SPX Corp (SPXC) Q1 2026 Earnings Call Transcript
SPX Technologies, Inc. engages in the supply of infrastructure equipment serving the heating, ventilation, and cooling (HVAC); and detection and measurement markets worldwide. The company operates in two segments, HVAC and Detection and Measurement. The HVAC segment engineers, designs, manufactures, installs, and services cooling products and engineered air movement and handling solutions for the HVAC industrial, commercial, data center, and power generation markets, as well as heating and ventilation products for the residential, industrial, and commercial markets. It offers its cooling products under the Marley, Recold, SGS, Cincinnati Fan, TAMCO, and Ingénia names; and heating products under the Berko, Qmark, Fahrenheat, Leading Edge, Patterson-Kelley, Weil-McLain, Williamson-Thermoflo, INDEECO, Heatrex, AccuTherm, Brasch, Spectrum, BannerDay PipeHeating, and Solar Products brands. The Detection and Measurement segment offers underground pipe and cable locators; inspection and rehabilitation equipment; robotic systems under the Radiodetection, Pearpoint, Schonstedt, Dielectric, Riser Bond, Cues, ULC Robotics, and Sensors & Software brands; transportation systems under the Genfare brand; communication technologies products under the TCI and ECS brand names; and obstruction lighting products under the Flash Technology, ITL, Sabik Marine, Sealite, and Avlite brands. The company markets its products through independent manufacturing representatives, third-party distributors, and retailers. The company was formerly known as SPX Corporation and changed its name to SPX Technologies, Inc. in August 2022. SPX Technologies, Inc. was founded in 1912 and is headquartered in Charlotte, North Carolina
SPX Technologies delivered solid 2025 results, announced 2026 guidance with ~20% EBITDA growth and ~15% EPS growth, and expanded capacity and acquisitions to capture strong data-center and HVAC demand.
⭐ Key Highlights
✔Positive Signals
- Q4 adjusted EPS up 25% and full-year adjusted EPS up 21% to $6.76, beating prior expectations.
- 2026 guidance calls for ~20% EBITDA growth and ~15% EPS growth at the midpoint, with solid revenue guidance.
- Big capacity expansion underway ( ~$100m in 2026) to support data center and custom air handling growth, with ~$700m incremental capacity at full run-rate.
- Strategic acquisitions (Thermalek, Air Enterprises, Ron Industries) expected to strengthen HVAC position and generate synergies.
- Backlog in both HVAC and D&M at record or near-record levels, with data-center demand underpinning upside.
✖Negative Signals
- 2026 HVAC margin includes temporary ~50bp impact from plant startup costs; margin expansion slower in 2026 before ramping in subsequent years.
- 2025 D&M revenue pull-forward of $20m reduces 2026 top-line growth by about that amount; near-term growth headwinds in D&M.
- Discontinued status for Crawford United businesses and related integration risk; excludes them from guidance.
- Significant capital expenditure cadence creates execution risk around timing of equipment delivery and ramp to full production.
- Sensitivity to project timing in D&M backlog and potential procyclicality in non-data-center HVAC end markets.
📊Financial Results
- Q4 revenue up 19.4% YoY; adjusted EPS $1.88 ( +25% YoY ); full-year adjusted EPS $6.76 (+21% YoY).
- Consolidated segment income $156m, up 21% YoY; segment margin +30bp; HVAC revenue +16.4% (organic +10.3%), backlog $585m (+22% organic).
- Detection & Measurement revenue +26.3% YoY (organic +1.7%); backlog $350m (+43% organic); segment income +27% YoY (+20bp margin).
- End-year cash $366m, total debt $502m; leverage 0.3x; including acquisitions, leverage ~1.0x.
- Full-year adjusted free cash flow $294m, 90% conversion of adjusted net income, net of ~$60m capex for capacity expansion.
🔮Future Guidance
- Total revenue guidance for 2026: $2.535–$2.605 billion.
- Adjusted EBITDA guidance: $590–$620 million; midpoint implies ~20% YoY growth and ~23.5% margin.
- Adjusted EPS guidance: $7.60–$8.00; midpoint implies ~15% YoY growth.
- HVAC 2026 revenue guidance: $1.80–$1.84 billion; HVAC segment margin 24.5–25.0%.
- D&M 2026 revenue guidance: $735–$765 million; D&M margin 24.75–25.25%; 2026 growth offset by $20m pull-forward from 2026 to 2025.
💡Interesting Insights
- Olympus Max bookings reached target and show differentiation through integrated controls and upgrade path; potential for broader data-center and non-data-center applications beyond initial launches.
Detailed Analysis
AI-generated summary of SPX Corp earnings call transcript.
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