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- **Revenue Surge**: Q3 2025 revenue up 8.6% YoY to $513.7M, driven by 11.9% IPS growth and 10.5% Service Centers expansion.
- **Profit Resilience**: 11%+ EBITDA margin maintained; GAAP EPS $1.31 vs. $1.27 YoY, despite $11M SG&A increase.
- **Strategic Wins**: DXP Water now 54% of IPS sales; 5 acquisitions YTD with 3 more in pipeline for 2026.
- **Growth Catalysts**: AI, e-commerce, and data center solutions; Q3 backlog up 56.2% YoY in energy/water sectors.
- **Risk Mitigation**: Seasonal SCS decline offset by 11% EBITDA margin; focus on converting quotes to bookings in energy.


**【CEO Summary Section】**
- **Revenue Growth**: Q3 2025 revenue reached $513.7 million, up 8.6% YoY, driven by 11.9% growth in Innovative Pumping Solutions (IPS) and 10.5% in Service Centers.
- **Market Expansion**: North American market recovery and DXP Water segment contributed 54% of IPS sales, up from 28% in Q1 2023.
- **Gross Margin Improvement**: Total gross margin improved to 31.4%, with Service Centers leading at 31.39%.
- **Strategic Initiatives**: Investment in AI, e-commerce channels, and new markets like data centers and filtration systems.

**【CFO Financial Commentary】**
- **Profitability**: Adjusted EBITDA of $56.5 million (11% margin), up 17.6% YoY; GAAP net income $21.6 million, EPS $1.31.
- **Cost Management**: SG&A increased $11 million QoQ due to insurance, tech investments, and acquisitions, but operating margin remained stable at 8.5%.
- **Liquidity**: $123.8 million cash, $277.3 million liquidity; free cash flow $28.2 million, up 15% YoY.
- **Acquisition Pipeline**: 5 acquisitions YTD, targeting 3 more by Q1 2026, focusing on water and industrial sectors.

**【Q&A Key Highlights】**
- **EBITDA Sustainability**: CFO expects 11%+ EBITDA margin in Q4 despite seasonal decline in Supply Chain Services (SCS) due to holiday closures.
- **Expense Trends**: Higher insurance costs and acquisition-related SG&A expected to persist, but 11% EBITDA margin remains achievable.
- **Data Center Opportunities**: CEO notes potential in pumps, filtration, and power equipment, though current contribution is limited.
- **Risk Management**: Focus on converting quotes to bookings in energy and water, with Q3 IPS backlog up 56.2% YoY.


DXP Enterprises, Inc. (DXPE) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

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Income Tax Expense

Current Income Tax

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Net Income from Continuing Operations

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Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

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Other Comprehensive Income

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Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

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Basic EPS from Discontinued Operations

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Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

DXPE

DXPE fundamentals

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