A. O. Smith Q2 2026: sales flat at $1.00B, EPS falls to $0.91 on restructuring
A. O. Smith's second quarter was a story of two businesses: North America grew sales 5.0% while Rest of World fell 19.0%, leaving total revenue roughly flat at $1.00 billion. The headline $0.91 of GAAP EPS misses the $0.93 consensus, but $0.16 a share of that shortfall is a restructuring charge in the water treatment unit. Read the quarter on adjusted EPS of $1.03, down 4.0%.
1 · Expected vs. Actual
Free preview belowGAAP EPS fell 15.0% to $0.91 from $1.07, and net earnings dropped to $124.9 million from $152.2 million. Adjusted EPS was $1.03, down 4.0%, because the $22.6 million pre-tax restructuring and impairment charge in North America water treatment cost $0.16 a share. Against the $0.93 consensus estimate, the adjusted number beat while the GAAP number missed — the charge is a management decision, not a demand problem.
Revenue of $1.00 billion was 0.7% below last year's $1.01 billion, so the top line is flat at best. The mix is the real story: North America rose 5.0% to $820.5 million on the Leonard Valve acquisition, 21% boiler growth and carryover pricing, while Rest of World dropped 19.0% to $194.9 million on China weakness. Strip out the acquisition and currency and total organic sales fell 3.0%.
Management narrowed full-year sales growth to 2.0% to 3.0% from 2.0% to 4.0%, implying $3.90 billion to $3.95 billion, and trimmed adjusted EPS to $3.70 to $3.85 from $3.70 to $4.00. The top of the EPS range came down while the bottom held, so this is a smaller cut than the headline suggests. Against 2025 actual sales of $3.83 billion and adjusted EPS of $3.85, the $3.925 billion sales midpoint is only modest growth.
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Figures on this page come from the company's original SEC filings. The analysis is generated automatically and checked against validation rules, but may still contain errors or omissions. Not investment advice. · Generated 2026-09-17
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