A.O. Smith Reports Q2 Earnings: North America Growth and Strategic Review in China
A.O. Smith Corporation (NYSE:AOS) reported second-quarter 2026 sales of approximately $1 billion, with adjusted earnings per share at $1.03. The company experienced strong growth in its North American operations, where sales rose by 5% to $821 million year-over-year, driven primarily by a 21% increase in boiler sales and the recent acquisition of Leonard Valve, which contributed an additional $16 million. However, A.O. Smith faced continued challenges in China, with Rest of World segment sales declining 19%, including a sharp 28% drop in local currency terms due to weak consumer demand—particularly for premium appliances. The company is nearing the conclusion of its strategic review regarding its Chinese operations and plans to provide an update next quarter. Despite these challenges, A.O. Smith reported stronger cash flow performance, with first-half free cash flow rising 67%. As a result, it raised its share repurchase target for 2026 to $300 million.
Tickers: $AOS
Topics: acquisition_impact china_performance leadership_transition margins sales_growth