Vertiv Raises 2026 Outlook as Q3 Sales Jump 61%

Vertiv (NYSE: VRT) raised its full-year 2026 guidance across all key metrics after third-quarter sales surged 61% and adjusted operating profit climbed 83%, supported by broad regional demand, capacity expansion and backlog execution. The data-center infrastructure provider now expects approximately 38% organic sales growth for the year and said its backlog and pipeline provide increased visibility into 2027 and beyond.

Third-quarter net sales reached $4.31 billion, up from $2.68 billion a year earlier and about $563 million above the midpoint of the company’s guidance. Organic sales, which exclude foreign-exchange and acquisition effects, increased 55%, while acquisitions contributed about six percentage points of growth.

GAAP operating profit rose to $983.8 million from $516.7 million, with operating margin expanding to 22.8% from 19.3%. GAAP diluted earnings per share increased to $1.95 from $1.02.

On an adjusted basis, operating profit advanced to $1.09 billion from $595.6 million. Adjusted operating margin widened by 290 basis points to 25.2%, reflecting higher organic sales, operating leverage and manufacturing productivity, partly offset by business mix. Adjusted diluted EPS rose 78% to $2.21.

Adjusted free cash flow increased 50% to $652.2 million as higher operating profit more than offset working-capital requirements and increased capital spending. Vertiv ended the quarter in a net cash position, with net leverage of approximately negative 0.2 times.

Growth across all regions

The Americas remained Vertiv’s largest and fastest-growing region. Sales increased 75% to $2.99 billion, including organic growth of 66%. Regional adjusted operating profit rose to $877.3 million from $501.8 million, while adjusted operating margin was broadly stable at 29.4% compared with 29.3% a year earlier.

Asia-Pacific sales grew 50% to $779.3 million, with organic growth of 48%. Adjusted operating profit nearly doubled to $132.4 million, and margin expanded to 17.0% from 13.2%. Vertiv said demand remained strong in India and the rest of Asia, while China showed early signs of improvement.

Europe, the Middle East and Africa reported a 23% sales increase to $544.7 million, including 19% organic growth. Adjusted operating profit rose to $152.3 million from $83.5 million, lifting margin to 28.0% from 18.8%. Management highlighted demand in the Nordic region and attributed the broader margin improvement to operating leverage, productivity and commercial execution.

Vertiv said revenue growth reflected strategic capacity expansion, improved utilization and execution against its backlog. The company expects positive price-cost performance in 2026 and plans capital expenditures equal to about 4% of annual sales as it expands manufacturing capacity, invests in technology and extends supply-chain capacity agreements for key commodities.

Full-year outlook raised

Vertiv now forecasts 2026 net sales of $14.45 billion to $14.85 billion, with a midpoint of $14.65 billion. That midpoint is $650 million above its previous guidance and represents growth of about 43% from 2025. The outlook assumes approximately 38% organic growth, a four-percentage-point acquisition contribution and a one-percentage-point foreign-exchange benefit.

Adjusted operating profit is projected at $3.48 billion to $3.56 billion, with the $3.52 billion midpoint up 68% year over year and $190 million above the prior outlook. Adjusted operating margin is expected to be 23.5% to 24.5%, compared with 20.4% in 2025.

The company increased its adjusted diluted EPS forecast to $7.10 to $7.20, implying about 70% growth at the midpoint. Adjusted free cash flow is expected to range from $2.6 billion to $2.8 billion, with the midpoint raised by $200 million. Vertiv expects full-year cash conversion of approximately 95% and said productivity and positive price-cost performance should offset tariff headwinds.

For the fourth quarter, Vertiv expects sales of $4.31 billion to $4.51 billion, representing about 53% year-over-year growth at the midpoint. Organic sales are projected to rise approximately 50%. Adjusted operating margin is forecast at 25.3% to 26.3%, while adjusted diluted EPS is expected to range from $2.22 to $2.28.

Investment and 2027 priorities

Management expects AI-driven data-center demand to remain strong in 2027 and anticipates continued significant above-market organic sales growth, supported by its backlog, pipeline and expected market-share gains. Vertiv plans to continue investing in research and development, manufacturing capacity, supply-chain scale and services. It also expects further margin expansion and significant adjusted free cash flow, although those statements remain forward-looking.

The company completed two acquisitions shortly after the quarter ended. Its October 26 purchase of UtilityInnovation Group adds microgrid solutions, power controls and behind-the-meter power design capabilities. The October 23 acquisition of King Environmental Services expands Vertiv’s fluid-management and load-testing services in Europe.

Vertiv identified power availability, permitting, construction moratoriums and skilled-labor constraints as factors that could affect the pace of large data-center projects. Other uncertainties include inflation, tariffs and changing trade policies, supply-chain and production-cost pressures, long customer sales cycles, order cancellations, backlog conversion, fixed-price contract exposure, foreign-exchange movements and the integration of acquired businesses. The company also cautioned that its non-GAAP measures may not be directly comparable with similarly named metrics reported by other companies.