HNI Shares Decline as Earnings Fall Short of Expectations

MUSCATINE, Iowa - HNI Corporation (NYSE:HNI) reported third-quarter earnings that surpassed analysts' expectations, yet revenue fell short of forecasts, causing a 1% decline in after-hours trading.

The office furniture and fireplace products manufacturer announced adjusted earnings of $1.03 per share, exceeding the consensus estimate of $0.98. However, revenue came in at $672.2 million, below the analyst prediction of $712.75 million, reflecting a 5.5% decrease compared to the same period last year.

HNI's Workplace Furnishings segment saw net sales decline by 5.9% to $505.1 million, while Residential Building Products revenue decreased by 4.4% to $167.1 million compared to the same quarter last year.

Despite the shortfall in revenue expectations, the company highlighted strong profit growth, with adjusted operating income rising by 10.8% to $72.3 million. Workplace Furnishings achieved an 11.9% non-GAAP operating margin, marking the third-highest third-quarter margin in the last 20 years.

Jeff Lorenger, Chairman, President, and CEO of HNI Corporation, stated, "Our strategies continue to drive strong profit growth. Our teams delivered outstanding results in the first three quarters of 2024 - year-to-date earnings per share have grown by 33%."

Looking ahead, HNI anticipates revenue declines in both segments for the fourth quarter due to economic uncertainty and delayed customer projects. However, the company remains optimistic for 2025, citing encouraging order rates in Workplace Furnishings and a growing sales funnel.

HNI has maintained its outlook for 2024, projecting non-GAAP earnings per share growth of 10% or more, which would indicate double-digit earnings growth for the third consecutive year.