WESCO's Q2 2025 Earnings Call: Unpacking Key Contradictions on Tariffs, Copper Prices, and Utility Market Growth

Inclusion of Tariff-Related Pricing in Guidance, Copper Price Impact, Utility Market Growth Expectations, Utility Recovery and Demand, and Gross Margin Expectations are the key contradictions discussed in WESCO International's latest 2025Q2 earnings call.



Revenue Growth and Sales Momentum:
- WESCO International reported organic sales growth of 7% in Q2 2025, building on the 6% growth in Q1.
- This marks three consecutive quarters of accelerating sales momentum, supported by strong performance in CSS and EES segments.

Data Center Sales and Growth:
- The company's total data center sales surpassed $1 billion in Q2 2025, up 65% year-over-year.
- This growth was driven by strong demand and increased investment in AI-driven data centers.

Utility Segment Performance:
- WESCO's Utility segment saw sales decline by 4% year-over-year in Q2 2025, but investor-owned utility customers returned to growth.
- The segment is expected to return to overall growth in the second half of the year due to improved project activity and new customer wins.

Profitability and Cost Management:
- WESCO's adjusted EBITDA margin improved by 90 basis points sequentially, driven by strong operating cost leverage and stable gross margin.
- This was despite lower gross margin due to mix impacts in CSS and EES, showing effective cost management and leverage on sales growth.