NYSE$VRT

Vertiv Holdings Co · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Reported a sales growth and improved profitability.

Vertiv reported a strong third quarter with a 20.5% increase in net sales and a 20.1% organic net sales increase. The company reaffirmed its fourth quarter and full year operating profit and adjusted operating profit guidance. Market demand remains strong, demonstrated by the increase in backlog.

  • Net sales increased by 20.5% compared to the third quarter of 2021.
  • Organic net sales growth was 20.1% compared to the third quarter of 2021.
  • Third quarter orders were up 15% compared to the third quarter of 2021, excluding foreign exchange impacts.
  • The company reaffirms fourth quarter 2022 operating profit guidance of $170 million to $190 million and adjusted operating profit of $220 million to $240 million.

Headline financials

Total Revenue

$1.48B

Previous: $1.23B+20.5%
EPS (adj)

$0.23

Previous: $0.20+15.0%
Organic Orders Growth

20.1%

Previous: 17.2%+16.9%
Operating Margin

5.4%

Previous: 6.7%-19.4%
Capital Expenditures

-$61.7M

Previous: -$43.3M-42.5%
Free Cash Flow

-$40.5M

Previous: $12.9M-414.0%
Net Income

$21.2M

Previous: $56.2M-62.3%
Operating Income

$80M

Previous: $81.8M-2.2%
Gross Profit

$429M

Previous: $382M+12.5%
Cash & Equivalents

$258M

Previous: $744M-65.3%
Total Assets

$6.83B

Previous: $5.26B+29.7%
Stock-Based Comp

$6.3M

Previous: $5.7M+10.5%

Revenue & EPS history

Vertiv · Revenue · Quarterly

$1.48B

Q3 2022+20.5%vs Q3 2021
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Revenue by segment

Vertiv · $1.14B total across 1 segment · Q3 2022

  • Products
    $1.14B

Forward guidance

Vertiv reaffirms its fourth quarter 2022 operating profit guidance of $170 million to $190 million and adjusted operating profit of $220 million to $240 million. The company also reaffirms its 2023 operating profit guidance of $530 million to $550 million and adjusted operating profit guidance of $730 million to $750 million.

Tailwinds

  • Reaffirms fourth quarter 2022 operating profit guidance of $170 million to $190 million
  • Reaffirms fourth quarter 2022 adjusted operating profit of $220 million to $240 million
  • Reaffirms 2023 operating profit guidance of $530 million to $550 million
  • Reaffirms 2023 adjusted operating profit guidance of $730 million to $750 million
  • Expects quarterly record high free cash flow generation in the fourth quarter of $250 million to $300 million

Headwinds

  • Supply chain challenges, notably for electronic components, are expected to continue at least into the first half of 2023.
  • Increased estimate for inflation by $15 million for the full year.
  • Foreign currency negatively impacted third quarter sales by approximately $86 million.
  • Difficult comparison to prior year periods for orders over the next several quarters.
  • Free cash flow for the full year 2022 to be a use of cash of $100 million to $150 million.

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 2022

Historical avgQ3 2022

+1.5%

Avg return

Earnings day

+2.5%

Avg return

5 days after

+7.7%

Avg return

30 days after

56%

18 / 32 earnings

Positive

+30.0%

Q2 2023

Best reaction

-36.7%

Q4 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-2.1%+3.2%+4.8%
Q4 2025+24.5%+17.5%+29.7%
Q3 2025-2.0%+10.4%-8.6%
Q2 2025+1.0%-1.8%-10.6%
Q1 2025+8.5%+20.0%+45.0%
Q4 2024-9.7%-12.3%-29.0%
Q3 2024-2.2%+1.0%+24.6%
Q2 2024-16.0%-14.3%-13.7%
Q1 2024+14.1%+19.7%+34.1%
Q4 2023+1.4%+6.9%+33.0%
Q3 2023-10.7%-1.9%+9.4%
Q2 2023+30.0%+34.6%+50.3%
Q1 2023+18.5%+21.2%+61.4%
Q4 2022+7.9%+3.3%-14.2%
Q3 2022+4.7%+1.3%-2.8%
Q2 2022+11.9%+10.2%-4.8%
Q1 2022+10.6%+9.3%-0.9%
Q4 2021-36.7%-33.5%-34.3%
Q3 2021+6.9%+8.3%+7.2%
Q2 2021+1.7%+0.2%+2.2%
Q1 2021+0.7%-1.1%+7.5%
Q4 2020-6.3%-1.8%-10.2%
Q3 2020-1.8%-4.0%+12.2%
Q2 2020+8.0%+11.1%+5.9%
Q4 2019+3.4%+8.5%+31.5%
Q1 2020-0.9%-2.9%+30.1%
Q2 2019-16.4%-31.9%-13.7%
Q3 2019+0.0%-0.3%+1.0%
Q1 2019-0.3%-0.3%+0.1%
Q4 2018+0.2%+0.6%+0.7%
Q3 2018+0.5%+1.2%+1.3%
Q2 2018-0.1%-1.1%-1.6%

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