MillerKnoll Inc Q4 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Greg Burns - Sidoti and Co - Analyst : Good afternoon. So I just want to kind of dig into the pull-forward effect from the pricing actions you've taken, obviously, strong order growth this quarter. Can you just give us maybe a little bit of insight into what you've seen in the early part of the current quarter? Has that slowed down? And are orders going to -- do you expect orders, I guess, to be down year-over-year because of the pull forward? How has that dynamic played out since the quarter ended?

Question: Greg Burns - Sidoti and Co - Analyst : Okay. And then in terms of the retail store openings, can you just talk about your confidence level in such, I guess, aggressive expansion this year or accelerating the expansion of the retail footprint this year given kind of the softer demand environment that we're currently in? And then could you just talk about how long it takes a store to fully mature and start to absorb some of those incremental upfront costs? And then lastly, I guess, just what are your expectations for the margin profile of the retail business in the near term, given all the store openings that you project? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 9:00PM, MLKN.OQ - Q4 2025 MillerKnoll Inc Earnings Call

Question: Greg Burns - Sidoti and Co - Analyst : Okay. Great. And then just to clarify, I appreciate kind of the long-term model on where you see the operating margins heading. But should we just expect kind of margins to be around that 5% level, I guess, in the near term until these stores mature and then you start to see leverage like for the next couple of quarters? Should our expectation be that, that models -- that margins stay at these current levels?

Question: Greg Burns - Sidoti and Co - Analyst : Okay great. Thank you.

Question: Reuben Garner - The Benchmark Company - Analyst : Thanks. Good evening, guys. Jeff, can you clarify, did you say that you guys estimated that North American pull forward was in the range of $55 million to $60 million in the quarter. Is that right?

Question: Reuben Garner - The Benchmark Company - Analyst : Okay. And is there any way to gauge like what period that was actually pulled forward from? In other words, like was that all pulled out of the month of June? Was it pulled from things that were in the pipeline for the rest of the year? And then in the past, you guys have kind of given us some of your internal metrics like the 12-month funnel and otherwise, how have those trended? I know last quarter was a little bit more mixed, but are those still tracking positively?

Question: Reuben Garner - The Benchmark Company - Analyst : And does anything jump out whether it's geographically or in terms of end markets within the North American Contract channel that stand out in the quarter or size of customers, size of projects, or anything like that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 25, 2025 / 9:00PM, MLKN.OQ - Q4 2025 MillerKnoll Inc Earnings Call

Question: Reuben Garner - The Benchmark Company - Analyst : Great. And then next question is on the profitability. So what you're suggesting is because of the pull forward, you're facing the tariffs, but you don't have the surcharge to offset it. How long? Is that just a one quarter dynamic? Or does that kind of lead into Q2 and Q3 as well when these orders are ultimately shipped?

Question: Reuben Garner - The Benchmark Company - Analyst : Okay. And then if I could sneak one more in on the balance sheet and cash flow, starting a new fiscal year, Jeff, any thoughts on the puts and takes of what might impact free cash flow this year and or kind of targeted leverage levels by the end of the year?

Question: Reuben Garner - The Benchmark Company - Analyst : Great, thank you guys. Good luck in the new fiscal year.

Question: Brian Gordon - Water Tower Research - Analyst : Hey, good afternoon, everyone. First, I just kind of wanted to dig in a little bit on what you saw in the sales and order growth for North American Contract. I'm trying to get a handle on how much of that pretty robust growth was kind of more transactional or shovel-ready projects and how much of it was genuine pull forward of larger projects?

Question: Brian Gordon - Water Tower Research - Analyst : Okay. And my next question maybe is best for Debbie. I was kind of wondering, did you see any indications of like significant demand pull forward on the retail side? And then kind of maybe as a quick follow-up to that, has the environment been getting more promotional from your standpoint?

Question: Brian Gordon - Water Tower Research - Analyst : Great. Thank you very much.