Apogee Enterprises Names Augdahl CFO on Permanent Basis

Apogee’s fourth quarter performance was met with a notably negative market reaction, as the company missed Wall Street’s revenue expectations and saw its operating margin decline compared to last year. Management attributed these results primarily to sustained pressure from rising aluminum costs and softer demand in the metals and glass segments. CEO Don Nolan emphasized the company’s ongoing efforts to maintain pricing discipline and execute on cost-saving initiatives, noting, “The margin pressures continue to build,” particularly in metals, while also highlighting the impact of higher health insurance costs. The quarter’s results were further shaped by the integration of the UW Solutions acquisition and lower incentive compensation expenses.

Apogee (APOG) Q4 CY2025 Highlights:

• Revenue: $348.6 million vs analyst estimates of $355.3 million (2.1% year-on-year growth, 1.9% miss)
• Adjusted EPS: $1.02 vs analyst estimates of $1.01 (1% beat)
• Adjusted EBITDA: $46.13 million vs analyst estimates of $44.76 million (13.2% margin, 3.1% beat)
• Adjusted EPS guidance for the full year is $3.45 at the midpoint, missing analyst estimates by 5.6%
• Operating Margin: 8.7%, in line with the same quarter last year
• Market Capitalization: $745.3 million

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Apogee’s Q4 Earnings Call

• Brent Thielman (D.A. Davidson) asked CEO Don Nolan about the criteria for new CFO leadership and whether the board’s strategic direction is changing. Nolan replied there are no changes in strategy, and the focus remains on operational excellence and M&A.

• Thielman (D.A. Davidson) also pressed on the outlook for metals margins given ongoing aluminum price inflation. Nolan confirmed that margin pressures are likely to persist, but the company is focused on cost control and efficiency measures.

• Jon Braatz (KCCA) questioned the emphasis on M&A versus returning cash to shareholders, noting past challenges with acquisitions. Nolan defended the M&A strategy, highlighting the success of UW Solutions and the robust pipeline of opportunities.

• Gowshihan Sriharan (Singling Research) asked about pricing discipline in metals and glass, and whether Apogee is willing to adjust bid thresholds. Management stated they are maintaining pricing rigor but will continue evaluating project economics on a case-by-case basis.

• Julio Romero (Sidoti) inquired about the company’s growth trajectory and how new opportunities might impact return metrics. CEO Nolan reiterated that the strategic focus is unchanged, with an emphasis on operational efficiency and disciplined acquisitions.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be watching (1) progress on the expanded Project Fortify phase two and the realization of cost savings, (2) stabilization or improvement in input cost trends, particularly aluminum, and (3) the pace and success of integrating UW Solutions and other prospective acquisitions. Execution on operational efficiency and evidence of margin recovery will also be central to our ongoing assessment of Apogee’s performance.

Apogee currently trades at $34.37, down from $37.29 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).

Architectural products company Apogee missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.1% year on year to $348.6 million. The company’s full-year revenue guidance of $1.39 billion at the midpoint came in 1.4% below analysts’ estimates. Its non-GAAP profit of $1.02 per share was 1% above analysts’ consensus estimates.

Apogee (APOG) Q4 CY2025 Highlights:

• Revenue: $348.6 million vs analyst estimates of $355.3 million (2.1% year-on-year growth, 1.9% miss)
• Adjusted EPS: $1.02 vs analyst estimates of $1.01 (1% beat)
• Adjusted EBITDA: $46.13 million vs analyst estimates of $44.76 million (13.2% margin, 3.1% beat)
• Adjusted EPS guidance for the full year is $3.45 at the midpoint, missing analyst estimates by 6%
• Operating Margin: 7.1%, down from 10.3% in the same quarter last year
• Market Capitalization: $690.7 million

StockStory’s Take

Apogee’s fourth quarter performance was met with a notably negative market reaction, as the company missed Wall Street’s revenue expectations and saw its operating margin decline compared to last year. Management attributed these results primarily to sustained pressure from rising aluminum costs and softer demand in the metals and glass segments. CEO Don Nolan emphasized the company’s ongoing efforts to maintain pricing discipline and execute on cost-saving initiatives, noting, “The margin pressures continue to build,” particularly in metals, while also highlighting the impact of higher health insurance costs. The quarter’s results were further shaped by the integration of the UW Solutions acquisition and lower incentive compensation expenses.

Looking ahead, Apogee’s guidance reflects cautious optimism tempered by persistent headwinds, with management pointing to elevated aluminum prices and normalization of incentive compensation as primary challenges for the coming year. CFO Mark Ogdahl stated that the company is expanding Project Fortify phase two to address these cost pressures, anticipating $25 to $26 million in annual savings. Management also expects the tariff impact from this year to subside, offering some relief in 2026. CEO Don Nolan reinforced the company’s focus on operational efficiency, strategic M&A, and scaling the Apogee Management System to navigate the challenging environment.

Key Insights from Management’s Remarks

Management identified rising input costs, ongoing portfolio realignment, and operational efficiencies as key themes shaping the quarter and future guidance.

• Leadership transition underway: The company announced that CFO Matt Osberg will depart, with Chief Accounting Officer Mark Ogdahl stepping in as interim CFO while a search for a permanent replacement begins. CEO Don Nolan, new to the role, reaffirmed existing strategic priorities with no change in direction.

• Aluminum cost inflation: Management highlighted sharp increases in average aluminum prices—up 13% quarter-over-quarter and over 50% year-on-year—as a primary source of volume pressure and margin compression in the metals segment. Nolan described the ongoing rise as a persistent challenge to profitability.

• UW Solutions integration: One year after acquiring UW Solutions, management reported that the integration is tracking to plan, expanding Apogee’s product capabilities and geographic reach. The acquisition has contributed to inorganic sales growth and is expected to deliver higher-margin opportunities, especially in performance surfaces.

• Project Fortify phase two expansion: Apogee is expanding its cost reduction initiative, Project Fortify phase two, to include further restructuring actions across metals and corporate functions. The company expects these actions to yield $25 to $26 million in annual pre-tax cost savings, with roughly $10 million realized next year.

• Operational excellence focus: The Apogee Management System (AMS) continues to drive productivity improvements, particularly in the glass segment, supporting margin resilience and offering a template for broader operational upgrades across the company.

Drivers of Future Performance

Apogee’s outlook emphasizes the need to offset ongoing cost inflation and volume pressures through operational discipline and portfolio management.

• Input cost headwinds persist: Management projects that rising aluminum and health insurance costs, coupled with normalization of incentive compensation, will continue to constrain margins. CFO Mark Ogdahl stated that these headwinds are shaping both the near-term and early outlook for next year, particularly in the metals and glass segments.

• Cost savings initiatives: The expanded Project Fortify phase two is central to Apogee’s strategy for mitigating margin pressure. The company expects the restructuring to deliver substantial annual cost savings, with a portion realized in the upcoming year, helping to sustain profitability despite a tough macro backdrop.

• Portfolio realignment and M&A: Management reiterated a commitment to disciplined M&A activity, citing the successful integration of UW Solutions as a model for future deals. CEO Don Nolan emphasized that the pipeline remains active, with acquisitions targeting higher-growth, higher-margin segments to support long-term performance.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be watching (1) progress on the expanded Project Fortify phase two and the realization of cost savings, (2) stabilization or improvement in input cost trends, particularly aluminum, and (3) the pace and success of integrating UW Solutions and other prospective acquisitions. Execution on operational efficiency and evidence of margin recovery will also be central to our ongoing assessment of Apogee’s performance.

Apogee currently trades at $32.57, down from $37.29 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members).

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What Happened?

Shares of architectural products company Apogee fell 12.7% in the afternoon session after it reported disappointing fourth-quarter 2025 results and issued a weak financial outlook for the upcoming year. For the quarter, while adjusted earnings of $1.02 per share narrowly beat analyst expectations, revenue of $348.6 million fell short of estimates. The company's profitability was squeezed, with its operating margin falling to 7.1% from 10.3% in the same quarter last year, reflecting what the company described as a more competitive environment and higher input costs.Compounding the weak results, management's forecast for the full year also fell short of Wall Street's projections. The company's full-year adjusted earnings per share guidance of $3.45 at the midpoint missed analyst estimates by 6%, and its revenue outlook of $1.39 billion was also below expectations. Overall, the combination of a revenue miss and a disappointing forward-looking forecast soured investor sentiment.

What Is The Market Telling Us

Apogee’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. Moves this big are rare for Apogee and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 9 days ago when the stock dropped 3.6% on the news that major indices pulled back from record highs reached the previous week. The S&P 500 and Nasdaq were under pressure as the dominant artificial intelligence trade cooled off. Notable names like Nvidia were down as traders locked in profits following a banner year where the Nasdaq surged over 20%. With the S&P 500 recently hitting intraday highs near 6,945, this dip reflected a shift in internal momentum rather than a response to major economic news.

Apogee is down 14.6% since the beginning of the year, and at $31.88 per share, it is trading 44.7% below its 52-week high of $57.60 from January 2025. Investors who bought $1,000 worth of Apogee’s shares 5 years ago would now be looking at an investment worth $920.59.

Architectural products company Apogee missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.1% year on year to $348.6 million. The company’s full-year revenue guidance of $1.39 billion at the midpoint came in 1.4% below analysts’ estimates. Its non-GAAP profit of $1.02 per share was 1% above analysts’ consensus estimates.

Apogee (APOG) Q4 CY2025 Highlights:

• Revenue: $348.6 million vs analyst estimates of $355.3 million (2.1% year-on-year growth, 1.9% miss)
• Adjusted EPS: $1.02 vs analyst estimates of $1.01 (1% beat)
• Adjusted EBITDA: $46.13 million vs analyst estimates of $44.76 million (13.2% margin, 3.1% beat)
• Adjusted EPS guidance for the full year is $3.45 at the midpoint, missing analyst estimates by 6%
• Operating Margin: 7.1%, down from 10.3% in the same quarter last year
• Free Cash Flow Margin: 6.6%, similar to the same quarter last year
• Market Capitalization: $802.1 million

“I’m proud of our team’s disciplined execution and agility during this transition. Despite a challenging environment, we delivered results in line with expectations and remain focused on serving customers with innovative products and exceptional service. Our strong operational foundation and balance sheet position us to navigate near-term challenges and drive sustainable long-term value,” said Donald Nolan, Executive Chair and CEO.

Company Overview

Involved in the design of the Apple Store on Fifth Avenue in New York City, Apogee sells architectural products and services such as high-performance glass for commercial buildings.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Regrettably, Apogee’s sales grew at a sluggish 2.1% compounded annual growth rate over the last five years. This was below our standards and is a rough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Apogee’s recent performance shows its demand has slowed as its revenue was flat over the last two years.

This quarter, Apogee’s revenue grew by 2.1% year on year to $348.6 million, falling short of Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to remain flat over the next 12 months. This projection is underwhelming and suggests its newer products and services will not accelerate its top-line performance yet.

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Operating Margin

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

Apogee has done a decent job managing its cost base over the last five years. The company has produced an average operating margin of 8.5%, higher than the broader industrials sector.

Looking at the trend in its profitability, Apogee’s operating margin rose by 2.8 percentage points over the last five years, as its sales growth gave it operating leverage.

This quarter, Apogee generated an operating margin profit margin of 7.1%, down 3.2 percentage points year on year. Since Apogee’s operating margin decreased more than its gross margin, we can assume it was less efficient because expenses such as marketing, R&D, and administrative overhead increased.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Apogee’s EPS grew at a decent 8.5% compounded annual growth rate over the last five years, higher than its 2.1% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Diving into Apogee’s quality of earnings can give us a better understanding of its performance. As we mentioned earlier, Apogee’s operating margin declined this quarter but expanded by 2.8 percentage points over the last five years. Its share count also shrank by 17.7%, and these factors together are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Apogee, its two-year annual EPS declines of 12.4% mark a reversal from its five-year trend. We hope Apogee can return to earnings growth in the future.

In Q4, Apogee reported adjusted EPS of $1.02, down from $1.19 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Apogee’s full-year EPS of $3.45 to grow 17.4%.

Key Takeaways from Apogee’s Q4 Results

It was encouraging to see Apogee beat analysts’ EBITDA expectations this quarter. On the other hand, its full-year EPS guidance missed and its revenue fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 11.4% to $33.05 immediately after reporting.

Apogee’s latest earnings report disappointed. One quarter doesn’t define a company’s quality, so let’s explore whether the stock is a buy at the current price. If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.