CARR · Carrier Global Corporation

Carrier Global Corporation's first quarter 2026 results reflected a mixed performance, characterized by robust order growth offset by significant profitability pressures. Total company orders rose 11%, with notable strength in the Commercial HVAC segment, which posted a 35% increase fueled by data center orders surging over 500%. This strong order activity contributed to a backlog that management stated fully covers expected 2026 data center sales, providing visibility for future revenue. However, profitability metrics declined sharply. GAAP operating profit fell 59% to $259 million, driven by lower sales in the CSA Residential business and continued headwinds in China Residential and Light Commercial (RLC). The CSA segment experienced a 730 basis point margin contraction, largely attributed to factory under-absorption from lower residential volumes. Similarly, the CSAME segment saw a 490 basis point margin decline, primarily due to China RLC dynamics. Total net sales increased 2% to $5.34 billion, though organic sales declined 1%, mitigated by a 3% benefit from foreign currency translation. Despite the profit decline, the company generated $79 million in operating cash flow and returned approximately $500 million to shareholders. Management expressed confidence in the portfolio's trajectory, specifically highlighting the expectation for a sixth consecutive year of double-digit growth in the Commercial HVAC business. Consequently, Carrier reaffirmed its full-year 2026 outlook, maintaining guidance for approximately $22 billion in sales, ~$3.4 billion in adjusted operating profit, ~$2.80 adjusted EPS, and ~$2 billion in free cash flow.