Key points
- How far Vertiv beat its own July forecast
- Where Vertiv's sales growth came from
- What Vertiv's release leaves out
Vertiv (VRT) reported third-quarter earnings above analysts' expectations, raised its full-year forecast, and said organic orders more than doubled from a year earlier.
The data center power and cooling company earned an adjusted $2.21 a share, up 78% from a year earlier and above the $1.82 analysts expected, according to Investing.com. Sales rose 61% to $4.31 billion, beating the top of Vertiv's own forecast by $463 million.
Vertiv shares were up 15.6% at $241.01 in premarket trading at 8:37 a.m. Eastern on Wednesday, October 28, after closing Tuesday at $208.56.
Sales beat Vertiv's forecast by more than $460 million
Vertiv's organic sales, which leave out the effect of acquisitions, grew 55% in the quarter ended September 30. In July, the company had forecast sales of $3.65 billion to $3.85 billion.
Adjusted earnings also exceeded Vertiv's July forecast of $1.77 to $1.83 a share. Earnings per share under standard accounting rules rose 91% to $1.95.
The Americas drove most of the growth, with sales up 75%. Asia Pacific sales rose 50%, and sales in Europe, the Middle East, and Africa rose 23%. The adjusted operating margin—the share of sales left as adjusted operating profit—rose 2.9 percentage points to 25.2%.
"We are in the middle of the largest infrastructure buildout and it's accelerating," chief executive Giordano Albertazzi said.
Vertiv raises its 2026 sales and earnings forecasts
Vertiv now expects 2026 net sales of $14.45 billion to $14.85 billion, up from $13.8 billion to $14.2 billion in July. It raised its adjusted earnings forecast to $7.10 to $7.20 a share, from $6.65 to $6.75.
The new earnings midpoint of $7.15 compares with a FactSet consensus of $6.73. For the fourth quarter alone, Vertiv expects sales of $4.31 billion to $4.51 billion and organic growth of 49% to 51%.
Adjusted free cash flow was $652 million in the quarter, up 50%. Vertiv said it has $6.2 billion in liquidity and more cash than debt, and that 2026 capital spending is still expected to be about 4% of revenue.
The release gives no order backlog
Vertiv gave orders only as a growth rate. The release doesn't include a dollar figure for third-quarter orders or for its backlog of orders not yet delivered. The company holds its earnings call at 11 a.m. Eastern on Wednesday.
Vertiv said the data center market "continues to generate strong, broad-based global demand." Microsoft (MSFT) and Alphabet (GOOGL) report their quarterly results after the market closes Wednesday, including how much they spent on data centers. Both were among the four companies in our comparison of Big Tech spending and cash flow.
Vertiv is also expanding beyond the equipment inside data centers. In September, it agreed to buy the company behind microgrid firm UtilityInnovation Group for about $1.45 billion in cash.
"We are in an industry where the more technology changes, the better it is for us," said executive chairman Dave Cote. "I believe there is a long runway ahead and the opportunity only gets bigger from here."
