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Dec 31, 2025
Lennox Q4 2025 Earnings Report
Lennox reported fourth quarter and full year 2025 financial results, with revenue declining 11% and GAAP diluted EPS decreasing 22% year-over-year for the quarter.
Key Takeaways
Lennox experienced a challenging fourth quarter in 2025, with total revenue down 11% to $1.2 billion and GAAP diluted EPS falling 22% to $4.07. The Home Comfort Solutions segment saw a significant revenue decline of 21% due to channel destocking and soft new construction sales, while the Building Climate Solutions segment showed resilience with 8% revenue growth, driven by parts acquisition and services demand.
Fourth quarter revenue decreased 11% to $1.2 billion, primarily due to unfavorable sales volumes.
GAAP diluted EPS for Q4 2025 was $4.07, a 22% decrease from the prior-year quarter.
Home Comfort Solutions revenue declined 21%, impacted by channel destocking and softness in new construction sales.
Building Climate Solutions revenue grew 8%, supported by steady parts acquisition, services demand, and favorable mix.
Revenue by Segment
Forward Guidance
For the full year 2026, Lennox anticipates revenue growth of 6% to 7%, with adjusted earnings per share expected to be between $23.50 and $25.00. Free cash flow is projected to be between $750 million and $850 million.
Positive Outlook
- Revenue is anticipated to increase by approximately 6% to 7% for full year 2026.
- Growth from completed acquisitions is expected to contribute approximately 4% to revenue.
- Adjusted earnings per share is expected to be within the range of $23.50 to $25.00.
- Free Cash Flow is estimated to fall within the range of $750 million to $850 million.
- The company remains confident that its strategy and recent investments position it to grow revenue and profits in 2026 as the industry normalizes.
Challenges Ahead
- Capital expenditures are projected to be approximately $250 million, which could impact short-term cash flow.
- Broader macroeconomic uncertainty continued to temper both consumer and dealer activity in 2025, which may persist.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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