A formulator and manufacturer of adhesives, sealants, and specialty chemicals, H.B. Fuller's products hold together everything from packaged goods and diapers to cars, electronics, and aircraft. It began in 1887 in St. Paul, Minnesota, when Harvey Benjamin Fuller started selling flour-and-water paste and his 'Premium Liquid Fish Glue,' famously marketed to 'cement everything' from tin cans to factory barrels. He even invented adjustable scaffolding for safer wallpaper hanging.
Gross margin reached 33.6%, the highest in over five years, as pricing and restructuring actions offset higher costs.
hit a multi-year high. rose 5.8% to $950.3 million and climbed 62.1% to $67.8 million, driven by higher pricing and a lower tax rate after a one-time charge last year. The quarter shows pricing power holding, but remains constrained by needs.
Key takeaways
expanded 1.8 points to 33.6%, the highest quarterly level in the data provided, as higher product pricing and restructuring actions more than offset increased manufacturing and distribution costs.
rose 62.1% to $67.8 million, aided by a lower of 27.8% compared with 44.7% a year ago, when a $14.0 million discrete tax expense depressed the result.
Consolidated grew 5.8% to $950.3 million, with of 2.6% led by a 6.2% increase in Building Adhesive Solutions, while Engineering Adhesives organic revenue declined 1.0%.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 net revenue rose 5.8% to $950.3M driven by pricing and currency, while net income surged 62% to $67.8M.
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Consolidated net grew 5.8% in Q2, with of 2.6% led by a 6.2% increase in Building Adhesive Solutions, while Engineering Adhesives organic revenue declined 1.0%.
increased 9.3% to $181.0 million, as higher was partially offset by increased compensation expense and foreign currency losses.
turned positive to $12.8 million year to date, compared with a $6.7 million use in the prior-year period, as more than doubled to $117.2 million despite higher .
The company is executing restructuring plans now expected to cost $85 million to $90 million under the 2023 plan and $11 million to $13 million for a 2025 footprint optimization, with most charges and cash payments occurring in fiscal 2026 and 2027.
What changed
The prior quarter flagged a 7.2% volume decline and a $61.7 million deficit. In Q2, organic returned to growth at 2.6%, and free cash flow turned positive at $12.8 million year to date, though the volume recovery was uneven across segments.
Earlier filings repeatedly asked whether could hold above 30% as raw material benefits lapped. In Q2, gross margin reached 33.6%, the highest in the data provided, suggesting pricing and restructuring actions are sustaining the expansion beyond the raw material .
The $14.0 million discrete tax expense that depressed Q2 FY2025 did not recur, and the normalized to 27.8%, confirming the prior-year charge was a one-time item.
The total debt-to-capital ratio improved to 50.1% from 55.1% a year ago, helped by a $62.1 million increase in , though remained elevated at $2.07 billion.
What to watch
Whether the 33.6% can be sustained in the second half as the company laps the 31.9% and 32.0% margins from Q2 and Q3 of FY2025, and as restructuring charges roll off.
Whether generation accelerates in the second half to close the gap with the prior year's $121.2 million full-year total, after year-to-date free cash flow of $12.8 million.
Whether the 1.0% organic decline in Engineering Adhesives is a one-quarter event or signals softening demand in what has been the primary profit driver.
Whether the restructuring plans, now expected to cost $85 million to $90 million, produce a measurable improvement in operating margins as charges roll off in fiscal 2026 and 2027.
margin expanded 170 to 33.6%, primarily due to higher product pricing and restructuring actions, partially offset by higher manufacturing and distribution costs.
attributable to H.B. Fuller jumped 62.2% to $67.8 million, aided by a lower (27.8% vs. 44.7%) as the prior year included $14.0 million in discrete tax expense.
increased 9.3% to $181.0 million, driven by higher , though partially offset by higher compensation expense and foreign currency losses.
turned positive to $12.8 million year-to-date from negative $6.7 million, as more than doubled to $117.2 million despite higher .
The company is executing restructuring plans expected to cost $85-$90 million (2023 plan) and $11-$13 million (2025 footprint optimization), with the majority of charges and cash payments occurring in fiscal 2026 and 2027.
Quantitative and Qualitative Disclosures About Market Risk
We are exposed to various market risks, including changes in interest rates, foreign currency rates and prices of raw materials. Market risk is the potential loss arising from adverse changes in market rates and prices, such as interest rates and foreign currency exchange rates.…
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We are exposed to various market risks, including changes in interest rates, foreign currency rates and prices of raw materials. Market risk is the potential loss arising from adverse changes in market rates and prices, such as interest rates and foreign currency exchange rates. See Part II, Item 7A in our Annual Report on Form 10-K for the year ended November 29, 2025 for further discussion of these market risks. There have been no material changes in the reported market risk of the Company since November 29, 2025.
The company states no pending legal matter, individually or in the aggregate, will have a material adverse effect on its financials.
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The company is involved in environmental investigations and clean-ups at former and current sites, including as a under and similar state laws.
Financial provisions are established for environmental liabilities when a probable amount can be reasonably estimated.
The company is party to ordinary-course lawsuits covering product liability, personal injury, IP, environmental, tax, and employment matters.
Management concluded that all pending matters, including asbestos-related litigation, will not materially affect results of operations, financial condition, or cash flow.
Adverse developments or periodic settlements in other legal proceedings could negatively impact results or cash flows in one or more future periods.
This Form 10-Q contains forward-looking statements concerning our future programs, products, expenses, revenue, liquidity and cash needs as well as our plans and strategies. These forward-looking statements are based on current expectations and we assume no obligation to update…
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This Form 10-Q contains forward-looking statements concerning our future programs, products, expenses, revenue, liquidity and cash needs as well as our plans and strategies. These forward-looking statements are based on current expectations and we assume no obligation to update this information. Numerous factors could cause actual results to differ significantly from the results described in these forward-looking statements, including the risk factors identified under Part I, Item 1A. Risk Factors contained in our Annual Report on Form 10-K for the fiscal year ended November 29, 2025. There have been no material changes in the risk factors disclosed by us under Part I, Item 1A. Risk Factors contained in the Annual Report on Form 10-K for the fiscal year ended November 29, 2025.