Insteel Industries Inc. reported first‑quarter 2026 results that included a $0.39 per share earnings figure, beating the consensus estimate of $0.38 by $0.01, while net sales of $159.9 million fell short of the $165.2 million forecast by $5.3 million.
Revenue growth of 23.3% was driven by an 18.8% rise in average selling prices and a 3.8% increase in shipments, reflecting strong demand in infrastructure and commercial construction markets. The company’s focus on nonresidential construction helped offset weaker performance in legacy segments.
Gross margin expanded to 11.3% from 7.3% a year earlier, a 400‑basis‑point gain that stemmed from wider pricing spreads, higher volumes, and lower unit manufacturing costs. The margin lift demonstrates Insteel’s pricing power and efficient cost management amid rising raw‑material costs.
Operating cash flow swung to a $0.7 million outflow, a reversal from the $19.0 million inflow seen a year earlier, largely due to higher inventories built from increased international steel wire rod purchases amid limited domestic supply. The company cautioned that raw‑material price pressure could compress margins in the next quarter.
Capital expenditures for the quarter were $1.5 million, down from $2.7 million a year earlier, with total fiscal‑2026 capex expected to be about $20 million. Management highlighted ongoing inventory buildup to meet strong demand and reiterated its focus on cost and productivity improvements.
Investors reacted with mixed sentiment; the revenue miss weighed against the EPS beat and margin expansion, leading to a cautious outlook for the next quarter while affirming confidence in the company’s operational execution.
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