10-Q · April 22, 2026
Vertiv reported Q1 2026 net sales of $2,649.5 million, up $613.5 million (+30.1%) versus Q1 2025, with gross margin expanding to ~37.7% and operating profit of $440.1 million. Diluted EPS was $0.99, up $0.57 versus Q1…
Earnings analysis · 10-Q
VRT earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
Vertiv posted a strong Q2: revenue increased 24.1% YoY to $3.2743B, gross margin expanded to 37.7% from 34.0%, and calculated operating margin reached 19.5% versus 16.8% a year ago. Americas and Asia Pacific were the…
Read full summary
Vertiv posted a strong Q2: revenue increased 24.1% YoY to $3.2743B, gross margin expanded to 37.7% from 34.0%, and calculated operating margin reached 19.5% versus 16.8% a year ago. Americas and Asia Pacific were the growth engines, while EMEA was nearly flat in Q2 and declined 8.4% in the first half. Cash generation was exceptionally strong, but the company is sharply increasing capacity capex, with $550.0M-$570.0M expected for 2026, and the filing adds a detailed debt-covenant risk factor.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.27
What stood out
-
Revenue growth accelerated to $3.274B
Q2 net sales rose $636.2M, or 24.1% YoY, to $3.2743B, and increased 23.6% sequentially from $2.6495B in Q1 2026. Higher volume was supplemented by $129.7M of acquisition-related sales and $35.9M of favorable FX.
-
Material margin and profit expansion
Gross margin expanded 370 bps YoY to 37.7% from 34.0%, while operating profit increased $195.5M, or 44.2%, to $637.9M; calculated operating margin was 19.5%, up from 16.8% a year earlier and 16.6% in Q1 2026.
-
GAAP EPS rose sequentially and year over year
GAAP net income increased $173.6M, or 53.5%, to $497.8M, and GAAP diluted EPS was $1.27, up from $0.99 in Q1 2026 and $0.83 in Q2 2025.
-
Americas and APAC led segment growth
Americas delivered $2.0708B of sales, up $468.5M or 29.2% YoY, with segment operating profit up 48.6% to $571.4M. Asia Pacific sales rose $159.7M, or 28.5%, to $719.9M and profit increased 61.5% to $95.6M.
-
Operating cash conversion strengthened
First-half operating cash flow rose $1.2404B to $1.8666B. Trade working capital generated $678.8M, versus a $95.2M use a year earlier, primarily due to deferred revenue.
-
Strong reported liquidity supports expansion
Liquidity was substantial at June 30, with $2.8106B of cash and equivalents, $300.0M of short-term investments, and $2.4836B available under the revolver after $16.4M of letters of credit.
What to watch
-
EMEA underlying demand remains weak
EMEA quarterly sales grew only $8.0M, or 1.7%, to $483.6M; favorable FX contributed approximately $13.7M. For the first half, EMEA sales fell $74.1M, or 8.4%, to $805.0M, reflecting softer prior-period demand.
-
Growth investment materially increases cash use
Capacity expansion is materially raising investment needs: first-half capex was $285.9M versus $81.5M a year earlier, and management expects full-year capex of $550.0M-$570.0M. Investing cash outflow increased to $780.7M from $182.8M.
-
Debt covenants could constrain flexibility
The new/updated debt-covenant risk factor notes $850.0M of Senior Secured Notes and $2.1000B of Senior Notes outstanding. The revolver requires a maximum consolidated leverage ratio of 4.00:1.00, with a possible 4.50:1.00 step-up following a qualifying acquisition of at least $750.0M cash consideration.
-
Acquisition-related costs and execution risk
Acquisition accounting and integration are weighing on expenses: Q2 corporate and other costs rose $20.9M to $79.6M, primarily including a $28.8M contingent-consideration fair-value loss related to PurgeRite; first-half related loss was $62.0M.
-
Trade and supply-chain uncertainty persists
Management cites dynamic trade and geopolitical conditions, including tariffs and the US-Israel and Iran war. It has begun IEEPA tariff refund claims, but states the amount, timing, and likelihood of recovery are uncertain; Q2 supply-chain congestion also modestly offset sales growth.
Management's outlook
The 10-Q provides no quantitative revenue or EPS outlook. Management expects 2026 capital expenditures, including capitalized software, of $550.0M-$570.0M to support capacity expansion; it also anticipates approximately $110.0M of full-year lease payments.
Earlier filings 4
10-K · February 13, 2026
Vertiv reports strong 2025 results driven by data-center demand: net sales rose to $10,229.9 million in 2025 from $8,011.8 million in 2024 (a ~27.7% increase) and backlog more than doubled to $15.0 billion as of…
10-Q · April 23, 2025
Vertiv reported a strong Q1 with net sales of $2,036.0M (up $396.9M or 24.2% YoY), operating profit of $290.7M, and net income of $164.5M reversing the prior-year loss. Operating cash flow was robust at $303.3M,…
10-K · February 18, 2025
Vertiv reported net sales of $8,011.8 million for the year ended December 31, 2024, up from $6,863.2 million in 2023, driven by stronger demand and a materially larger backlog. Backlog increased to $7,178.8 million (up…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.