Watts Water Technologies reported third‑quarter 2025 results that surpassed analyst expectations, with net sales reaching $611.7 million—an increase of 13% from $543.6 million in Q3 2024. The growth was driven by robust demand in the Americas, where the company achieved a 9% organic sales lift, while European markets experienced a modest decline that was offset by stronger performance in the APMEA region.
Operating income climbed to $111.4 million, giving an operating margin of 18.2%. Adjusted operating income rose to $113.3 million, translating to an 18.5% margin. The margin expansion reflects a mix shift toward higher‑margin industrial and institutional products, disciplined cost management, and favorable pricing actions that more than offset inflationary pressures and tariff costs.
Diluted earnings per share were $2.45, a 19% increase from $2.06 in Q3 2024, while adjusted diluted EPS reached $2.50, up 23% from $2.03. The earnings beat—$0.39 per share—was largely driven by the combination of higher sales volume, improved pricing power, and the elimination of one‑time restructuring charges that were present in the prior year.
The company also announced the acquisition of Haws Corporation, a long‑standing brand in emergency safety and hydration solutions. The deal, completed on November 4, 2025, expands Watts’ product portfolio and strengthens its presence in institutional and industrial markets. CEO Bob Pagano said the addition “will enable us to offer our customers expanded capabilities and solutions” and highlighted the strategic fit with Watts’ existing safety and water‑management businesses.
Watts raised its full‑year 2025 sales and margin outlook. The new guidance lifts reported revenue growth to 7–8% from the previous 2–5% range and raises the adjusted operating margin expansion to 140–150 basis points from the prior 60–120 basis point range. Management cited stronger performance in the Americas, the Haws acquisition, and successful tariff‑mitigation strategies as key drivers of the upgraded outlook.
Share repurchase activity was highlighted, with 15,000 shares bought back for $3.9 million during the quarter and a total of 51,000 shares repurchased in the first nine months of 2025. The company also declared a quarterly dividend of $0.52 per share, maintaining its commitment to returning value to shareholders.
The market reaction was mixed. Investors welcomed the earnings beat and guidance raise but remained cautious about the impact of ongoing tariff costs and softer European demand, which tempered enthusiasm for the upside.
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