Mohawk Industries (NYSE: MHK) reported Q2 EPS ex-items of $3.51, $0.39 worse than the analyst estimate of $3.90. Revenue for the quarter came in at $2.6 billion versus the consensus estimate of $2.6 billion.

GUIDANCE:

Mohawk Industries sees Q3 2018 EPS ex-items of $3.54-$3.64 versus the consensus of $4.29.

"We are taking a comprehensive approach to improve our performance and profitability in the U.S. Our initiatives to improve pricing, increase sales in growing channels and reduce cost will benefit the remainder of the year. Given the impact of inflation, timing of price increases and other challenges, we do not anticipate that our actions in the U.S. will offset the pressures we are facing before next year. We expect continued strength in Europe and Russia, where inflation and shifting product preferences are less intense than in the U.S. Around the globe, we are entering new products and geographies as well as expanding constrained categories. Having closed Godfrey Hirst, we are already enhancing the largest flooring provider in Australia and New Zealand. In the U.S., we are investing in growing categories such as LVT and quartz countertops. If the recently announced Chinese tariffs are implemented, they will enhance our U.S. market position and results. Taking all of this into account, our EPS guidance for the third quarter is $3.54 to $3.64, excluding any one-time charges.

"We are passing through inflation, optimizing our new expansions and maximizing our LVT position to increase our profitability. Our talented organization, innovative products and strong balance sheet provide long-term advantages, and we continue to pursue acquisitions that bolt on or add new dimensions to expand the value of our company."

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