On this page of StockholderLetter.com we present the latest annual shareholder letter from MOHAWK INDUSTRIES INC — ticker symbol MHK. Reading current and past MHK letters to shareholders can bring important insights into the investment thesis.
From the FLOOR 2025 ANNUAL REPORT
Mohawk at-a-Glance Mohawk is the world s largest flooring manufacturer with leading positions in residential and commercial product categories in key global markets on four continents. Our business segments include: Global Ceramic The world s largest manufacturer of ceramic and porcelain floor and wall tile with growing quartz countertop and porcelain panel positions. Leading Market Positions1 Primary Markets 2nd Mexico 1st United States 1st Europe 1st Brazil North America, Europe, South America Flooring North America A leading North American supplier of premium carpet, laminate, luxury vinyl tile (LVT), sheet vinyl, wood flooring and accessories. Primary Markets Flooring Rest of the World Leading Market Positions1 1st Laminate/Hybrid Flooring 2nd Resilient 2nd Carpet and Rugs North America 2nd Flooring Accessories One of the largest flooring suppliers outside of North America, providing premium laminate, LVT, sheet vinyl, carpet and wood. In Europe, products also include insulation, decorative and MDF panels, chipboards and other specialty items. Leading Market Positions1 Primary Markets Europe, Oceania, Middle East, Asia, South America 1 1st Sheet Vinyl (Europe) 1st Panels (Benelux) 1st Polyurethane Insulation (Benelux, U.K., Ireland) 1st Flooring (Oceania) 1st Premium Laminate (Europe) 1st Domestic LVT (Europe) Based on management s internal estimates and trade publication data.
Building TOWARD WHAT S Strength begins from a solid foundation. But time rewards those who aren t afraid to think big. As we prepare for our markets to recover, we are reinvigorating our business from the floor up streamlining our operations, delivering new products and creating opportunities in new markets and sales channels. This is how we build on Mohawk s historical success to ensure an even more promising future. Jeffrey S. Lorberbaum Chairman and Chief Executive Officer 1
To Our Shareholders Mohawk s 2025 performance benefited from ongoing initiatives to stimulate sales and optimize operations. In the midst of our industry s cyclical downturn, we are taking the proper actions to manage through the present environment while positioning the Company for long-term profitable growth when housing markets rebound. Mohawk has built leadership positions in North America, Europe, South America and Oceania with product portfolios tailored to local preferences. Across our regions, commercial demand remained stable during 2025, though ongoing weakness in housing turnover and sluggish new home construction impacted our volume. In all of our markets, we are capitalizing on industry-leading design and performance features to capture opportunities in the better-performing commercial sector while enticing consumers to upgrade existing flooring with exciting new products. We are expanding our customer base in our current regions and extending sales into new markets. In 2025, we executed additional restructuring initiatives to further lower our cost position. When finalized, the cumulative actions we have taken since 2022 will deliver annualized savings of approximately $365 million. By conservatively managing our capital, we have maintained solid liquidity and healthy cash flow generation. Over the past ten years, we have generated an average of approximately $630 million1 in free cash flow annually. These fundamental strengths represent key advantages in supporting our growth when market conditions become more favorable. 2025 Performance and Market Insights For the full year, our net sales were approximately $10.8 billion, flat with the prior year as reported. Our adjusted EPS was $8.96, a decrease of approximately 7.5%1 compared to the prior year. For the year, we delivered free cash flow of approximately $616 million and repurchased approximately 1.3 million shares of our stock for $149 million as part of our current stock buyback authorization. Since 2020, we have repurchased approximately 18% of our outstanding shares. The challenging macroeconomic factors that our industry has faced since the second half of 2022 persisted throughout 2025. Housing turnover in our major regions stalled at historical lows due to affordability challenges and economic uncertainty. Consumer confidence remained weak due to inflation, employment concerns and geopolitical tensions. As a result, many large discretionary investments such as home renovations continued to be postponed. Remodeling activity that did take place was primarily undertaken by more affluent consumers or those addressing essential needs. 2 Mohawk 2025 Annual Report 1 Reconciliation tables of GAAP to non-GAAP financial measures begin on page 75 of the closing section of this annual report.
Throughout 2025, most central banks took actions intended to stimulate economic growth and housing markets, including multiple rate cuts by the U.S. Federal Reserve. Currently, U.S. mortgage rates are at their lowest levels in years, and we anticipate these more favorable rates, combined with proposed housing stimulus programs, will improve home sales. In Europe, interest rates have also fallen, while consumers have built record levels of savings, inflation has eased and employment has remained steady. These conditions should support greater participation in the housing market as consumer confidence improves. As the year progressed, U.S. builders completed fewer projects as they focused on reducing inventories, lowering the construction of new homes. In Europe, high building costs, land shortages and labor constraints continue to impede residential construction. Completed housing units in Europe declined in 2025, though moderate building recoveries in Southern and Eastern Europe have emerged. As housing demand increases, European governments are evaluating options to stimulate construction. In our markets, the commercial channel outperformed residential throughout the year with strength in healthcare, education and hospitality. We anticipate that lower interest rates will encourage additional investments in commercial construction and renovation. Managing the Current Environment In response to these ongoing conditions, we took actions to stimulate sales and enhance our mix through innovative product introductions, marketing actions and promotional programs. Our premium products delivered differentiated design and performance features to incentivize remodeling, and our new commercial collections helped us gain momentum in both new construction and remodeling projects. 2025 Sales by Business Segment 2025 Sales by Geography In ceramic tile, for example, we have combined our design leadership with three-dimensional digital printing technology to reproduce the appearance of wood or stone with unsurpassed realism and dimension. These collections have appealed to the architect and designer community, helping us increase our participation in high-margin commercial projects. We recently enhanced the value proposition of our proprietary SmartStrand Forever Clean collections with Pur-Ease technology, creating the world s first asthma- and allergy-friendly carpet. Pur-Ease uses integrated natural probiotics to reduce common household allergens including pet dander, dust mites or pollen. Our PVC-free hard surface alternatives, SolidTech R and PureTech , offer consumers waterproof flooring solutions with superior visuals and durability through cores featuring recycled plastic bottles and renewable, plant-based content, respectively. To expand our product portfolio in the high-performance commercial channel, we acquired HERO Flooring , a small U.S. rubber flooring manufacturer and authorized licensee of products made with recycled Nike Grind rubber. 2025 Sales by Channel 3
 • shareholder letter icon 4/3/2026 Letter Continued (Full PDF)
 • stockholder letter icon 4/7/2023 MHK Stockholder Letter
 • stockholder letter icon 4/5/2024 MHK Stockholder Letter
 • stockholder letter icon 4/4/2025 MHK Stockholder Letter
 • stockholder letter icon More "Construction Materials & Machinery" Category Stockholder Letters
 • Benford's Law Stocks icon MHK Benford's Law Stock Score = 93


MHK Shareholder/Stockholder Letter Transcript:

From the
FLOOR
2025 ANNUAL REPORT

Mohawk at-a-Glance
Mohawk is the world   s largest flooring manufacturer with leading positions in residential
and commercial product categories in key global markets on four continents. Our business
segments include:
Global Ceramic
The world   s largest
manufacturer of ceramic
and porcelain floor and wall
tile with growing quartz
countertop and porcelain
panel positions.
Leading Market Positions1
Primary Markets
2nd Mexico
1st United States
1st Europe
1st Brazil
North America, Europe,
South America
Flooring North America
A leading North American
supplier of premium carpet,
laminate, luxury vinyl tile
(LVT), sheet vinyl, wood
flooring and accessories.
Primary Markets
Flooring Rest of the World
Leading Market Positions1
1st Laminate/Hybrid Flooring
2nd Resilient
2nd Carpet and Rugs
North America
2nd Flooring Accessories
One of the largest flooring
suppliers outside of North
America, providing premium
laminate, LVT, sheet vinyl,
carpet and wood. In Europe,
products also include
insulation, decorative and
MDF panels, chipboards and
other specialty items.
Leading Market Positions1
Primary Markets
Europe, Oceania, Middle East,
Asia, South America
1
1st Sheet Vinyl (Europe)
1st Panels (Benelux)
1st Polyurethane Insulation
(Benelux, U.K., Ireland)
1st Flooring (Oceania)
1st Premium Laminate
(Europe)
1st Domestic LVT (Europe)
Based on management   s internal estimates and trade publication data.

Building
TOWARD
WHAT   S
Strength begins from a solid foundation.
But time rewards those who aren   t afraid
to think big.
As we prepare for our markets
to recover, we are reinvigorating
our business from the floor up    
streamlining our operations, delivering new products and creating
opportunities in new markets and
sales channels.
This is how we build on Mohawk   s
historical success to ensure an even
more promising future.
Jeffrey S. Lorberbaum
Chairman and Chief Executive Officer
1

To Our Shareholders
Mohawk   s 2025 performance benefited from ongoing initiatives to stimulate
sales and optimize operations. In the midst of our industry   s cyclical downturn,
we are taking the proper actions to manage through the present environment
while positioning the Company for long-term profitable growth when housing
markets rebound.
Mohawk has built leadership positions in North America, Europe, South America
and Oceania with product portfolios tailored to local preferences. Across our
regions, commercial demand remained stable during 2025, though ongoing
weakness in housing turnover and sluggish new home construction impacted
our volume. In all of our markets, we are capitalizing on industry-leading design
and performance features to capture opportunities in the better-performing
commercial sector while enticing consumers to upgrade existing flooring with
exciting new products. We are expanding our customer base in our current
regions and extending sales into new markets.
In 2025, we executed additional restructuring initiatives to further lower our
cost position. When finalized, the cumulative actions we have taken since 2022
will deliver annualized savings of approximately $365 million. By conservatively
managing our capital, we have maintained solid liquidity and healthy cash
flow generation. Over the past ten years, we have generated an average of
approximately $630 million1 in free cash flow annually. These fundamental
strengths represent key advantages in supporting our growth when market
conditions become more favorable.
2025 Performance and Market Insights
For the full year, our net sales were approximately $10.8 billion, flat with the
prior year as reported. Our adjusted EPS was $8.96, a decrease of approximately
7.5%1 compared to the prior year. For the year, we delivered free cash flow of
approximately $616 million and repurchased approximately 1.3 million shares of
our stock for $149 million as part of our current stock buyback authorization.
Since 2020, we have repurchased approximately 18% of our outstanding shares.
The challenging macroeconomic factors that our industry has faced since the
second half of 2022 persisted throughout 2025. Housing turnover in our major
regions stalled at historical lows due to affordability challenges and economic
uncertainty. Consumer confidence remained weak due to inflation, employment
concerns and geopolitical tensions. As a result, many large discretionary
investments such as home renovations continued to be postponed. Remodeling
activity that did take place was primarily undertaken by more affluent
consumers or those addressing essential needs.
2
Mohawk 2025 Annual Report
1
Reconciliation tables of GAAP to non-GAAP financial measures begin on page 75 of the closing section of this annual report.

Throughout 2025, most central banks took actions intended
to stimulate economic growth and housing markets, including
multiple rate cuts by the U.S. Federal Reserve. Currently, U.S.
mortgage rates are at their lowest levels in years, and we
anticipate these more favorable rates, combined with
proposed housing stimulus programs, will improve home sales.
In Europe, interest rates have also fallen, while consumers
have built record levels of savings, inflation has eased and
employment has remained steady. These conditions should
support greater participation in the housing market as
consumer confidence improves.
As the year progressed, U.S. builders completed fewer projects as
they focused on reducing inventories, lowering the construction
of new homes. In Europe, high building costs, land shortages and
labor constraints continue to impede residential construction.
Completed housing units in Europe declined in 2025, though
moderate building recoveries in Southern and Eastern Europe have
emerged. As housing demand increases, European governments
are evaluating options to stimulate construction.
In our markets, the commercial channel outperformed
residential throughout the year with strength in healthcare,
education and hospitality. We anticipate that lower interest
rates will encourage additional investments in commercial
construction and renovation.
Managing the Current Environment
In response to these ongoing conditions, we took actions to
stimulate sales and enhance our mix through innovative product
introductions, marketing actions and promotional programs.
Our premium products delivered differentiated design and
performance features to incentivize remodeling, and our new
commercial collections helped us gain momentum in both new
construction and remodeling projects.
2025 Sales by
Business Segment
2025 Sales by
Geography
In ceramic tile, for example, we have combined our design
leadership with three-dimensional digital printing technology to
reproduce the appearance of wood or stone with unsurpassed
realism and dimension. These collections have appealed to the
architect and designer community, helping us increase our
participation in high-margin commercial projects. We recently
enhanced the value proposition of our proprietary SmartStrand  
Forever Clean    collections with Pur-Ease    technology, creating
the world   s first asthma- and allergy-friendly carpet. Pur-Ease
uses integrated natural probiotics to reduce common household
allergens including pet dander, dust mites or pollen. Our PVC-free
hard surface alternatives, SolidTech R    and PureTech  , offer
consumers waterproof flooring solutions with superior visuals
and durability through cores featuring recycled plastic bottles
and renewable, plant-based content, respectively. To expand our
product portfolio in the high-performance commercial channel,
we acquired HERO Flooring   , a small U.S. rubber flooring
manufacturer and authorized licensee of products made with
recycled Nike Grind   rubber.
2025 Sales by
Channel
3


shareholder letter icon 4/3/2026 Letter Continued (Full PDF)
 

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