Plunges 10% Despite Strong Q2 Growth and Raised Guidance

TLDR

• Vertiv shares plunged 10% pre-market despite strong second-quarter results.

• Second-quarter revenue rose 24% to $3.27 billion as data center demand grew.

• Adjusted operating profit jumped 51% as margins expanded by 410 basis points.

• Adjusted free cash flow climbed 234% to $925 million in the second quarter.

• Vertiv raised its 2026 sales, earnings, margin, and free cash flow guidance.

Vertiv Holdings Co (NYSE: VRT) stock plunged 10.01% in pre-market trading to $242.50 after Tuesday’s sharp decline. The stock closed the previous session 6.27% lower at $269.56 despite strong quarterly results. Vertiv reported higher revenue, wider margins, stronger cash flow, and raised its full-year 2026 guidance.

Vertiv Holdings Co, VRT

Vertiv Reports Strong Second-Quarter Revenue Growth

Vertiv generated second-quarter net sales of $3.27 billion, up 24% from the same period last year. Organic sales increased 18%, while acquisitions added 5% and currency movements contributed another 1%. However, supply congestion and larger multi-stage projects caused minor revenue timing shifts.

Operating profit rose 44% to $638 million during the quarter, supported by stronger execution and improved pricing. Adjusted operating profit increased 51% to $738 million, while adjusted operating margin reached 22.6%. Consequently, the adjusted margin expanded 410 basis points from the second quarter of 2025.

The company linked its growth to rising demand for data center power and cooling infrastructure. High-density computing projects now require more complex electrical and thermal systems across larger facilities. Therefore, Vertiv has expanded capacity and technology investment to support these projects.

Vertiv Strengthens Cash Flow and Liquidity

Vertiv generated $1.1 billion in operating cash flow during the second quarter. Adjusted free cash flow reached $925 million, rising 234% from the prior-year period. Higher profit, working capital efficiency, and lower interest costs supported the increase.

The company ended June with $5.6 billion in liquidity and reported a net cash position. This balance sheet gives Vertiv flexibility to fund production growth and pursue strategic opportunities. However, higher taxes and capital spending reduced part of the cash flow benefit.

Vertiv expects capital spending to equal about 4% of full-year revenue. That level sits at the top of its planned investment range for 2026. The spending will support additional capacity as global data center demand continues expanding.

Vertiv Raises 2026 Sales and Earnings Guidance

Vertiv now expects third-quarter sales between $3.65 billion and $3.85 billion. It forecasts organic sales growth between 34% and 36% during the period. Meanwhile, adjusted earnings should range from $1.77 to $1.83 per diluted share.

For 2026, Vertiv expects net sales between $13.8 billion and $14.2 billion. The company projects organic sales growth between 30% and 32% for the full year. Adjusted operating profit should reach between $3.29 billion and $3.37 billion.

Vertiv also expects adjusted earnings between $6.65 and $6.75 per diluted share. Adjusted free cash flow should range from $2.4 billion to $2.6 billion. The raised outlook reflects strong demand, expanding project pipelines, and continued investment across major data center markets.