What happened

Building products company Jeld-Wen Holding (JELD 0.06%) had a difficult time in 2022, squeezed by higher supply costs and softening demand. But the company's latest results suggest the worst might be over, and shares jumped as much as 19.5% on Tuesday as a result.

So what

Jeld-Wen makes windows, doors, and wall systems for interior and exterior applications. As such, the company is closely tied to the housing and construction sectors and took a hit last year when higher interest rates caused construction to slow.

The housing market hasn't yet rebounded, but Jeld-Wen appears to be managing through the softness better than expected. On Tuesday, the company reported fourth-quarter adjusted earnings of $0.47 per share on revenue of $1.33 billion, topping analyst expectations for a $0.25 per share profit on sales of $1.2 billion.

Net revenue was up year over year, even with an adverse foreign exchange impact, but net income fell to $33.6 million from $42.1 million due to higher expenses.

"Our team continued to take decisive actions in the fourth quarter to improve execution and address our cost structure, while staying focused on safety and quality in all that we do," CEO William J. Christensen said in a statement. "I want to thank our global associates for their commitment to serving customers in 2022 amid significant change and a challenging macroeconomic backdrop."

Now what

Christensen said he expects continued soft demand in most of Jeld-Wen's end markets in 2023. He said the company is focused on finding ways to cut costs and expand margins without putting long-term growth plans at risk.

For the year, Jeld-Wen is forecasting revenue of $4.5 billion to $4.9 billion, down from $5.129 billion in sales in 2022. The guidance offers potential downside and upside to the consensus $4.67 billion estimate. Jeld-Wen also ended the year with total liquidity of $645.5 million, giving it a stable cash cushion as it rides out the macroeconomic storm.

Investors knew 2023 would be a challenging year for Jeld-Wen, just as 2022 was. Indeed, the stock gave back most of its initial gains after a strong opening, largely due to continuing market jitters about what lies ahead.

But post-earnings, there is more reason for optimism that the company is doing what it can to weather the cycle, and that gave the shares a boost on Tuesday.