Flexsteel Industries Inc (FLXS) Q2 2026 Earnings Report

Flexsteel reported strong top-line growth in QQ2 2026, with revenue of $119.1 million, up 14.5% year over year. The quarter delivered meaningful margin improvement, with gross margin at 23.23% and operating income of $9.83 million, translating to an operating margin of 8.26%. Net income rose to $7.48 million, up 80.7% YoY, and diluted EPS reached $1.18 on a per-share basis, up about 55% versus the prior year. QoQ momentum remained positive but more modest, with EPS down 10.1% on a sequential basis, reflecting typical seasonality and discrete items in the period.

Cash flow remained modestly positive from operations at $1.01 million, while free cash flow registered a negative $0.735 million due to capex of approximately $1.742 million. The company finished the period with a robust balance sheet and a net cash position of about $36.8 million, as cash and cash equivalents stood at $36.8 million and debt was negligible. These dynamics suggest Flexsteel is generating operating leverage and improving profitability while maintaining ample liquidity to fund growth initiatives and working capital needs.

Management commentary (where available) pointed to sustained demand in residential and contract channels, ongoing investments in product lines and distribution capabilities, and a focus on cost controls to support margins. The absence of explicit forward guidance in QQ2 2026 requires investors to monitor macro consumer sentiment, input costs, and inventory dynamics as potential drivers of near-term performance. Overall, the QQ2 results reinforce a constructive earnings trajectory for Flexsteel within the US furnishings market, supported by conservative balance sheet risk and a cash-rich liquidity profile.