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Watsco Revenue Misses Estimates Amid Sales Dip
29 Jul
Summary
- Watsco's Q2 revenue of $2.10 billion missed expectations.
- GAAP profit of $4 per share was 8.8% below analyst estimates.
- Operating margin declined to 11.3% from 13.2% last year.
Equipment distributor Watsco reported its Q2 CY2026 financial results, missing market revenue expectations. Sales for the quarter reached $2.10 billion, a 2.1% increase year-on-year, but fell short of the anticipated $2.14 billion. Watsco's reported GAAP profit of $4 per share was also below analysts' consensus estimates, marking an 8.8% deficit.
The company's operating margin saw a decline, standing at 11.3% compared to 13.2% in the same quarter last year. Free Cash Flow improved slightly to -$11.57 million from -$14.04 million in the previous year's quarter. Despite these figures, Watsco's Chairman and CEO noted improving end-market stability.
Looking forward, sell-side analysts project a 7.4% revenue growth over the next twelve months, suggesting potential improvements driven by newer products and services. However, this projected growth remains below the average for the industrials sector.
