Acuity Q4 Fiscal 2026: Intelligent Spaces Grows While Lighting Holds Steady

Acuity grew fourth-quarter net sales 2.9% to $1.24 billion. Acuity Intelligent Spaces kept climbing, Acuity Brands Lighting was flat, and tariff refunds boosted the GAAP numbers.

Acuity Inc. (NYSE: AYI) reported fourth-quarter fiscal 2026 net sales of $1.24 billion for the quarter that ended 31 AUG 2026. That is an increase of $35.3 million, or 2.9%, over the prior year. Diluted earnings per share jumped 56% to $5.63, while adjusted diluted EPS rose 11% to $5.77.

The headline numbers look strong, but the details deserve a closer look. The growth belongs to Acuity Intelligent Spaces (AIS). Acuity Brands Lighting (ABL), the business we care about was flat on sales and down on an adjusted profit basis.

Neil Ashe on the Quarter

“We demonstrated solid execution in the fourth quarter of fiscal 2026,” said Neil Ashe, Chairman, President and CEO of Acuity. “We grew sales and expanded our adjusted operating profit and adjusted operating profit margin.”

Neil said Acuity spent the year strengthening ABL while continuing to scale AIS. The goal, he added, is “building the operating and financial capacity needed to compound growth and value over time.”

Tariff Refunds Boosted GAAP Results

Acuity received $44.9 million in tariff refunds during the fourth quarter and $51.3 million for the full year. Acuity reports those refunds as a non-GAAP adjustment, which is why GAAP and adjusted results look so different this quarter. GAAP operating profit rose 25.7% to $227.0 million. Adjusted operating profit grew a more modest 3.4% to $232.9 million, a margin of 18.7%.

Acuity also recorded $17.8 million in special charges. Of that, $14.7 million went to ABL initiatives involving its product portfolio, supply chain and operating footprint. The remaining $3.1 million covered a facility impairment at AIS. The release did not say which products or facilities are affected.

The prior-year comparison also helps. The fourth quarter of fiscal 2025 included a $30.9 million pension settlement loss, which held down net income a year ago. Net income this quarter rose 51.8% to $173.0 million.

Acuity Brands Lighting Was Flat

ABL posted fourth-quarter net sales of $958.7 million, down 0.4% from last year. GAAP operating profit increased 3.2% to $188.8 million, but $31.8 million of the quarter’s tariff refunds landed in ABL. Without the refunds and other adjustments, ABL adjusted operating profit fell 7.1% to $179.8 million, and the adjusted margin dropped 130 basis points to 18.8%.

The full year told the same story. ABL sales slipped 1.0% to $3.58 billion, and adjusted operating profit declined 2.5% to $646.0 million. Flat is not a disaster for a business this size. Combined with the restructuring charges, though, it tells me Acuity is working hard to protect lighting margins in a slow market.

Agents Up, Direct Sales Down

The channel breakdown is the most interesting part of this report. ABL’s independent sales network, meaning the agent channel, grew 3.8% in the quarter to $729.2 million. That channel now accounts for roughly 76% of ABL sales. Corporate accounts rose 4.3% for the quarter and 16.2% for the year.

The direct sales network moved the other way, falling 24.2% in the quarter to $79.8 million and 23.6% for the year to $314.2 million. OEM sales dropped 9.6% in the quarter, and retail slipped 3.9%. The release does not explain the decline in direct sales, and your humble editor will be asking. What is clear is that the agent channel continues to carry Acuity’s lighting business.

Acuity Intelligent Spaces Keeps Climbing

AIS delivered another strong quarter. Net sales rose 16.6% to $297.6 million, adjusted operating profit jumped 35.7% to $74.1 million, and the adjusted margin climbed 350 basis points to 24.9%.

For the full year, AIS sales grew 44.8% to $1.11 billion. Part of that increase reflects a full year of QSC, the audio, video and control business Acuity acquired during fiscal 2025. Full-year adjusted operating profit rose 55.2% to $255.0 million, with an adjusted margin of 23.0%. AIS now generates nearly a quarter of Acuity’s sales at higher margins than ABL.

Full-Year Fiscal 2026 Results

Acuity’s full-year net sales rose 6.8% to $4.64 billion. GAAP operating profit increased 26.6% to $713.7 million, and adjusted operating profit grew 7.8% to $828.7 million. Diluted EPS climbed 36.1% to $17.05, while adjusted diluted EPS rose 10.5% to $19.90.

Cash flow was a bright spot. Net cash from operating activities reached $825.6 million, up 37.3%, and free cash flow rose 40.3% to $747.9 million. Acuity used that cash to cut debt by about $200 million and buy back more than 940,000 shares for $287.2 million. It also raised its dividend 18%.

These results are preliminary until Acuity completes its audit and files its Form 10-K.

My Take

Acuity is becoming two companies under one roof. AIS is the growth engine, with double-digit sales growth and adjusted margins in the mid-20s. ABL is the cash machine, and Acuity is reshaping it to protect margins while the lighting market stays soft.

I’ll keep watching the channel numbers. Agents grew while direct sales fell nearly 24%, which tells me Acuity’s lighting business still runs through the independent agent network. 

Go Deeper: William Blair Downgrades Acuity Brands Stock

Acuity Q3 Earnings: Intelligent Spaces is Strong; Lighting is Soft