WD-40’s second quarter results reflected moderate revenue growth, which management attributed to mixed demand trends across global regions and the timing of customer orders, especially in distributor markets. CEO Steve Brass cited solid momentum in the Americas and Asia Pacific, with higher sales of WD-40 Multi-Use Product in the United States and China, driven by promotional activities and expanded distribution. However, weakness in Europe, the Middle East, and Africa stemmed from a combination of supply chain adjustments and lower sales volumes to marketing distributor customers, particularly in Turkey and the Middle East. Management described these challenges as largely related to operational changes and market variability.
Is now the time to buy WDFC? Find out in our full research report (it’s free).
WD-40 (WDFC) Q2 CY2025 Highlights:
- Revenue: $156.9 million vs analyst estimates of $160.6 million (1.2% year-on-year growth, 2.3% miss)
- EPS (GAAP): $1.54 vs analyst estimates of $1.40 (10% beat)
- Adjusted EBITDA: $29.36 million vs analyst estimates of $28.5 million (18.7% margin, 3% beat)
- The company dropped its revenue guidance for the full year to $610 million at the midpoint from $615 million, a 0.8% decrease
- EPS (GAAP) guidance for the full year is $5.45 at the midpoint, missing analyst estimates by 1.6%
- Operating Margin: 17.4%, in line with the same quarter last year
- Market Capitalization: $3.05 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions WD-40’s Q2 Earnings Call
- Daniel Rizzo (Jefferies) questioned the rationale behind the still-wide Q4 guidance range. CFO Sara Hyzer highlighted the variability in promotional activity and the timing of distributor orders, which can significantly impact quarterly sales.
- Daniel Rizzo (Jefferies) asked about the sustainability of elevated gross margins. Hyzer indicated that further supply chain improvements could be accretive, but acknowledged that inflation or input cost volatility could affect margins.
- Daniel Rizzo (Jefferies) sought clarity on the trajectory of SG&A costs. Hyzer said recent investments in IT and ESG are tapering, and she does not anticipate double-digit SG&A growth rates in the coming year.
- Daniel Rizzo (Jefferies) inquired about foreign exchange trends. Hyzer explained that while currency was a headwind earlier in the year, recent rates in Europe have turned favorable, though Latin American currencies remain a challenge.
- Michael Allen Baker (D.A. Davidson) asked how promotional activities align with lower overall advertising spend. CEO Steve Brass differentiated between brand-building investments and tactical promotions, noting that promotional timing can drive significant quarterly variance.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will monitor (1) progress on the divestiture of the homecare and cleaning business, (2) the pace of premium product adoption and digital commerce expansion, and (3) the impact of supply chain initiatives on sustaining gross margin improvements. Additionally, we will track regional growth trends, especially in emerging markets where volatility has recently impacted results.
WD-40 currently trades at $225.33, in line with $225.35 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).
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