to existing siding kind of vendor relationships? Is this a situation where you're displacing someone else or sort of, you know, expanding into new markets for Westlake?

[Shyam Reddy, CEO at BlueLinx]

First of all, thanks for the question. Good to hear from you. First of all, at this point, all I can say is a couple of things I'm really excited about and wanna recognize the team for. It's not too often that you can work with a key vendor to roll out 12 markets all at once, especially covering the number of MSAs in the top 50 that we're hitting. That reflects a strong degree of confidence on the part of our vendor vis-à-vis us, with Westlake Royal, and in particular, its confidence in our channel growth strategy, which is helping drive this product strategy. Just wanna point that out with respect to our respective teams.

[Shyam Reddy, CEO at BlueLinx]

In terms of the go-to-market, you know, this is a brand new rollout of a brand new product across multiple markets, so I can't give you any indication of how that's gonna roll out through the year. What I can tell you is we have been very focused on proving, demonstrating our value proposition as it relates to rolling out new product lines in multiple markets in a very consistent, successful manner so that we can help our suppliers grow at scale like we wanna grow at scale. In other words, we wanna be their best partner to commercialize their product lines. I think the best way to do that is to go bigger, faster.

[Shyam Reddy, CEO at BlueLinx]

In support of that, we did a big load in of product across multiple markets very quickly, which I would posit is highly unusual for two-step distribution, but also consistent with the value proposition and, you know, competitive spirit we have, quite frankly. So over the coming months, you know, our plan is to accelerate the sales activity of those product lines with the inventory we put on the ground in multiple markets in a very, very short timeline. As it relates to other how we view that product line vis-à-vis other siding categories, we view them as complementary. At the end of the day, siding trim, et cetera, that product line is a strategic growth category for us.

[Shyam Reddy, CEO at BlueLinx]

We think it's an important solve for both multi-family and single-family across multiple channels, whether they be, you know, home centers, pro dealers, independent dealers, lumber yards, co-ops, et cetera. From that perspective, the wider specialty product assortment we have to serve, you know, local market and regional market conditions while also supporting the bigger, biggest customers at scale, is what's ultimately gonna be important to us. We have no conflict. We are selling multiple lines with multiple vendors and are pleased with the bundling opportunities and value proposition we can provide our customers, especially the ones, that, you know, that we have some dedicated, focused efforts, on with respect to scale. It's an exciting launch for us.

[Kurt Yinger, Analyst at D.A. Davidson]

Got it. Okay. Appreciate that color. And then just looking at the outlook on daily sales volume, you know, a little bit lower in Q2, I guess first, does that include Disdero? Second, maybe just bigger picture. I mean, have you seen any meaningful change in terms of kinda customer order patterns as you work through April? Or anything maybe surprising relative to what you would expect from normal seasonality?

[Kelly Wall, CFO and Treasurer at BlueLinx]

Yeah, Kurt. As it relates to volumes. Our view on volume has been slightly lower than last year. That does include the impact of Disdero as we think about that. Again, it is driven by just the, you know, the in-market demand as it relates to fulfilling activity that we're expecting to take place this year versus last year, which continues to be down. You know, the general views on that has worsened, right, through the course of the last several weeks. That's informing our view there. You know, what was the second part of your question?

[Kurt Yinger, Analyst at D.A. Davidson]

Just on Disdero. That kind of daily sales volume would include the acquisition?

[Kelly Wall, CFO and Treasurer at BlueLinx]

It does.

[Kurt Yinger, Analyst at D.A. Davidson]

Okay.

[Kelly Wall, CFO and Treasurer at BlueLinx]

It does include the acquisition.

[Kurt Yinger, Analyst at D.A. Davidson]

Perfect. Then just on competitive dynamics. I think it makes sense that, you know, those are intense. I'm just curious if that's maybe accelerating or intensifying, however you wanna characterize it, relative to what you saw late last year, 'cause, you know, the back half of 2025 was very challenging. You know, I think a lot of channel partners kinda ran inventories into the ground at year-end. Seems like Q1 wasn't too bad. I'm just trying to figure out if this is kind of a continuation of, you know, soft market, more people fighting over, you know, fewer orders, or if maybe something's changed in the last couple months.

[Shyam Reddy, CEO at BlueLinx]

I think it's a continuation of what we saw last year. Given activity, end-market activity leading into the selling season this year, just, you know, queuing off, teeing off the February, March numbers, not our numbers, but macro numbers, I don't expect anything different. Which means, you know, depending on the market, it will be highly competitive, right? We call it, we think of it as degrees of competitive activity. You might have a market where industrial is not as competitive as another market, because of, you know, what we coin knife fights that might be happening in that secondary or tertiary market. In other areas of the country like the East, the weather was, you know, had a meaningful impact on business in the East because January and February were rough from a year-over-year weather perspective.

[Shyam Reddy, CEO at BlueLinx]

Generally speaking, the East has solid housing related activity, especially on the pro contractor R&R side. But then there are other states that are tough, right? Just given what was done during the pandemic and coming off those pandemic highs that were years ago, Texas and Florida, for example. So in those markets, we're seeing stabilization and opportunities for growth, but that we're taking advantage of given our customer and channel and product focus. Again, it's very targeted to take advantage, you know, to really sell our value-added services and other, you know, other value propositions, if you will, in order to take more share of whatever pie exists. That does not mean that it is not competitive out there.

[Shyam Reddy, CEO at BlueLinx]

We use our competitive value proposition to mitigate the adverse impacts of the highly competitive environment. As our results demonstrate, we feel like we're doing that fairly, you know, in a solid manner. Of course, Disdero has done a really good job of helping shift our specialty mix and drive, you know, some good EBITDA contribution on top of solid margins, higher than what we would normally have margins on the specialty side because it's a very good product line.

[Kurt Yinger, Analyst at D.A. Davidson]

Right. Okay. That's helpful. Then just lastly on capital allocation, maybe less relevant today given some of the excess kind of cash has worked down a little bit. How are you thinking about share repurchases relative to inorganic growth opportunities out there? I guess particularly given kind of where the stock is traded, what seems like some traction on some of the strategic initiatives, has that relative attractiveness maybe changed versus the, you know, hopes of generating some more inorganic growth?

[Kelly Wall, CFO and Treasurer at BlueLinx]

Yeah, Kurt, I think, you know, we continue to take the same approach to capital allocation, right? We're committed to investing in the various initiatives that are, you know, delivering some of the results that you saw this quarter. And then outside of that, M&A continues to be a focus of ours, right? We're gonna remain disciplined as it relates to valuation. We're gonna remain disciplined as it relates to what assets we're gonna pursue, again, with the M&A strategy intended to grow our geographic presence in markets that we're not currently in, as well as continue to drive growth in our specialty products, similar to what we did with Disdero on that side.

[Kelly Wall, CFO and Treasurer at BlueLinx]

What I'd say is that, you know, similar to what we mentioned on the last call, you know, we are expecting, you know, free cash flow to be, you know, kind of consistent with, if not a little bit lower than last year. That's that still remains the same, even with the strong quarter that we had in Q1. You know, if we don't have opportunities to invest that cash in areas that drive the business growth and earnings going forward, then we'd look to buy back shares similar to what we did in the prior quarter.

[Kurt Yinger, Analyst at D.A. Davidson]

Okay. That's helpful. Appreciate the color, guys. Thank you.

[Shyam Reddy, CEO at BlueLinx]

Thank you.

[Operator]

That concludes our Q&A session. I will now turn the call back over to Tom Morabito for closing remarks.

[Tom Morabito, Investor Relations Officer at BlueLinx]

Thanks, Bella. Thank you again for joining us today, and we look forward to speaking with you in August as we share our second quarter 2026 results.

[Operator]

Ladies and gentlemen, that does conclude today's call. Thank you all for joining, and you may now disconnect. Everyone, have a great day.

Participants

Executives

• Kelly Wall, CFO and Treasurer
• Shyam Reddy, CEO
• Tom Morabito, Investor Relations Officer

Analysts

• Kurt Yinger, Analyst at D.A. Davidson
• Reuben Garner, Analyst at The Benchmark Company
• Zack Pacheco, Analyst at Loop Capital