WESCO International Q2 Earnings Call Highlights

WESCO delivered record second-quarter results: Sales rose 13% to $6.7 billion, adjusted EBITDA increased 24% to $487 million, and adjusted EPS climbed 35% to $4.57. Margins expanded across the company, supported by favorable mix and improvement initiatives. Data center demand remained the primary growth driver, with sales up approximately 45% to $1.5 billion. All three business units reported higher sales and backlogs, while the Newark Engineering acquisition added cooling, engineering and lifecycle-service capabilities in Southeast Asia. WESCO raised its 2026 outlook, now forecasting 9%–11% organic sales growth, adjusted EBITDA margins of 6.9%–7.1% and adjusted EPS of $16.00–$17.50. The company expects low-double-digit sales growth in the third quarter, although margins may decline slightly sequentially due to business mix.

WESCO International NYSE: WCC reported record second-quarter results and raised its full-year outlook, citing continued data center demand, broad-based growth across its business units and expanding profitability. Chairman, President and CEO John Engel said the company achieved record sales, backlog, adjusted EBITDA and adjusted earnings per share in the quarter, all above its internal plan. Sales rose 13% from a year earlier, extending WESCO’s streak of double-digit sales growth to four consecutive quarters.

Executive Vice President and CFO Indraneel Dev said quarterly sales reached a record $6.7 billion, up 13% on both a reported and organic basis. The increase included an estimated 3% benefit from pricing, while volume growth was positive across all three business units. Adjusted EBITDA increased 24% to a record $487 million, and adjusted EBITDA margin expanded 60 basis points to 7.3%. Gross margin increased 70 basis points, which Dev attributed to favorable sales mix and margin-improvement initiatives. SG&A expense was 14.5% of sales, compared with 14.4% a year earlier, reflecting higher incentive compensation that was partly offset by operating leverage. Adjusted diluted earnings per share rose 35% to a record $4.57. The company said operating performance, margin expansion, a lower tax rate, the absence of preferred dividends and a lower share count supported earnings growth, partially offset by higher interest expense. Free cash flow totaled $32 million in the second quarter and $246 million in the first half. Dev said working-capital intensity remained approximately 20% of sales despite the company’s double-digit revenue growth.

WESCO’s Communications and Security Solutions, or CSS, business posted 18% reported and organic sales growth. Sales within WESCO Data Center Solutions increased approximately 45%, while security and enterprise network infrastructure grew at a low-single-digit rate. CSS backlog rose approximately 95% year over year to a record level. CSS adjusted EBITDA increased 37%, and its adjusted EBITDA margin expanded 140 basis points to a record 10.2%, marking the segment’s first double-digit EBITDA-margin quarter. The Electrical and Electronic Solutions, or EES, segment recorded 11% sales growth, including approximately 6% volume growth and approximately 5% from pricing. Construction sales increased at a high...