second quarter of 2026
Filed Jul 30, 2026Wesco International Reports Second Quarter 2026 Results
Record net sales, backlog, adjusted EBITDA and adjusted diluted EPS were accompanied by double-digit organic growth, expansion in gross margin and adjusted EBITDA margin, and a raised full-year 2026 outlook.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net salesGAAP | $6,665.1 million | 9.6% | 13.0% |
| Organic sales growthnon-GAAP | 12.6% | 6.6% | – |
| Data center salesother | $1.5 billion | – | ~45% |
| Selling, general, and administrative expensesGAAP | $1,022.7 million | – | 17.3% |
| Operating profitGAAP | $382.2 million | – | 18.6% |
| Operating marginGAAP | 5.7% | – | 20 basis points |
| Net income attributable to common stockholdersGAAP | $209.0 million | – | 10.5% |
| Earnings per diluted shareGAAP | $4.23 | – | 10.4% |
| Effective tax rateGAAP | 22.9% | – | (320) basis points |
| Gross profitnon-GAAP | $1,456.0 million | – | 17.2% |
| Gross marginnon-GAAP | 21.8% | – | 70 basis points |
| Adjusted selling, general, and administrative expensesnon-GAAP | $999.5 million | – | 15.7% |
| Adjusted EBITDAnon-GAAP | $487.2 million | – | 23.6% |
| Adjusted EBITDA marginnon-GAAP | 7.3% | 90 basis points | 60 basis points |
| Adjusted net income attributable to common stockholdersnon-GAAP | $225.6 million | – | 34.7% |
| Adjusted earnings per diluted sharenon-GAAP | $4.57 | – | 34.8% |
| Operating cash flowGAAP | $53.7 million | – | (50.2)% |
| Free cash flownon-GAAP | $32.3 million | – | (62.7)% |
| Six months net salesGAAP | $12,745.2 million | – | 13.4% |
| Six months organic sales growthnon-GAAP | 12.5% | – | – |
| Six months operating profitGAAP | $675.7 million | – | 20.0% |
| Six months net income attributable to common stockholdersGAAP | $362.8 million | – | 23.7% |
| Six months earnings per diluted shareGAAP | $7.33 | – | 23.8% |
| Six months adjusted EBITDAnon-GAAP | $876.0 million | – | 24.3% |
| Six months adjusted earnings per diluted sharenon-GAAP | $7.93 | – | 41.6% |
| Six months operating cash flowGAAP | $275.1 million | – | 102.6% |
| Six months free cash flownon-GAAP | $245.7 million | – | 156.2% |
Capital returns
- The prior year period included the favorable impact of the June 2025 redemption of the Company's 10.625% Series A Fixed-Rate Reset Cumulative Perpetual Preferred Stock, partially offset by $12.9 million of preferred stock dividends.
What drove it
- Volume growth in all three segments, CSS, EES and UBS, and a favorable impact from changes in price supported second-quarter organic sales growth of 12.6%.
- Data center sales were $1.5 billion, up ~45% YOY.
- Record backlog was up by approximately 60% compared to the end of the second quarter of 2025, fueled by multi-year customer commitments.
- Gross-margin improvement in EES and CSS was partially offset by a decline in UBS gross margin.
- Higher sales and gross margin drove the increase in adjusted EBITDA and adjusted EBITDA margin.
- The effective tax rate declined largely due to higher discrete income tax benefits relating to the exercise and vesting of stock-based awards.
- Wesco won a significant multi-year Grid Services award in UBS from a hyperscale data center customer and acquired Singapore-based Newark Engineering to strengthen cooling solutions and end-to-end data center capabilities.
Concerns
- Second-quarter operating cash flow declined by $54.1 million, driven by trade accounts receivable and other current and noncurrent assets, including supplier prepayments.
- UBS gross margin declined and partially offset gross-margin improvement in EES and CSS.
- Second-quarter SG&A expenses included $23.2 million of digital transformation costs, compared to $8.1 million of digital transformation and restructuring costs in the prior-year quarter.
- Interest expense increased by $17.5 million, primarily due to higher net term debt throughout the quarter compared to the prior year.
- The quarter included a $10.0 million non-cash loss on extinguishment from the redemption of the 2028 Notes.
What to watch
- Whether record backlog, up approximately 60% YOY, converts into continued sales growth.
- Data center sales momentum following $1.5 billion of sales and the new multi-year Grid Services award.
- UBS margin performance following the reported decline in segment gross margin.
- Working-capital effects from trade accounts receivable and supplier prepayments on quarterly operating cash flow.
- Delivery of the raised full-year 2026 outlook, for which numerical guidance was not included in the provided filing text.
Balance sheet and cash flow
- Second quarter operating cash flow was $53.7 million, compared to $107.8 million in the second quarter of 2025.
- Second quarter free cash flow was $32.3 million, compared to $86.5 million in the second quarter of 2025.
- First six months operating cash flow was $275.1 million, compared to $135.8 million for the first six months of 2025.
- First six months free cash flow was $245.7 million, compared to $95.9 million for the first six months of 2025.
- The second-quarter operating cash flow decrease included a $182.8 million impact from changes in trade accounts receivable and a $155.3 million impact from changes in other current and noncurrent assets, partially offset by a $129.9 million impact from changes in other current and noncurrent liabilities.
- The first-six-month operating cash flow increase included a $170.4 million impact from changes in other current and noncurrent liabilities and a $151.3 million impact from accounts payable, partially offset by a $209.8 million impact from changes in trade accounts receivable and a $168.1 million impact from changes in other current and noncurrent assets.
Analysis
Wesco reported record second-quarter net sales of $6,665.1 million, up 13.0% year over year and up 9.6% sequentially. Organic sales growth was 12.6%, supported by volume growth across CSS, EES and UBS and a favorable pricing impact. Data center sales were $1.5 billion, up ~45% YOY, while total company backlog reached a record and was up approximately 60% year over year. Management described four consecutive quarters of double-digit sales growth fueled by data centers, alongside continued infrastructure-project demand across the diversified portfolio.
Management, verbatim
We delivered another exceptional quarter marked by continued market outperformance and accelerating business momentum. Sales, backlog, adjusted EBITDA, and adjusted earnings per share all increased versus the prior year and achieved records that exceeded our plan.
John Engel, Chairman, President, and CEO
As a result, we are significantly raising our full-year 2026 outlook reflecting the favorable secular growth trends and our confidence in continued strong execution.
John Engel, Chairman, President, and CEO
Not in the filing
stated, not guessed- Numerical full-year 2026 guidance for revenue, gross margin, operating expenses, tax rate, adjusted EBITDA, adjusted EPS, cash flow, or any other metric was not included in the provided filing text.
- Prior outlook was not provided, so reported results cannot be compared with prior guidance.
- Segment revenue, segment profit, and segment margin for CSS, EES and UBS were not included in the provided filing text.
- Quarter-end cash, total debt, net debt, liquidity, inventory, accounts receivable, and accounts payable balances were not included in the provided filing text.
- Second-quarter share repurchases, common dividends, and related authorization information were not included in the provided filing text.
- Prior-quarter absolute figures for the reported metrics were not included, other than the stated sequential changes for net sales, organic sales growth, and adjusted EBITDA margin.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.