How much did third-quarter results exceed expectations?

  • Vertiv’s third-quarter revenue was 4.313 billion dollars, up 61.2% year on year and 14.8% above market consensus. Organic growth was 55.0%, well above market expectations of 35.2% and above 28.4% a year earlier.
  • Adjusted EBIT was 1.087 billion dollars, up 82.5% year on year and 17.7% above market consensus. Adjusted earnings per share were 2.21 dollars, above the expected 1.81 dollars.
  • According to the report’s table, the overall adjusted EBIT margin was 25.2%, above 22.3% a year earlier and market expectations of 24.6%. Bernstein believes the quarter showed the company can access substantial latent demand and eased some investors’ concerns about accelerating growth in the second half.

Which regions drove growth, and how did margins differ?

  • The Americas was the strongest-growing region: third-quarter revenue was 2.989 billion dollars, up 74.5% year on year. Organic growth was 66.6%, above market expectations of 39.1%.
  • The Americas’ adjusted operating margin was 29.4%, close to 29.3% a year earlier but below market expectations of 30.5%. Revenue and profit exceeded expectations, but the region’s margin did not also exceed expectations.
  • Asia-Pacific organic growth was 48.3%, and its adjusted operating margin rose to 17.0% from 13.2% a year earlier. Europe, the Middle East and Africa recorded organic growth of 22.8%, and its margin rose to 28.0% from 18.8%. Revenue and profit in both regions exceeded market expectations.

How did full-year guidance and the firm’s assessment change?

  • The company raised its 2026 revenue guidance from 13.8 billion–14.2 billion dollars to approximately 14.65 billion dollars, and its organic revenue growth guidance from 30%–32% to approximately 38%. Adjusted diluted earnings per share guidance rose from 6.65–6.75 dollars to approximately 7.15 dollars.
  • Bernstein believes Vertiv’s results are also a positive signal for the broader cooling and electrical equipment sector, particularly after valuations in the sector fell last quarter.
  • Bernstein has an Outperform rating on Vertiv and a price target of 368 dollars. Downside risks it identifies include an unexpected slowdown in data-center expansion and reduced cooling demand resulting from efficiency gains.