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- **Revenue Surge**: Q3 organic sales +28% YoY, driven by Americas (+43%) and APAC (+21%). Full-year 2025 sales guidance raised to $10.2 billion.
- **Profitability Breakthrough**: Adjusted EPS of $1.24 (63% YoY), operating margin 22.3%, with incremental margin of 30% in Q3.
- **Backlog Explosion**: Total backlog $9.5 billion (+30% YoY), orders +60% YoY, and 1.4x book-to-bill ratio.
- **AI-Driven Growth**: $30 million restructuring program to accelerate EMEA recovery, and 20%+ R&D spend growth in 2026.
- **Tariff Mitigation**: Expected to offset current tariffs by Q1 2026, with free cash flow conversion at 95%.
- **Long-Term Vision**: Targeting 25%+ operating margin by 2029, with incremental margins in the 30-35% range.

**【Management Opening Remarks】**
- Vertiv delivered a record-breaking Q3 2025, exceeding all metrics and demonstrating strong execution across its strategy of AI-driven growth, operational excellence, and R&D investment.
- Executive Chairman Dave Cote emphasized the company's position as a leader in the digital transformation, citing its ability to stay ahead of market trends and customer needs.

**【CEO Commentary】**
- **Financial Highlights**: Adjusted diluted EPS of $1.24 (63% YoY growth), organic sales up 28%, and a 1.4x book-to-bill ratio.
- **Market Momentum**: Americas sales +43%, APAC +21%, with a trailing 12-month orders growth of 21%. Total backlog reached $9.5 billion (30% YoY).
- **Strategic Investments**: Accelerating R&D spend (+20%+ in 2026), capacity expansion in Americas, and $30 million restructuring program in EMEA to drive $20 million annualized savings.
- **Tariff Mitigation**: Expected to offset current tariff impacts by Q1 2026 through pricing and supply chain optimization.

**【CFO Financial Commentary】**
- **Profitability**: Adjusted operating profit of $596 million (43% YoY), margin of 22.3% (vs. 20.1% prior year). Incremental margin of ~30% in Q3.
- **Cash Flow**: Adjusted free cash flow of $462 million (38% YoY), with full-year guidance raised to $1.5 billion.
- **Guidance Update**: Full-year 2025 EPS raised to $4.10, net sales to $10.2 billion, and operating profit to $2.06 billion.
- **Margin Outlook**: Targeting 25%+ operating margin by 2029, with incremental margins in the 30-35% range.

**【Q&A Key Highlights】**
- **Order Growth Dynamics**: Q3 orders +60% YoY, driven by AI infrastructure projects. Backlog phasing aligns with historical patterns, with 12-18-month deployment timelines.
- **Services Growth**: Service revenue growth outpacing equipment, with 4,400+ field engineers and AI-enabled tools like Waylay for predictive maintenance.
- **EMEA Recovery**: EMEA sales down 4% in Q3 but expected to rebound in H2 2026 due to latent AI demand and restructuring efforts.
- **Capacity Expansion**: Accelerating manufacturing and service capacity in Americas, with new sites and existing facility expansions to meet 6-12-month demand visibility.
- **Tariff Impact**: Q4 guidance includes $30 million tariff-related headwinds, but mitigation strategies expected to offset impacts by Q1 2026.


Vertiv (VRT)-22 Oct 25-2025 Q3 Earnings call transcript

- **Record Growth**: Q2 organic sales +34% YoY, orders >$3B, and EPS $0.95 (+42% YoY), driven by North American hyperscale and APAC expansion.
- **Margin Recovery**: Q4 adjusted operating margin >23%, targeting 25%+ by 2029 despite $100M+ tariff headwinds.
- **Strategic Investments**: $1.4B free cash flow guidance (+24% YoY) fuels M&A (Great Lakes acquisition) and R&D (+$150M+ in 2025).
- **Long-Term Vision**: Modular solutions (SmartRun), liquid cooling partnerships (CoreWeave, Oklo), and AI factory infrastructure position Vertiv as the connective tissue between gray and white space.

**【Management Opening Remarks】**
- Executive Chairman Dave Cote highlighted strong Q2 performance, emphasizing organic growth, M&A strategy (e.g., Great Lakes acquisition), and R&D investments. He expressed optimism about the digital revolution and Vertiv's position as a leader in data center infrastructure.

**【CEO Summary Section】**
- Q2 organic sales grew 34% YoY, driven by 43% growth in Americas, 37% in APAC, and 7% in EMEA. Adjusted EPS was $0.95, up 42% YoY.
- Orders surpassed $3 billion Q2, with a 1.2x book-to-bill ratio. Trailing 12-month orders grew 11%, and backlog reached $8.5 billion.
- Tariffs and supply chain transitions caused 110bps margin decline, but inefficiencies expected to moderate by year-end.
- Full-year guidance raised: net sales to $10 billion (+24% organic), EPS to $3.80, and free cash flow to $1.4 billion.
- Acquired Great Lakes for its high-end rack solutions, enhancing white space capabilities.

**【CFO Financial Commentary】**
- Q2 adjusted operating profit: $489M (+28% YoY), margin 18.5% (vs. 19.6% prior year). Free cash flow: $277M Q2, $542M H1 (+24% YoY).
- Q3 EPS guidance: $0.97 (+28% YoY), driven by 22% organic growth and 20% margin.
- Full-year AOP guidance: ~$2B (+28% YoY), with Q4 margin >23%.
- Tariffs expected to moderate, with 2025 exit rate targeting 25%+ long-term margin.

**【Q&A Highlights】**
- **Margins & Tariffs**: CFO expects Q4 margin >23%, driven by operational leverage and inefficiency resolution. Tariffs remain dynamic but expected to decline post-2025.
- **M&A & Growth**: CEO emphasized M&A pipeline and modular solutions (e.g., SmartRun) to accelerate deployment. EMEA pipeline healthy, but growth lagging due to regulatory environment.
- **Customer Diversity**: Backlog balanced across hyperscale, colocation, and sovereign clouds. Liquid cooling services poised for growth due to system complexity.
- **Execution Challenges**: EMEA operational issues and supply chain costs temporary, expected to resolve by year-end.


Vertiv Holdings Co (VRT) Q2 2025 Earnings Call Transcript

- **Revenue Growth Surges**: Q1 2025 sales up 25% YoY to $1.4B, driven by 30% TTM Americas orders and 21% QoQ APAC expansion.
- **Profitability Accelerates**: 35% YoY adj. op. profit growth to $337M, with margin +130bps to 23.4%.
- **Tariff Mitigation On Track**: 2025E tariff impact expected to halve Q2-Q4, with 90% China imports re-routed and 100% Mexico USMCA compliance.
- **Investment Grade Strength**: Fitch BBB- rating enables $100M buyback, with 0.8x net leverage and >100% free cash flow conversion.
- **AI Infrastructure Leadership**: iGenius AI factory deal highlights end-to-end liquid cooling leadership, with CDU orders up 3x YoY.


**【CEO Summary Section】**
- Q1 2025 revenue grew 25% YoY to $1.4 billion, driven by strong demand in Americas (+30% TTM orders) and APAC (+21% QoQ). Book-to-bill ratio of 1.4x reflects robust pipeline visibility.
- Adjusted operating profit rose 35% YoY to $337 million, with margin expanding 130bps to 23.4%. Free cash flow hit $265 million, up 162% YoY, fueled by strong collections and operational efficiency.
- Full-year sales guidance raised to 18% YoY growth ($6.2-6.4 billion), with adjusted EPS maintained at $3.55 midpoint despite $100+ million tariff headwinds.
- Tariff mitigation strategy includes USMCA qualification for 100% of Mexico production, relocating 90% of China-sourced goods to low/no-tariff regions, and selective price adjustments.

**【CFO Financial Commentary】**
- Q1 EPS of $0.64 beat estimates by $0.04, up 49% YoY. GAAP net income was $420 million, with Non-GAAP EPS of $1.08 exceeding expectations.
- 2025E adjusted operating profit guidance of $1.935 billion reflects $250 million sales up revision, offset by $100 million tariff impact. Free cash flow conversion >100% in Q1, with H1 2025F cash flow expected to match H1 2024.
- Balance sheet strength highlighted by 0.8x net leverage and Fitch's BBB- investment-grade rating, enabling $100 million share buyback program.

**【Q&A Key Themes】**
- **Tariff Mitigation Progress**: 70% of U.S. demand now sourced from U.S./Mexico, with 90% of China imports re-routed. 2025E tariff impact expected to decline 50% Q2-Q4 as countermeasures ramp.
- **Europe Recovery**: EMEA pipelines growing sequentially, with sovereign AI projects driving 2025E orders +13% YoY despite slower hyperscaler build.
- **Liquid Cooling Growth**: Blackwell shipments leading indicator, with Vertiv CDU orders up 3x YoY. iGenius AI factory deal showcases end-to-end infrastructure leadership.
- **Share Repurchases**: $100M buyback authorized, but prioritizing balance sheet flexibility amid macro uncertainty.


Vertiv (VRT)-23 Apr 25-2025 Q1 Earnings call transcript

- **Q4 Superformance**: 27% organic sales growth, $0.99 EPS (77% YoY), and $362M free cash flow.
- **2025 Guidance**: $3.55 EPS midpoint, $9.2B sales, 16% organic growth, and $1.3B free cash flow.
- **AI Growth Driver**: Hyperscale capex expansion and AI adoption fueling power and thermal solutions demand.
- **Supply Chain Strength**: 1x net leverage, U.S. manufacturing expansion, and tariff mitigation strategies.

**【Management Opening Remarks】**
- **Q4 Outperformance**: Exceeded sales guidance, delivering strong EPS and cash flow, reflecting company transformation.
- **Americas Strength**: Hyper and Colo orders up 50% YoY, driven by AI adoption and data center expansion.
- **Market Confidence**: Despite stock price volatility, management emphasizes long-term growth in data centers and digital infrastructure.

**【CEO Commentary】**
- **Q4 Financials**: Adjusted EPS of $0.99 (77% YoY growth), 27% organic sales growth, and 30% trailing 12-month orders.
- **2025 Guidance**: Adjusted EPS $3.5-$3.6, sales $9.2B, with $75M upside from Q4 over-delivery.
- **Strategic Investments**: $50M in R&D, U.S. manufacturing expansion, and supply chain resilience to mitigate tariffs.

**【CFO Commentary】**
- **Q4 Financial Highlights**: $362M free cash flow, 21.5% operating margin, and $1.1B annualized free cash flow.
- **2025 Outlook**: 16% organic sales growth, 25% adjusted operating profit increase, and $1.3B free cash flow.
- **Balance Sheet**: 1x net leverage, $2.4B remaining share buyback authorization.

**【Q&A Highlights】**
- **EMEA Dynamics**: Q4 weakness due to project delays, but 2025 pipeline supports high single-digit growth.
- **AI Impact**: Increased compute efficiency driving hyperscale investments, benefiting Vertiv's power and thermal solutions.
- **Supply Chain Resilience**: U.S. manufacturing expansion and regional sourcing to mitigate tariff risks.
- **Order Visibility**: 2025 trailing 12-month orders expected to remain strong, supporting financial targets.

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