Financial Data and Key Metrics Changes - In Q1 2025, adjusted diluted EPS increased by 49% to $0.64, driven by higher adjusted operating profit and lower interest expenses [31][32] - Organic net sales rose by 25% year-over-year, exceeding sales guidance by over $100 million [32][33] - Adjusted operating profit increased by 35% to $337 million, with a 130 basis point expansion in adjusted operating margin [16][33] - Adjusted free cash flow reached $265 million, up 162% year-over-year, with a free cash flow conversion of over 100% [17][34] - Net leverage currently stands at 0.8%, with an investment-grade credit rating recently assigned by Fitch [35][36] Business Line Data and Key Metrics Changes - Strong growth was observed in both the Americas and APAC regions, while EMEA's growth lagged due to slower AI infrastructure build [37] - Adjusted operating margin increased across all three regions, with a notable 160 basis point expansion in the Americas [38] Market Data and Key Metrics Changes - The trailing 12-month organic orders growth was reported at 20%, with Q1 orders up 21% sequentially and 13% year-over-year [15][16] - In the Americas, TTM organic orders increased by over 30%, while APAC showed order strength and pipeline growth [21][22] - EMEA's order pipeline is robust and growing, despite lagging behind other regions [37][38] Company Strategy and Development Direction - The company is focused on capitalizing on the digital revolution and robust data center demand, particularly around AI infrastructure [8][14] - A strong emphasis on operational excellence and supply chain resilience has been established to navigate tariff challenges [24][30] - The company is committed to maintaining a strong balance sheet and cash generation to support future investments and M&A opportunities [36][94] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to handle tariff situations and emphasized the importance of operational flexibility [10][11] - The outlook for 2025 remains strong, with expectations for continued growth driven by demand signals from customers and technology partners [20][52] - The company raised its full-year organic sales growth guidance to 18%, supported by a strong backlog and pipeline [51][43] Other Important Information - The company is actively working on a project with NVIDIA to deliver a prefabricated AI factory, showcasing its capabilities in advanced AI infrastructure [54][57] - The company has developed a detailed tariff playbook to monitor and respond to evolving trade dynamics [30] Q&A Session Summary Question: How do you see the mitigation efforts phasing in through '25? - Management indicated that countermeasures include price actions on new contracts and existing backlog repricing, with benefits expected to increase as the year progresses [61][64] Question: What is driving the impressive performance on orders? - Management noted that growing pipelines and order durability are key factors, with stable pipeline velocity indicating consistent demand [72][74] Question: Can you provide details on China import exposure? - Management refrained from disclosing specific numbers but confirmed that supply reconfiguration and pricing are both contributing to mitigation efforts [80][82] Question: How are you managing production given market dynamics? - Management stated that demand remains strong across various segments, allowing for increased capacity and delivery to the market [98][100] Question: What is the ability to reprice the backlog regarding tariffs? - Ongoing conversations with customers are taking place, with a general understanding of the unique challenges posed by the current tariff environment [103][105] Question: Will Europe start to contribute to bookings? - Management expressed cautious optimism about European growth, while the Americas continue to be a primary growth engine [114][115] Question: What is the total gross tariff-related pressure for 2025? - Management did not disclose specific figures but emphasized a focus on reducing gross impact through pricing and supply chain countermeasures [89][90]

Group 1: Core Insights - Vertiv's stock rose significantly, indicating strong demand for data center equipment, with a peak increase of 21% in early trading and a 10.5% rise by midday [1] - The earnings report revealed a positive outlook with a hike in full-year sales guidance and a return to strong order growth [2] - Concerns over previous flat order performance were alleviated by a 13% growth in orders in the first quarter compared to the same period in 2024, alongside a 20% increase in trailing-12-month orders [3] Group 2: Guidance and Valuation - Management updated the organic net sales growth forecast to 16.5%-19.5%, up from the previous estimate of 15%-17%, while maintaining the midpoint of earnings and free cash flow guidance [4] - Vertiv is currently trading at less than 24 times the midpoint of free cash flow guidance for 2025, positioning it as an attractively priced growth stock amid the early stages of AI application growth [5]

Core Insights - Vertiv Holdings Co (NYSE:VRT) stock increased by 16.4% to $83.60 following better-than-expected first-quarter earnings and revenue, along with an upward revision of full-year sales guidance, driven by strong demand for data center infrastructure to support artificial intelligence (AI) [1] Group 1: Stock Performance - The stock is currently trading at its highest level since late March, although it remains 48% below its record high of $155.81 from January 24, and has a year-to-date deficit of 24% [2] - Shares are testing their 50-day moving average, which has not been cleared on a closing basis since a late January bear gap [2] Group 2: Options Activity - Vertiv stock has experienced significant options activity with 28,000 calls and 9,992 puts traded, which is triple the typical overall options volume for this time [3] - The most popular option is the weekly 4/25 90-strike call, with new positions being opened [3] Group 3: Sentiment Shift - There has been a notable shift in trader sentiment, as puts were more popular prior to the recent surge in call activity, indicated by a 10-day put/call volume ratio of 1.05, ranking higher than 95% of readings from the past year [4]

Core Viewpoint - Vertiv (VRT) has experienced a significant stock price recovery following a better-than-expected earnings report, reversing a year-to-date decline of 39.29% and surging 18.35% in pre-market trading [1][3]. Financial Performance - Vertiv reported a year-over-year earnings-per-share (EPS) growth of 49% to $0.64 and a sales increase of 24% to $2.04 billion [3]. - The company has upgraded its 2025 net sales guidance to a range of $9.325 billion to $9.575 billion, up from the previous forecast of $9.125 billion to $9.275 billion [4]. Analyst Sentiment - Analysts maintain a bullish outlook on VRT stock, with a consensus rating of 'strong buy' and an average 12-month price target of $113 [5][6]. - The lowest analyst forecast is $73, which is above the latest closing price, while the highest forecast suggests a potential rise to $146 [6]. Market Context - Despite the positive earnings report, there are concerns regarding the broader economic environment, including trade war risks and potential bubbles in the data center sector [9][10].

Core Viewpoint - Vertiv Holdings Co. reported quarterly earnings of $0.64 per share, exceeding the Zacks Consensus Estimate of $0.62 per share, and showing an increase from $0.43 per share a year ago, indicating a positive earnings surprise of 3.23% [1][2] Financial Performance - The company achieved revenues of $2.04 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 6.24%, and up from $1.64 billion in the same quarter last year [2] - Over the last four quarters, Vertiv has consistently exceeded consensus EPS estimates and revenue expectations [2] Stock Performance - Vertiv shares have declined approximately 36.8% since the beginning of the year, contrasting with the S&P 500's decline of 10.1% [3] - The current Zacks Rank for Vertiv is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.87 on revenues of $2.25 billion, while the estimate for the current fiscal year is $3.47 on revenues of $9.15 billion [7] - The trend of estimate revisions for Vertiv is currently mixed, which may change following the recent earnings report [6] Industry Context - The Computers - IT Services industry, to which Vertiv belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Another company in the same industry, Dynatrace, is expected to report quarterly earnings of $0.30 per share, with a revenue expectation of $434.56 million, reflecting a 14.1% increase from the previous year [9]

First quarter 2025 operating profit of $291 million increased $88 million, or 43%, and adjusted operating profit of $337 million increased $88 million, or 35%, compared to first quarter 2024. Adjusted operating margin expanded 130 basis points to 16.5% in the first quarter 2025 compared to the first quarter 2024, driven by operational leverage on higher sales, price-cost tailwinds and productivity, partially offset by impacts from increased tariffs and regional mix. "Vertiv's strong first quarter results de ...

Strong first quarter trailing twelve-month (TTM) orders growth of ~20%, with first quarter orders up ~13% compared to last year's first quarter and up ~21% sequentially from fourth quarter 2024 First quarter book-to-bill ratio of ~1.4x. Backlog 10% higher than year-end and up 25% from end of first quarter 2024 First quarter net sales of $2,036 million, 24% higher than first quarter 2024, with organic net sales up 25% First quarter diluted EPS of $0.42 and adjusted diluted EPS(1) of $0.64, up ~49% from firs ...

Key Takeaways Vertiv shares have struggled in 2025 amid the cooldown in AI stocks. The company is on deck to report quarterly results this week. Analysts have taken a bearish stance on its EPS outlook. The AI trade has cooled off significantly in 2025, a stark turnaround after big gains that spanned several years. While many have recalculated their bets, the staying power of AI is undeniable, and it will undoubtedly remain a focal point within the market for years to come.A company in the middle of the fr ...

Core Insights - Vertiv has announced a collaboration with NVIDIA and iGenius to deploy Colosseum, a significant AI supercomputer, in Italy in 2025, aimed at transforming the digital landscape for regulated workloads [1][3][12] - Colosseum is designed to meet the needs of highly regulated industries such as finance and healthcare, combining computational power, energy efficiency, and data sovereignty [2][9] Group 1: Collaboration and Technology - The partnership between Vertiv and NVIDIA has led to the development of Colosseum, which utilizes NVIDIA's DGX SuperPOD technology and is strategically located in southern Italy [3][4] - Colosseum is engineered for efficiency, leveraging Vertiv's infrastructure management and NVIDIA's accelerated computing capabilities, marking a new era for mission-critical AI [4][10] Group 2: Infrastructure and Design - The modular and scalable design of Colosseum allows for rapid deployment of one of the fastest hyperscale AI supercomputers, supporting sovereign AI [5][6] - Vertiv's AI-ready prefabricated modular data center solution supports up to 132kW per rack initially, with scalability for future designs [10][11] Group 3: Innovation and Efficiency - The use of NVIDIA Omniverse technologies enables real-time collaboration and predictive modeling, significantly reducing design-to-deploy cycles from months to hours [7][8] - Colosseum serves as a template for scalable, repeatable sovereign AI factories, emphasizing the importance of secure and efficient data processing [12][13] Group 4: Company Backgrounds - Vertiv provides critical digital infrastructure solutions globally, addressing challenges in data centers and communication networks [15] - iGenius specializes in AI solutions for regulated industries, offering products like Unicorn and advanced language models tailored for mission-critical applications [16]

Core Viewpoint - Vertiv (VRT) is expected to report strong first-quarter 2025 results with projected net sales between $1.9 billion and $1.95 billion, reflecting an organic growth rate of 17-21% year over year, alongside anticipated non-GAAP earnings of 57 to 63 cents per share [1][2]. Group 1: Financial Expectations - The Zacks Consensus Estimate for first-quarter revenues is $1.92 billion, indicating a year-over-year growth of 16.92% [2]. - The consensus estimate for earnings is 62 cents per share, representing a 44.19% year-over-year growth [2]. - Vertiv has consistently beaten the Zacks Consensus Estimate in the past four quarters, with an average earnings surprise of 13.67% [3]. Group 2: Market Position and Growth Drivers - Vertiv serves data center providers and is benefiting from strong AI-driven order growth, particularly in thermal management solutions [4]. - The company launched four new systems in March, enhancing its capabilities in infrastructure management and advanced thermal management [5]. - Vertiv's partnerships with major companies like NVIDIA and Intel are significant growth catalysts [5]. Group 3: Stock Performance and Valuation - Vertiv shares have declined 35.6% year to date, underperforming the Zacks Computer & Technology sector and the Computer IT Services industry [6]. - The stock is trading at a price/book ratio of 11.45, which is higher than the sector average of 8.16 and its peers like Eaton and Schneider Electric [13]. - Vertiv's stock is currently showing a bearish trend, trading below both the 50-day and 200-day moving averages [10][12]. Group 4: Capacity Expansion and Collaborations - Vertiv is expanding its manufacturing capacity globally to meet AI-driven demand, with 23 manufacturing plants in operation [16]. - The company has opened a new 215,000 square feet facility in South Carolina to support production of integrated modular solutions [17]. - Collaborations with Ballard Power and the development of backup power applications for data centers are noteworthy advancements [19].