AAON Plunge Amid Operational Woes and Supply Chain Struggles Drives $490M Volume Surge as Liquidity-Driven Strategy Posts 166% Return

On August 11, 2025, Aaon (NASDAQ:AAON) closed at a 10.49% decline, with a trading volume of $0.49 billion, a 210.55% surge from the previous day. The drop followed the company’s Q2 2025 earnings report, which revealed a 0.6% year-over-year sales decline to $311.6 million, driven by ERP system implementation challenges and supply chain bottlenecks. Non-GAAP adjusted EBITDA margin contracted 1,120 basis points to 14.9%, while GAAP diluted EPS fell 69.4% to $0.19. CEO Matt Tobolski acknowledged operational inefficiencies, particularly at the Longview facility, which disrupted production of coils and finished goods. Despite these issues, the company reported a 71.9% year-over-year increase in adjusted backlog to $1.12 billion, driven by strong demand for data center equipment under the BASX brand and AAON-branded products.

The earnings report highlighted mixed performance across segments. AAON Oklahoma’s sales dropped 18.0% due to coil supply shortages linked to ERP implementation, while BASX and AAON Coil Products saw growth of 20.4% and 86.4%, respectively, fueled by data center orders. Gross profit margins across segments contracted sharply, with AAON Oklahoma’s margin declining 970 basis points to 27.5% and AAON Coil Products’ margin dropping 1,990 basis points to 22.0%. Tobolski emphasized production improvements since April, including a 30% sequential rise in AAON-branded equipment output at Longview, but noted ongoing inefficiencies at the facility and slower-than-expected production ramps in Tulsa. The company revised its full-year 2025 outlook downward, citing unresolved operational challenges and moderated production rates.

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