Acuity Inc. (AYI) shares moved lower Thursday after the company reported fiscal second-quarter results that beat on earnings but came up short on sales. The quarter (ended Feb. 28, 2026) delivered adjusted EPS of $4.14 versus expectations around $4.01, while revenue of roughly $1.06 billion missed estimates near $1.08 billion, shifting the market’s attention to demand and mix rather than profitability alone.

The biggest pressure point was the company’s largest segment, Acuity Brands Lighting (ABL). ABL net sales fell 2.8% year over year to $817.4 million, a decline that outweighed strong growth elsewhere and reinforced concerns that the legacy lighting business remains choppy even as Acuity invests in higher-growth offerings.

Acuity Intelligent Spaces (AIS) posted rapid growth, with net sales up 44.7% year over year to $248.1 million, helping lift consolidated net sales 4.9% to $1.0557 billion. Profitability also improved, but investors appeared to treat the revenue shortfall and the uneven segment picture as the headline, particularly with ABL still contracting.

Management highlighted margin expansion and cash generation, but results included about $6 million of special charges tied to productivity improvements in the ABL segment, primarily related to labor cost reductions. The company also increased its quarterly dividend by 18% to $0.20 per share and reported $106 million of share repurchases year-to-date, actions that supported the longer-term shareholder-return narrative even as the stock traded down on the near-term sales miss.