#United States #Pittsburgh #Wesco International #EBITDA margin #Data Center Sales

Wesco International Reports Strong Second Quarter Performance

Wesco International (NYSE: WCC), a leader in business-to-business distribution and supply chain solutions, recently published its second quarter results for 2025. The report reveals notable advancements in both sales and profits, demonstrating the company's robust market position.

Strong Sales Performance

In the second quarter, Wesco detailed an impressive 7.7% year-over-year increase in net sales, reaching approximately $5.9 billion. Organic sales, which exclude the effects of acquisitions, rose by 7.2% compared to the same quarter last year and also reported a sequential growth of 6.2%. The growth was especially driven by the data center segment, which surpassed $1 billion in sales, reflecting a significant increase of 65% year over year. This achievement marks a milestone for the company and highlights its capabilities in meeting the growing demands of the digital infrastructure market.

CEO John Engel commented on the results, stating, "We continued to build on our positive sales momentum in the first half of 2025 and outperformed the market with our leading portfolio of products, services, and solutions. The growth has been especially evident in our Communications and Security Solutions (CSS) and Electrical and Electronic Solutions (EES) divisions, which reported organic growth rates of 17% and 6%, respectively."

EBITDA Expansion and Free Cash Flow

Wesco reported an EBITDA margin of 6.7% for the second quarter, reflecting a sequential increase of 90 basis points. However, net income attributable to common stockholders fell to $189.2 million, a decrease of 13.1% compared to $217.7 million in the previous year. Adjusted earnings per diluted share were at $3.39, marking a 5.6% uptick from the year-ago period.

Wesco's dedication to maintaining healthy cash flow is highlighted by its significant operational cash inflow of $107.8 million for the quarter, more than doubling from a cash outflow in the prior year. This positive cash flow enables the company to prioritize investments in growth and technology.

Operational Excellence and Market Outlook

The backlog at Wesco has also shown growth, increasing by 11% year-over-year and 5% sequentially. The company is on track to maintain its momentum, with expectations for continued organic sales growth for the full year 2025. Engel also noted that there is a robust pipeline of opportunities, driven by increased bidding activity across all segments, particularly within utility sectors.

The redemption of preferred stock in June has further improved Wesco's financial position, enhancing cash flow and earnings per share. The company is now positioned with no significant debt maturities until 2028, allowing flexibility for capital allocation, which prioritizes debt reduction, stock buybacks, and strategic acquisitions. Engel expressed confidence in Wesco's capability to sustain and expand its growth, highlighting enduring trends in automation, electrification, and the convergence of AI with data centers as key growth drivers.

Conclusion

Wesco International's second quarter results present a compelling picture of a company that is not only weathering current market conditions but is also positioned to capitalize on emerging opportunities. With a strong sales trajectory, robust cash flow, and a strategic approach towards innovation and operational excellence, Wesco is poised for continued success in 2025 and beyond.