The Scotts Miracle-Gro Company (SMG) Q3 2026 earnings summary

Executive summary

• CEO transition completed with Nate Baxter appointed, supporting the SMG 2.0 strategy and organizational restructuring, including elimination of the COO role and new innovation/information officers.

• Full-year non-GAAP adjusted EPS guidance raised to $4.30–$4.45, reflecting confidence in ongoing performance and accelerated EPS growth.

• Net sales increased 1–1.1% for the quarter and 2–2.4% year-to-date, driven by branded product sales and e-commerce growth.

• E-commerce POS for branded products surged 27% in dollars and 33% in units year-to-date.

• The Hawthorne business was divested in April 2026, resulting in a $101.8 million loss from discontinued operations.

Financial highlights

• Q3 net sales reached $1.17B (up 1–1.1%); year-to-date net sales up 2–2.4% to $2.99B.

• GAAP gross margin rate was 31.2% for the quarter (down 90–100 bps); non-GAAP gross margin rate was 31.3%.

• Non-GAAP adjusted EBITDA for the quarter was $246.3M; year-to-date $686.6M, up 5%.

• GAAP net income from continuing operations was $103.6M for the quarter ($1.75/share); year-to-date $319.1M ($5.40/share).

• Net leverage ratio improved to 3.78x from 4.15x prior year.

Outlook and guidance

• Fiscal 2026 guidance reaffirmed, with non-GAAP adjusted EPS raised to $4.30–$4.45.

• U.S. Consumer net sales expected to achieve low single-digit growth; gross margin expansion expected to continue.

• Free cash flow guidance maintained at $275M; leverage ratio targeted in the high 3s.

• Management continues to monitor macroeconomic conditions, including inflation, interest rates, and geopolitical risks.

• No material changes to risk factors or forward-looking statements since the last annual report.