AAON Inc
Q4 2025 Earnings
Market Reaction
Did AAON Beat Earnings? Q4 2025 Results
AAON delivered a classically split quarter in Q4 2025, posting revenue that cleared Wall Street's bar while profitability fell short, sending shares down roughly 5% in the aftermath. Net sales of $424.22 million topped the $374.11 million consensus by 13.39% and rose 42.5% year-over-year, powered by explosive growth in the company's BASX data center cooling business, where branded sales surged 138.8% to $181.40 million. Yet the top-line strength could not offset the margin drag from aggressive capacity investments, with GAAP diluted EPS of $0.39 missing the $0.45 estimate by 13.33%, even as it rose 30.0% from the year-ago period. The company's Memphis facility and ongoing ERP implementation costs continued to weigh on profitability, compressing gross margin to 25.9%. Looking ahead, management guided for 18-20% revenue growth in 2026 alongside gross margins of 29-31%, signaling confidence that the investment cycle is cresting, with a record backlog of $1.83 billion, up 110.9% year-over-year, providing substantial visibility into that recovery.
- BASX-branded sales increased 138.8% to $181.4 million driven by strong data center equipment demand
- AAON-branded sales increased 9.5% to $242.8 million supported by strong backlog and favorable prior-year comparison
- New 787,000-square-foot Memphis facility ramping production and reaching profitability earlier than expected
- Record year-end backlog of $1.83 billion providing strong revenue visibility
- Manufacturing footprint increased approximately 25% during 2025
“2025 represented a year of record growth for AAON, driven by strong bookings and sales reflecting expanding market share and growing demand for our products and custom solutions. During the year, we executed on targeted investments to support long-term growth and profitability. These actions included strengthening our leadership team, enhancing supply chain management capabilities, and expanding manufacturing capacity.”
AAON CEO, on the earnings call
Forward Guidance & Outlook
For fiscal year 2026, AAON expects revenue growth of 18-20%, gross profit margins of approximately 29-31%, SG&A expenses of approximately 16% of sales, depreciation and amortization of $95-$100 million, and capital expenditures of $190 million. The company enters 2026 with a record backlog of $1.83 billion, and management expects operating cash flow to improve significantly in 2026 supported by higher earnings and improved working-capital efficiency. Near-term ERP rollouts have been moderated to focus on execution and margin recovery.
AAON YoY Financials
AAON Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.