How does EPOS integrate with PowerA's LucidSound brand, and what are the synergy opportunities?

LucidSound is an owned gaming brand for retail, while EPOS focuses on enterprise with higher-quality, certified solutions. There are opportunities to expand EPOS, but integration is currently focused on IT and cost synergies, with growth synergies to be explored later. “EPOS has a bit of a different consumer set. It's predominantly focused on enterprise. It is a brand that has unified certification certificates across most of the solutions that are in the market today... So it serves a different purpose. It serves a different consumer.”

Is the full-year guidance raise solely due to stronger first-half performance, despite cautious second-half comments?

Yes, the raise is primarily driven by a stronger first half, with second-half expectations remaining consistent with prior views. “No, I think that's right, Kevin. I think we've had a strong first half, and it flowed through to the full year. Our expectations for the back half are fairly consistent with what we've been saying all along.”

Given soft demand, will technology peripherals demand return, and what is the long-term view on these categories?

Management remains optimistic about long-term growth opportunities in technology peripherals, viewing them as attractive categories. Short-term disruption is due to enterprise spending slowdowns, higher hardware costs, and AI investment shifts, causing deals to be postponed. “So we continue to be optimistic about the future growth opportunities within our technology peripheral categories. Long term, we see them as very attractive growth opportunities for the company.”

ACCO

ACCO Brands (ACCO) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Jul 31, 2026

Source: earnings call transcript

Executive summary

ACCO Brands Q2 FY26 — Sales and EPS Exceed Outlook, Full-Year Guidance Raised

ACCO Brands delivered a strong second quarter, surpassing sales and adjusted EPS expectations, primarily driven by robust performance in the Americas and successful integration of the EPOS acquisition. Despite facing headwinds in technology peripherals and international markets, the company raised its full-year outlook, reflecting confidence in its cost reduction programs and strategic growth initiatives. Management remains focused on operational excellence and repositioning towards faster-growing categories, while acknowledging a seasonally adverse product and geographic mix in the second half.

Highlights

Q2 consolidated sales grew 5% and adjusted EPS exceeded outlook.
Americas segment sales up 6% with comparable sales up 2%, driven by strong back-to-school placements in North America and solid growth in Mexico.
EPOS acquisition integration on track, with Q2 sales ahead of expectations and full-year sales expected at $80 million.
Adjusted gross profit margin increased 20 basis points to 33.1% due to cost savings.
Full-year outlook for both sales (up 2%-5%) and adjusted EPS ($0.87-$0.91) raised.

Concerns

Comparable sales were down 2% due to soft demand in Brazil and technology peripherals.
International segment comparable sales down approximately 9% due to weak demand in EMEA and Australia, compounded by a distribution system upgrade disruption.
Technology peripherals demand soft due to cautious end-user spending, elevated hardware costs, constrained memory chip availability, soft console gaming, and shifts to AI investments.
Anticipate lower gross profit and operating income margin in H2 FY26 compared to prior year due to higher inflationary costs and lagging pricing efforts.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year reported sales	up within a range of 2% to 5% high materiality	FY26	High
Full-year adjusted EPS	within the range of $0.87 to $0.91 high materiality	FY26	High
Full-year free cash flow	within the range of $75 million to $85 million medium materiality	FY26	High
Full-year restructuring payments	$24 million low materiality	FY26	High
Full-year CapEx	$15 million low materiality	FY26	High
Year-end consolidated leverage ratio	within a range of 3.7 to 3.9x medium materiality	FY26	High
Q3 reported sales	within a range of down 1% to up 2% medium materiality	Q3 · FY26	High
Q3 adjusted EPS	within a range of $0.17 to $0.21 medium materiality	Q3 · FY26	High
EPOS 2026 sales	approximately $80 million medium materiality	FY26	High
EPOS cost synergies	$15 million medium materiality	18 months from closing	High
Cost reductions	$100 million high materiality	FY26	High
Back-to-school sales	up mid-single digits medium materiality	Full season	Medium

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Americas Comparable sales up 2%. Good growth in Learning & Creative in both North America and Mexico, partially offset by softer demand in Brazil and in core office and technology peripheral products. Adjusted operating income was $56 million, up approximately $13 million. Margin rate improved 380 basis points, driven by stronger volume and cost savings. Prior year results were impacted by tariff-related disruption.	up 6%	—	—	21.2%
International Comparable sales down approximately 9%. Demand in EMEA and Australia was soft due to purchasing hesitancy related to geopolitical and economic factors. Planned EMEA distribution system upgrade disrupted supply chain and customer deliveries, now resolved. Adjusted operating income was $4 million, both down versus the prior year. Second quarter is seasonally the weakest margin quarter due to lower sales and volume.	up 4%	—	—	2.4%

Deals & partnerships

EPOS (from Demant A/S) Acquisition of technology peripherals business

Integration progressing as planned, with second quarter sales ahead of expectations. Inherited a great team, strong capabilities, and product portfolio. Initial integration focused on IT infrastructure and synergy conversations, now shifting to growth opportunities.

Risks & headwinds

Uncertain Global Operating Environment H2 FY26

Seasonally adverse product and geographic mix in the back half of the year.

Mitigation:Maintaining a prudent view of the second half of the year.

Weak Industry Demand in Technology Peripherals Q2 FY26, expected to continue in H2 FY26

Soft in the second quarter due to cautious spending, elevated hardware costs, constrained memory chip availability, soft console gaming, and shifts in enterprise investments to AI. Global PC shipments declined.

Mitigation:Optimistic in PowerA brand and well positioned to benefit when industry dynamics improve. Expect the fourth quarter release of Grand Theft Auto 6 to drive positive sales momentum.

Soft Demand in Brazil Q2 FY26

Weaker sales due to a soft economy, creating hesitancy in customer purchasing and an adverse product mix.

Mitigation:Adjusted product assortment, go-to-market strategies, sales incentive plans, and pricing where appropriate to better align with consumer needs.

Weak Demand in EMEA and Australia Q2 FY26

Weaker than expected due to geopolitical and economic conditions. Negatively affected by a systems upgrade at largest distribution center in Europe.

Mitigation:Distribution system upgrade is now behind us with performance improving in June.

Higher Inflationary Costs H2 FY26

Anticipate a lower gross profit and operating income margin compared to prior year due to higher inflationary costs and the fact that pricing efforts will lag cost increases.

Mitigation:Strong cost mitigation in place with savings more than offsetting cost inflation. Assessing ability to pass through price by market and geography.

What to watch in Q3 FY26

Back-to-School Season Performance

next quarter

Current Sell-in strong, early sell-through in line or better than plan, taking share

Target Full season sales up mid-single digits

Why it matters

Back-to-school is an important season for ACCO Brands, impacting product sales and margins.

We now expect sales of back-to-school products to be up mid-single digits for the full season.

Find out whether ACCO delivers this. Inve re-checks your case every morning.

Q&A highlights

What are you seeing in back-to-school channels, inventory levels, and retailer approach?

Early reads are positive with strong sell-in and sell-through in line or better than plan. ACCO Brands is taking market share, and inventory positions are good. Retailers are cautiously optimistic.

“Our sell-in was strong. We see the sell-through or sellout of our products, again, early in the season to be in line or better than our plan. And our brands are taking share in the first few weeks of back-to-school.”

asked by Greg Burns · answered by Thomas Tedford

2 min read 6 chapters

Detailed narrative

Strong Q2 Performance and Raised Outlook

ACCO Brands reported Q2 sales and adjusted EPS above expectations, leading to a raised full-year outlook for both metrics. This performance was driven by strong results in the Americas segment, particularly North America back-to-school, and a solid contribution from the EPOS acquisition.

The company's multi-year cost reduction program and focus on commercial excellence are yielding positive results, despite a cautious view for the second half due to seasonal mix and an uncertain global environment.

Americas Segment Strength

The Americas segment saw a 6% sales increase, with comparable sales up 2%. This was primarily fueled by robust back-to-school placements in North America and strong growth in Mexico, where strategic changes in go-to-market, pricing, and product assortment have paid off.

This strength helped offset weaker demand in Brazil and technology peripherals. The segment's adjusted operating income increased by $13 million, with margin improving 380 basis points to 21.2%, driven by volume and cost savings.

International Headwinds and EPOS Contribution

The International segment experienced a 4% sales increase, but comparable sales were down approximately 9%. This decline was attributed to soft demand in EMEA and Australia due to geopolitical and economic factors, as well as disruptions from a distribution system upgrade in Europe, which is now resolved.

The EPOS acquisition, however, provided a significant boost to international sales and is performing ahead of expectations, with $80 million in sales projected for 2026 and $15 million in cost synergies within 18 months.

Technology Peripherals Demand Softness

The demand environment for technology peripherals was challenging in Q2, impacted by cautious end-user spending, elevated hardware costs, memory chip constraints, a soft console gaming market, and enterprise investment shifts towards AI. These trends are expected to persist in the second half.

Despite the near-term difficulties, management remains optimistic about the long-term growth opportunities in these categories and continues to pursue organic and inorganic initiatives to expand market share.

Cost Optimization and Financial Position

ACCO Brands is on track to achieve its targeted $100 million in cost reductions for the year, with cost savings more than offsetting inflationary pressures. The company maintains a strong financial position, with $205 million available under its revolver and a consolidated leverage ratio of 4.3x at quarter-end, well below debt covenants.

They anticipate leverage to decrease to 3.7-3.9x by year-end, with no debt maturities until 2029, supporting their strategy to generate consistent free cash flow.

Tariff Refunds Update

The company has submitted claims for $20 million in tariff refunds related to Phase 2, expected in 2026, and an additional $5 million claim for 2027. These potential benefits are not included in the current outlook, as they are accounted for as a gain contingency, only to be recorded upon assured receipt.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.