Whirlpool Slumps After Q2 Miss, Cuts Guidance and Dividend Amid Tariff Pressures

WATCH: The Fed’s “independence” is a myth — here’s who really calls the shots

Whirlpool (WHR) reported a disappointing second quarter, as ongoing competitive pressures from Asian import stockpiling, weak consumer demand, and elevated promotional activity weighed on results. While the company achieved sequential net sales growth across all segments and delivered meaningful cost savings, earnings fell short of expectations, and management was forced to cut its full-year guidance and slash its dividend. Shares tumbled in postmarket trading as investors digested the weaker outlook and the persistent tariff-driven headwinds facing the U.S. appliance giant.

In the second quarter, Whirlpool reported adjusted EPS of $1.34, well below analyst expectations of $1.68 and significantly down from $2.39 a year ago. Revenue came in at $3.77 billion, missing the consensus estimate of $3.85 billion and representing a 5.4% year-over-year decline. Ongoing EBIT margin was 5.3%, down from last year, though cost reductions provided some offset. Free cash flow remained negative, at -$702 million versus -$465 million a year ago, highlighting continued working capital pressure.

The shortfall was most evident in the company’s critical North American market, where net sales fell 4.7% year over year (4.6% excluding currency). Management pointed directly to competitors pre-loading Asian imports ahead of expected U.S. tariff increases, a trend that has distorted pricing and volumes. Promotional activity also remained elevated, further pressuring margins. Latin America saw sales decline 0.9% excluding currency, as weak demand in Mexico offset the benefit of pricing actions. In Asia, sales slipped 3.7% on an industry-wide slowdown, though Whirlpool did manage to sustain share gains. The SDA Global segment was a bright spot, with sales up 6.8% year over year thanks to new products and direct-to-consumer strength.

The tariff backdrop remains central to Whirlpool’s outlook. CEO Marc Bitzer reiterated that the stockpiling of Asian imports ahead of tariff deadlines has been a key challenge, creating an environment of excessive supply and discounting. However, he struck a cautiously optimistic tone on the longer-term impact of U.S. trade policy, noting that evolving tariffs are likely to support domestic manufacturers by narrowing the cost gap with imported appliances. With roughly 80% of its North American sales produced domestically, Whirlpool believes it is well-positioned to benefit once tariff enforcement stabilizes.

Despite the weak quarter, management reaffirmed its commitment to structural cost takeouts, targeting $200 million in savings for the year. CFO Jim Peters emphasized efforts to proactively manage debt maturities and strengthen the balance sheet, citing the refinancing of $1.2 billion in term loans at a weighted average rate of 6.3%. Still, financial flexibility remains tight, underscored by the decision to slash the quarterly dividend from $1.75 to $0.90 per share—bringing the annual payout to $3.60 and reducing the yield to 3.7% from over 7%.

Looking ahead, Whirlpool cut its full-year ongoing EPS guidance to a range of $6.00 to $8.00, with the midpoint at $7.00—well below the prior forecast of $10. The Street had been expecting $8.96, making the guidance reset particularly painful. The company maintained its full-year revenue outlook of $15.8 billion, signaling expectations for demand to stabilize, particularly as U.S. housing fundamentals improve. Bitzer cited a recovery in existing home sales and a multiyear expansion of new housing supply as long-term tailwinds for appliance demand.

Tariffs remain both a headwind and an opportunity. In the near term, preemptive imports have depressed pricing and volumes, but Whirlpool expects these pressures to ease in the second half of 2025 as new tariff enforcement levels the playing field. Management also indicated that reciprocal tariffs are beginning to alter competitive dynamics, with foreign-made appliances facing higher landed costs. However, investors remain cautious that the benefits will take time to materialize, especially if consumer sentiment remains weak.

Market reaction was swift. Whirlpool shares dropped 12.2% in postmarket trading Monday, following a 1.8% decline during the regular session. The sell-off reflected concerns about reduced profitability, the dividend cut, and lingering uncertainty around tariff impacts. Analysts struck a tone of cautious optimism, acknowledging Whirlpool’s strong U.S. manufacturing footprint and cost controls, but questioning whether near-term headwinds would give way quickly enough to salvage 2025 performance.

Ultimately, Whirlpool’s Q2 illustrated the delicate balance the company faces: cutting costs and shoring up its balance sheet in the face of weak demand, while betting on tariff policy and housing tailwinds to drive a rebound later this year. For now, the combination of weaker-than-expected earnings, a dividend reduction, and muted near-term visibility has left investors wary, even as management emphasizes confidence in its long-term strategy.