filings.toolsCover and table of contents
62K characters. Original on sec.gov · Markdown
Cover and table of contents
li
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2025
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 001-40620
BUILDERS FIRSTSOURCE, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 52-2084569 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
| 6031 Connection Drive**,** Suite 400 | ||
| Irving**,** Texas | 75039 | |
| (Address of principal executive offices) | (Zip Code) |
(214) 880-3500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered |
| Common stock, par value $0.01 per share | BLDR | New York Stock Exchange NYSE Texas |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
| Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).Yes ☐ No ☒
The number of shares of the issuer’s common stock, par value $0.01, outstanding as of October 24, 2025, was 110,580,581.
BUILDERS FIRSTSOURCE, INC.
Index to Form 10-Q
P****ART I — FINANCIAL INFORMATION
I****tem 1. Financial Statements (unaudited)
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES
C****ONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| (in thousands, except per share amounts) | 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Net sales | $ | 3,941,190 | $ | 4,232,494 | $ | 11,832,750 | $ | 12,580,186 | ||||||||
| Cost of sales | 2,741,707 | 2,846,161 | 8,218,985 | 8,431,315 | ||||||||||||
| Gross margin | 1,199,483 | 1,386,333 | 3,613,765 | 4,148,871 | ||||||||||||
| Selling, general and administrative expenses | 970,715 | 958,310 | 2,889,269 | 2,857,768 | ||||||||||||
| Income from operations | 228,768 | 428,023 | 724,496 | 1,291,103 | ||||||||||||
| Interest expense, net | 69,258 | 54,263 | 206,139 | 154,615 | ||||||||||||
| Income before income taxes | 159,510 | 373,760 | 518,357 | 1,136,488 | ||||||||||||
| Income tax expense | 37,126 | 88,977 | 114,638 | 248,834 | ||||||||||||
| Net income | $ | 122,384 | $ | 284,783 | $ | 403,719 | $ | 887,654 | ||||||||
| Net income per share: | ||||||||||||||||
| Basic | $ | 1.11 | $ | 2.45 | $ | 3.61 | $ | 7.45 | ||||||||
| Diluted | $ | 1.10 | $ | 2.44 | $ | 3.60 | $ | 7.39 | ||||||||
| Weighted average common shares: | ||||||||||||||||
| Basic | 110,547 | 116,176 | 111,703 | 119,120 | ||||||||||||
| Diluted | 110,930 | 116,940 | 112,142 | 120,116 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDA****TED BALANCE SHEETS
(Unaudited)
| (in thousands, except per share amounts) | September 30, 2025 | December 31, 2024 | ||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 296,162 | $ | 153,624 | ||||
| Accounts receivable, less allowances of $43,203 and $41,233, respectively | 1,254,739 | 1,163,147 | ||||||
| Other receivables | 299,226 | 344,342 | ||||||
| Inventories, net | 1,176,429 | 1,212,375 | ||||||
| Contract assets | 148,480 | 151,095 | ||||||
| Other current assets | 121,152 | 116,656 | ||||||
| Total current assets | 3,296,188 | 3,141,239 | ||||||
| Property, plant and equipment, net | 2,203,663 | 1,961,731 | ||||||
| Operating lease right-of-use assets, net | 604,286 | 594,301 | ||||||
| Goodwill | 3,996,476 | 3,678,504 | ||||||
| Intangible assets, net | 1,195,868 | 1,103,634 | ||||||
| Other assets, net | 134,402 | 103,677 | ||||||
| Total assets | $ | 11,430,883 | $ | 10,583,086 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 960,870 | $ | 868,054 | ||||
| Accrued liabilities | 578,768 | 634,045 | ||||||
| Contract liabilities | 184,197 | 168,208 | ||||||
| Current portion of operating lease liabilities | 107,019 | 103,499 | ||||||
| Current maturities of long-term debt | 14,228 | 3,470 | ||||||
| Total current liabilities | 1,845,082 | 1,777,276 | ||||||
| Noncurrent portion of operating lease liabilities | 531,164 | 525,213 | ||||||
| Long-term debt, net of current maturities, discounts and issuance costs | 4,428,746 | 3,700,643 | ||||||
| Deferred income taxes | 172,043 | 148,167 | ||||||
| Other long-term liabilities | 137,659 | 135,317 | ||||||
| Total liabilities | 7,114,694 | 6,286,616 | ||||||
| Commitments and contingencies (Note 11) | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $0.01 par value, 10,000 shares authorized; zero shares issued and outstanding | — | — | ||||||
| Common stock, $0.01 par value, 300,000 shares authorized; 110,552 and 113,578 shares issued and outstanding, respectively | 1,106 | 1,136 | ||||||
| Additional paid-in capital | 4,192,699 | 4,271,269 | ||||||
| Retained earnings | 122,384 | 24,065 | ||||||
| Total stockholders' equity | 4,316,189 | 4,296,470 | ||||||
| Total liabilities and stockholders' equity | $ | 11,430,883 | $ | 10,583,086 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES
C****ONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended September 30, | ||||||||
| (in thousands) | 2025 | 2024 | ||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 403,719 | $ | 887,654 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 440,090 | 425,441 | ||||||
| Deferred income taxes | 23,876 | (46,000 | ) | |||||
| Stock-based compensation expense | 46,800 | 50,885 | ||||||
| Other non-cash adjustments | (5,625 | ) | 17,136 | |||||
| Changes in assets and liabilities, net of assets acquired and liabilities assumed: | ||||||||
| Receivables | 10,160 | 105,140 | ||||||
| Inventories, net | 103,616 | 47,316 | ||||||
| Contract assets | 2,615 | (18,220 | ) | |||||
| Other current assets | (3,731 | ) | 4,741 | |||||
| Other assets and liabilities | (21,772 | ) | (41,009 | ) | ||||
| Accounts payable | 77,263 | 123,658 | ||||||
| Accrued liabilities | (65,368 | ) | (81,237 | ) | ||||
| Contract liabilities | 9,449 | 23,724 | ||||||
| Net cash provided by operating activities | 1,021,092 | 1,499,229 | ||||||
| Cash flows from investing activities: | ||||||||
| Cash used for acquisitions, net of cash acquired | (904,515 | ) | (256,856 | ) | ||||
| Purchases of property, plant and equipment | (274,531 | ) | (280,897 | ) | ||||
| Proceeds from sale of property, plant and equipment | 18,408 | 10,555 | ||||||
| Cash used for equity investments | (1,330 | ) | (7,686 | ) | ||||
| Net cash used in investing activities | (1,161,968 | ) | (534,884 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Borrowings under revolving credit facility | 4,058,000 | 954,000 | ||||||
| Repayments under revolving credit facility | (4,058,000 | ) | (1,418,000 | ) | ||||
| Proceeds from long-term debt and other loans | 750,000 | 1,000,000 | ||||||
| Repayments of long-term debt and other loans | (2,151 | ) | (2,613 | ) | ||||
| Payments of loan costs | (19,861 | ) | (12,829 | ) | ||||
| Payments of acquisition-related deferred and contingent consideration | (3,425 | ) | (14,364 | ) | ||||
| Tax withholdings on and exercises of equity awards | (27,191 | ) | (55,267 | ) | ||||
| Repurchase of common stock | (413,958 | ) | (1,153,325 | ) | ||||
| Net cash provided by (used in) financing activities | 283,414 | (702,398 | ) | |||||
| Net change in cash and cash equivalents | 142,538 | 261,947 | ||||||
| Cash and cash equivalents at beginning of period | 153,624 | 66,156 | ||||||
| Cash and cash equivalents at end of period | $ | 296,162 | $ | 328,103 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | 205,872 | $ | 160,383 | ||||
| Cash paid for income taxes | 72,760 | 312,307 | ||||||
| Supplemental disclosures of non-cash activities: | ||||||||
| Accrued consideration for acquisitions | $ | 6,277 | $ | 8,570 | ||||
| Accrued purchases of property, plant and equipment | 8,164 | 19,680 | ||||||
| Right-of-use assets obtained in exchange for operating lease obligations | 79,099 | 159,221 | ||||||
| Amounts accrued related to repurchases of common stock | 3,538 | 15,624 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Unaudited)
| Additional | ||||||||||||||||||||
| Common Stock | Paid-in | Retained | ||||||||||||||||||
| (in thousands) | Shares | Amount | Capital | Earnings | Total | |||||||||||||||
| Balance at December 31, 2023 | 121,857 | $ | 1,219 | $ | 4,270,948 | $ | 460,184 | $ | 4,732,351 | |||||||||||
| Vesting of restricted stock units | 438 | 4 | (4 | ) | — | — | ||||||||||||||
| Stock-based compensation expense | — | — | 16,900 | — | 16,900 | |||||||||||||||
| Repurchase of common stock (1) | (97 | ) | (1 | ) | — | (19,599 | ) | (19,600 | ) | |||||||||||
| Exercise of stock options | 21 | — | 151 | — | 151 | |||||||||||||||
| Shares withheld for restricted stock units vested | (169 | ) | (3 | ) | (31,873 | ) | — | (31,876 | ) | |||||||||||
| Net income | — | — | — | 258,781 | 258,781 | |||||||||||||||
| Balance at March 31, 2024 | 122,049 | 1,220 | 4,256,122 | 699,366 | 4,956,708 | |||||||||||||||
| Vesting of restricted stock units | 351 | 3 | (3 | ) | — | — | ||||||||||||||
| Stock-based compensation expense | — | — | 16,726 | — | 16,726 | |||||||||||||||
| Repurchase of common stock (1) | (5,821 | ) | (58 | ) | — | (989,550 | ) | (989,608 | ) | |||||||||||
| Exercise of stock options | 2 | — | 28 | — | 28 | |||||||||||||||
| Shares withheld for restricted stock units vested | (130 | ) | (1 | ) | (23,301 | ) | — | (23,302 | ) | |||||||||||
| Net income | — | — | — | 344,090 | 344,090 | |||||||||||||||
| Balance at June 30, 2024 | 116,451 | 1,164 | 4,249,572 | 53,906 | 4,304,642 | |||||||||||||||
| Vesting of restricted stock units | 7 | — | — | — | — | |||||||||||||||
| Stock-based compensation expense | — | — | 17,259 | — | 17,259 | |||||||||||||||
| Repurchase of common stock (1) | (904 | ) | (8 | ) | — | (159,733 | ) | (159,741 | ) | |||||||||||
| Exercise of stock options | 5 | — | 66 | — | 66 | |||||||||||||||
| Shares withheld for restricted stock units vested | (2 | ) | — | (336 | ) | — | (336 | ) | ||||||||||||
| Net income | — | — | — | 284,783 | 284,783 | |||||||||||||||
| Balance at September 30, 2024 | 115,557 | $ | 1,156 | $ | 4,266,561 | $ | 178,956 | $ | 4,446,673 | |||||||||||
| Balance at December 31, 2024 | 113,578 | $ | 1,136 | $ | 4,271,269 | $ | 24,065 | $ | 4,296,470 | |||||||||||
| Vesting of restricted stock units | 376 | 4 | (4 | ) | — | — | ||||||||||||||
| Stock-based compensation expense | — | — | 14,238 | — | 14,238 | |||||||||||||||
| Repurchase of common stock (2) | (97 | ) | (1 | ) | — | (12,749 | ) | (12,750 | ) | |||||||||||
| Exercise of stock options | 9 | — | 77 | — | 77 | |||||||||||||||
| Shares withheld for restricted stock units vested | (140 | ) | (2 | ) | (20,177 | ) | — | (20,179 | ) | |||||||||||
| Net income | — | — | — | 96,304 | 96,304 | |||||||||||||||
| Balance at March 31, 2025 | 113,726 | 1,137 | 4,265,403 | 107,620 | 4,374,160 | |||||||||||||||
| Vesting of restricted stock units | 166 | 2 | (2 | ) | — | — | ||||||||||||||
| Stock-based compensation expense | — | — | 16,160 | — | 16,160 | |||||||||||||||
| Repurchase of common stock (2)(3) | (3,305 | ) | (33 | ) | (98,172 | ) | (292,651 | ) | (390,856 | ) | ||||||||||
| Exercise of stock options | 5 | — | 69 | — | 69 | |||||||||||||||
| Shares withheld for restricted stock units vested | (55 | ) | (1 | ) | (6,471 | ) | — | (6,472 | ) | |||||||||||
| Net income | — | — | — | 185,031 | 185,031 | |||||||||||||||
| Balance at June 30, 2025 | 110,537 | 1,105 | 4,176,987 | — | 4,178,092 | |||||||||||||||
| Vesting of restricted stock units | 19 | 1 | (1 | ) | — | — | ||||||||||||||
| Stock-based compensation expense | — | — | 16,402 | — | 16,402 | |||||||||||||||
| Exercise of stock options | 2 | — | 29 | — | 29 | |||||||||||||||
| Shares withheld for restricted stock units vested | (6 | ) | — | (718 | ) | — | (718 | ) | ||||||||||||
| Net income | — | — | — | 122,384 | 122,384 | |||||||||||||||
| Balance at September 30, 2025 | 110,552 | $ | 1,106 | $ | 4,192,699 | $ | 122,384 | $ | 4,316,189 |
During the three months ended March 31, 2024, June 30, 2024, and September 30, 2024, we repurchased and retired 0.1 million shares, 5.8 million shares and 0.9 million shares of our common stock for $19.6 million, $989.6 million and $159.7 million, inclusive of applicable fees and taxes, at an average price of $202.67, $170.01 and $176.73 per share, respectively.
During the three months ended March 31, 2025 and June 30, 2025, we repurchased and retired 0.1 million shares and 3.3 million shares of our common stock for $12.8 million and $390.9 million, inclusive of applicable fees and taxes, at an average price of $131.51 and $118.27 per share, respectively.
The amounts paid in excess of par have been allocated to additional paid-in capital upon depleting retained earnings.
The accompanying notes are an integral part of these condensed consolidated financial statements.
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES
N****OTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
Builders FirstSource, Inc., a Delaware corporation formed in 1998, is a leading supplier of building materials, manufactured components and construction services to professional contractors, sub-contractors, and consumers. The Company operates approximately 585 locations in 43 states across the United States. In this quarterly report, references to the “Company,” “we,” “our,” “ours” or “us” refer to Builders FirstSource, Inc. and its consolidated subsidiaries unless otherwise stated or the context otherwise requires.
In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all recurring adjustments and normal accruals necessary for a fair statement of the Company’s financial position, results of operations and cash flows for the dates and periods presented. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period. Intercompany transactions are eliminated in consolidation.
The Condensed Consolidated Balance Sheet as of December 31, 2024, is derived from the audited consolidated financial statements but does not include all disclosures required by Generally Accepted Accounting Principles in the United States of America (“GAAP”). The Condensed Consolidated Balance Sheet as of December 31, 2024, and the unaudited condensed consolidated financial statements included herein should be read in conjunction with the more detailed audited consolidated financial statements for the year ended December 31, 2024, included in our most recent annual report on Form 10-K for fiscal year 2024 (“2024 Form 10-K”). Accounting policies used in the preparation of these unaudited condensed consolidated financial statements are consistent with the accounting policies described in the Notes to Consolidated Financial Statements included in our 2024 Form 10-K.
Business Combinations
When they meet the requirements under ASC 805, Business Combinations, merger and acquisition transactions are accounted for using the acquisition method, and accordingly the results of operations of the acquiree are included in the Company’s consolidated financial statements from the acquisition date. The consideration transferred is allocated to the identifiable assets acquired and liabilities assumed based on estimated fair values at the acquisition date, with any excess recorded as goodwill. Transaction-related costs are expensed in the period the costs are incurred. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill.
Segments
We offer an integrated solution to our customers providing manufacturing, supply, and installation of a full range of structural and related building products. Given the span and depth of our geographical reach, our locations are organized into three geographical divisions (East, Central, and West), which are also our operating segments. All of our operating segments have similar customers, products and services, and distribution methods.
Due to these similarities, along with the similar economic profitability achieved across all our operating segments, we aggregate our three operating segments into one reportable segment in accordance with GAAP. Centralized financial and operational oversight, including resource allocation and assessment of performance, is performed by our principal executive officer (“CEO”), whom we have determined to be our chief operating decision maker (“CODM”). Since the Company operates in one reportable segment, the primary measures reviewed by our CEO, including revenue, gross margin and income before income taxes, are shown in these condensed consolidated financial statements.
The accounting policies of our reportable segment are consistent with the accounting policies described in the Notes to Consolidated Financial Statements included in our 2024 Form 10-K.
Cloud Computing Arrangements
We assess cloud computing arrangements to determine whether the contract meets the definition of a service contract or conveys a software license. When cloud computing arrangements meet the definition of a service contract, we capitalize expenditures for implementation, set-up, and other upfront costs incurred. Once the implementation of a cloud computing arrangement is complete and ready for its intended use, we amortize the costs over the expected term of the hosting arrangement using the straight-line method to the same income statement line as the associated cloud operating expenses. As of September 30, 2025, and December 31, 2024, we had capitalized costs, net of amortization, of $20.8 million and $9.3 million, respectively, included in other current assets. As of September 30, 2025, and December 31, 2024, we had capitalized costs, net of amortization, of $81.8 million and $52.7 million, respectively, included in other assets, net. During the three and nine months ended September 30, 2025, we amortized $4.8 million for these costs. During the three and nine months ended September 30, 2024, we amortized $0.3 million and $1.0 million for these costs,
respectively. The amortized expenses are included in selling, general and administrative expenses within the Condensed Consolidated Statements of Operations.
Comprehensive Income
Comprehensive income is equal to net income for all periods presented.
Equity Investments
The Company’s equity investments are accounted for using equity method accounting and are recorded as other assets, net in the accompanying Condensed Consolidated Balance Sheets and are not considered significant to the Company.
Reclassifications
The prior period amounts disclosed in Note 3 have been reclassified to conform to current year presentation. These reclassifications had no impact on net income, total assets and liabilities, stockholders’ equity or cashflows as previously reported.
Recent Accounting Pronouncements
In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to enhance the transparency and decision usefulness of income tax disclosures. This amendment modifies the rules on income tax disclosures to require entities to disclose: (i) specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold; (ii) the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes, as well as individual jurisdictions in which income taxes paid is equal to or greater than five percent of total income taxes paid net of refunds; (iii) the income or loss from continuing operations before income tax expense, or benefit, disaggregated between domestic and foreign; and (iv) income tax expense or benefit from continuing operations disaggregated by federal, state and foreign. The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted, and should be applied on a prospective basis, though retrospective application is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements and we will reflect the related disclosure requirements within our 2025 Annual Report on Form 10-K.
In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued Accounting Standards Update No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application and early adoption is permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The standard applies to costs incurred to develop or obtain software for internal use. ASU 2025-06 amends the existing standard that refers to various stages of a software development project to align better with current software development methods, such as agile programming. Under the new standard, entities will commence capitalizing eligible costs when (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in ASU 2025-06 are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods, with early adoption permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.
2. Business Combinations
During the first nine months of 2025, we completed the acquisitions of Alpine Lumber Company (“Alpine Lumber”), O.C. Cluss Lumber Company (“Cluss Lumber”), Truckee Tahoe Lumber (“Truckee Tahoe”) and St. George Truss Co. (“St. George Truss”) for a combined total of approximately $910.8 million, net of cash acquired. Alpine Lumber was the largest independently operated supplier of building materials in Colorado and northern New Mexico. Alpine Lumber serves the Colorado Front Range, western Colorado and northern New Mexico, providing a broad product range which includes prefabricated trusses and wall panels, and millwork. Cluss Lumber is a supplier of lumber and building materials to southwestern Pennsylvania, western Maryland and northern West Virginia. Truckee Tahoe is a supplier of lumber and building materials in the northern California and northwestern Nevada markets. St. George Truss manufactures trusses, serving builders in southern Utah and southern Nevada.
During the first nine months of 2024, we completed the acquisitions of Quality Door & Millwork, Inc. (“Quality Door”), Hanson Truss Components, Inc. (“Hanson Truss”), Schoeneman Bros. Company (“Schoeneman”), TRSMI, LLC (“TRSMI”), RPM Wood Products, Inc. (“RPM”), Western Truss & Components (“Western Truss”), CRi SoCal (“CRi”), Wyoming Millwork Co. (“Wyoming Millwork”), Sunrise Wood Designs, LLC (“Sunrise Wood Designs”), Reno Truss, Inc. (“Reno Truss”) and High Mountain Door and Trim, Inc. (“High Mountain”) for a combined total of approximately $265.4 million, net of cash acquired. Quality Door is a millwork distributor, serving Idaho markets in the Boise and Idaho Falls areas. Hanson Truss produces trusses, serving the areas of northern California and western Nevada. Schoeneman manufacturers trusses and provides building materials and products to eastern South Dakota, and western Iowa. TRSMI manufactures and distributes trusses around the Detroit, Michigan area. RPM provides a diverse product mix of lumber, windows, doors, millwork and trusses in northeastern Florida. Western Truss manufactures roof and floor trusses, serving central Arizona. CRi installs windows and doors in the southern California area. Wyoming Millwork serves custom and semi-custom builders with lumber and lumber sheet goods, windows, doors, millwork, trusses and other building products in Delaware. Sunrise Wood Designs is a custom cabinet manufacturer and installer to production and custom builders in North Texas. Reno Truss is a manufacturer and distributor of roof and floor trusses to single-family and multi-family markets in the Nevada area. High Mountain distributes and installs doors, windows and millwork to single-family and multi-family markets in the southern Nevada area.
The acquisitions were funded with a combination of cash on hand and borrowings under our $2.2 billion revolving credit facility due May 20, 2030 (the “Revolving Facility”). The transactions were accounted for by the acquisition method, and accordingly, the results of operations have been included in the Company’s consolidated financial statements from the acquisition dates. The purchase price was allocated to the assets acquired and liabilities assumed based on estimated fair values at the acquisition dates, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill.
Pro forma financial information for the acquisitions discussed above for 2025 and 2024 are not presented as these acquisitions did not have a material impact on our results of operations, individually or in the aggregate for each respective period.
The following table summarizes the aggregate fair values of the assets acquired and liabilities assumed for acquisitions during the periods ended September 30, 2025, and September 30, 2024:
| Total Acquisitions | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents | $ | 2,785 | $ | 7,749 | ||||
| Accounts receivable | 49,795 | 26,749 | ||||||
| Other receivables | 6,842 | 127 | ||||||
| Inventories | 67,670 | 22,969 | ||||||
| Contract assets | — | 454 | ||||||
| Other current assets | 766 | 410 | ||||||
| Property, plant and equipment | 193,816 | 51,550 | ||||||
| Operating lease right-of-use assets | 11,646 | 14,502 | ||||||
| Finance lease right-of-use assets | 286 | — | ||||||
| Intangible assets | 312,917 | 82,125 | ||||||
| Other assets | 262 | 134 | ||||||
| Total assets | 646,785 | 206,769 | ||||||
| Accounts payable | 14,512 | 4,709 | ||||||
| Accrued liabilities | 18,196 | 4,612 | ||||||
| Contract liabilities | 6,540 | 130 | ||||||
| Operating lease liabilities | 11,646 | 14,502 | ||||||
| Finance lease liabilities | 286 | — | ||||||
| Total liabilities | 51,180 | 23,953 | ||||||
| Goodwill | 317,972 | 90,359 | ||||||
| Total purchase consideration | 913,577 | 273,175 | ||||||
| Accrued contingent consideration and purchase price adjustments | (6,277 | ) | (8,570 | ) | ||||
| Less: cash acquired | (2,785 | ) | (7,749 | ) | ||||
| Total cash consideration | $ | 904,515 | $ | 256,856 |
3. Revenue
The following table disaggregates our net sales by product category:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Manufactured products | $ | 868,363 | $ | 1,014,658 | $ | 2,691,517 | $ | 3,075,489 | ||||||||
| Windows, doors and millwork | 989,916 | 1,086,981 | 2,962,268 | 3,238,405 | ||||||||||||
| Specialty building products and services | 1,087,272 | 1,049,698 | 3,050,015 | 2,963,801 | ||||||||||||
| Lumber and lumber sheet goods | 995,639 | 1,081,157 | 3,128,950 | 3,302,491 | ||||||||||||
| Net sales | $ | 3,941,190 | $ | 4,232,494 | $ | 11,832,750 | $ | 12,580,186 |
As our product alignment continues to be refined, we have reclassified prior periods’ net sales by product category to conform to current period presentation. The impact to each of the prior periods’ net sales for manufactured products, windows, doors and millwork, specialty building products and services, and lumber and lumber sheet goods was 1.7%, 0.2%, -2.9% and 1.1%, respectively, for the three months ended September 30, 2024, and 1.4%, 0.2%, -3.6% and 1.8%, respectively, for the nine months ended September 30, 2024.
The timing of revenue recognition, invoicing and cash collection results in accounts receivable, unbilled receivables, contract assets and contract liabilities. Contract assets include unbilled amounts when the revenue recognized exceeds the amount billed to the customer, and amounts representing a right to payment from previous performance that is conditional on something other than passage of time, such as retainage. Contract liabilities consist of customer advances and deposits, and deferred revenue.
Through September 30, 2025, and 2024, we recognized as revenue substantially all of the contract liabilities balances outstanding as of December 31, 2024, and 2023, respectively.
4. Net Income per Common Share
Net income per common share (“EPS”) is calculated in accordance with the Earnings per Share topic of the FASB Accounting Standards Codification, which requires the presentation of basic and diluted EPS. Basic EPS is computed using the weighted average number of common shares outstanding during the period. Diluted EPS is computed using the weighted average number of common shares outstanding during the period, plus the dilutive effect of potential common shares.
The table below presents the calculation of basic and diluted EPS:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| (in thousands, except per share amounts) | ||||||||||||||||
| Numerator: | ||||||||||||||||
| Net income | $ | 122,384 | $ | 284,783 | $ | 403,719 | $ | 887,654 | ||||||||
| Denominator: | ||||||||||||||||
| Weighted average shares outstanding, basic | 110,547 | 116,176 | 111,703 | 119,120 | ||||||||||||
| Dilutive effect of options and RSUs | 383 | 764 | 439 | 996 | ||||||||||||
| Weighted average shares outstanding, diluted | 110,930 | 116,940 | 112,142 | 120,116 | ||||||||||||
| Net income per share: | ||||||||||||||||
| Basic | $ | 1.11 | $ | 2.45 | $ | 3.61 | $ | 7.45 | ||||||||
| Diluted | $ | 1.10 | $ | 2.44 | $ | 3.60 | $ | 7.39 | ||||||||
| Antidilutive and contingent RSUs excluded from diluted EPS | 118 | 271 | 323 | 196 |
5. Goodwill
The following table sets forth the changes in the carrying amount of goodwill:
| (in thousands) | ||||
| Balance as of December 31, 2024 (1) | $ | 3,678,504 | ||
| Acquisitions | 317,972 | |||
| Balance as of September 30, 2025 (1) | $ | 3,996,476 |
(1) Goodwill is presented net of historical accumulated impairment losses of $44.6 million.
In 2025, the change in the carrying amount of goodwill is attributable to the acquisitions completed during the period. As of September 30, 2025, no impairment triggering events have occurred. The amount allocated to goodwill is attributable to the assembled workforce, synergies and expected growth from the expanded product and service offerings of acquisitions. The goodwill recognized from the current year acquisitions is expected to be deductible and amortized ratably over a 15-year period for tax purposes.
6. Intangible Assets
The following table presents intangible assets as of:
| September 30, 2025 | December 31, 2024 | |||||||||||||||
| Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | |||||||||||||
| (in thousands) | ||||||||||||||||
| Customer relationships | $ | 2,520,495 | $ | (1,403,173 | ) | $ | 2,216,578 | $ | (1,198,125 | ) | ||||||
| Developed technology | 95,600 | (43,849 | ) | 95,600 | (35,887 | ) | ||||||||||
| Trade names | 73,500 | (49,629 | ) | 64,500 | (43,483 | ) | ||||||||||
| Non-compete agreements | 13,050 | (10,126 | ) | 13,050 | (8,599 | ) | ||||||||||
| Total intangible assets | $ | 2,702,645 | $ | (1,506,777 | ) | $ | 2,389,728 | $ | (1,286,094 | ) |
In connection with the current year acquisitions, we recorded intangible assets of $312.9 million, which includes $303.9 million of customer relationships and $9.0 million of trade names. The weighted average useful life of the current year acquired intangible assets is 10.7 years in total, 10.9 years for customer relationships and 3.0 years for trade names. The fair value of acquired customer relationship intangible assets was primarily estimated by applying the multi-period excess earnings method, which involved the use of significant estimates and assumptions primarily related to forecasted revenue growth rates, gross margin, contributory asset charges, customer attrition rates, and market-participant discount rates. These measures are based on significant Level 3 inputs not observable in the market. Key assumptions developed based on the Company’s historical experience, future projections and comparable market data include future cash flows, long-term growth rates, attrition rates and discount rates.
During the three and nine months ended September 30, 2025, we recorded amortization expense in relation to the above-listed intangible assets of $73.5 million and $220.7 million, respectively. During the three and nine months ended September 30, 2024, we recorded amortization expense in relation to the above-listed intangible assets of $76.3 million and $237.2 million, respectively.
The following table presents the estimated amortization expense for intangible assets for the years ending December 31:
| (in thousands) | ||||
| 2025 (from October 1, 2025) | $ | 73,722 | ||
| 2026 | 264,308 | |||
| 2027 | 204,085 | |||
| 2028 | 151,792 | |||
| 2029 | 96,507 | |||
| Thereafter | 405,454 | |||
| Total future intangible amortization expense | $ | 1,195,868 |
7. Accrued Liabilities
Accrued liabilities consisted of the following as of:
| September 30, 2025 | December 31, 2024 | |||||||
| (in thousands) | ||||||||
| Accrued payroll and other employee related expenses | $ | 266,672 | $ | 310,073 | ||||
| Self-insurance reserves | 96,288 | 102,876 | ||||||
| Accrued business and other taxes | 74,907 | 72,944 | ||||||
| Accrued interest | 51,496 | 55,454 | ||||||
| Accrued rebates payable | 30,944 | 35,404 | ||||||
| Accrued professional service fees | 21,808 | 16,406 | ||||||
| Other | 36,653 | 40,888 | ||||||
| Total accrued liabilities | $ | 578,768 | $ | 634,045 |
8. Long-Term Debt
Long-term debt consisted of the following as of:
| September 30, 2025 | December 31, 2024 | |||||||
| (in thousands) | ||||||||
| Revolving credit facility | $ | — | $ | — | ||||
| 4.25% 2032 notes | 1,300,000 | 1,300,000 | ||||||
| 6.375% 2034 notes | 1,000,000 | 1,000,000 | ||||||
| 6.75% 2035 notes | 750,000 | — | ||||||
| 6.375% 2032 notes | 700,000 | 700,000 | ||||||
| 5.00% 2030 notes | 550,000 | 550,000 | ||||||
| Other finance obligations | 186,987 | 190,312 | ||||||
| Finance lease obligations | 942 | 1,078 | ||||||
| 4,487,929 | 3,741,390 | |||||||
| Unamortized debt discount/premium and debt issuance costs | (44,955 | ) | (37,277 | ) | ||||
| 4,442,974 | 3,704,113 | |||||||
| Less: current maturities of long-term debt | 14,228 | 3,470 | ||||||
| Long-term debt, net of current maturities, discounts and issuance costs | $ | 4,428,746 | $ | 3,700,643 |
2025 Debt Transactions
Notes Offering Transaction
On May 8, 2025, the Company completed a private offering of $750.0 million in aggregate principal amount of 6.750% senior unsecured notes due 2035 (“6.75% 2035 Notes”) at an issue price equal to 100% of par value. The net proceeds from the offering were used to repay indebtedness outstanding under the Revolving Facility.
In connection with the issuance of the 6.75% 2035 Notes, we incurred $11.1 million of various third-party fees and expenses. These costs have been recorded as a reduction to long-term debt and are being amortized over the contractual life of the 6.75% 2035 Notes using the effective interest method.
The 6.75% 2035 Notes mature on May 15, 2035, with interest accruing at a rate of 6.75% per annum and interest payable semi-annually on May 15 and November 15 of each year.
The terms of the 6.75% 2035 Notes are governed by the indenture, dated as of May 8, 2025 (“2035 Indenture”). The 2035 Indenture contains terms consistent with the other indentures the Company is party to and is among the Company, the guarantors named therein and Wilmington Trust, National Association, as trustee.
The 6.75% 2035 Notes, subject to certain exceptions, are guaranteed, jointly and severally, on a senior unsecured basis, by each of the Company’s direct and indirect wholly-owned subsidiaries (the “Guarantors”) that guarantee the Revolving Facility, the 5.000% senior notes due 2030 (the “5.00% 2030 Notes”), the 4.250% senior notes due 2032 (the “4.25% 2032 Notes”), the 6.375% senior notes due 2032 (the “6.375% 2032 Notes”) and the 6.375% senior notes due 2034 (the “6.375% 2034 Notes” and, collectively with the 5.00% 2030 Notes, the 4.25% 2032 Notes and 6.375% 2032 Notes, the “Existing Notes”).
The 6.75% 2035 Notes constitute senior unsecured obligations of the Company and Guarantors, pari passu in right of payment, with all of the existing and future senior indebtedness of the Company, including indebtedness under the Revolving Facility and the Existing Notes effectively subordinated to all existing and future secured indebtedness of the Company and the Guarantors (including indebtedness under the Revolving Facility) to the extent of the value of the assets securing such indebtedness, senior to all of the future subordinated indebtedness of the Company and the Guarantors and structurally subordinated to any existing and future indebtedness and other liabilities, including preferred stock, of the Company’s subsidiaries that do not guarantee the 6.75% 2035 Notes.
The 2035 Indenture contains certain covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, incur additional debt or issue preferred stock, create liens, create restrictions on the Company’s subsidiaries’ ability to make payments to the Company, pay dividends and make other distributions in respect of the Company’s and its subsidiaries’ capital stock, make certain investments or certain other restricted payments, guarantee indebtedness, designate unrestricted subsidiaries, sell certain kinds of assets, enter into certain types of transactions with affiliates, and effect mergers and consolidations.
The Company may redeem the 6.75% 2035 Notes within five years from the date of issuance, in whole or in part, at a redemption price equal to 100% of the principal amount of the 6.75% 2035 Notes plus the “applicable premium” set forth in the 2035 Indenture. The Company may, within three years of the date of issuance, redeem up to 40% of the aggregate principal amount of the 6.75% 2035 Notes with the net cash proceeds of one or more equity offerings at 106.75% of the principal amount thereof plus accrued and unpaid interest, if any, to the redemption date. After the five-year period from original issuance, the Company may redeem the 6.75% 2035 Notes at the redemption prices set forth in the 2035 Indenture, plus accrued and unpaid interest, if any, to the redemption date. If the Company experiences certain change of control triggering events, holders of the 6.75% 2035 Notes may require it to
repurchase all or part of their notes at 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the repurchase date.
The Company’s other outstanding senior unsecured notes are discussed in more detail in our 2024 Form 10-K.
Revolving Credit Facility Amendment
On May 20, 2025, the Company amended the Revolving Facility to increase the existing revolving commitments of $1.8 billion with new revolving commitments of $2.2 billion, and to extend the maturity date to May 20, 2030. Effective with the amendment, the interest pricing tiers will be 1.00% or 1.25% per annum in the case of Secured Overnight Financing Rate (“SOFR”) loans, and 0.00% or 0.25% per annum in the case of base rate loans, in each case based on a measure of availability under the amended Revolving Facility. Letters of credit fees under the Revolving Facility are assessed at a rate between 1.00% and 1.25%, based on the average excess availability. The commitment fee rate will continue to be equal to 0.20% per annum. In addition, the Revolving Facility also contains a financial covenant requiring the satisfaction of a minimum fixed charge ratio of 1.00 to 1.00 if our excess availability falls below the greater of $165.0 million or 10% of the maximum borrowing amount, which was $187.0 million as of September 30, 2025. The guarantees and covenants in the amended revolving facility remain consistent with those in the prior revolving facility and described in our 2024 Form 10-K.
In connection with this amendment, we expensed approximately $0.2 million of unamortized debt issuance costs related to an exiting lender to interest expense, and we incurred approximately $8.7 million of new debt issuance costs which, together with the previous unamortized debt issuance costs, have been deferred and will be amortized over the remaining contractual life.
Fair Value
As of September 30, 2025, and December 31, 2024, the Company does not have any financial instruments that are measured at fair value on a recurring basis. We have elected to report the value of our 6.75% 2035 Notes, and Existing Notes at amortized cost. The fair values of the 4.25% 2032 Notes, 6.375% 2034 Notes, 6.75% 2035 Notes, 6.375% 2032 Notes, and 5.00% 2030 Notes at September 30, 2025 were approximately $1.2 billion, $1.0 billion, $785.6 million, $724.5 million, and $543.8 million, respectively, which were determined using Level 2 inputs based on market prices.
We were not in violation of any covenants or restrictions imposed by any of our debt agreements at September 30, 2025.
9**.** Employee Stock-Based Compensation
Time Based Restricted Stock Unit Grants
In the first nine months of 2025, our board of directors granted 453,500 restricted stock units (“RSUs”) to employees under our 2014 Incentive Plan for which vesting is based solely on continuous employment over the requisite service period. These grants vest over a service period between one and three years. The weighted average grant date fair value for these RSUs was $126.91 per unit, which was based on the closing stock price on the respective grant dates.
Performance, Market and Service Condition Based Restricted Stock Unit Grants
In the first nine months of 2025, our board of directors granted 180,500 RSUs to employees under our 2014 Incentive Plan, which cliff vest on the third anniversary of the grant date based on the Company’s level of achievement of performance goals relating to return on invested capital over a three-year period (“performance condition”) and continued employment during the performance period (“service condition”). The total number of shares of common stock that may be earned from the performance condition ranges from zero to 200% of the RSUs granted. The number of shares earned from the performance condition may be further increased or decreased by 10% based on the Company’s total shareholder return relative to a peer group during the performance period (“market condition”). The grant date fair value for these RSUs, with consideration of the market condition, was $129.03 per unit, which was determined using the Monte Carlo simulation model, applying the following assumptions:
| Expected volatility (Company) | 44.3% |
| Expected volatility (peer group median) | 31.5% |
| Correlation between the Company and peer group median | 0.5 |
| Expected dividend yield | 0.0% |
| Risk-free rate | 4.0% |
The expected volatilities and correlation are based on the historical daily returns of our common stock and the common stocks of the constituents of our peer group over the most recent period equal to the measurement period. The expected dividend yield is based on our history of not paying regular dividends in the past and our current intention to not pay regular dividends in the foreseeable future. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant and has a term equal to the measurement period.
10**.** Income Taxes
A reconciliation of the statutory federal income tax rate to our effective rate for continuing operations is provided below:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Statutory federal income tax rate | 21.0 | % | 21.0 | % | 21.0 | % | 21.0 | % | |||||||
| State income taxes, net of federal income tax | 2.6 | 2.5 | 2.5 | 2.5 | |||||||||||
| Stock-based compensation windfall benefit | (0.2 | ) | (0.1 | ) | (1.0 | ) | (2.2 | ) | |||||||
| Permanent differences and other | (0.1 | ) | 0.4 | (0.4 | ) | 0.6 | |||||||||
| 23.3 | % | 23.8 | % | 22.1 | % | 21.9 | % | ||||||||
We base our estimate of deferred tax assets and liabilities on current tax laws and rates. In certain cases, we also base our estimate on business plan forecasts and other expectations about future outcomes. Changes in existing tax laws or rates could affect our actual tax results, and future business results may affect the amount of our deferred tax liabilities or the valuation of our deferred tax assets over time. Due to uncertainties in the estimation process, particularly with respect to changes in facts and circumstances in future reporting periods, as well as the residential homebuilding industry’s cyclicality and sensitivity to changes in economic conditions, it is possible that actual results could differ from the estimates used in previous analyses. These differences could have a material impact on our consolidated results of operations or financial position.
On July 4, 2025, H.R.1 - One Big Beautiful Bill was enacted into law (the “Act”). The Act makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation. The Company's deferred income tax liabilities as of September 30, 2025, and December 31, 2024, were $172.0 million and $148.2 million, respectively. The increase was primarily due to the bonus depreciation and domestic research cost expensing elements of the Act. The Act did not have a material impact on our income tax expense for the period ending September 30, 2025, and we do not expect it to materially change our effective income tax rate for the year ending December 31, 2025. With further guidance from the U.S. Treasury and IRS expected, the Company is continuing to analyze the full impact of the Act on the Company’s financial statements and related disclosures. We anticipate the Act to have a material impact on our future financial results including cash flows. The permanent extension of 100% bonus depreciation and reinstating the expensing of domestic research costs is anticipated to reduce our cash tax payments in the current and future years, and increase our operating cash flows.
11. Commitments and Contingencies
As of September 30, 2025, we had outstanding letters of credit totaling $79.6 million under our Revolving Facility that principally support our self-insurance programs.
The Company has a number of known and threatened construction defect legal claims. While these claims are generally covered under the Company’s existing insurance programs to the extent any loss exceeds the deductible, there is a reasonable possibility of loss that is not able to be estimated at this time because (i) many of the proceedings are in the discovery stage, (ii) the outcome of future litigation is uncertain, and/or (iii) the complex nature of the claims. Although the Company cannot estimate a reasonable range of loss based on currently available information, the resolution of these matters could materially affect the Company's financial position, results of operations or cash flows.
In addition, we are involved in various other claims and lawsuits incidental to the conduct of our business in the ordinary course. We carry insurance coverage in amounts in excess of our self-insured retention that we believe to be reasonable under the circumstances and that may or may not cover any or all of our liabilities in respect to such claims and lawsuits. Although the ultimate disposition of these other proceedings cannot be predicted with certainty, management believes the outcome of any such claims that are pending or threatened, either individually or on a combined basis, will not materially affect our consolidated financial position, cash flows or results of operations. However, there can be no assurances that future adverse judgments and costs would not be material to our results of operations or liquidity for a particular period.
12. Significant Segment Expenses
The primary measures reviewed by the CODM, including revenue, gross margin and income before income taxes, are shown in these condensed consolidated financial statements. The CODM uses these measures to assess performance for the reportable segment and to decide how to allocate resources. Gross margin and income before income taxes are driven by the segment’s significant expense items of cost of sales and compensation and benefits, as well as other segment items. Cost of sales is shown in these condensed consolidated financial statements. Compensation and benefits, which are reported within selling, general, and administrative expenses in these condensed consolidated financial statements were $0.6 billion for the three months ended September 30, 2025 and 2024, and $1.7 billion for the nine months ended September 30, 2025 and 2024. Other segment items are substantially all the remaining selling, general, and administrative expenses reported in these condensed consolidated financial statements. The measure of segment assets is reported on the Condensed Consolidated Balance Sheet as total assets.
13. Subsequent Events
Business Combinations
Subsequent to September 30, 2025, we completed the acquisitions of Stately Las Vegas Holdings, LLC and substantially all the assets of Rystin Construction, Inc. Both of the acquired businesses provide turnkey door and trim solutions to customers in the Las Vegas area.
The accounting for these business combinations has not been completed as of the date of this quarterly report on Form 10-Q given the proximity to the acquisition date.
Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations