Carrier Global Corp Reports 2025 Results and 2026 Outlook

Carrier reported a total net sales of $4.8 billion for Q4 2025, reflecting a 6% decrease from the $5.1 billion reported in the same quarter of 2024. The downturn was attributed primarily to a 9% decline in organic sales, although this impact was partially mitigated by a 3% benefit from foreign currency translation.

Operating profit fell sharply to $101 million, an 87% decline compared to the previous year, which had benefited from a gain related to the sale of the commercial refrigeration business. The company’s operating margin plummeted to 2.1%, down from 15.0% in Q4 2024. Adjusted operating profit also decreased by 33% to $455 million, bringing the adjusted operating margin down to 9.4%.

The diluted earnings per share (EPS) from continuing operations stood at $0.03, contrasting with a loss of $0.05 in the same quarter last year. Adjusted EPS for continuing operations was reported at $0.34, a decline of 37% from $0.54 in Q4 2024.

The CSA segment experienced a significant sales drop of 17%, with organic sales mirroring this decline. The downturn was driven predominantly by a 38% fall in residential sales and a 20% decrease in light commercial sales. The segment’s operating profit also suffered, declining 61% to $168 million, with an operating margin down to 8.7%.

In contrast, the CSE segment reported a 6% increase in net sales, reaching $1.3 billion. Although organic sales dipped by 2%, the segment’s operating profit surged by 50% to $120 million, enhancing the operating margin to 9.0%, reflecting strong productivity and cost synergies.

CSAME's net sales fell 9% to $798 million, with organic sales also down by 9%. Notably, the segment's operating profit remained stable at $95 million, resulting in a slight increase in operating margin to 11.9%.

The CST segment was a standout performer, posting a 13% increase in net sales to $772 million, supported by a 10% rise in organic sales. Operating profit climbed 15% to $112 million, with the segment's operating margin improving to 14.5%.

Carrier reported robust cash flow metrics, with net cash flows from operating activities amounting to $1.04 billion, a significant increase from $132 million in the prior year. Free cash flow also showed strong improvement, reaching $909 million, compared to a negative $89 million in Q4 2024.

Looking ahead, Carrier is optimistic about achieving continued double-digit growth in global commercial HVAC and aftermarket segments despite ongoing weaknesses in the residential market, especially in the Americas. The company anticipates a flat to low-single-digit organic growth rate for 2026, with expected reported sales ranging from flat to low-single-digit growth.

David Gitlin, Chairman & CEO, emphasized the company’s focus on strategic cost management and building backlog in long-cycle businesses to navigate the current market challenges effectively. As Carrier moves forward into 2026, its commitment to innovation and operational efficiency remains central to its growth strategy.