Pool Corporation, the nation’s largest wholesale distributor of swimming pool supplies and equipment, reported higher sales but lower profits for the third quarter of 2026, as rising costs ate into earnings.

The Covington, Louisiana-based company released its earnings report on Oct. 22. Sales reached $1.50 billion for the three months ended Sept. 30, up 4 percent from $1.45 billion during the same period last year. But net income — the money left after expenses — fell 3 percent, from $127 million to $123 million. Diluted earnings per share remained unchanged at $3.40.

Costs Up

Pool Corp. CEO John Watwood said freight costs had risen unusually sharply over the past year. “We really haven't seen freight increases quite like what we've experienced the past year, since COVID,” he told analysts.

The company introduced a freight surcharge earlier in the year on some products it delivers. The surcharge applies only to a portion of its business.

The company also paid higher sales incentives as sales increased, including special one-time payments to its sales team. Employee insurance costs also rose, although management did not explain why.

Pool Corp. also paid outside firms for work related to its strategic initiatives. Management did not disclose how much these fees added to costs.

Sales Up

Higher prices accounted for most of the company’s sales growth. Chief Financial Officer Melanie Hart told analysts that pricing contributed 3 percentage points to the company’s 4 percent sales growth, while increased sales volume accounted for the remaining percentage point.

Some price increases were intended to offset higher shipping costs. Pool Corp. raised prices on selected building materials in August. Those products accounted for about 11 percent of third-quarter sales, and the increases took effect partway through the quarter. Most of the company’s remaining price increases are expected to take effect at the beginning of the 2027 pool season.

Hart said sales growth was supported by stronger maintenance sales, stable renovation activity, and new pool construction that outperformed building-permit trends, although building permits remained below year-earlier levels.

Building-material sales increased for the fifth consecutive quarter, Watwood said. Chemical sales rose 4 percent, primarily because of higher sales volume, while equipment sales increased 5 percent, reflecting stronger sales of replacement products such as pumps and filters.

Profits Down

Pool Corp.’s operating income — its profit from business operations — fell 3 percent, from $178 million in the third quarter of 2025 to $172.2 million in the third quarter of 2026.

Pool Corp.’s gross profit margin — the share of sales revenue remaining after accounting for the cost of products sold — declined to 29 percent from 29.6 percent a year earlier.

The company attributed the decline to higher shipping costs, faster growth among larger customers that generate less profit per sales dollar, and a comparison with last year, when midseason price increases helped boost margins.

For the first nine months of 2026, Pool Corp.’s sales rose 4 percent to $4.5 billion, while net income fell 3 percent to $364.4 million compared with the same period last year. In other words, the company brought in more money from sales but kept less of it as profit.

The company maintained its fullyear earnings forecast, expecting adjusted earnings of $10.87 to $11.17 per share in 2026.

The forecast excludes certain costs related to the transition to a new chief executive and was unchanged from its previous outlook.