Fortune Brands Delivers Solid Q3

Despite challenges in key global markets and a drop in net income, the company remains focused on long-term growth.

October 31, 2025

Fortune Brands Shows Resilience in Q3 with Targeted Growth and Adjusted Forecasts

Fortune Brands held steady in the third quarter of 2025, posting $1.15 billion in net sales—roughly flat compared to the same period last year. Excluding China, where demand continues to lag, the company recorded a 1.1% sales increase, pointing to pockets of strength across core categories.

Earnings per share came in at $0.59 on a GAAP basis, down sharply from the prior year. Adjusted EPS, which excludes restructuring and other one-time charges, landed at $1.09, a 6% decline. While profitability took a hit, the company continued to outperform broader market trends in several key businesses.

Segment Performance Overview

Security led the way with nearly 5% sales growth and a solid 17.8% operating margin before charges. Water Innovations saw a modest sales decline, driven primarily by weak performance in China, but margins held up. Outdoors reported flat sales but faced more pressure on the bottom line. A $50 million asset impairment, along with restructuring costs, weighed heavily on profitability in that segment.

Cash flow remained strong. The company generated $204 million in operating cash and $177 million in free cash during the quarter. It exited with $224 million in cash on hand and a net debt position of $2.4 billion, putting its net debt-to-EBITDA ratio at 2.7x—slightly above the upper end of its original guidance range.

Updated 2025 Outlook

Heading into the end of the year, Fortune Brands adjusted its full-year outlook. It now expects:

• Adjusted EPS between $3.70 and $3.80, slightly below the prior range


• Free cash flow between $400 and $420 million

At the segment level, the company now anticipates:

• Outdoors: Sales flat to down 2%, with tighter margins


• Water and Security: Sales and margin expectations held steady

Investments to Drive Future Growth

Strategically, the company is still executing. Fortune Brands opened its new corporate campus during the quarter, bringing over 500 associates together under one roof. The move is designed to accelerate collaboration and speed up innovation across the business.

Even with a mixed macro backdrop, the company is keeping its focus: disciplined operations, responsive execution, and long-term value creation. With solid fundamentals and a clear view of where the market is heading, Fortune Brands is positioning itself to build momentum into 2026.