Swimming pool distributor Pool (NASDAQ: POOL) fell short of the market’s revenue expectations in Q4 CY2025, with sales flat year on year at $982.2 million. Its GAAP profit of $0.85 per share was 12.2% below analysts’ consensus estimates.
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Pool (POOL) Q4 CY2025 Highlights:
- Revenue: $982.2 million vs analyst estimates of $998.8 million (flat year on year, 1.7% miss)
- EPS (GAAP): $0.85 vs analyst expectations of $0.97 (12.2% miss)
- EPS (GAAP) guidance for the upcoming financial year 2026 is $11 at the midpoint, missing analyst estimates by 5.6%
- Operating Margin: 5.3%, in line with the same quarter last year
- Free Cash Flow Margin: 7.3%, down from 15.9% in the same quarter last year
- Market Capitalization: $9.51 billion
“Our 2025 results highlight the differentiation of our customer experience and the depth of our building products portfolio, as well as the stability of our maintenance business and the strength and adaptability of the POOLCORP team. We were encouraged by improving trends for discretionary products in the second half of the year, even with ongoing consumer pressures. Throughout the year, our strategic initiatives remained focused on enhancing our value-added services, supporting industry professionals with our digital platforms and expanding our product offerings. We also maintained disciplined cost management as we navigated an evolving market environment, while continuing to invest in our sales center network and digital ecosystem to sustain our industry-leading position. These efforts are guided by our long-term strategy, positioning us to deliver returns for our shareholders while laying a solid foundation for future performance,” said Peter D. Arvan, president and CEO.
Company Overview
Founded in 1993 and headquartered in Louisiana, Pool (NASDAQ: POOL) is one of the largest wholesale distributors of swimming pool supplies, equipment, and related leisure products.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Regrettably, Pool’s sales grew at a weak 6.1% compounded annual growth rate over the last five years. This fell short of our benchmark for the consumer discretionary sector and is a poor baseline for our analysis.
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Pool’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 2.3% annually. 
This quarter, Pool missed Wall Street’s estimates and reported a rather uninspiring 0.5% year-on-year revenue decline, generating $982.2 million of revenue.
Looking ahead, sell-side analysts expect revenue to grow 3.7% over the next 12 months. While this projection implies its newer products and services will catalyze better top-line performance, it is still below the sector average.
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Operating Margin
Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.
Pool’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 11.3% over the last two years. This profitability was inadequate for a consumer discretionary business and caused by its suboptimal cost structure.
In Q4, Pool generated an operating margin profit margin of 5.3%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Pool’s EPS grew at a weak 3.8% compounded annual growth rate over the last five years, lower than its 6.1% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.
In Q4, Pool reported EPS of $0.85, down from $0.98 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects Pool’s full-year EPS of $10.83 to grow 7.4%.
Key Takeaways from Pool’s Q4 Results
We struggled to find many positives in these results. Its EPS missed and its full-year EPS guidance fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 6.6% to $238.40 immediately after reporting.
Pool didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
