Carrier Global Corporation

Carrier reported 2Q sales of $6.4 billion, adjusted operating profit of $1.1 billion, adjusted EPS of $0.86, and adjusted operating margin of 17.2%. Organic sales growth was 3%, segment organic sales rose 4% in CSA and CSAME, and CST organic sales were flat. Free cash flow was $810 million. For 2026, management now expects sales of roughly $23 billion, adjusted operating profit of about $3.5 billion, adjusted EPS of about $2.90, data center revenue of approximately $2 billion versus the prior $1.5 billion guide, and full-year CapEx of about $600 million; share repurchases are expected to remain at $1.5 billion. For 3Q, Carrier expects revenue just below $6 billion, organic growth of about 10%, operating margin of about 16.5%, a 24% tax rate, and adjusted EPS of about $0.75.

Dave Gitlin said the quarter reflected strong orders, record backlog, and early returns from Carrier’s long-term strategic investments. He emphasized the company’s growing position in data centers, the launch of 75F as a technology-led acquisition to expand the buildings software and controls strategy, and the need to keep building capacity to support 2027 and beyond. His tone was confident and upbeat, but he was also clear that Carrier needs stronger price/cost discipline and more cost reduction in parts of the portfolio, especially Europe.

Patrick Goris highlighted reported sales of $6.4 billion, adjusted operating profit of $1.1 billion, adjusted EPS of $0.86, and free cash flow of $810 million. He said the 17.2% adjusted operating margin was a bit better than expected, but year-over-year EPS declined 7% due to lower operating profit and a higher tax rate, partly offset by a lower share count. He also walked through the raised outlook: about $23 billion in sales, about $3.5 billion in adjusted operating profit, about $2.90 in adjusted EPS, about $600 million in CapEx, and $1.5 billion of share repurchases, while noting about $125 million of revenue headwind from NORESCO and about $100 million of incremental CapEx tied to the new U.S. site.

Analysts pressed on margin pressure, especially the mix impact, tariff timing, and the new leadership in Europe. Management said the quarter’s margin pressure came from tariff mitigation timing, lower JV income, unfavorable mix, and higher input costs; Dave Gitlin also said the new European leader Thomas Donato would bring more discipline on pricing and cost, including footprint, supply chain, and G&A. Questions also focused on data center capacity and whether demand could outstrip supply; management said second-half data center revenue is fully booked, the new U.S. facility is needed to support 2027-plus demand, and the extra capacity should also be usable for broader commercial applications. On residential, management said destocking is easing, field inventories are healthy, and movement is improving, with second-half Resi benefiting from the absence of destocking.