Watsco Cools Down the Competition with Record-Breaking Quarter and Bright Future
On February 18th, 2025, Watsco Inc. reported its most impressive quarterly earnings to date. Chairman and CEO Albert Nahmad proudly announced a record-breaking quarter that exceeded all expectations, with sales reaching unprecedented heights.
The company's financial position is stronger than ever, with a remarkable 14% growth in equipment sales and an astonishing 16% increase in residential products. This significant improvement is attributed to the favorable market conditions, which have been conducive to Watsco's success. As Nahmad mentioned during the earnings call, "Market conditions continue to improve, which led to a 14% growth in equipment sales and 16% growth in residential products."
In addition to these remarkable numbers, Watsco also announced an impressive dividend increase of 11%, taking it up to $12 per share. This demonstrates the company's commitment to rewarding its shareholders while continuing to invest in its future.
The company is optimistic about its prospects for the coming year, with several factors contributing to this confidence. The transition to next-generation A2L products, which provide more efficient and environmentally friendly systems, is well underway. This transition has already influenced 50% to 60% of Watsco's sales, with the company investing heavily in training customers and leveraging its technology advantage.
The adoption of digital technologies has also been a significant factor in Watsco's success. The company's mobile apps have attracted an impressive community of active users, numbering over 64,000 annually. E-commerce sales grew by 16% during the quarter, representing 35% of the company's annual sales, totaling $2.6 billion.
Watsco's digital sales platform, OnCall Air, has also seen remarkable success, with contractors presenting approximately 313,000 proposals to homeowners and generating 1.5 million in gross merchandise value – a 25% increase.
The company believes that its technology investments have significantly contributed to its performance and provide it with a significant competitive advantage. As Nahmad emphasized during the earnings call, "There is no question that our technology investments have contributed to our performance and provide us an immense competitive environment."
Watsco's strong financial position has allowed the company to invest in big opportunities and accelerate growth. In January 2025, Watsco completed its 70th acquisition since 1989, demonstrating the company's commitment to expansion and innovation.
