Wesco International Reports First Quarter 2026 Results
Rhea-AI Summary
Wesco International (NYSE: WCC) reported record Q1 2026 results: $6.08B sales (+13.8% YoY), organic sales +12.3%, data center sales ~$1.4B (~24% of sales, ~70% YoY), and record backlog +22% YoY. GAAP diluted EPS was $3.11; adjusted EPS $3.37 (+52.5% YoY). Operating cash flow was $221M and free cash flow $213M (128% of adjusted net income). The company raised its full-year 2026 outlook.
Positive
- Net sales $6.08B (+13.8% YoY)
- Organic sales growth +12.3% YoY
- Data center sales ~$1.4B (~24% of sales, +~70% YoY)
- Adjusted EPS $3.37 (+52.5% YoY)
- Free cash flow $213M (128% of adjusted net income)
Negative
- SG&A expense increase to $947.6M (+13.3% YoY)
- Interest expense rose to $96.7M, pressuring net interest cost
News Market Reaction – WCC
On the day this news was published, WCC gained 14.36%, reflecting a significant positive market reaction. This price movement added approximately $1.87B to the company's valuation, bringing the market cap to $14.88B at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
WCC was down 0.38% pre-release. Peers showed mostly negative moves (e.g., WSO -6.13%, POOL -2.91%, CNM -1.58%), with QXO slightly positive at +0.56%, suggesting stock-specific rather than coordinated sector action.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Apr 09 | Earnings call notice | Neutral | +2.4% | Announcement of Q1 2026 earnings call and webcast logistics. |
| Feb 10 | Earnings results | Positive | -5.3% | Record 2025 sales, strong data center growth, and raised 2026 guidance. |
| Jan 20 | Earnings call notice | Neutral | -1.9% | Scheduling and access details for Q4 and full-year 2025 call. |
| Oct 30 | Earnings results | Positive | +10.5% | Record Q3 2025 sales, strong data center growth, raised 2025 guidance. |
| Oct 09 | Earnings call notice | Neutral | -1.0% | Announcement of Q3 2025 earnings call and replay information. |
Earnings-related news has usually aligned with price moves, but there was a notable selloff on the strong full-year 2025 results, showing the stock can diverge from fundamentals at times.
Recent earnings-related communications show a pattern of strong operating performance and growing scale. Q3 2025 delivered record net sales of $6.20B and adjusted EPS of $3.92, with data center strength and higher backlog. Full-year 2025 results on Feb 10, 2026 highlighted $23.5B in sales and increased 2026 guidance. Multiple earnings-call notices in late 2025 and early 2026 reinforced consistent engagement with investors. Today’s Q1 2026 report continues this track of record quarterly sales, rising margins, and raised full-year outlook.
Historical Comparison
In the past 5 earnings-tagged events, WCC’s average move was about 0.94%. This context helps frame how the market reacts to another quarter of record sales and higher guidance.
Earnings news shows steady progression: record Q3 2025 sales and data center growth, followed by record full-year 2025 results with raised 2026 guidance, and now Q1 2026 record sales, strong cash generation, and a higher 2026 outlook.
Market Pulse Summary
The stock surged +14.4% in the session following this news. A strong positive reaction aligns with the report’s broad-based strength: net sales reached $6.1B, data center revenue grew ~70%, backlog rose 22%, and adjusted EPS climbed to $3.37. Historically, earnings news has often produced aligned moves, though the full-year 2025 release showed that strong fundamentals did not always prevent a pullback. Investors would likely monitor valuation, leverage from recent senior notes, and the sustainability of high growth in data center and backlog.
Key Terms
adjusted ebitda financial
free cash flow financial
operating margin financial
basis points financial
effective tax rate financial
senior notes financial
dividend equivalent rights financial
restricted stock units financial
AI-generated analysis. Not financial advice.
- Record first quarter reported net sales of
$6.1 billion 14% YOY- Organic sales up
12% YOY - Data center sales of
$1.4 billion 70% YOY
- Organic sales up
- Record total company backlog, up
22% YOY - First quarter operating margin of
4.8% , up 30 basis points YOY; adjusted EBITDA margin of6.4% , up 60 basis points YOY - First quarter diluted EPS of
$3.11 $3.37 52.5% YOY - First quarter operating cash flow of
$221 million $193 million $213 million 128% of adjusted net income - Raising 2026 outlook reflecting an exceptional start to the year
"We delivered an exceptional start to 2026, building on last year's market outperformance and accelerating business momentum. Sales, backlog, operating margin, adjusted earnings per share, and free cash flow all increased versus the prior year and exceeded our expectations. Record sales of
Mr. Engel concluded, "We are very pleased with our first quarter results and continued positive business momentum to start the year. While uncertainty in the macro-economic environment may present challenges, we're focused on continued strong execution and outperformance under all market conditions. We are raising our full-year 2026 outlook reflecting our exceptional start to the year. As the market leader, and with positive momentum building, I'm confident that Wesco will continue to outperform our markets and deliver superior value to our customers and shareholders in 2026 and beyond."
Key Financial Highlights
Three Months Ended March 31 | |||
($ in millions except per share data) | 2026 | 2025 | Change vs prior |
GAAP Results | |||
Net sales | 13.8 % | ||
Selling, general, and administrative expenses | 13.3 % | ||
Operating profit | 21.8 % | ||
Net income attributable to common stockholders | 47.9 % | ||
Earnings per diluted share | 48.1 % | ||
Operating cash flow | 690.7 % | ||
Effective tax rate | 21.8 % | 23.4 % | (160) basis points |
($ in millions except per share data) | 2026 | 2025 | Change vs prior |
Non-GAAP Results* | |||
Organic sales growth | 12.3 % | 5.6 % | N/A |
Gross profit | 14.8 % | ||
Gross margin | 21.2 % | 21.1 % | 20 basis points |
Adjusted selling, general, and administrative expenses | 12.2 % | ||
Adjusted EBITDA | 25.1 % | ||
Adjusted EBITDA margin | 6.4 % | 5.8 % | 60 basis points |
Adjusted net income attributable to common stockholders | 52.2 % | ||
Adjusted earnings per diluted share | 52.5 % | ||
Free cash flow | 2,170.2 % | ||
* | Amounts may not foot or recalculate due to rounding. |
Net Sales
- On an organic basis, which removes differences in foreign exchange rates, sales for the first quarter of 2026 grew by
12.3% . The increase in organic sales reflects volume growth in all three segments (CSS, EES and UBS), as well as a favorable impact from changes in price. We had record backlog at the end of the first quarter of 2026, up by22% compared to the end of the first quarter of 2025.
Gross Profit and Gross Margin
- The increase in gross margin for the first quarter of 2026 reflects improved gross margin in the EES segment partially offset by a decline in the UBS segment.
Selling, General, and Administrative ("SG&A") Expenses
- The increase in SG&A expenses for the first quarter of 2026 is primarily driven by higher salaries and an increase in commissions and incentives due to higher sales and profit. SG&A expenses for the first quarter of 2026 include
$17.5 million $7.3 million 15.3% and15.5% of net sales for the first quarter of 2026 and 2025, respectively, reflecting positive operating cost leverage on the sales growth.
Adjusted EBITDA and Adjusted EBITDA Margin
- The increase in adjusted EBITDA for the first quarter of 2026 primarily reflects higher sales, lower cost of goods sold as a percentage of sales, and lower SG&A expenses as a percentage of sales, as described above.
Effective Tax Rate
- The lower effective tax rate for the first quarter of 2026 is largely driven by higher discrete income tax benefits relating to the exercise and vesting of stock-based awards.
Adjusted Earnings Per Diluted Share
- The increase in adjusted earnings per diluted share in the first quarter of 2026 primarily reflects higher sales, lower cost of goods sold as a percentage of sales, and lower SG&A expenses as a percentage of sales, as described above. Additionally, the prior year period included
$14.4 million
Operating Cash Flow
- Net cash provided by operating activities for the first quarter of 2026 totaled
$221.4 million $28.0 million $193.4 million $105.7 million
Webcast and Teleconference Access
Wesco will conduct a webcast and teleconference to discuss the first quarter of 2026 earnings as described in this News Release on Thursday, April 30, 2026, at 10:00 a.m. E.T. The call will be broadcast live over the internet and can be accessed from the Investor Relations page of the Company's website at https://investors.wesco.com. The call will be archived on this internet site for seven days.
Wesco International (NYSE: WCC) builds, connects, powers and protects the world. Headquartered in
Forward-Looking Statements
All statements made herein that are not historical facts should be considered as "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. These statements include, but are not limited to, statements regarding business strategy, growth strategy, competitive strengths, productivity and profitability enhancement, competition, new product and service introductions, and liquidity and capital resources. Such statements can generally be identified by the use of words such as "anticipate," "plan," "believe," "estimate," "intend," "expect," "project," and similar words, phrases or expressions or future or conditional verbs such as "could," "may," "should," "will," and "would," although not all forward-looking statements contain such words. These forward-looking statements are based on current expectations and beliefs of Wesco's management, as well as assumptions made by, and information currently available to, Wesco's management, current market trends and market conditions and involve risks and uncertainties, many of which are outside of Wesco's and Wesco's management's control, and which may cause actual results to differ materially from those contained in forward-looking statements. Accordingly, you should not place undue reliance on such statements.
Important factors that could cause actual results or events to differ materially from those presented or implied in the forward-looking statements include, among others, the failure to achieve the anticipated benefits of, and other risks associated with, acquisitions, joint ventures, divestitures and other corporate transactions; the inability to successfully integrate acquired businesses; the impact of increased interest rates or borrowing costs; fluctuations in currency exchange rates; evolving impacts from tariffs or other trade tensions between the
Contact Information | |
Investor Relations | Corporate Communications |
Scott Gaffner Senior Vice President, Investor Relations | Jennifer Sniderman Vice President, Corporate Communications 717-579-6603 |
WESCO INTERNATIONAL, INC. | |||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||
(in millions, except per share amounts) | |||||
(Unaudited) | |||||
Three Months Ended | |||||
March 31, 2026 | March 31, 2025 | ||||
Net sales | $ 6,080.1 | $ 5,343.7 | |||
Cost of goods sold (excluding depreciation and amortization) | 4,788.3 | 78.8 % | 4,218.1 | 78.9 % | |
Selling, general and administrative expenses | 947.6 | 15.6 % | 836.3 | 15.7 % | |
Depreciation and amortization | 50.7 | 48.4 | |||
Income from operations | 293.5 | 4.8 % | 240.9 | 4.5 % | |
Interest expense, net | 96.7 | 86.3 | |||
Other (income) expense, net | (0.4) | 0.2 | |||
Income before income taxes | 197.2 | 3.2 % | 154.4 | 2.9 % | |
Provision for income taxes | 43.1 | 36.1 | |||
Net income | 154.1 | 2.5 % | 118.3 | 2.2 % | |
Less: Net income attributable to noncontrolling interests | 0.3 | (0.1) | |||
Net income attributable to WESCO International, Inc. | 153.8 | 2.5 % | 118.4 | 2.2 % | |
Less: Preferred stock dividends | — | 14.4 | |||
Net income attributable to common stockholders | $ 153.8 | 2.5 % | $ 104.0 | 1.9 % | |
Earnings per diluted share attributable to common stockholders | $ 3.11 | $ 2.10 | |||
Weighted-average common shares outstanding and common | 49.5 | 49.6 | |||
WESCO INTERNATIONAL, INC. | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(dollar amounts in millions) | |||
(Unaudited) | |||
As of | |||
March 31, | December 31, | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 696.6 | $ 604.8 | |
Trade accounts receivable, net | 4,273.1 | 4,069.6 | |
Inventories | 4,213.1 | 4,008.8 | |
Other current assets | 770.8 | 773.0 | |
Total current assets | 9,953.6 | 9,456.2 | |
Goodwill and intangible assets | 5,077.5 | 5,112.6 | |
Other assets | 1,933.6 | 1,926.1 | |
Total assets | $ 16,964.7 | $ 16,494.9 | |
Liabilities and Equity | |||
Current liabilities: | |||
Accounts payable | $ 3,470.5 | $ 3,030.5 | |
Short-term debt and current portion of long-term debt, net | 22.8 | 25.0 | |
Other current liabilities | 1,194.9 | 1,241.3 | |
Total current liabilities | 4,688.2 | 4,296.8 | |
Long-term debt, net | 5,738.1 | 5,756.4 | |
Other noncurrent liabilities | 1,440.5 | 1,415.3 | |
Total liabilities | 11,866.8 | 11,468.5 | |
Equity: | |||
Total equity | 5,097.9 | 5,026.4 | |
Total liabilities and equity | $ 16,964.7 | $ 16,494.9 | |
WESCO INTERNATIONAL, INC. | |||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
(dollar amounts in millions) | |||
(Unaudited) | |||
Three Months Ended | |||
March 31, | March 31, | ||
Operating activities: | |||
Net income | $ 154.1 | $ 118.3 | |
Add back (deduct): | |||
Depreciation and amortization | 50.7 | 48.4 | |
Change in trade receivables, net | (216.1) | (188.7) | |
Change in inventories | (215.2) | (227.4) | |
Change in accounts payable | 449.5 | 343.8 | |
Other, net | (1.6) | (66.4) | |
Net cash provided by operating activities | 221.4 | 28.0 | |
Investing activities: | |||
Capital expenditures | (23.4) | (20.4) | |
Acquisition payments, net of cash acquired | — | (35.2) | |
Other, net | 3.5 | 1.2 | |
Net cash used in investing activities | (19.9) | (54.4) | |
Financing activities: | |||
Debt (repayments) borrowings, net(1) | (11.0) | 99.7 | |
Payments for taxes related to net-share settlement of equity awards | (22.0) | (18.0) | |
Repurchases of common stock | (25.0) | (25.0) | |
Payment of common stock dividends | (24.4) | (22.1) | |
Payment of preferred stock dividends | — | (14.4) | |
Other, net | (25.8) | (17.9) | |
Net cash (used in) provided by financing activities | (108.2) | 2.3 | |
Effect of exchange rate changes on cash and cash equivalents | (1.5) | 3.1 | |
Net change in cash and cash equivalents | 91.8 | (21.0) | |
Cash and cash equivalents at the beginning of the period | 604.8 | 702.6 | |
Cash and cash equivalents at the end of the period | $ 696.6 | $ 681.6 | |
(1) | The three months ended March 31, 2026 includes the issuance of the Company's |
NON-GAAP FINANCIAL MEASURES
In addition to the results provided in accordance with
WESCO INTERNATIONAL, INC. | |||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||||
(in millions, except per share amounts and ratios) | |||||||||||||
(Unaudited) | |||||||||||||
Organic Sales Growth by Segment: | |||||||||||||
Three Months Ended | Growth/(Decline) | ||||||||||||
March 31, 2026 | March 31, 2025 | Reported | Acquisition | Foreign | Workday | Organic | |||||||
EES | $ 2,244.2 | $ 2,065.3 | 8.7 % | — % | 1.7 % | — % | 7.0 % | ||||||
CSS | 2,478.9 | 2,000.3 | 23.9 % | — % | 2.0 % | — % | 21.9 % | ||||||
UBS | 1,357.0 | 1,278.1 | 6.2 % | — % | 0.4 % | — % | 5.8 % | ||||||
Total net sales | $ 6,080.1 | $ 5,343.7 | 13.8 % | — % | 1.5 % | — % | 12.3 % | ||||||
Organic Sales Growth by Segment - Sequential: | |||||||||||||
Three Months Ended | Growth/(Decline) | ||||||||||||
March 31, 2026 | December 31, | Reported | Acquisition | Foreign | Workday | Organic | |||||||
EES | $ 2,244.2 | $ 2,272.9 | (1.3) % | — % | 0.5 % | (1.6) % | (0.2) % | ||||||
CSS | 2,478.9 | 2,424.7 | 2.2 % | — % | 0.4 % | (1.6) % | 3.4 % | ||||||
UBS | 1,357.0 | 1,371.0 | (1.0) % | — % | 0.2 % | (1.6) % | 0.4 % | ||||||
Total net sales | $ 6,080.1 | $ 6,068.6 | 0.2 % | — % | 0.4 % | (1.6) % | 1.4 % | ||||||
Note: Organic sales growth is a non-GAAP financial measure of sales performance. Organic sales growth is calculated by deducting the percentage impact from acquisitions and divestitures for one year following the respective transaction, fluctuations in foreign exchange rates and number of workdays from the reported percentage change in consolidated net sales. Workday impact represents the change in the number of operating days period-over-period after adjusting for weekends and public holidays in |
Three Months Ended | |||
Gross Profit: | March 31, | March 31, | |
Net sales | $ 6,080.1 | $ 5,343.7 | |
Cost of goods sold (excluding depreciation and amortization) | 4,788.3 | 4,218.1 | |
Gross profit | $ 1,291.8 | $ 1,125.6 | |
Gross margin | 21.2 % | 21.1 % | |
Note: Gross profit is a financial measure commonly used in the distribution industry. Gross profit is calculated by deducting cost of goods sold, excluding depreciation and amortization, from net sales. Gross margin is calculated by dividing gross profit by net sales. |
WESCO INTERNATIONAL, INC. | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||
(in millions, except per share amounts and ratios) | |||
(Unaudited) | |||
Three Months Ended | |||
March 31, 2026 | March 31, 2025 | ||
Adjusted SG&A Expenses: | |||
SG&A expenses | $ 947.6 | $ 836.3 | |
Digital transformation costs(1) | (17.5) | (6.2) | |
Restructuring costs(2) | — | (1.1) | |
Adjusted SG&A expenses | $ 930.1 | $ 829.0 | |
Percentage of Net sales | 15.3 % | 15.5 % | |
Adjusted Income from Operations: | |||
Income from operations | $ 293.5 | $ 240.9 | |
Digital transformation costs(1) | 17.5 | 6.2 | |
Restructuring costs(2) | — | 1.1 | |
Adjusted income from operations | $ 311.0 | $ 248.2 | |
Adjusted income from operations margin % | 5.1 % | 4.6 % | |
Adjusted Other (Income) Expense, net: | |||
Other (income) expense, net | $ (0.4) | $ 0.2 | |
Loss on termination of business arrangement(3) | — | (0.3) | |
Adjusted other income, net | $ (0.4) | $ (0.1) | |
Adjusted Provision for Income Taxes: | |||
Provision for income taxes | $ 43.1 | $ 36.1 | |
Income tax effect of adjustments to income from | 4.5 | 2.0 | |
Adjusted provision for income taxes | $ 47.6 | $ 38.1 | |
Adjusted Net Income Attributable to Common | |||
Net income attributable to common stockholders | $ 153.8 | $ 104.0 | |
Digital transformation costs(1) | 17.5 | 6.2 | |
Restructuring costs(2) | — | 1.1 | |
Loss on termination of business arrangement(3) | — | 0.3 | |
Income tax effect of adjustments to income from | (4.5) | (2.0) | |
Adjusted net income attributable to common | $ 166.8 | $ 109.6 | |
(1) | Digital transformation costs include costs associated with certain digital transformation initiatives. |
(2) | Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan. |
(3) | Loss on termination of business arrangement represents the loss recognized as a result of management's decision to terminate a business arrangement with a third party. |
(4) | The adjustments to income from operations and other (income) expense, net have been tax effected at rates of |
WESCO INTERNATIONAL, INC. | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||
(in millions, except per share amounts and ratios) | |||
(Unaudited) | |||
Three Months Ended | |||
Adjusted Earnings per Diluted Share: | March 31, | March 31, | |
Adjusted income from operations | $ 311.0 | $ 248.2 | |
Interest expense, net | 96.7 | 86.3 | |
Adjusted other income, net | (0.4) | (0.1) | |
Adjusted income before income taxes | 214.7 | 162.0 | |
Adjusted provision for income taxes | 47.6 | 38.1 | |
Adjusted net income | 167.1 | 123.9 | |
Net income (loss) attributable to noncontrolling interests | 0.3 | (0.1) | |
Adjusted net income attributable to WESCO International, Inc. | 166.8 | 124.0 | |
Preferred stock dividends | — | 14.4 | |
Adjusted net income attributable to common stockholders | $ 166.8 | $ 109.6 | |
Diluted shares | 49.5 | 49.6 | |
Adjusted earnings per diluted share | $ 3.37 | $ 2.21 | |
Note: For the three months ended March 31, 2026, SG&A expenses, income from operations, provision for income taxes, net income attributable to common stockholders and earnings per diluted share have been adjusted to exclude digital transformation costs and the related income tax effects. For the three months ended March 31, 2025, SG&A expenses, income from operations, other non-operating (income) expense, provision for income taxes, net income attributable to common stockholders and earnings per diluted share have been adjusted to exclude digital transformation costs, restructuring costs, the loss on termination of business arrangement, and the related income tax effects. These non-GAAP financial measures provide a better understanding of our financial results on a comparable basis. |
WESCO INTERNATIONAL, INC. | ||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||||
(in millions, except per share amounts and ratios) | ||||||||||
(Unaudited) | ||||||||||
Three Months Ended March 31, 2026 | ||||||||||
EBITDA and Adjusted EBITDA by Segment: | EES | CSS | UBS | Corporate | Total | |||||
Net income attributable to common stockholders | $ 164.1 | $ 188.3 | $ 121.7 | $ (320.3) | $ 153.8 | |||||
Net income (loss) attributable to noncontrolling interests | 0.1 | 0.4 | — | (0.2) | 0.3 | |||||
Provision for income taxes(1) | — | — | — | 43.1 | 43.1 | |||||
Interest expense, net(1) | — | — | — | 96.7 | 96.7 | |||||
Depreciation and amortization | 13.2 | 19.8 | 8.5 | 9.2 | 50.7 | |||||
EBITDA | $ 177.4 | $ 208.5 | $ 130.2 | $ (171.5) | $ 344.6 | |||||
Other expense (income), net | 6.8 | 13.1 | (0.4) | (19.9) | (0.4) | |||||
Stock-based compensation expense | 0.8 | 1.6 | 0.9 | 12.8 | 16.1 | |||||
Digital transformation costs(2) | — | — | — | 17.5 | 17.5 | |||||
Cloud computing arrangement amortization(3) | — | — | — | 11.0 | 11.0 | |||||
Adjusted EBITDA | $ 185.0 | $ 223.2 | $ 130.7 | $ (150.1) | $ 388.8 | |||||
Adjusted EBITDA margin % | 8.2 % | 9.0 % | 9.6 % | 6.4 % | ||||||
(1) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the Corporate tax and | ||||||||||
(2) Digital transformation costs include costs associated with certain digital transformation initiatives. | ||||||||||
(3) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized | ||||||||||
Three Months Ended March 31, 2025 | ||||||||||
EBITDA and Adjusted EBITDA by Segment: | EES | CSS | UBS | Corporate | Total | |||||
Net income attributable to common stockholders | $ 125.1 | $ 127.2 | $ 130.3 | $ (278.6) | $ 104.0 | |||||
Net (loss) income attributable to noncontrolling interests | (0.1) | 0.1 | — | (0.1) | (0.1) | |||||
Preferred stock dividends | — | — | — | 14.4 | 14.4 | |||||
Provision for income taxes(1) | — | — | — | 36.1 | 36.1 | |||||
Interest expense, net(1) | — | — | — | 86.3 | 86.3 | |||||
Depreciation and amortization | 12.2 | 19.0 | 7.8 | 9.4 | 48.4 | |||||
EBITDA | $ 137.2 | $ 146.3 | $ 138.1 | $ (132.5) | $ 289.1 | |||||
Other expense (income), net | 4.4 | 10.9 | (0.2) | (14.9) | 0.2 | |||||
Stock-based compensation expense | 1.0 | 1.3 | 0.4 | 7.5 | 10.2 | |||||
Digital transformation costs(2) | — | — | — | 6.2 | 6.2 | |||||
Cloud computing arrangement amortization(3) | — | — | — | 3.9 | 3.9 | |||||
Restructuring costs(4) | — | — | — | 1.1 | 1.1 | |||||
Adjusted EBITDA | $ 142.6 | $ 158.5 | $ 138.3 | $ (128.7) | $ 310.7 | |||||
Adjusted EBITDA margin % | 6.9 % | 7.9 % | 10.8 % | 5.8 % | ||||||
(1) The reportable segments do not incur income taxes and interest expense as these costs are centrally controlled through the corporate tax and | ||||||||||
(2) Digital transformation costs include costs associated with certain digital transformation initiatives. | ||||||||||
(3) Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized | ||||||||||
(4) Restructuring costs include severance costs incurred pursuant to an ongoing restructuring plan. | ||||||||||
Note: EBITDA, adjusted EBITDA and adjusted EBITDA margin % are non-GAAP financial measures that provide indicators of the Company's performance and its ability to meet debt service requirements. For the three months ended March 31, 2026, adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization before other non-operating expenses (income), non-cash stock-based compensation expense, digital transformation costs, and cloud computing arrangement amortization. For the three months ended March 31, 2025, adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization before other non-operating expenses (income), non-cash stock-based compensation expense, digital transformation costs, cloud computing arrangement amortization, and restructuring costs. |
WESCO INTERNATIONAL, INC. | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||
(in millions, except per share amounts and ratios) | |||
(Unaudited) | |||
Twelve Months Ended | |||
Financial Leverage: | March 31, | December 31, | |
Net income attributable to common stockholders | $ 695.6 | $ 645.8 | |
Net income attributable to noncontrolling interests | 2.6 | 2.3 | |
Gain on redemption of Series A Preferred Stock | (32.9) | (32.9) | |
Preferred stock dividends | 12.9 | 27.3 | |
Provision for income taxes | 220.4 | 213.4 | |
Interest expense, net | 397.2 | 386.7 | |
Depreciation and amortization | 199.9 | 197.6 | |
EBITDA | $ 1,495.7 | $ 1,440.2 | |
Other income, net | (10.1) | (9.6) | |
Stock-based compensation expense | 46.4 | 40.5 | |
Digital transformation costs(1) | 46.5 | 35.2 | |
Cloud computing arrangement amortization(2) | 37.3 | 30.2 | |
Restructuring costs(3) | (1.1) | — | |
Adjusted EBITDA | $ 1,614.7 | $ 1,536.5 | |
As of | |||
March 31, | December 31, | ||
Short-term debt and current portion of long-term debt, net | $ 22.8 | $ 25.0 | |
Long-term debt, net | 5,738.1 | 5,756.4 | |
Debt issuance costs and debt discount(4) | 63.6 | 48.0 | |
Total debt | 5,824.5 | 5,829.4 | |
Less: Cash and cash equivalents | 696.6 | 604.8 | |
Total debt, net of cash | $ 5,127.9 | $ 5,224.6 | |
Financial leverage ratio | 3.2 | 3.4 | |
(1) | Digital transformation costs include costs associated with certain digital transformation initiatives. |
(2) | Cloud computing arrangement amortization consists of expense recognized in selling, general and administrative expenses for capitalized implementation costs for cloud computing arrangements to support our digital transformation initiatives. |
(3) | Reduction to restructuring costs represents the reversal of certain severance costs previously incurred pursuant to an ongoing restructuring plan. |
(4) | Debt is presented in the Condensed Consolidated Balance Sheets net of debt issuance and debt discount costs. |
Note: Financial leverage ratio is a non-GAAP measure of the use of debt. Financial leverage ratio is calculated by dividing total debt, excluding debt issuance costs, and debt discount, net of cash, by adjusted EBITDA. EBITDA is defined as the trailing twelve months earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as the trailing twelve months EBITDA before other non-operating expense (income), non-cash stock-based compensation expense, digital transformation costs, cloud computing arrangement amortization, and restructuring costs. | |
WESCO INTERNATIONAL, INC. | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||
(in millions, except per share amounts and ratios) | |||
(Unaudited) | |||
Three Months Ended | |||
Free Cash Flow: | March 31, | March 31, | |
Cash flow provided by operations | $ 221.4 | $ 28.0 | |
Less: Capital expenditures | (23.4) | (20.4) | |
Add: Other adjustments | 15.4 | 1.8 | |
Free cash flow | $ 213.4 | $ 9.4 | |
Percentage of Adjusted net income | 127.7 % | 7.6 % | |
Note: Free cash flow is a non-GAAP financial measure of liquidity. Capital expenditures are deducted from operating cash flow to determine free cash flow. Free cash flow is available to fund investing and financing activities. For the three months ended March 31, 2026 and 2025, the Company paid for certain costs related to digital transformation and restructuring. Such expenditures have been added back to operating cash flow to determine free cash flow for such periods. Our calculation of free cash flow may not be comparable to similar measures used by other companies. |
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SOURCE Wesco International