Carrier Global (CARR) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales reached $6.7 billion, up 12% year-over-year, with organic orders up 30% and strong HVAC and aftermarket performance, driven by Viessmann Climate Solutions acquisition and robust data center and commercial HVAC demand, offsetting weakness in Europe and China.

• Adjusted operating profit rose 26% to over $1.2 billion, with adjusted EPS up 10% to $0.87; GAAP EPS was $2.55, reflecting a $2.9 billion gain on the Access Solutions divestiture.

• Portfolio transformation advanced with the $14.2 billion Viessmann acquisition, two major business exits closed, and net debt reduced by over $5 billion; $1 billion in share repurchases planned for H2 2024.

• Continued innovation in sustainable solutions, digital platforms, and AI, with aftermarket sales up 9% and recurring revenue focus.

• Net income attributable to common shareowners rose to $2.3 billion, driven by divestiture gains and portfolio actions.

Financial highlights

• Q2 2024 reported sales were $6.7 billion, up 12% year-over-year; organic sales up 2%.

• Adjusted operating margin expanded by 200 basis points to 18.1%; HVAC margin at 19.9%, Refrigeration 12.1%, Fire & Security 17.8%.

• Adjusted EPS was $0.87, up from $0.79 in Q2 2023; free cash flow was $549 million, up 35% year-to-date.

• Net income was $2.3 billion; adjusted net income was $793 million.

• Net debt reduced to $10.4 billion as of June 30, 2024, from $14.2 billion at year-end 2023.

Outlook and guidance

• Full-year 2024 sales guidance updated to $25.5 billion, with mid-single-digit organic growth expected.

• Adjusted operating margin guidance maintained at roughly 15.5%; adjusted EPS range of $2.80–$2.90 reaffirmed.

• Free cash flow outlook remains $400 million, reflecting $2 billion in tax payments on business exits; underlying free cash flow expected at $2.4 billion.

• Q3 2024 sales expected at $6.6 billion, with adjusted EPS of about $0.80 and a 500 basis point higher tax rate year-over-year.