A. O. Smith reported its third‑quarter 2025 results, showing net sales of $942.5 million, a 4 % year‑over‑year increase, and diluted earnings per share of $0.94, which beat consensus estimates of $0.89.
Segment results highlighted North America sales of $742.8 million, up 6 % YoY, driven by higher volumes of water‑heater and boiler products and pricing actions. The Rest of World segment generated $207.9 million in sales, down 1 % YoY; China sales fell 12 % in local currency, while India sales grew 13 %, and Pureit contributed $17 million to the segment.
Net earnings for the quarter were $132 million, a 10 % increase from the prior year, and the diluted EPS of $0.94 represented a 15 % year‑over‑year rise.
Operating margins improved across both segments: North America’s margin expanded to 24.2 %, up 110 basis points, and the Rest of World margin grew to 7.4 %, up 90 basis points.
Cash‑flow metrics were strong, with free cash flow of $381 million and cash provided by operations of $434 million, up 21 % in the first nine months of 2025.
The company repurchased 5 million shares for $335.4 million during the same period.
Management updated its full‑year outlook, projecting consolidated sales of $3.8 billion to $3.85 billion and diluted EPS of $3.70 to $3.85.
A 6 % dividend increase was approved on October 13, 2025, continuing a streak of more than 30 consecutive years of dividend growth.
CEO Stephen Shafer noted that pricing actions helped offset cost pressures, but cautioned that China’s market softness could temper growth in the coming quarters and that the company is conducting a strategic review of its China operations.
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