Building and construction materials manufacturer Owens Corning (NYSE: OC) fell short of the market’s revenue expectations in Q4 CY2025, with sales falling 24.6% year on year to $2.14 billion. Next quarter’s revenue guidance of $2.15 billion underwhelmed, coming in 3.4% below analysts’ estimates. Its non-GAAP profit of $1.10 per share was 18.8% below analysts’ consensus estimates.

Is now the time to buy Owens Corning? Find out by accessing our full research report, it’s free.

“Our performance in 2025 continued to demonstrate the strength of the company we have built. Through a combination of our strong market positions, improved operating efficiencies, and favorable product mix shifts, we are generating higher margins and operating cash flows on lower market volumes,” said Chair and Chief Executive Officer Brian Chambers.

Company Overview

Credited with the discovery of fiberglass, Owens Corning (NYSE: OC) supplies building and construction materials to the United States and international markets.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Regrettably, Owens Corning’s sales grew at a mediocre 7.4% compounded annual growth rate over the last five years. This was below our standard for the industrials sector and is a rough starting point for our analysis.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Owens Corning’s recent performance shows its demand has slowed as its annualized revenue growth of 2.2% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

This quarter, Owens Corning missed Wall Street’s estimates and reported a rather uninspiring 24.6% year-on-year revenue decline, generating $2.14 billion of revenue. Company management is currently guiding for a 15% year-on-year decline in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to decline by 3.3% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and suggests its products and services will face some demand challenges.

Microsoft, Alphabet, Coca-Cola, Monster Beverage—all began as under-the-radar growth stories riding a massive trend. We’ve identified the next one: a profitable AI semiconductor play Wall Street is still overlooking. Go here for access to our full report.

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.

Owens Corning has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 13.2%. This result was particularly impressive because of its low gross margin, which is mostly a factor of what it sells and takes huge shifts to move meaningfully. Companies have more control over their operating margins, and it’s a show of well-managed operations if they’re high when gross margins are low.

Analyzing the trend in its profitability, Owens Corning’s operating margin decreased by 13.4 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

In Q4, Owens Corning generated an operating margin profit margin of negative 10.5%, down 2 percentage points year on year. Since Owens Corning’s gross margin decreased more than its operating margin, we can assume its recent inefficiencies were driven more by weaker leverage on its cost of sales rather than increased marketing, R&D, and administrative overhead expenses.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Owens Corning’s EPS grew at an astounding 18.7% compounded annual growth rate over the last five years, higher than its 7.4% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

Diving into the nuances of Owens Corning’s earnings can give us a better understanding of its performance. A five-year view shows that Owens Corning has repurchased its stock, shrinking its share count by 25.1%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Owens Corning, its two-year annual EPS declines of 7.5% mark a reversal from its (seemingly) healthy five-year trend. We hope Owens Corning can return to earnings growth in the future.

In Q4, Owens Corning reported adjusted EPS of $1.10, down from $3.22 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects Owens Corning’s full-year EPS of $11.95 to shrink by 13.2%.

Key Takeaways from Owens Corning’s Q4 Results

We struggled to find many positives in these results. Its EPS missed and its revenue fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock remained flat at $125.99 immediately following the results.

The latest quarter from Owens Corning’s wasn’t that good. One earnings report doesn’t define a company’s quality, though, so let’s explore whether the stock is a buy at the current price. We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).