Wesco Shares Fall by 5% Following Q2 Earnings and Revenue Disappointment

PITTSBURGH – Wesco International, a global leader in supply chain solutions and logistics, announced second-quarter earnings that fell short of Wall Street’s expectations.

The company reported adjusted earnings per share (EPS) of $3.21, which missed the analyst estimate of $3.59. Revenue also underperformed, with the reported figure at $5.48 billion, compared to the consensus estimate of $5.56 billion.

Following the announcement, Wesco’s stock dropped by 5%. This decline in share price highlights concerns regarding the company’s performance and future outlook. Wesco has also revised its full-year guidance downwards, now projecting organic sales growth between a decline of 1.5% and an increase of 0.5% compared to the previous year, with an adjusted EBITDA margin expected to be between 7.0% and 7.3%.

In the second quarter, Wesco’s net sales showed a year-over-year (YoY) decrease of 4.6%, with organic sales down 0.8% YoY. However, the company reported a sequential sales increase of 4.7%. The operating profit was recorded at $324 million, yielding an operating margin of 5.9%. The gross margin saw a slight improvement YoY, rising from 21.6% to 21.9%.

John Engel, Chairman, President, and CEO, commented on the results, stating, "Our second-quarter results were somewhat below our expectations for a low single-digit decline in reported sales against a continued mixed and multi-speed economic environment." Engel attributed the lower performance to a significant slowdown in purchases by utility customers and inventory destocking, which adversely affected the Utility and Broadband Solutions segment.

Despite these challenges, Wesco remains optimistic about its long-term growth potential, pointing to an increase in AI-driven data center development and the successful completion of strategic acquisitions. Engel also highlighted the company’s strong free cash flow generation in the first half of the year and its ongoing execution of capital allocation strategies, including a planned $300 million share repurchase.