New York, July 10, 2026, 11:24 (EDT)
WD-40 Company NASDAQ:WDFC jumped 14.8% to $274.80 Friday morning. The lubricant maker posted a big gain in fiscal Q3 sales and earnings. Shares hit as high as $298.44, up 24.7%, but then gave back about 40% of those intraday gains.
WD-40 posted strong earnings. Revenue came in at $195.1 million, well above the $172.8 million FactSet consensus. Adjusted earnings were $2.33 per share, beating the $1.56 estimate. Still, the company’s outlook points to a sharp slowdown in both sales and margins for the August quarter.
Chief Executive Steve Brass said the quarter showed “the operating leverage inherent in our business model.” The company saw sales up 24%, but operating income jumped 47% to $40.3 million as certain costs like administration were spread over more revenue. Business Wire
Much of the higher full-year outlook is due to a shift in business scope. WD-40 no longer pushed its Americas homecare and cleaning products, or HCCP, and added their projected results back into its guidance. Looking at the April and July midpoint numbers, those brands left in the portfolio make up most of the reported forecast gain.
| Fiscal 2026 measure | April midpoint | July midpoint | Contribution from retained HCCP | HCCP share of increase |
|---|---|---|---|---|
| Constant-currency sales in millions | 642.5 | 659.5 | 12.0 | 71% |
| Operating income in millions | 106.5 | 110.0 | 2.9 | 83% |
| Diluted earnings per share | 5.95 | 6.20 | 0.17 | 68% |
Constant-currency sales exclude the impact of currency moves. With the retained portfolio taken out, the midpoint rise comes to around $5 million in sales, $600,000 in operating income, and about eight cents in earnings per share.
Fourth-quarter numbers look weaker. At the forecast midpoint, reported sales would be about 12% lower than the third quarter. Gross margin would drop to around 51.5%. Adjusted operating margin would almost be cut in half.
| Measure | Fiscal Q3 actual | Fiscal Q4 implied at FY midpoint | Sequential change |
|---|---|---|---|
| Reported sales, $mln | 195.1 | 171.3 | -12.2% |
| Gross margin | 56.6% | 51.5% | -5.1 points |
| Adjusted operating margin | 21.3% | 11.0% | -10.3 points |
WD-40’s annual midpoint and nine-month numbers are used for these calculations, not official quarterly guidance from the company. The third-quarter adjusted operating margin includes a $1.3 million amortization add-back, since the annual outlook doesn’t count that charge.
The downside isn’t just about timing, according to Chief Financial Officer Sara Hyzer. “It was really more timing that impacted ultimately the fourth quarter outlook,” Hyzer said. Executives put the amount of business shifted into Q3 at about $3 million, as customers moved up purchases to avoid price hikes or stock up because of supply worries. Brass added that the latest price increases “do not fully represent the scale of the cost increases we’ve seen.” Most of the gains from higher prices and cost savings are now expected in fiscal 2027. Investing.com
WD-40’s valuation doesn’t offer much cushion if margins don’t recover. The stock is at about 41.7 times trailing earnings, well above RPM International (NYSE:RPM) at 20.3 times and Church & Dwight (NYSE:CHD) at 31.8 times. Both are key peers in maintenance and household products.
D.A. Davidson kept its Buy call on Friday and bumped its price target up to $305 from $270. That points to around 11% upside from where shares traded late in the morning, but the day’s high already landed within 2.2% of the new target. The next hurdle for a bigger move isn’t the Q3 beat—it will be if WD-40 can keep margins from sliding as the company signaled for Q4.
