Trane Technologies Q2 Earnings Call Highlights

Trane Technologies raised its full-year outlook after strong second-quarter results, now expecting approximately 9% organic revenue growth and adjusted EPS of $15.20–$15.30.

Enterprise organic bookings rose 37%, creating a record $12.1 billion backlog.

Commercial HVAC led growth , with Americas bookings up 50% and applied bookings up 130%; about 90% of the backlog is tied to commercial HVAC, including substantial data-center and thermal-management demand.

The company expects stronger margins in the second half, supported by Americas growth, while Middle East weakness continues to pressure EMEA.

Residential demand also exceeded expectations, and Trane has repurchased about $840 million of stock year to date.

Trane Technologies NYSE: TT raised its full-year revenue and earnings outlook after reporting second-quarter growth in bookings, revenue and adjusted earnings per share, supported by demand in commercial HVAC, services and residential markets.

Chair and CEO Dave Regnery said enterprise organic bookings rose 37% in the quarter, driving a record backlog of $12.1 billion, up 70% from a year earlier.

Organic revenue increased 9%, while adjusted EPS grew 11%.

The company now expects full-year organic revenue growth of approximately 9% and adjusted EPS of $15.20 to $15.30.

For the third quarter, Trane expects approximately 10% organic revenue growth and adjusted EPS of about $4.70.

Commercial HVAC was the primary source of strength, particularly in the Americas.

Regnery said Americas commercial HVAC bookings rose 50% year over year to an all-time high, while organic revenue increased by the low teens.

Applied bookings rose 130%, marking the fourth consecutive quarter in which applied bookings exceeded 100% growth.

On a two-year stacked basis, applied bookings have increased more than fourfold, he said.

About 90% of the company’s backlog is in commercial HVAC, according to Regnery.

Approximately $6 billion of backlog is scheduled for 2027 and beyond, providing visibility beyond the current year.

Applied revenue grew more than 40% in the second quarter, and the company expects that growth rate to continue in the second half based on its current guidance, Regnery said.

He added that Trane does not expect to turn away orders because of capacity limitations, citing a fourfold expansion of applied capacity during the past three years, along with continuing lean initiatives, brick-and-mortar investments and acquisitions.

Chief Operating Officer Donny Simmons said the company booked four orders greater than $100 million during the quarter, including one at Stellar Energy.

Trane acquired Stellar, a provider of modular chiller plants, and expects the business to generate approximately $500 million of revenue in 2026 from the backlog it brought into the company.

Regnery said Stellar is currently focused almost entirely on data centers but has applications in other verticals.

While the company previously expected the acquisition to be modestly accretive to EPS this year, he said Trane now expects it to be flat for EPS in 2026 as it pulls forward investments to implement its operating system and support future growth.

Data center demand remains important but emphasized that commercial HVAC growth was broad-based.

Regnery said Trane tracks 14 verticals in the Americas, all of which posted booking growth of more than 20% during the quarter.

On a year-to-date basis, 11 of the 14 verticals recorded order growth, with m...