Watsco, Inc. (NYSE: WSO) shares withered Wednesday, on unveiling operating results for the first quarter ended March 31, 2025 and provided commentary on growth opportunities, business trends, its financial position and long-term growth drivers.
Watsco maintains a strong balance sheet and is well-positioned to invest in growth. As previously announced, Watsco raised its annual dividend by 11% to $12.00 per share effective in April 2025. At March 31, 2025, Watsco had $432 million of cash, no outstanding debt and $3 billion of shareholders’ equity. 2025 marks the Company’s 51st consecutive year of paying dividends.
Revenues decreased 2% to $1.53 billion; Gross profit of $430 million was flat versus last year; Gross profit margin improved 60 basis-points to 28.1%; SG&A expenses increased 4%; Operating income was $112 million with an operating margin of 7.3%; Earnings per share of $1.93 versus $2.17 for the prior year
Watsco is the leading distributor in the HVAC/R marketplace, serving over 375,000 contractors, technicians and installers from 693 locations across the U.S., Canada and Latin America. Since entering distribution in 1989, the Company has scaled to be the industry leader through a combination of organic growth and the acquisition of 71 businesses. From 1989 through 2024, Watsco has achieved a 19% compounded annual growth rate for total-shareholder-return, representing strong performance across most macroeconomic and industry cycles.
WSO shares faltered $30.77, or 6.1%, to $472.39.