Manufacturing company Leggett & Platt (NYSE:LEG) announced better-than-expected revenue in Q3 CY2025, but sales fell by 5.9% year on year to $1.04 billion. On the other hand, the company’s full-year revenue guidance of $4.05 billion at the midpoint came in 1% below analysts’ estimates. Its non-GAAP profit of $0.29 per share was in line with analysts’ consensus estimates.
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Leggett & Platt (LEG) Q3 CY2025 Highlights:
- Revenue: $1.04 billion vs analyst estimates of $1.03 billion (5.9% year-on-year decline, 1.1% beat)
- Adjusted EPS: $0.29 vs analyst estimates of $0.29 (in line)
- Adjusted EBITDA: $102.2 million vs analyst estimates of $105.4 million (9.9% margin, 3% miss)
- The company dropped its revenue guidance for the full year to $4.05 billion at the midpoint from $4.15 billion, a 2.4% decrease
- Management lowered its full-year Adjusted EPS guidance to $1.05 at the midpoint, a 4.5% decrease
- Operating Margin: 16.5%, up from 7.1% in the same quarter last year
- Free Cash Flow Margin: 10.6%, up from 7% in the same quarter last year
- Market Capitalization: $1.23 billion
President and CEO Karl Glassman commented, "We are pleased to report solid results for the quarter, achieved amid ongoing macroeconomic challenges. Our performance reflects continued progress on strategic priorities and disciplined execution across the company. During the quarter, we successfully completed the sale of our Aerospace business, further sharpening our focus on core operations.
Company Overview
Founded in 1883, Leggett & Platt (NYSE:LEG) is a diversified manufacturer of products and components for various industries.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Unfortunately, Leggett & Platt struggled to consistently increase demand as its $4.17 billion of sales for the trailing 12 months was close to its revenue five years ago. This wasn’t a great result and is a sign of poor business quality.
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. Leggett & Platt’s recent performance shows its demand remained suppressed as its revenue has declined by 6.8% annually over the last two years. 
We can better understand the company’s revenue dynamics by analyzing its three most important segments: Bedding, FF&T, and Specialized Products, which are 38.8%, 26.8%, and 34.4% of revenue. Over the last two years, Leggett & Platt’s Bedding (mattresses and foundations) and FF&T (sofa parts and tiles ) revenues averaged year-on-year declines of 11.2% and 6.8% while its Specialized Products revenue (automobile components) was flat. 
This quarter, Leggett & Platt’s revenue fell by 5.9% year on year to $1.04 billion but beat Wall Street’s estimates by 1.1%.
Looking ahead, sell-side analysts expect revenue to decline by 2.6% over the next 12 months. While this projection is better than its two-year trend, it’s hard to get excited about a company that is struggling with demand.
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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.
Leggett & Platt’s operating margin has risen over the last 12 months, but it still averaged negative 5.5% over the last two years. This is due to its large expense base and inefficient cost structure.
In Q3, Leggett & Platt generated an operating margin profit margin of 16.5%, up 9.5 percentage points year on year. This increase was a welcome development, especially since its revenue fell, showing it was more efficient because it scaled down its 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.
Sadly for Leggett & Platt, its EPS declined by 12.7% annually over the last five years while its revenue was flat. However, its operating margin actually improved during this time, telling us that non-fundamental factors such as interest expenses and taxes affected its ultimate earnings.
In Q3, Leggett & Platt reported adjusted EPS of $0.29, down from $0.32 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Leggett & Platt’s full-year EPS of $1.04 to grow 9.1%.
Key Takeaways from Leggett & Platt’s Q3 Results
We were also happy its revenue narrowly outperformed Wall Street’s estimates. On the other hand, its full-year revenue and EPS guidance were both lowered, which is never a good sign. Overall, this quarter could have been better. The stock remained flat at $9.28 immediately following the results.
So should you invest in Leggett & Platt right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.