Core Viewpoint - Aaon (AAON) reported quarterly earnings of $0.37 per share, exceeding the Zacks Consensus Estimate of $0.33 per share, but down from $0.63 per share a year ago, indicating a +12.12% earnings surprise [1] Financial Performance - The company posted revenues of $384.24 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 13.66% and up from $327.25 million year-over-year [2] - Over the last four quarters, Aaon has exceeded consensus EPS estimates two times and topped revenue estimates twice [2] Stock Performance - Aaon shares have declined approximately 20.6% since the beginning of the year, contrasting with the S&P 500's gain of 15.6% [3] Future Outlook - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $0.47 for the upcoming quarter and $1.36 for the current fiscal year [7] - The Zacks Rank for Aaon is currently 2 (Buy), indicating expectations for the stock to outperform the market in the near future [6] Industry Context - The Building Products - Air Conditioner and Heating industry is currently ranked in the bottom 23% of over 250 Zacks industries, which may impact Aaon's stock performance [8]

Q3 2025 Earnings Conference Call November 6, 2025 This presentation includes references to calculations that are not based on generally accepted accounting principles ("GAAP"). Reconciliations of each of those non-GAAP measures to the most directly comparable GAAP measures have been included in the Appendix. When forward-looking non-GAAP measures are provided, the Company does not provide quantitative reconciliations of forward-looking non-GAAP measures to the most directly comparable GAAP measures, because ...

Revenue and Sales Performance - Total revenue for the three months ended September 30, 2025, was $384.238 million, compared to $327.252 million for the same period in 2024, representing a year-over-year increase of approximately 17.4%[35] - Aftermarket part sales for the three months ended September 30, 2025, were $24.9 million, up from $21.1 million in 2024, reflecting a growth of about 17.9%[35] - The company recognized revenue of $11.8 million for the nine months ended September 30, 2025, that was included in the contract liability balance at the beginning of the period, compared to $12.4 million for the same period in 2024[45] - For the three months ended September 30, 2025, AAON Oklahoma reported external sales of $238.7 million, while AAON Coil Products and BASX reported external sales of $70.2 million and $75.2 million, respectively[142] Financial Position and Assets - Contract assets increased to $207.739 million as of September 30, 2025, from $135.820 million at the end of 2024, indicating a significant rise of approximately 53%[44] - Total accounts receivable increased to $267,568 thousand as of September 30, 2025, up from $148,472 thousand in December 31, 2024, representing an increase of 80.3%[53] - Total inventories increased to $256,728 thousand as of September 30, 2025, compared to $192,612 thousand as of December 31, 2024, reflecting a growth of 33.3%[54] - Total property, plant, and equipment rose to $947,478 thousand as of September 30, 2025, from $819,998 thousand as of December 31, 2024, marking an increase of 15.6%[56] - Total long-lived assets increased to $608.7 million as of September 30, 2025, compared to $525.8 million as of December 31, 2024[144] Liabilities and Debt - The company’s total contract liabilities as of September 30, 2025, were $(19.974) million, compared to $(14.913) million at the end of 2024, indicating an increase in liabilities[44] - The total minimum lease obligations, net of present value of minimum lease payments, amounted to $14,902 thousand as of September 30, 2025[52] - The company entered into a Third Amendment to its Loan Agreement, including an $80 million term loan and a $200 million revolving credit facility, which was increased to $230 million in April 2025[66] - As of September 30, 2025, the total Revolver commitment was $500 million, with outstanding borrowings of $360,142,000, leaving $139,204,000 available[68] - The Company had an outstanding balance of $360.1 million on its combined Revolver and Term Loan as of September 30, 2025[208] Expenses and Costs - Costs incurred on uncompleted contracts for the nine months ended September 30, 2025, totaled $192.207 million, compared to $132.844 million for the same period in 2024, marking an increase of approximately 44.7%[45] - Depreciation expense for the three months ended September 30, 2025, was $18,419 thousand, compared to $14,636 thousand for the same period in 2024, representing a 25.5% increase[57] - The total amount paid to representatives for the three months ended September 30, 2025, was $11.1 million, compared to $10.7 million for the same period in 2024, reflecting a year-over-year increase of approximately 3.7%[43] - Accrued liabilities increased to $120,468,000 as of September 30, 2025, from $99,347,000 as of December 31, 2024, representing a growth of approximately 21.3%[65] Tax and Compliance - The effective income tax rate for the nine months ended September 30, 2025, was 16.4%, compared to 19.3% for the same period in 2024[75] - The company recorded deferred tax assets of $10.2 million (Federal) and $2.3 million (State) related to net operating loss carryforwards of approximately $48.6 million as of September 30, 2025[84] - The company recognized an increase in deferred tax liabilities of $30.9 million due to changes in tax law effective January 1, 2025[82] Shareholder and Employee Compensation - The company awarded annual merit raises resulting in a 3.3% increase in wages in March 2024 and a 4.0% increase in March 2025[29] - The total share-based compensation expense for the nine months ended September 30, 2025, was $13.4 million, compared to $12.8 million for the same period in 2024[98] - The Company matches 175.0% up to 6.0% of employee contributions in its defined contribution plan[102] - Contributions to the defined contribution plan increased to $5,975,000 for the three months ended September 30, 2025, compared to $4,570,000 for the same period in 2024, representing a 30.8% increase[103] Market and Operational Challenges - The company is facing inflationary cost pressures and supply chain disruptions due to global health issues, impacting demand for products and financial position[209] - There are concerns regarding the tightening of labor markets, affecting the ability to hire employees for continued growth[209] - The company is monitoring fluctuations in the commercial/industrial new construction market, which may influence future performance[209] - Future levels of capital expenditures and research and development are critical for the company's growth strategy[209] - The company is focused on the integration of acquired businesses to realize synergies and cost savings[209] - Legal, regulatory, and environmental compliance is essential for the company's operations and product standards[209] - The company is assessing the creditworthiness of customers and their access to capital, which could affect revenue generation[209] - Changes in interest rates and competitive factors are being closely monitored as they may impact financial results[209] - The company is addressing cybersecurity risks and potential impacts on information technology systems[209] - The timing and market acceptance of new product introductions are crucial for future revenue growth[209] Profitability and Shareholder Returns - Basic earnings per share for the nine months ended September 30, 2025, was $0.93, down from $1.77 in 2024, a decline of 47.2%[109] - The company repurchased approximately $30.0 million of shares as of September 30, 2025, with $70.0 million remaining under the current board authorization[110] - The company declared cash dividends of $0.10 per share for the periods ending March 5, 2025, May 13, 2025, and August 14, 2025, with an annualized dividend of $0.40[113] - The company reported net income of $30,782,000 for the three months ended September 30, 2025, compared to $52,625,000 in 2024, a decrease of 41.5%[109]

Exhibit 99.1 AAON Reports Strong Third Quarter 2025 Results Driven by Operational Improvements and Share Gains Q3 Highlights (All comparisons are year-over-year, unless otherwise noted) TULSA, Okla., November 6, 2025 - AAON, INC. (NASDAQ-AAON), a leader in high-performing, energy-efficient HVAC solutions that bring long-term value to customers and owners, today announced its results for the third quarter of 2025. The quarter demonstrated robust underlying demand across both AAON and BASX brands. Total backl ...

Core Insights - AAON, Inc. reported strong demand and significant growth in backlog, reaching a record $1.32 billion, up 103.8% year-over-year and 18.1% sequentially, driven by data center applications [2][19] - Net sales for Q3 2025 increased by 17.4% to $384.2 million, with BASX-branded sales rising 95.8% to $124.8 million, while AAON-branded sales decreased by 1.5% to $259.5 million [3][14] - Gross profit margin decreased to 27.8% from 34.9% year-over-year but improved sequentially from 26.6%, primarily due to operational inefficiencies related to ERP implementation [4][14] Financial Performance - Earnings per diluted share were $0.37, down 41.3% year-over-year but up 94.7% sequentially [5][14] - The company anticipates cash flow from operations to turn significantly positive in Q4 2025, with capital expenditure plans of $180 million for the year [17][14] Operational Highlights - Production throughput improved significantly at the Longview, Texas facility, reaching 90% of target in September and exceeding that level in October [6][8] - The BASX brand is expanding its presence in the data center market, with substantial increases in production of liquid cooling equipment [7][8] Segment Performance - AAON Oklahoma segment net sales increased by 4.3% year-over-year to $238.7 million, while gross profit margin was 31.5%, down from 36.8% [9][10] - AAON Coil Products segment net sales surged by 99.4% to $70.2 million, driven by BASX-branded liquid cooling product sales [11][12] - BASX segment net sales increased by 19.2% to $75.2 million, with a gross margin of 27.0% [15][16] Backlog and Market Position - Total backlog increased to $1.32 billion, with BASX-branded backlog growing by 119.5% year-over-year [19][14] - AAON-branded equipment backlog increased by 77.1% year-over-year but declined sequentially by 14.3% [19][14] 2025 Outlook - The company expects mid-teens sales growth for FY25, with gross profit margin projected between 28.0% and 28.5% [20][14]

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh. ...

Core Insights - AAON, Inc. has appointed Roberto Giacomelli as Senior Vice President of Operations, responsible for overseeing operations at five manufacturing facilities across the U.S. [1][2] - Giacomelli brings over 24 years of experience in manufacturing operations, particularly in the automotive and HVAC industries, with a focus on operational excellence and team performance [2][3] - The company emphasizes its commitment to high-performance and energy-efficient HVAC solutions, aiming to enhance customer value through improved operations [4][6] Company Overview - AAON, founded in 1988, is a leader in HVAC solutions for commercial and industrial indoor environments, known for its highly configurable equipment [4] - The company is headquartered in Tulsa, Oklahoma, featuring an innovation center and testing lab to advance HVAC technology [4] Leadership Vision - Giacomelli expressed enthusiasm for AAON's leadership vision and the talent within the company, aiming to drive operational improvements and customer value [4]

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for Aaon, despite an expected increase in revenues, with the actual results being crucial for stock price movement [1][2]. Earnings Expectations - Aaon is projected to report quarterly earnings of $0.33 per share, reflecting a year-over-year decrease of 47.6%. Revenues are expected to reach $338.05 million, which is a 3.3% increase from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised 1.09% higher in the last 30 days, indicating a positive reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model shows a positive Earnings ESP of +3.50% for Aaon, suggesting analysts are optimistic about the company's earnings prospects [12]. Historical Performance - In the last reported quarter, Aaon was expected to earn $0.31 per share but only achieved $0.22, resulting in a surprise of -29.03%. Over the last four quarters, the company has beaten consensus EPS estimates twice [13][14]. Investment Considerations - While a potential earnings beat is indicated, other factors may influence stock performance, making it essential to consider the broader context beyond just earnings results [15][17].

Core Insights - The U.S. construction sector is experiencing slow expansion in Q3 2025, driven by infrastructure development, data center construction, and utility projects, while housing and conventional commercial categories remain weak [1][2] Construction Sector Performance - Demand is primarily supported by infrastructure and technology initiatives, while traditional commercial and residential markets face financing constraints and reduced demand [2] - Companies in essential sectors are performing well, whereas those focused on discretionary or office spaces are facing significant challenges [2] Earnings Trends - Approximately 25% of S&P 500 companies have reported Q3 earnings, with the construction sector's total earnings down 30.4% year-over-year on 4.8% lower revenues; 75% of these companies beat EPS estimates, and 50% exceeded revenue estimates [4] - Construction sector earnings are expected to decline by 13.8% in Q3 compared to the previous year, a worsening from the 10.4% decline in Q2 2025, while revenues are projected to grow by 1.1% [9] Factors Influencing Construction Activity - AI-related data center development is a significant driver of construction activity, with hyperscale operators expanding capacity, leading to increased building work and upgrades in electrical and power transmission [5] - Public investment, particularly from federal infrastructure programs, is converting planned projects into actual construction, supported by incentives for clean energy and federal spending through various acts [6] - Industrial reshoring continues to support domestic manufacturing and logistics, with steady demand from technology, healthcare, and institutional sectors [7] Challenges in the Sector - Residential construction is struggling due to high borrowing costs, affordability issues, and weak demand, particularly in multifamily housing [8] - Labor shortages remain a critical constraint, affecting project schedules, while rising materials and equipment costs continue to pressure margins and new starts [8] Company Highlights - Companies such as MasTec, AAON, Vulcan Materials, Johnson Controls, and EMCOR are expected to perform well in the upcoming earnings season, with several poised to beat earnings expectations [3][12][14][15][16][19] - MasTec is projected to report a 41.7% increase in EPS year-over-year, while Vulcan anticipates a 20.7% improvement [13][16] - EMCOR is expected to show a 14.7% growth in EPS compared to the previous year [19]

Core Viewpoint - AAON, Inc. is set to discuss its third quarter 2025 financial results in a conference call scheduled for November 6, 2025, at 9:00 a.m. EST, with results released earlier that morning [1]. Company Overview - AAON, founded in 1988, is a global leader in HVAC solutions for commercial, industrial, and data center environments, focusing on high-performance and energy-efficient products [3]. - The company designs and manufactures highly configurable and custom-made equipment, enhancing efficiency, performance, and long-term value for customers [3]. - AAON operates under the AAON and BASX brands and is headquartered in Tulsa, Oklahoma, where it has an innovation center and testing lab [3].