Core Insights - Generac Holdings Inc. (GNRC) reported Q3 2025 adjusted earnings per share (EPS) of $1.83, missing the Zacks Consensus Estimate of $2.25 and down from $2.25 in the prior-year quarter [1][9] - Net sales were $1.11 billion, a decrease of 5% compared to $1.17 billion in the prior-year quarter, also missing the consensus estimate of $1.2 billion [2][9] - The company has revised its 2025 revenue expectations to flat growth, down from an earlier guidance of 2-5% increase [3] Financial Performance - Net income margin is now expected to be 6%, reduced from the previous guidance of 7.5-8.5% [4] - Adjusted EBITDA margin is estimated to be 17%, down from the previous range of 18-19% [4] - Free cash flow conversion from adjusted net income is now expected to be 80%, compared to the earlier guidance of 90-100% [4] Segment Performance - Domestic revenues fell 8% year over year to $938.1 million, with acquisitions contributing a 1% benefit [7] - International revenues increased by 11% year over year to $185.5 million, aided by a 3% favorable impact from foreign currency fluctuations [8] - Residential product revenues decreased by 13% year over year to $627 million, while C&I revenues rose by 9% to $358 million [10] Margin and Operating Metrics - Gross profit was $426.9 million, down from $472.3 million in the prior-year quarter, with respective margins of 38.3% and 40.2% [11] - Operating income decreased by 38.9% year over year to $103.1 million, and adjusted EBITDA fell to $193 million from $232 million a year ago [12] Cash Flow and Liquidity - The company generated $118.4 million of net cash from operating activities in Q3, with free cash flow totaling $96.5 million [13] - As of September 30, 2025, GNRC had $300 million in cash and cash equivalents, with long-term borrowings and finance-lease obligations totaling nearly $1.36 billion [13] - GNRC has a new share buyback authorization of up to $500 million for the next 24 months [14]

Core Insights - Generac Holdings Inc. (GNRC) is set to report its second-quarter 2025 results on July 30, with expected revenues of $1.02 billion, reflecting a 2.6% increase year over year. The consensus estimate for earnings is $1.33 per share, down 1.5% from the previous year [1][7]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for second-quarter revenues is $1.02 billion, which is a 2.6% increase from the prior year's reported figure [1]. - The consensus estimate for earnings per share is $1.33, indicating a 1.5% decline year over year, with a recent downward adjustment of 2 cents in the past week [1][2]. Recent Performance - GNRC has consistently exceeded the Zacks Consensus Estimate in the last four quarters, achieving an average earnings surprise of 15.45%. Over the past year, GNRC shares have increased by 1%, while the Zacks Manufacturing-General Industrial industry has grown by 6.9% [2]. Factors Influencing Q2 Performance - The Residential segment, particularly home standby generators, is expected to be a significant growth driver, with Residential product sales increasing by 15% year over year to $494 million in Q1 2025, driven by rising power outages and demand for reliable backup power solutions [3]. - The adoption of residential-energy technology products, including ecobee and Energy Storage systems, is anticipated to contribute positively to revenue growth. New product launches and investments in manufacturing capacity are also expected to support top-line momentum [4]. Margin Performance - Margin performance is likely to benefit from a favorable sales mix due to strong home standby shipments, improved production efficiencies, and reduced input costs [5]. - However, there are concerns regarding softness in Commercial & Industrial (C&I) sales, which saw a 5% year-over-year decline in Q1 2025, totaling $337 million. Management anticipates flat C&I sales year over year for Q2 [5][8]. Market Conditions - The company faces challenges from volatile macroeconomic conditions, including tariff issues, intense competition, and rising operating costs, particularly due to increased marketing expenditures. For Q2 2025, Residential product sales are expected to show modest growth, with estimates of $557 million, while C&I product revenues are projected at $343 million [9]. Earnings Prediction Model - Current models do not predict an earnings beat for Generac, as the company has an Earnings ESP of -0.19% and a Zacks Rank of 3 (Hold) [10].

Core Insights - Generac Holdings Inc (GNRC) reported first-quarter 2025 adjusted earnings per share (EPS) of $1.26, exceeding the Zacks Consensus Estimate of 99 cents and up from 88 cents in the prior-year quarter [1] - Net sales reached $942 million, a 6% increase from $889 million in the prior-year quarter, also surpassing the consensus estimate of $918.7 million [2] Financial Performance - The increase in Residential product sales was a key driver, compensating for weaker Commercial & Industrial (C&I) product sales, with higher demand for home standby generators amid rising power outages [2] - Management revised its 2025 revenue expectations to a growth range of 0-7%, down from the previous guidance of 3-7%, with net income margin expectations adjusted to 6.5-8.5% from 8-9% [3][4] - Gross profit rose to $372 million from $316.4 million year-over-year, with gross profit margins improving to 39.5% from 35.6% [10] Segment Analysis - Domestic revenues increased by 9% year-over-year to $782.3 million, aided by acquisitions contributing a 2% increase, while core sales rose by 7% [5] - International revenues decreased by 0.6% year-over-year to $185.5 million, impacted by a 5% unfavorable effect from foreign currency fluctuations [6] - Residential product revenues surged by 15% year-over-year to $494 million, while C&I revenues fell by 5% to $337 million [7] Cash Flow and Liquidity - In the first quarter, GNRC generated $58 million in net cash from operating activities, with free cash flow totaling $27 million [12] - As of March 31, 2025, GNRC had $187.5 million in cash and cash equivalents, alongside nearly $1.19 billion in long-term borrowings [12] Share Buyback Program - GNRC approved a new share buyback authorization of up to $500 million over the next 24 months, replacing the remaining balance of the previous program [13]

Core Viewpoint - Generac Holdings Inc. is set to report its first-quarter 2025 results on April 30, with expectations of revenue growth driven by strong residential product sales, despite challenges in the commercial and industrial (C&I) segment [1][3][4]. Group 1: Financial Performance Expectations - The Zacks Consensus Estimate for first-quarter revenues is $918.7 million, reflecting a 3.3% increase year-over-year, while earnings are estimated at 99 cents per share, up 12.5% year-over-year [1]. - Generac has consistently beaten the Zacks Consensus Estimate in the past four quarters, with an average earnings surprise of 14.2% [2]. - The company's shares have declined 17.8% over the past year, compared to a 9.3% loss in the Zacks Manufacturing-General Industrial industry [2]. Group 2: Key Factors Influencing Performance - The residential segment, particularly home standby generators, is expected to be a significant growth driver, with a 28% year-over-year increase in residential product sales in Q4 2024, reaching $743 million [3]. - Demand for Generac's products has been bolstered by extreme weather events leading to power outages, with 2024 recording the highest number of outage hours since 2010 [4]. - The first quarter typically sees less impact from hurricanes, but unexpected severe weather could positively influence sales [4]. Group 3: Product Developments and Market Position - Generac's expansion into the data center market with new high-capacity generators (2.25 MW to 3.25 MW) is aimed at meeting rising electricity needs and enhancing reliability [11]. - The ecobee smart thermostat line is gaining traction, with the launch of the Smart Thermostat Essential expected to contribute to top-line growth [12]. - The introduction of the 28kW home standby generator model enhances Generac's product offerings, providing a comprehensive home energy solution [13]. Group 4: Segment Performance Insights - The Zacks Consensus Estimate for residential products' revenues is $483.5 million, while C&I products' revenues are estimated at $324.6 million [8]. - There is concern over prolonged weakness in C&I revenues, with expectations of flat year-over-year sales and a high single-digit decline in the first quarter [7].