Core Insights - nVent Electric Plc reported strong Q2 2025 earnings, with adjusted EPS of $0.86, a 28% increase year-over-year, and revenue of $963 million, up 30% year-over-year, driven by acquisitions and product launches [1][2][6] Financial Performance - Adjusted EPS reached $0.86, exceeding the consensus estimate of $0.79 and up from $0.67 in Q2 2024 [2][6] - Revenue for Q2 2025 was $963 million, surpassing the estimate of $908.38 million and increasing from $740 million in Q2 2024 [2][5] - Free cash flow declined to $74 million from $101 million in Q2 2024, a decrease of 26.7% [2][8] - Adjusted operating income rose to $200 million, an 18.3% increase year-over-year [2][6] - Adjusted return on sales fell to 20.8%, down from 22.9% in the previous year [2][7] Growth Drivers - The company achieved organic sales growth of 9%, with acquisitions contributing 20.7 percentage points to the overall revenue growth [5][6] - Power utilities and data centers now account for approximately 40% of total sales, reflecting a strategic shift towards high-growth infrastructure sectors [5][9] - nVent launched 35 new products in Q1, supporting growth in electrification and sustainability markets [6][9] Strategic Acquisitions - Recent acquisitions, including ECM Industries and Trachte, have enhanced nVent's capabilities in key sectors [4][9] - The integration of Trachte and Avail EPG has exceeded expectations, contributing positively to growth synergies [9] Operational Efficiency - The company emphasizes lean manufacturing practices, which have led to increased output and operational improvements [11] - Management anticipates that tariff-related costs will be offset over time through pricing and productivity enhancements [11][13] Future Outlook - nVent raised its full-year 2025 guidance, expecting reported sales growth of 24–26% and adjusted EPS in the range of $3.22–$3.30 [12] - For Q3, projected reported sales growth is 27–29%, with adjusted EPS between $0.86 and $0.88 [12] - The company is focused on margin recovery and capturing synergies from recent acquisitions [13]

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents nVent Electric plc's unaudited condensed consolidated financial statements and management's analysis for H1 2025 [Item 1. Financial Statements](index=3&type=section&id=ITEM%201.%20Financial%20Statements) H1 2025 unaudited consolidated financial statements reflect the Thermal Management sale and recent acquisitions [Condensed Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q2 2025 net sales grew **30.2%** to **$963.1 million**, with net income at **$109.5 million** impacted by discontinued operations Condensed Consolidated Statements of Income (Q2 & H1 2025 vs 2024) | In millions, except per share data | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | **$963.1** | **$739.8** | **$1,772.4** | **$1,471.9** | | Gross profit | $371.8 | $307.6 | $685.5 | $598.5 | | Operating income | $156.7 | $144.9 | $286.7 | $276.8 | | Net income from continuing operations | $106.7 | $93.2 | $193.7 | $178.4 | | Income from discontinued operations, net of tax | $2.8 | $17.8 | $276.5 | $37.7 | | **Net income** | **$109.5** | **$111.0** | **$470.2** | **$216.1** | | **Diluted EPS (Continuing operations)** | **$0.65** | **$0.55** | **$1.17** | **$1.06** | | **Diluted EPS (Total)** | **$0.67** | **$0.66** | **$2.84** | **$1.28** | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets were **$6.74 billion** as of June 30, 2025; long-term debt decreased to **$1.75 billion**, and equity increased to **$3.52 billion** Balance Sheet Summary (June 30, 2025 vs Dec 31, 2024) | In millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $1,484.6 | $1,389.3 | | Goodwill | $2,678.7 | $2,221.8 | | Intangibles, net | $1,954.8 | $1,587.0 | | **Total assets** | **$6,741.7** | **$6,734.9** | | Long-term debt | $1,752.1 | $2,117.5 | | **Total liabilities** | **$3,223.0** | **$3,497.3** | | **Total equity** | **$3,518.7** | **$3,237.6** | - The balance sheet no longer shows assets and liabilities held for sale as of June 30, 2025, following the completion of the Thermal Management business sale[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) H1 2025 operating cash flow decreased to **$43.3 million**; investing activities generated **$576.6 million** from the Thermal Management sale Cash Flow Summary (Six months ended June 30) | In millions | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by (used for) operating activities | $43.3 | $220.8 | | Net cash provided by (used for) investing activities | $576.6 | $(34.3) | | Net cash provided by (used for) financing activities | $(714.0) | $(83.2) | | **Change in cash and cash equivalents** | **$(64.1)** | **$88.9** | - Key investing activities included **$971.6 million** for acquisitions and **$1,584.6 million** in proceeds from discontinued operations (sale of Thermal Management)[15](index=15&type=chunk) - Key financing activities included **$866.3 million** in long-term debt repayments and **$253.1 million** in share repurchases, partially offset by **$275.0 million** in new long-term debt and **$200.0 million** from a revolving credit facility[15](index=15&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, revenue, acquisitions, the Thermal Management sale, segment performance, debt, and capital returns [Note 2. Revenue](index=8&type=section&id=Note%202.%20Revenue) H1 2025 total revenue was **$1.77 billion**, with Americas contributing **$1.41 billion** and Infrastructure leading verticals Net Sales by Geography (Six months ended June 30, 2025) | In millions | Systems Protection | Electrical Connections | Total | | :--- | :--- | :--- | :--- | | Americas | $874.4 | $537.4 | $1,411.8 | | EMEA | $209.6 | $75.2 | $284.8 | | Asia-Pacific | $56.2 | $19.6 | $75.8 | | **Total** | **$1,140.2** | **$632.2** | **$1,772.4** | Net Sales by Vertical (Six months ended June 30, 2025) | In millions | Systems Protection | Electrical Connections | Total | | :--- | :--- | :--- | :--- | | Industrial | $479.1 | $84.7 | $563.8 | | Commercial & Residential | $132.4 | $318.4 | $450.8 | | Infrastructure | $510.4 | $203.9 | $714.3 | | Energy | $18.3 | $25.2 | $43.5 | | **Total** | **$1,140.2** | **$632.2** | **$1,772.4** | [Note 5. Acquisitions](index=11&type=section&id=Note%205.%20Acquisitions) nVent acquired Electrical Products Group for **$975.4 million** and Trachte, LLC for **$687.5 million**, significantly increasing goodwill - On May 1, 2025, nVent acquired the Electrical Products Group for a purchase price of **$975.4 million** in cash, funded with cash on hand[33](index=33&type=chunk) - The preliminary purchase price allocation for the Electrical Products Group acquisition includes **$440.9 million** of goodwill and **$429.8 million** of identifiable intangible assets[35](index=35&type=chunk)[36](index=36&type=chunk) - The acquisition of Trachte, LLC was completed on July 16, 2024, for approximately **$687.5 million** in cash, primarily funded through debt[38](index=38&type=chunk) [Note 6. Discontinued Operations](index=14&type=section&id=Note%206.%20Discontinued%20Operations) Thermal Management business sold for **$1.7 billion** on January 30, 2025, generating **$1.585 billion** net proceeds and a **$435.4 million** gain - The sale of the Thermal Management business was completed on January 30, 2025, for a purchase price of **$1.7 billion**, resulting in net cash proceeds of **$1,585.2 million**[45](index=45&type=chunk) - The sale resulted in a pre-tax gain of **$435.4 million**, net of **$32.8 million** in transaction costs, during the six months ended June 30, 2025[46](index=46&type=chunk) [Note 10. Debt](index=19&type=section&id=Note%2010.%20Debt) Total debt decreased to **$1.77 billion** by June 30, 2025, with new **$275.0 million** term and **$600.0 million** revolving credit facilities established Debt Outstanding (June 30, 2025 vs Dec 31, 2024) | In millions | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Revolving credit facility | $200.0 | $— | | Term loan facilities | $275.0 | $866.3 | | Senior notes - fixed rate | $1,300.0 | $1,300.0 | | **Total debt (before issuance costs)** | **$1,775.0** | **$2,166.3** | - In June 2025, nVent entered into an amended and restated credit agreement, establishing a new five-year **$275.0 million** term loan facility and a **$600.0 million** revolving credit facility[65](index=65&type=chunk) - The company repaid the remainder of borrowings on its 2021, 2023, and 2024 term loan facilities in 2025[64](index=64&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) [Note 12. Shareholders' Equity](index=21&type=section&id=Note%2012.%20Shareholders%27%20Equity) H1 2025 saw **4.8 million** shares repurchased for **$253.1 million** under the **$500 million** 2024 Authorization, with **$146.9 million** remaining - In the first six months of 2025, the company repurchased **4.8 million** ordinary shares for **$253.1 million**[75](index=75&type=chunk) - A new **$500.0 million** share repurchase authorization (the "2024 Authorization") was approved by the Board on May 17, 2024, and is effective until July 22, 2027. As of June 30, 2025, **$146.9 million** was available under this plan[74](index=74&type=chunk)[75](index=75&type=chunk) - On May 16, 2025, the Board declared a quarterly cash dividend of **$0.20** per ordinary share[77](index=77&type=chunk) [Note 13. Segment Information](index=22&type=section&id=Note%2013.%20Segment%20Information) H1 2025 Systems Protection sales were **$1.14 billion** (**21.2%** margin); Electrical Connections sales were **$632.2 million** (**28.5%** margin) Segment Performance (Six months ended June 30, 2025 vs 2024) | In millions | Systems Protection 2025 | Systems Protection 2024 | Electrical Connections 2025 | Electrical Connections 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | **$1,140.2** | **$880.7** | **$632.2** | **$591.2** | | **Reportable segment income** | **$241.3** | **$198.6** | **$180.0** | **$177.7** | | **Segment income margin** | **21.2%** | **22.6%** | **28.5%** | **30.1%** | - In Q1 2025, the company renamed its segments from Enclosures to Systems Protection and from Electrical & Fastening Solutions to Electrical Connections[78](index=78&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses H1 2025 financial results, highlighting **20.4%** sales growth from acquisitions and organic expansion, and capital deployment [Consolidated Results of Operations](index=28&type=section&id=Consolidated%20Results%20of%20Operations) H1 2025 net sales grew **20.4%** to **$1.77 billion** from acquisitions and organic growth, but margins contracted due to inflation Components of Net Sales Change (H1 2025 vs H1 2024) | Component | % Change | | :--- | :--- | | Organic growth | 5.2% | | Acquisition | 15.3% | | Currency | (0.1)% | | **Total** | **20.4%** | - Gross profit margin declined due to inflationary increases in raw materials and labor, and investments in capacity. This was partially offset by higher sales volume and productivity gains[105](index=105&type=chunk)[107](index=107&type=chunk) - SG&A as a percentage of sales increased due to higher intangible amortization from acquisitions, inflation, and investments in capacity and new products[105](index=105&type=chunk)[107](index=107&type=chunk) - Net interest expense decreased primarily due to interest income earned on the cash proceeds from the sale of the Thermal Management business[106](index=106&type=chunk) [Segment Results of Operations](index=31&type=section&id=Segment%20Results%20of%20Operations) Systems Protection sales grew **29.5%** (acquisitions **24.3%**), margin **21.2%**; Electrical Connections sales grew **6.9%** (organic **5.4%**), margin **28.5%** Systems Protection Performance (H1 2025 vs H1 2024) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $1,140.2M | $880.7M | +29.5% | | Segment Income | $241.3M | $198.6M | +21.5% | | Segment Income % | 21.2% | 22.6% | -1.4 pts | - Systems Protection sales growth was driven by a **24.3%** contribution from acquisitions and **5.1%** organic growth, primarily from the infrastructure business[113](index=113&type=chunk)[114](index=114&type=chunk) Electrical Connections Performance (H1 2025 vs H1 2024) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $632.2M | $591.2M | +6.9% | | Segment Income | $180.0M | $177.7M | +1.3% | | Segment Income % | 28.5% | 30.1% | -1.6 pts | - Electrical Connections sales growth was driven by **5.4%** organic growth, led by the infrastructure and industrial businesses[117](index=117&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, liquidity included **$125.8 million** cash and **$400.0 million** credit facility; H1 2025 free cash flow was **$118.5 million** - As of June 30, 2025, the company had **$125.8 million** of cash on hand and **$400.0 million** of borrowing capacity under its Revolving Credit Facility[120](index=120&type=chunk)[136](index=136&type=chunk) Free Cash Flow Reconciliation (Six months ended June 30) | In millions | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities of continuing operations | $154.9 | $165.7 | | Capital expenditures | $(38.0) | $(31.8) | | Proceeds from sale of property and equipment | $1.6 | $0.3 | | **Free cash flow of continuing operations** | **$118.5** | **$134.2** | - During H1 2025, the company used cash for **$866.3 million** in debt repayments, **$253.1 million** in share repurchases, and **$65.7 million** in dividends[127](index=127&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) No material changes in market risk were reported for the quarter ended June 30, 2025, with further details in the 2024 Form 10-K - There have been no material changes in market risk during the quarter ended June 30, 2025[150](index=150&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Disclosure controls were effective as of June 30, 2025, with ongoing integration into the newly acquired Electrical Products Group - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[151](index=151&type=chunk) - The company is in the process of incorporating its controls and procedures into the newly acquired Electrical Products Group business[152](index=152&type=chunk) [PART II OTHER INFORMATION](index=37&type=section&id=PART%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, and other disclosures for the period [Item 1. Legal Proceedings](index=37&type=section&id=ITEM%201.%20Legal%20Proceedings) No material developments in legal proceedings were reported since the 2024 Annual Report on Form 10-K disclosures - No material developments in legal proceedings were reported for the period[154](index=154&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=ITEM%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported for the period - No material changes to risk factors were reported for the period[155](index=155&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Q2 2025 saw **3,864,207** shares repurchased under the **$500 million** 2024 Authorization, with **$146.9 million** remaining Share Repurchases (Q2 2025) | Period | Total number of shares purchased | Average price paid per share | | :--- | :--- | :--- | | April 1 - April 26, 2025 | 3,154,657 | $51.22 | | April 27 - May 24, 2025 | 708,516 | $54.85 | | May 25 - June 30, 2025 | 1,034 | $68.80 | | **Total** | **3,864,207** | | - As of June 30, 2025, **$146.9 million** remained available for share repurchases under the 2024 Authorization, which expires on July 22, 2027[158](index=158&type=chunk) [Item 5. Other Information](index=37&type=section&id=ITEM%205.%20Other%20Information) No directors or Section 16 officers adopted or terminated Rule 10b5-1 trading arrangements during Q2 2025 - No directors or Section 16 officers adopted or terminated any Rule 10b5-1 trading arrangements during Q2 2025[157](index=157&type=chunk) [Item 6. Exhibits](index=38&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including credit agreements and officer certifications

Financial Data and Key Metrics Changes - The company reported record sales of $963 million, up 30% year-over-year, with organic growth of 9% driven by both volume and price [13] - Adjusted EPS grew 28% to $0.86, exceeding guidance [15] - Adjusted operating income increased 18% year-over-year with a return on sales of nearly 21% [9][15] Business Line Data and Key Metrics Changes - Systems Protection sales increased 43% to $632 million, with organic growth of 10% [15][16] - Electrical Connections sales rose 11% to $331 million, with organic sales up 7% [17] - Infrastructure vertical led with organic sales growth over 20%, while commercial residential sales grew mid-single digits and industrial sales were down slightly [9][10] Market Data and Key Metrics Changes - All key geographic regions experienced growth: Americas up 9%, Europe up 10%, and Asia Pacific up low single digits [10][16] - The backlog increased more than fourfold compared to the previous year, driven by strong demand in data centers and power utilities [7][39] Company Strategy and Development Direction - The company is focused on becoming a higher growth electrical connection and protection company, with significant investments in data solutions and infrastructure [6][26] - The infrastructure vertical is expected to account for over 40% of sales, with data centers and power utilities each contributing approximately 20% [27] - The company is prioritizing growth initiatives, including new products and acquisitions, to enhance its market position [11][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance and growth outlook, particularly in data centers and power utilities [11][12] - The company raised its full-year sales and adjusted EPS guidance, reflecting strong Q2 results and increased visibility in growth areas [22][24] - Management acknowledged the dynamic tariff environment but emphasized their ability to manage pricing and productivity to offset impacts [11][92] Other Important Information - The company launched 50 new products in the first half of the year, contributing over three points to sales growth [9] - Free cash flow for the quarter was robust at $74 million, with a strong balance sheet supporting capital allocation strategies [19][20] Q&A Session Summary Question: What is the timing of converting the backlog? - Management indicated that the backlog is expected to convert into sales through 2026, driven by growth in the data center solutions business and recent acquisitions [39] Question: How does the company view competition from hyperscalers developing their own cooling solutions? - Management stated that partnerships with hyperscalers remain crucial, as many do not wish to manufacture their own solutions, allowing for continued collaboration [42] Question: What is the outlook for commercial residential performance? - Management noted healthy performance in commercial residential but remained cautious, expecting it to be flattish for the year due to market uncertainties [51][102] Question: How is the company managing tariff and inflation pressures? - Management confirmed that pricing strategies are in place to offset tariff impacts, with expectations for improved margins in the second half of the year [92] Question: What is the expected growth for the Tracke business in 2025? - Management reported that the Tracke business is growing at double digits, with strong orders and healthy backlog contributing to raised guidance [52] Question: How is the company approaching modular data centers? - Management indicated that they are expanding capacity for modular data centers and integrating other OEMs' equipment, which will enhance overall margins [68][94] Question: What is the company's strategy for acquisitions? - Management emphasized a disciplined approach to acquisitions, focusing on high-growth verticals and complementary products to enhance capabilities [131]

Financial Data and Key Metrics Changes - The company reported record sales of $963 million, up 30% year-over-year, with organic growth of 9% driven by both volume and price [12] - Adjusted EPS grew 28% to $0.86, exceeding guidance [14] - Adjusted operating income increased 18% year-over-year, with a return on sales of nearly 21% [8][14] Business Line Data and Key Metrics Changes - Systems Protection sales increased 43% to $632 million, with organic growth of 10% [14][16] - Electrical Connections sales rose 11% to $331 million, with organic sales up 7% [16] - Infrastructure vertical led with organic sales growth over 20%, while commercial residential sales were up mid-single digits and industrial sales were down slightly [8][16] Market Data and Key Metrics Changes - All key geographic regions experienced growth: Americas up 9%, Europe up 10%, and Asia Pacific up low single digits [9] - The backlog increased more than fourfold compared to the previous year, driven by strong demand in data centers and power utilities [6][10] Company Strategy and Development Direction - The company is focused on becoming a higher growth electrical connection and protection company, with a significant shift towards the infrastructure vertical, which is expected to account for over 40% of sales [25][26] - Investments are being made in data solutions to support the AI build-out, with a focus on innovative power and cooling solutions [27][29] - The company is prioritizing growth initiatives, including new products and acquisitions, while maintaining a strong balance sheet [10][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance and growth outlook, particularly in data centers and power utilities [10][11] - The company raised its full-year sales guidance to reflect strong Q2 results, expecting reported sales growth of 24% to 26% [21] - Management acknowledged the dynamic tariff environment but emphasized their ability to manage pricing and productivity to offset impacts [10][87] Other Important Information - The company launched 50 new products in the first half of the year, contributing over three points to sales growth [8] - Free cash flow for the quarter was robust at $74 million, with a healthy balance sheet supporting disciplined capital allocation [18][19] Q&A Session Summary Question: Timing of converting backlog and its duration - Management indicated that the backlog is expected to convert into sales through 2026 and beyond, driven by growth in the data center solutions business and recent acquisitions [36][37] Question: Concerns about disintermediation in liquid cooling - Management clarified that they partner with hyperscalers to provide complete system solutions or specific products, maintaining strong relationships despite market changes [38][41] Question: Performance of commercial residential segment - Management noted healthy performance in the commercial residential segment but remained cautious about the overall industry outlook, expecting it to be flattish for the year [47][49] Question: Backlog growth and expectations for the second half - Management confirmed that backlog has grown significantly, particularly in the systems protection business, which is expected to grow ahead of the electrical connections segment [54][55] Question: Price recovery from tariff impacts - Management stated that they expect to recover tariff impacts through pricing and productivity, with a focus on maintaining healthy margins [85][87] Question: Modular data centers and integration of other products - Management indicated that they are integrating other OEMs' equipment into their modular data center offerings, which will enhance their capabilities over time [90][91] Question: Growth opportunities in international markets - Management attributed outperformance in international markets to a focus on high-growth verticals and strong distribution partnerships [117] Question: Margin protection amid inflation and tariffs - Management confirmed that they have mechanisms in place to adjust pricing in response to tariffs and inflation, ensuring margin protection through long-term contracts [119]

Financial Performance - nVent delivered record Q2 sales of $963 million, up 30% year-over-year[10] - Adjusted EPS was $0.86, a 28% increase[12] - Adjusted operating income reached $200 million, up 18% year-over-year, with a ROS of 20.8%[12] - Free cash flow generation amounted to $74 million in Q2 2025[12] Growth and Orders - Organic sales increased by 9%[12] - Organic orders grew by over 20% year-over-year[10] - Total backlog increased more than four-fold year-over-year[10] - New products contributed over 3 percentage points to sales growth[12] Outlook and Guidance - nVent is raising full-year sales and adjusted EPS guidance[10] - The company expects sales to be up 24% to 26% reported, and 8% to 10% organically[33] - Adjusted EPS is projected to be between $3.22 and $3.30, a 29% to 33% increase[33]

[Q2 2025 Earnings Release Overview](index=1&type=section&id=Q2%202025%20Earnings%20Release%20Overview) nVent reports strong Q2 2025 results, driven by acquisitions and organic growth, leading to increased full-year guidance [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) nVent achieved record Q2 2025 results with **30% reported sales growth** to **$963 million** and **28% adjusted EPS growth** to **$0.86**, leading to raised full-year guidance - Portfolio transformation and recent acquisitions, including Trachte and Electrical Products Group, significantly drove strong performance in high-growth infrastructure verticals like power utilities, data centers, and renewables[3](index=3&type=chunk)[4](index=4&type=chunk) Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Reported Sales | $963 million | $740 million | +30% | | Organic Sales Growth | 9% | N/A | N/A | | Reported EPS (cont. ops) | $0.65 | $0.55 | +18% | | Adjusted EPS (cont. ops) | $0.86 | N/A | +28% | | Operating Income | $157 million | $145 million | +8% | | Adjusted Operating Income | $200 million | $169 million | +18% | | Free Cash Flow | $74 million | $101 million | -27% | [Second Quarter 2025 Performance Analysis](index=2&type=section&id=Second%20Quarter%202025%20Performance%20Analysis) nVent's Q2 2025 consolidated net sales grew **30% to $963 million**, with both segments contributing, despite a **210 basis point decline** in adjusted Return on Sales to **20.8%** [Consolidated Performance](index=2&type=section&id=Consolidated%20Performance) Consolidated net sales increased **30% to $963 million** with **9% organic growth**, while adjusted Return on Sales contracted **210 basis points** to **20.8%** nVent Consolidated Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $963M | $740M | +30% | | Organic Growth | 9% | N/A | N/A | | Operating Income | $157M | $145M | +8% | | Reported ROS | 16.3% | 19.6% | -330 bps | | Adjusted Operating Income | $200M | $169M | +18% | | Adjusted ROS | 20.8% | 22.9% | -210 bps | [Segment Performance](index=2&type=section&id=Segment%20Performance) Systems Protection sales rose **43% to $632 million** with **10% organic growth**, and Electrical Connections sales increased **11% to $331 million** with **7% organic growth**, though both segments saw adjusted ROS decline Q2 2025 Segment Performance | Segment | Net Sales | YoY Change | Organic Growth | Adjusted ROS | ROS Change (bps) | | :--- | :--- | :--- | :--- | :--- | :--- | | Systems Protection | $632M | +43% | +10% | 21.7% | -180 bps | | Electrical Connections | $331M | +11% | +7% | 28.7% | -220 bps | [Full-Year and Third Quarter 2025 Guidance](index=3&type=section&id=Full-Year%20and%20Third%20Quarter%202025%20Guidance) nVent raised full-year 2025 guidance, projecting **24-26% reported sales growth** and **adjusted EPS of $3.22-$3.30**, with strong Q3 2025 forecasts Updated Full-Year 2025 Guidance | Metric | New Guidance | Prior Guidance | | :--- | :--- | :--- | | Reported Sales Growth | 24% to 26% | 19% to 21% | | Organic Sales Growth | 8% to 10% | 5% to 7% | | GAAP EPS | $2.48 to $2.56 | $2.48 to $2.58 | | Adjusted EPS | $3.22 to $3.30 | $3.03 to $3.13 | Third Quarter 2025 Guidance | Metric | Q3 2025 Guidance | | :--- | :--- | | Reported Sales Growth | 27% to 29% | | Organic Sales Growth | 11% to 13% | | GAAP EPS | $0.67 to $0.69 | | Adjusted EPS | $0.86 to $0.88 | [Shareholder Returns](index=3&type=section&id=Shareholder%20Returns) A regular cash dividend of **$0.20 per share** was approved by the Board of Directors, payable on August 1, 2025 - A regular cash dividend of **$0.20 per share** was approved, payable in the third quarter on August 1, 2025[14](index=14&type=chunk) [Consolidated Financial Statements (Unaudited)](index=5&type=section&id=Consolidated%20Financial%20Statements%20(Unaudited)) Unaudited financial statements provide a comprehensive view of nVent's financial health and operational results for the three and six months ended June 30, 2025 [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q2 2025 net sales reached **$963.1 million**, with net income from continuing operations increasing to **$106.7 million** and diluted EPS rising to **$0.65** Income Statement Highlights (Three Months Ended June 30) | Metric (in millions, except EPS) | 2025 | 2024 | | :--- | :--- | :--- | | Net Sales | $963.1 | $739.8 | | Gross Profit | $371.8 | $307.6 | | Operating Income | $156.7 | $144.9 | | Net Income from Continuing Operations | $106.7 | $93.2 | | Diluted EPS from Continuing Operations | $0.65 | $0.55 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were **$6,741.7 million**, with a significant increase in Goodwill and Intangibles, and long-term debt decreasing to **$1,752.1 million** Balance Sheet Summary (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $1,484.6 | $1,389.3 | | Goodwill & Intangibles, net | $4,633.5 | $3,808.8 | | Total Assets | $6,741.7 | $6,734.9 | | Long-term Debt | $1,752.1 | $2,117.5 | | Total Liabilities | $3,223.0 | $3,497.3 | | Total Equity | $3,518.7 | $3,237.6 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities for the six months ended June 30, 2025, was **$154.9 million**, while investing activities used **$1,008.0 million** primarily for acquisitions, and financing activities used **$714.0 million** Cash Flow Summary (Six Months Ended June 30, in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating (Continuing Ops) | $154.9 | $165.7 | | Net Cash from Investing (Continuing Ops) | $(1,008.0) | $(31.5) | | Net Cash from Financing | $(714.0) | $(83.2) | | Change in Cash and Cash Equivalents | $(64.1) | $88.9 | [Supplemental Financial Information by Reportable Segment](index=8&type=section&id=Supplemental%20Financial%20Information%20by%20Reportable%20Segment) For the six months ended June 30, 2025, Systems Protection generated **$1,140.2 million** in sales and Electrical Connections **$632.2 million**, both showing sales and income growth despite declining Return on Sales percentages Segment Performance (Six Months Ended June 30) | Segment (in millions) | Net Sales 2025 | Net Sales 2024 | Segment Income 2025 | Segment Income 2024 | | :--- | :--- | :--- | :--- | :--- | | Systems Protection | $1,140.2 | $880.7 | $241.3 | $198.6 | | Electrical Connections | $632.2 | $591.2 | $180.0 | $177.7 | [Non-GAAP Financial Measures and Reconciliations](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section reconciles non-GAAP financial measures like organic sales, adjusted operating income, and free cash flow to GAAP equivalents, used to assess core operational performance - The company defines 'organic sales' as GAAP net sales excluding the impact of currency translation and revenue from acquisitions within their first year[30](index=30&type=chunk) - Adjusted measures are used to eliminate the distorting effects of certain items, such as restructuring costs, acquisition expenses, and amortization of intangible assets, to better assess the underlying strength of operations[31](index=31&type=chunk)[33](index=33&type=chunk) [Reconciliation of GAAP to Non-GAAP Measures (2025 Forecast)](index=10&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures%20(2025%20Forecast)) Q2 2025 operating income of **$156.7 million** was adjusted to **$200.0 million**, and diluted EPS of **$0.65** was adjusted to **$0.86**, after accounting for specific items Q2 2025 GAAP to Non-GAAP Reconciliation | Metric (in millions, except EPS) | GAAP | Adjustments | Non-GAAP | | :--- | :--- | :--- | :--- | | Operating Income | $156.7 | $43.3 | $200.0 | | Net Income (cont. ops) | $106.7 | $33.9 | $140.6 | | Diluted EPS (cont. ops) | $0.65 | $0.21 | $0.86 | [Reconciliation of Net Sales Growth to Organic Net Sales Growth](index=12&type=section&id=Reconciliation%20of%20Net%20Sales%20Growth%20to%20Organic%20Net%20Sales%20Growth) Q2 2025 total net sales growth of **30.2%** comprised **8.7% organic growth** and **20.7% from acquisitions**, with full-year forecasts anticipating **24-26% total sales growth** Q2 2025 Net Sales Growth Reconciliation | Segment | Organic | Currency | Acq./Div. | Total | | :--- | :--- | :--- | :--- | :--- | | nVent | 8.7% | 0.8% | 20.7% | 30.2% | | Systems Protection | 10.0% | 1.0% | 32.4% | 43.4% | | Electrical Connections | 6.8% | 0.3% | 3.6% | 10.7% | [Reconciliation of Cash from Operating Activities to Free Cash Flow](index=12&type=section&id=Reconciliation%20of%20Cash%20from%20Operating%20Activities%20to%20Free%20Cash%20Flow) For Q2 2025, net cash from continuing operating activities was **$91.0 million**, resulting in a free cash flow of **$74.1 million** after capital expenditures Free Cash Flow Reconciliation (Three Months Ended June 30) | Metric (in millions) | 2025 | 2024 | | :--- | :--- | :--- | | Net cash from operating activities (cont. ops) | $91.0 | $117.1 | | Capital expenditures | $(16.9) | $(16.5) | | **Free cash flow (non-GAAP)** | **$74.1** | **$100.6** |

Core Insights - Vertiv (VRT) and nVent Electric (NVT) are significant players in the data center infrastructure market, providing essential solutions for data centers and industrial environments [1] - The data center infrastructure management market is projected to grow from approximately $3.06 billion in 2024, with a CAGR of 17.3% from 2025 to 2030, presenting growth opportunities for both companies [2] Vertiv (VRT) Overview - Vertiv's product portfolio includes thermal systems, liquid cooling, UPS, switchgear, busbar, and modular solutions, with organic orders growing about 20% in the last 12 months and a book-to-bill ratio of 1.4 for Q1 2025, indicating strong prospects [3] - The backlog for Vertiv increased by 10% sequentially and 25% year-over-year, reaching $7.9 billion [3][10] - Recent product launches include a 142kW cooling and power reference architecture for NVIDIA's GB300 NVL72 platform, aimed at enhancing AI infrastructure deployment [4] - Vertiv introduced four new systems to meet AI application demands, focusing on power efficiency, thermal management, and scalability [5] - Strong capital expenditure plans from hyperscalers for data center expansion are favorable for Vertiv, supported by a rich partner base [6] nVent Electric (NVT) Overview - nVent Electric is experiencing strong momentum in the data center sector, with its Data Solutions business showing double-digit sales growth due to rising demand for electrical infrastructure products [7] - The recent $975 million acquisition of the Electrical Products Group from Avail Infrastructure Solutions enhances NVT's Systems Protection segment and expands its market presence [8] - nVent launched 35 new products during the quarter to address evolving data center demands [9] - Collaboration with NVIDIA to deliver advanced liquid cooling solutions for AI-driven data centers is a notable achievement [11] Stock Performance and Valuation - Year-to-date, Vertiv's shares have decreased by 2.7%, while nVent Electric's shares have increased by 0.7% [12] - Vertiv shares are currently overvalued with a Value Score of D, trading at a forward Price/Sales ratio of 4.17X, compared to nVent's lower valuation with a Value Score of B and a Price/Sales ratio of 3.01X [14] - Earnings estimates for 2025 indicate a projected $3.55 per share for Vertiv (24.56% year-over-year increase) and $3.08 per share for nVent (23.69% year-over-year increase) [17] Conclusion - Both Vertiv and nVent Electric are well-positioned to benefit from the growing data center market, but nVent is considered the stronger investment option due to consistent growth in its Data Solutions segment, strategic acquisitions, and favorable valuation [20] - nVent Electric holds a Zacks Rank 2 (Buy), while Vertiv has a Zacks Rank 3 (Hold), indicating a stronger investment outlook for nVent [21]

Company Overview - nVent is a high-performance electrical company focused on connection and protection[10] - The company reported net sales of $3 billion with a return on sales (ROS) of 21.7% and adjusted EPS of $2.49 in 2024[9] - Free cash flow for 2024 was $427 million[9] - The company expects to launch over 75 new products in 2025, driving 2+ points of sales growth and expects product vitality above 22% in 2025[14] Business Segments and Verticals - The company operates through two segments: Electrical Connections (39%) and Systems Protection (61%)[8] - Infrastructure accounts for >40% of the portfolio[15] - Data Solutions and Power Utilities each represent approximately 20% of the portfolio[15] Data Solutions - Data Solutions sales reached approximately $600 million in 2024 and are growing at a double-digit rate in 2025[21] Sustainability - The company reduced normalized CO2e emissions by 47% since 2019[23] - 85% of products in the New Product Introduction funnel have a positive sustainability impact[23] Financial Performance - Adjusted operating income for 2024 was $652 million, resulting in an adjusted return on sales of 21.7%[31]

nVent Electric (NVT) FY Conference Summary Company Overview - nVent Electric provides a wide range of electrical products, fastening solutions, and systems supporting electrical infrastructure across various industries, including industrial, commercial, and data centers [4][8] - The company has transformed its portfolio, focusing more on electrical infrastructure after selling its thermal management business [8][9] Key Points Portfolio Transformation - The sale of the thermal management business has led to a new focus on two segments: systems protection and electrical connections [9][10] - As of the end of last year, over 40% of nVent's revenue now comes from infrastructure, which is the fastest-growing segment [17][18] - New products contributed approximately two points to growth last year, indicating a strong emphasis on innovation [12][18] Growth Strategy - nVent has completed eight acquisitions since its spin-off, demonstrating strong integration and execution capabilities [12][17] - The company aims to grow globally, with a focus on high-growth verticals such as infrastructure [12][13] - The backlog of business is growing, with strong orders and visibility into 2026 and beyond [18] Financial Performance - nVent reported $600 million in sales from its cooling and power segment, with over half of that portfolio growing double digits [21] - The company expects to see strong sales, EPS growth, and robust cash flow in the coming years [24][55] Market Trends - The demand on the electrical grid is projected to double by 2050, necessitating significant infrastructure build-out [23] - nVent's products are essential for this electrical infrastructure development, positioning the company for future growth [24] Liquid Cooling Segment - nVent has a leading portfolio in liquid cooling, with applications in data centers, battery energy storage, and industrial applications [18][20] - The company has established relationships with major players like NVIDIA and AMD to inform its product roadmap [19][62] Margin Expansion Potential - Both segments of nVent have opportunities for margin expansion through new product launches and productivity improvements [41][42] - The company targets over 30% incremental margins and sees geographic expansion as a key area for growth [43][44] Tariff Impact - nVent has managed tariff impacts through pricing productivity and supply chain actions, with an estimated $120 million impact from tariffs [46][48] - The company has raised its guidance for the year despite potential challenges in the commercial residential market [47] Competitive Position - nVent has a competitive advantage in liquid cooling due to its extensive experience and manufacturing capabilities, ensuring high-quality, leak-proof systems [57][58] - The company continues to innovate and expand its customer base, anticipating a record year for new products [60][61] Additional Insights - The company emphasizes sustainability and employee engagement as part of its mission to connect and protect in an electrified world [22][24] - nVent's disciplined approach to capital allocation and M&A is expected to drive future growth [39][34]

Summary of nVent Conference Call Company Overview - **Company**: nVent - **Industry**: Electrical Infrastructure and Data Solutions Key Points and Arguments Transformation and Growth Strategy - nVent reported $3 billion in sales for the previous year, indicating a strong return on sales and free cash flow generation [3][4] - The company is focusing on high-growth verticals, new products, and mergers and acquisitions (M&A) as part of its transformation strategy [4][6] - The portfolio has shifted to 40% electrical infrastructure, 20% data solutions, and 20% power utilities, reflecting a balanced approach between high-growth and long-cycle businesses [6][10] Acquisitions and Market Position - nVent has completed eight acquisitions since its spin-off, including the recent acquisitions of Trocde and Avail EPG, which have significantly expanded its utility segment [5][12] - The utility segment has grown to 20% of sales due to these acquisitions, focusing on engineered building solutions and long-cycle businesses [12][13] - The company has a leadership position in the utility category, particularly in transmission and distribution [14] Financial Performance and Guidance - nVent raised its guidance for organic growth to 4-6% for the second quarter, driven by strong backlog and orders, particularly in Data Solutions and Power Utilities [25][26] - The company expects to see margin improvement over time through synergy savings and productivity enhancements, despite initial lower margins from newly acquired businesses [17][19] Market Trends and Competitive Landscape - The trends of digitalization, sustainability, and electrification are expected to drive growth in the electrical industry [7] - nVent is well-positioned in the liquid cooling market, which is anticipated to grow significantly as demand for energy-efficient solutions increases [44][46] - The competitive environment in liquid cooling is intensifying, but nVent believes its established testing and performance standards will maintain its leadership [46][47] Future Outlook and M&A Strategy - nVent is optimistic about future growth, with plans to update midterm targets due to the transformation of its portfolio [55] - The company has a healthy pipeline for M&A opportunities in the fragmented $100 billion connect and protect space, targeting deals that generate value above the weighted average cost of capital [70][71] - nVent aims to integrate its recent acquisitions into a cohesive business model, enhancing synergies and operational efficiencies [62][66] Additional Insights - The company is focused on expanding its presence in Europe and Asia, recognizing the growth potential outside North America [22][23] - nVent's CapEx guidance has increased due to strong backlog and orders, particularly in Data Solutions and supply chain resiliency [52] - The company is committed to offsetting tariff impacts through pricing strategies and operational flexibility [30][31] Conclusion - nVent is undergoing a significant transformation aimed at enhancing its growth potential in the electrical infrastructure and data solutions markets. The company is leveraging acquisitions, focusing on high-growth verticals, and maintaining a disciplined approach to M&A, positioning itself for a strong future in a rapidly evolving industry [76]