NYSE$AOS
A O Smith Corp · Q3 2023 earnings
Q3 2023 earnings · · Investor relations
Briefing
A. O. Smith delivered strong Q3 2023 results, driven by North America segment and China's new products.
A. O. Smith reported a strong third quarter with EPS of $0.90. The North America segment performed particularly well, with resilient demand for residential water heaters and improved operating margin. China's new kitchen appliance products drove year-over-year improvement, despite a challenging economic backdrop. India experienced sales growth of 17% in local currency, and the company acquired Water Tec to expand its water treatment business in the U.S.
- North America water heater sales increased 13% due to strength in residential water heater demand.
- China's third quarter sales increased 9% in local currency, driven by newly introduced dishwasher and steam oven products.
- India delivered year-to-date sales growth of 17% in local currency with new product introductions.
- Company acquired Water Tec, an Arizona-based water treatment company.
Headline financials
Revenue & EPS history
A O Smith · Revenue · Quarterly
$938M
Revenue by segment
A O Smith · $943M total across 2 segments · Q3 2023
- North America$710M+8.7%75.3%
- Rest of World$233M+1.2%24.7%
Forward guidance
A. O. Smith increased its 2023 outlook with an expected adjusted earnings per share range of $3.70 to $3.80. Sales are expected to grow approximately 2% compared to 2022. North America full year margin guidance is approximately 25%, and Rest of the World margin guidance remains unchanged at approximately 10%. Strong free cash flow is expected between $575 million and $600 million.
Tailwinds
- Residential water heater orders remained strong through October.
- 2023 residential water heater industry volumes will increase approximately 4% compared to last year.
- Demand for commercial electric water heaters greater than 55-gallon continue to be robust.
- Sales in China will grow 2% to 5% local currency in 2023.
- Sales in India will grow 15% this year.
Headwinds
- Stable supply chain with limited disruption
- Q4 material costs will be similar to Q3 material costs.
- CapEx should be approximately $65 million
- Corporate and other expenses are expected to be approximately $60 million.
- Effective tax rate is estimated to be approximately 24%.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q3 2023
+1.1%
Avg return
Earnings day
+1.1%
Avg return
5 days after
+1.8%
Avg return
30 days after
59%
40 / 68 earnings
Positive
+17.5%
Q4 2022
Best reaction
-9.7%
Q2 2020
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q1 2026 | -2.9% | -7.5% | -10.9% | |
| Q4 2025 | +5.9% | +9.9% | +12.2% | |
| Q3 2025 | -2.6% | -3.8% | -3.3% | |
| Q1 2025 | +3.5% | +5.7% | -0.1% | |
| Q4 2024 | -2.8% | -5.1% | -4.0% | |
| Q3 2024 | -1.7% | -2.2% | -7.2% | |
| Q2 2024 | -9.1% | -4.9% | -8.6% | |
| Q1 2024 | -4.4% | -4.8% | -2.6% | |
| Q4 2023 | -4.9% | -4.1% | +1.5% | |
| Q3 2023 | +4.0% | +7.0% | +16.6% | |
| Q2 2023 | -3.8% | -3.3% | -7.1% | |
| Q1 2023 | +1.2% | +3.4% | -1.2% | |
| Q4 2022 | +17.5% | +15.9% | +13.6% | |
| Q3 2022 | +4.7% | +5.1% | +19.1% | |
| Q2 2022 | +4.5% | -0.1% | -3.5% | |
| Q1 2022 | -7.1% | -6.0% | -2.7% | |
| Q4 2021 | +1.0% | +1.1% | -7.1% | |
| Q3 2021 | +13.7% | +22.0% | +26.1% | |
| Q2 2021 | +1.3% | +3.2% | +4.3% | |
| Q1 2021 | +1.8% | +7.5% | +6.8% | |
| Q4 2020 | +2.1% | +7.9% | +11.6% | |
| Q3 2020 | +0.4% | +3.6% | +10.9% | |
| Q2 2020 | -9.7% | -10.0% | -7.4% | |
| Q1 2020 | +4.0% | +6.7% | +20.5% | |
| Q4 2019 | +1.1% | -2.6% | -8.4% | |
| Q3 2019 | -1.9% | -2.1% | -5.1% | |
| Q2 2019 | +3.7% | -0.2% | +5.3% | |
| Q1 2019 | -5.9% | -3.9% | -26.2% | |
| Q4 2018 | -0.8% | -0.1% | +7.7% | |
| Q3 2018 | +7.7% | +13.7% | +10.8% | |
| Q2 2018 | -0.3% | -1.6% | -2.0% | |
| Q1 2018 | +0.9% | -1.2% | +3.8% | |
| Q4 2017 | -0.1% | -3.3% | -7.1% | |
| Q3 2017 | -3.6% | -4.4% | -2.2% | |
| Q2 2017 | -2.0% | -2.7% | -2.0% | |
| Q1 2017 | +1.7% | +0.5% | +2.1% | |
| Q4 2016 | +1.9% | +1.9% | +3.6% | |
| Q3 2016 | -3.9% | -3.4% | +5.3% | |
| Q2 2016 | +5.6% | +4.7% | +7.6% | |
| Q1 2016 | -3.4% | — | — | |
| Q4 2015 | +2.8% | — | — | |
| Q3 2015 | +2.8% | — | — | |
| Q2 2015 | +5.5% | — | — | |
| Q1 2015 | +0.6% | — | — | |
| Q4 2014 | +6.3% | — | — | |
| Q3 2014 | +3.8% | — | — | |
| Q2 2014 | +6.2% | — | — | |
| Q1 2014 | +1.0% | — | — | |
| Q4 2013 | -2.8% | — | — | |
| Q3 2013 | +9.9% | — | — | |
| Q2 2013 | +2.3% | — | — | |
| Q1 2013 | +6.9% | — | — | |
| Q4 2012 | +3.7% | — | — | |
| Q3 2012 | +0.5% | — | — | |
| Q2 2012 | +4.6% | — | — | |
| Q1 2012 | +2.4% | — | — | |
| Q4 2011 | -0.7% | — | — | |
| Q3 2011 | -4.7% | — | — | |
| Q2 2011 | -2.2% | — | — | |
| Q1 2011 | -0.7% | — | — | |
| Q1 2010 | -0.7% | — | — | |
| Q4 2010 | +2.2% | — | — | |
| Q4 2008 | +2.2% | — | — | |
| Q3 2010 | +4.4% | — | — | |
| Q3 2009 | +4.4% | — | — | |
| Q2 2009 | +0.0% | — | — | |
| Q4 2009 | +0.0% | — | — | |
| Q2 2010 | +0.0% | — | — |
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