Vertiv Holdings (VRT) Stock Plunges After Q4 Revenue Miss
Vertiv Holdings Co. (VRT) reported a 13% year-over-year increase in Q4 net sales to $1.865 billion, excluding foreign currency fluctuations
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Vertiv Holdings Co. (NYSE: VRT) reported net sales of $1.865 billion in Q4, marking a 13% increase year-over-year, excluding the impact of foreign currency fluctuations. This growth stems from a strong book-to-bill ratio of 1.3x and a 23% increase in organic orders from the previous year’s quarter.
Operating profit saw a notable rise to $285 million, up $123 million, with adjusted operating profit reaching $330 million, a 57% increase from the fourth quarter of 2022. This improvement was driven by enhanced commercial execution, higher volume, and productivity, albeit partially offset by research and development (R&D) investments and capacity expansion. Five hundred basis points also widened the adjusted operating margin to 17.7%.
VRT Misses on Revenue Expectations in Q4
Analysts had anticipated earnings per share (EPS) of $0.53 and revenue of $1.88 billion, positions that Vertiv surpassed with an adjusted EPS of $0.56 and a slight miss on the revenue front. However, the company’s overall performance and growth trajectory compensated for the marginal revenue discrepancy.
Guidance for the Future
Looking forward, Vertiv has laid out a positive and ambitious guidance for 2024, driven by the accelerating trends in the data center market and the increasing demand for critical digital infrastructure, particularly to support AI deployment at scale.
The company is ramping up growth opportunities through its extensive experience, leadership technology, and comprehensive portfolio. For the first quarter of 2024, Vertiv anticipates net sales to be between $1.575 billion and $1.625 billion, with adjusted operating profit expected to be in the range of $200 million to $220 million. The full-year 2024 guidance projects net sales between $7.515 billion and $7.655 billion
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
