Capstone Holding Corp. reported record pro‑forma adjusted EBITDA for the third quarter of 2025, rising 46% year over year to $X million. The jump was driven by a combination of disciplined cost control, a favorable mix shift toward higher‑margin product lines, and the immediate accretive impact of two acquisitions completed in the second half of the year.
The company closed the Carolina Stone acquisition and announced a second multi‑location stone distributor that is expected to close before December 15, 2025. Together, the two deals are projected to add $26 million in annualized revenue and $Y million in pro‑forma adjusted EBITDA, accelerating Capstone toward its $100 million run‑rate target for 2026.
Gross‑margin expansion in Q3 2025 reached 24.4%, up from 21.4% in the same quarter a year earlier. The lift reflects higher pricing power in the core natural‑stone segment, improved inventory turnover, and the cost‑efficient integration of the new acquisitions, which helped offset modest increases in raw‑material costs.
CEO Matthew Lipman said the quarter “demonstrated the strength of our platform and the effectiveness of our disciplined acquisition strategy.” He added that the company’s focus on scale and operational leverage is “key to sustainable growth” and that the new acquisitions “are proof of that.”
Management guided for continued revenue growth in 2025, maintaining its $100 million run‑rate target for 2026. The guidance reflects confidence in the momentum of the natural‑stone market, the successful integration of the new assets, and the company’s ability to maintain margin expansion through cost discipline and pricing power.
Capstone’s results underscore the company’s M&A‑driven growth strategy, but analysts note that underlying financial health concerns—such as negative equity and a lack of profitability—remain a risk. The company’s ability to translate revenue growth into sustainable profitability will be a key focus for investors in the coming quarters.
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