Core & Main ($CNM) Smashes Q1 Records as Infrastructure Boom Fuels Fire Hose of Profits

Another quarter, another all-time high—Core & Main''s pipes are overflowing with cash as America''s crumbling infrastructure demands urgent fixes. The waterworks distributor rode the wave of municipal spending to post its best Q1 ever, proving even boring industries can surf a macro trend.

Wall Street analysts nod approvingly between sips of their $8 artisanal lattes—nothing like taxpayer-funded concrete to juice those margins. Meanwhile, crypto traders watching from the sidelines mutter about ''real-world adoption'' while refreshing their degen portfolios.

Infrastructure: the ultimate ''number go up'' technology.

TLDR

• Q1 FY2025 net sales rose 9.8% to $1.91B; adjusted EBITDA grew 3.2%

• EPS increased to $0.52; gross margin stood at 26.7%

• Operating income rose to $171M; net income reached $105M

• $39M in share repurchases; operating cash flow at $77M

• FY2025 outlook reaffirmed: net sales of $7.6B–$7.8B

Core & Main Inc. (NYSE: CNM) delivered record financial results for the fiscal Q1 ended May 4, 2025, showcasing resilient infrastructure demand. Net sales ROSE 9.8% year-over-year to $1.91 billion, supported by higher volumes and strategic acquisitions. Net income climbed 4% to $105 million, while diluted EPS rose 6.1% to $0.52.

Core & Main, Inc. (CNM)

Gross profit increased 9% to $510 million. Gross margin slightly decreased to 26.7% from 26.9% due to higher inventory costs, partially offset by pricing and acquisition benefits. Operating income improved by 1.8% to $171 million.

Adjusted EBITDA reached $224 million, up 3.2% from last year. EBITDA margin dipped to 11.7% from 12.5%, mainly reflecting higher SG&A expenses, which rose 14% to $293 million due to acquisitions and inflationary pressures.

Core & Main, $CNM, Q1-25. Results:
🔴 -2.5% Pre-Market

📊 Adj. EPS: $0.52 🔴
💰 Revenue: $1.91B 🟢
🔎 Record Q1 results driven by strong volume growth and margin expansion initiatives, with $77M in operating cash FLOW and $39M in share repurchases. pic.twitter.com/TjdoE83fC5

— EarningsTime (@Earnings_Time) June 10, 2025

Capital Allocation & Cash Flow

During Q1, Core & Main generated $77 million in operating cash flow, similar to the $78 million recorded a year ago, even with seasonal working capital demands. The company repurchased 837,000 shares for $39 million at an average price of $46.64, and spent $13 million on capital expenditures.

Net debt stood at $2.276 billion, down from $2.419 billion a year ago, driven by reduced borrowings on its senior ABL credit facility. As of May 4, 2025, the company had access to approximately $1.135 billion in available borrowing capacity.

Strategic Growth Initiatives Drive Long-Term Expansion

Core & Main emphasized multiple growth levers. Its 600+ strong sales team, extensive 370-branch footprint across 49 states, and robust acquisition track record have helped drive its scale. With 20 greenfield sites added since 2017 and 40+ acquisitions totaling $1.8 billion in annual sales, CNM has established itself as the “acquirer of choice” in its space.

The company serves over 60,000 customers and offers 225,000+ products across municipal, residential, and commercial water infrastructure.

Outlook for Fiscal 2025

Core & Main reaffirmed its fiscal 2025 guidance. It expects net sales between $7.6 billion and $7.8 billion, representing 2%–5% annual growth. Adjusted EBITDA is forecast in the range of $950 million to $1 billion, with an EBITDA margin of 12.5%–12.8%. Operating cash Flow is projected between $570 million and $650 million.

Despite flat trends in residential and non-residential markets, management anticipates low-single-digit growth in the municipal segment, supported by minimal tariff exposure and ongoing margin initiatives.