Business Overview - Watsco is a market leader in a highly fragmented industry, focusing on transforming customer experience with technology and value creation[4] - The company operates 693 strategic locations across the United States, Canada, and Latin America & Caribbean[12] - Watsco's business model involves contractors purchasing equipment, parts, and supplies to repair or replace homeowner's systems[10] Market and Products - The company estimates its market share to be 18-20%[46] - Watsco's revenue is primarily generated in the United States (90%), with Canada and Latin America contributing 5% each[19] - Residential HVAC equipment accounts for 55% of revenue, followed by other HVAC products (26%), commercial HVAC equipment (15%), and refrigeration (4%)[19] - The installed base of HVAC units in the U S continues to grow, with approximately 96 million units shipped in 2024, and only ~12% of industry shipments tied to Residential New Construction[24] Technology and ESG - Watsco is focused on using technology to transform the HVAC industry, with $2.6B in annualized e-commerce revenue in 2024, an 8% increase[25, 35] - The company has over 930k product SKUs digitized and accessible in its mobile app[32, 36] - Watsco's ESG efforts have resulted in averting 23.7 million metric tons of CO2e from the sale of high-efficiency equipment from January 2020 – March 2025[38] Financial Performance - From 1989 to LTM 3/31/25, Watsco's revenues grew from $64 million to $7.6 billion, representing a 14% CAGR[46] - EBIT increased from $2 million to $767 million during the same period, a 17% CAGR[46] - The company's market capitalization has grown from $22 million to $20 billion, a 21% CAGR[46]

Business Overview - Watsco operates in a highly fragmented industry, holding a leading market position [4, 13] - The company's business model involves contractors purchasing equipment, parts, and supplies to repair or replace HVAC systems [10] - Watsco has a significant geographic presence with 690 locations across the United States, Canada, and Latin America & Caribbean [12] - The company's revenue is primarily generated in the United States (90%), with Canada and Latin America contributing 5% each [19] - Residential HVAC equipment accounts for 54% of Watsco's revenue, followed by commercial HVAC equipment at 15% and other HVAC products at 27% [19] Technology and Digital Transformation - Watsco is focused on transforming the HVAC industry through technology, aiming to enhance customer experience and improve efficiency [23] - The company's annualized e-commerce revenue reached $2.4 billion in 2023, representing a 5% increase [32] - Watsco has digitized over 1.5 million product SKUs, accessible through its mobile app [29, 33] - E-commerce users experience approximately 50% less attrition compared to traditional customers [32] Financial Performance and Shareholder Value - From 1989 to 12/31/23, Watsco's revenues grew from $64 million to $7.3 billion, representing a 15% compound annual growth rate (CAGR) [41] - Over the same period, EBIT increased from $2 million to $795 million, with an 18% CAGR [41] - The company's market capitalization grew from $22 million to $16.9 billion, reflecting a 22% CAGR [41]