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The call reflects a constructive and confident tone: the company delivered resilient margins and operational progress despite meaningful volume declines and inflationary headwinds. Management highlighted several strategic wins (cost synergies ahead of target, portfolio monetization, improved safety/sustainability recognition, digital investments, and a strong distribution footprint) and provided an outlook with materially higher expected margins in Q2. Notable near-term negatives include a 10% YoY revenue decline, a Q1 free cash flow outflow of $387 million, $75 million of adjusting charges (including a recall), and inflationary pressures (including an expected ~$60 million Iran-related cost impact in Q2) that create uncertainty. On balance, the company appears to be effectively managing a challenging macro environment and positioned to capitalize on recovery and structural improvements.
Owens Corning guided Q2 revenue of approximately $2.6–$2.7 billion and an enterprise adjusted EBITDA margin of roughly 20%–22%; by segment they expect Roofing revenue down low‑ to mid‑single digits with an EBITDA margin in the low‑30% range, Insulation revenue down low‑single digits (price roughly flat) with ~20% EBITDA margin, and Doors revenue down mid‑single digits with EBITDA margins improving to the high‑single digits. They expect Iran‑related cost headwinds of about $60 million in Q2 (≈50% Roofing, remainder split toward Insulation), did not include potential tariff refunds (~$50 million total, ~$25M already submitted) in the outlook, and reiterated corporate guidance of general corporate EBITDA expense $245–$255M, an effective tax rate of 24%–26%, D&A ≈$680M, and capital additions ≈$800M for 2026; liquidity was $1.8B and net leverage ~2.5x.
Generated $369 million of adjusted EBITDA in Q1 2026 with an adjusted EBITDA margin of 16% and adjusted EPS of $1.22, demonstrating durable margin structure despite volume headwinds; company notes margin improvement of over 500 basis points in Roofing and Insulation versus similar market conditions over the past 10 years.
Roofing delivered a 24% EBITDA margin in Q1 and management expects Roofing EBITDA margin in the low 30% range in Q2. Insulation posted a 19% EBITDA margin in Q1 and is guided to ~20% in Q2. Doors improved to a 7% margin in Q1 and is expected to reach high single digits in Q2.
Reported continuing operations revenue of $2.3 billion in Q1; returned $63 million to shareholders in the quarter and reaffirmed commitment to return $1 billion of cash to shareholders in 2026.
On track to achieve approximately $135 million in run-rate enterprise cost synergies by midyear (exceeding the $125 million commitment) and pursuing an additional $75 million of structural operational cost improvements to further lower the cost base.
Completed sale of glass reinforcements with expected cash proceeds of ~ $280 million plus an additional $50–70 million of excess alloy sales over the next year; quarter-end liquidity of $1.8 billion ( $272 million cash and $1.5 billion available under facilities) and a debt-to-EBITDA ratio of 2.5x.
First quarter recordable incident rate of 0.46 with nearly 85% of sites recordable-injury free; recognized by S&P Global in the Sustainability Yearbook as a top 1% performer in the building products industry.
Expanded use of digital monitoring/AI: monitoring over 20,000 process sensors across ~40 plants to improve asset reliability, reduce unplanned downtime and support a structurally lower cost position.
Serving over 4,100 home center locations and more than 8,000 distributor locations; Roofing contractor network expanded to over 30,000 members, supporting downstream demand creation and cross-category pull-through.
Ladies and gentlemen, thank you for joining us, and welcome to Owens Corning's First Quarter 2026 Earnings Call. [Operator Instructions] I will now hand the conference over to Darren Garvin, Director of Investor Relations. Please go ahead.
Good morning, and thank you for joining us to discuss Owens Corning's First Quarter 2026 results. Joining me today are Brian Chambers, our Chair and Chief Executive Officer; and Todd Fister, our Chief Financial and Operating Officer. Our earnings release, Form 10-Q, and presentation slides were issued earlier this morning and are available on the Investors section of our website at owenscorning.com. Following our prepared remarks, we will open the call for Q&A. To allow for broad participation, please limit yourself to one question. Before we begin, please refer to Slide 2. Today's remarks will include forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ materially. We undertake no obligation to update these statements, except as required by law.
Please refer to the cautionary statements and risk factors identified in our SEC filings for more detail. This presentation also includes non-GAAP financial measures. Explanations and reconciliations to GAAP measures can be found in our earnings release and presentation materials available on our website. Financial metrics discussed today reflect continuing operations, except for cash flow measures, which include amounts related to glass reinforcements. With the completed divestiture of glass reinforcements, Q2 will be the final quarte...