A. O. Smith Corporation Q3 2026 Earnings Recap

A. O. Smith shares rose 4.3% after earnings. The company reported flat third-quarter sales and $0.93 in EPS, while North America grew 3%; its announced China transaction and plans to return proceeds through share repurchases also sharpen the strategic outlook.

Key Takeaways

• Total-company Q3 sales were $941 million, essentially flat year over year; EPS was $0.93.
• North America sales rose 3% to $762 million, including a 2% contribution from Leonard Valve; organic growth was about 1%.
• Within North America, boiler sales increased 13% and water-treatment sales grew 5%, while water-heater sales declined 1% amid soft residential demand.
• Steel and freight costs are rising; the company announced a price increase of up to 9.5% on most water-heater products, effective in December.
• A. O. Smith agreed to sell 81% of its China business, valued at $400 million, while retaining 19% and the brand under a licensing agreement. It expects total value, including estimated future royalties, to exceed $500 million and plans to prioritize after-tax proceeds and about $80 million of expected China cash repatriation for share repurchases.