AAON

United Rentals, Inc. URI reported third-quarter 2026 results, with adjusted earnings per share and total revenues beating the Zacks Consensus Estimate and increasing year over year. Strong rental demand and operating efficiencies supported the results. Fleet productivity, which combines rental rates, time utilization and mix, improved 6.5% year over year. URI stock inched up 1% in yesterday's after-hours trading, following the earnings release. URI's adjusted earnings of $15.55 per share topped the Zacks Consensus Estimate of $13.83 by 12.4% and grew 32.9% year over year from $11.70 per share. Total revenues rose 15.7% year over year to $4.89 billion and surpassed the consensus estimate of $4.69 billion by 4.3%. United Rentals, Inc. price-consensus-eps-surprise-chart | United Rentals, Inc. Quote Rental revenues increased 17.8% year over year to a quarterly record of $4.32 billion. Average fleet size, measured at original equipment cost, rose 7.9%. Owned equipment rental revenues grew 12.9% to $3.32 billion. Revenues from re-renting equipment sourced from other vendors surged 76.7% to $129 million, while ancillary and other rental revenues climbed 33% to $871 million. Used equipment sales rose 4.5% to $348 million, with an adjusted gross margin of 46.3% compared with 45.9% a year earlier. New equipment sales fell 11.6% to $84 million. Contractor supplies sales and service and other revenues increased 9.3% to $47 million and 5.4% to $98 million, respectively. General Rentals segment rental revenues increased 8.8% year over year to $2.61 billion. Rental gross profit grew 13.8% to $1 billion, while gross margin expanded 170 basis points (bps) to 38.4%. Specialty rental revenues surged 34.7% to $1.7 billion. Rental gross profit increased 42.3% to $811 million, with gross margin expanding 250 bps to 47.6%. Both segments benefited from efficiencies in depreciation, labor and benefits, repairs and maintenance, and delivery. Faster growth in lower-margin ancillary and re-rent revenues partly offset these gains. Gross profit increased 22.9% to $2.05 billion, with gross margin improving to 41.8% from 39.4%. Selling, general and administrative expenses rose 15.6% to $511 million but declined to 10.4% of revenues from 10.5%. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 19.8% to a quarterly record of $2.33 billion. Its margin expanded 160 bps to 47.6%, supported partly by a higher proportion of revenues from equipment rentals. Operating income grew 26.5% to $1.41 billion, with operating margin increasing to 28.8% from 26.3%. For the first nine months of 2026, operating cash flow rose 25.4% to $4.93 billion. Free cash flow increased 19.2% to $1.42 billion, including $27 million of restructuring-related payments. United Rentals ended September 2026 with liquidity of $2.62 billion, including $153 million in cash and equivalents. Net leverage, or net debt divided by trailing 12-month adjusted EBITDA, improved to 1.8x from 1.9x at the end of 2025. Total debt increased to $14.67 billion from $14.23 billion over that period. URI returned $1.496 billion to shareholders during the first nine months of 2026, comprising $1.125 billion in share repurchases and $371 million in dividends. It completed its prior $2 billion repurchase program and began its new $5 billion authorization. The company still expects $1.5 billion of share repurchases in 2026. It declared a quarterly dividend of $1.97 per share, payable Nov. 25, 2026, to shareholders of record Nov. 11, 2026. Management raised its revenue outlook to $18-$18.2 billion from $17.5-$17.8 billion. Adjusted EBITDA is now projected at $8.3-$8.4 billion compared with $7.98-$8.13 billion previously. Operating cash flow is expected at $6.25-$6.85 billion, up from $5.85-$6.65 billion. The free cash flow outlook, excluding restructuring-related payments, remains $2.15-$2.45 billion. Net rental capital expenditures are projected at $3.75-$4.05 billion after gross purchases of $5.2-$5.5 billion compared with $3.4-$3.8 billion after gross purchases of $4.85-$5.25 billion previously. Management cited customer confidence, backlogs and large-project momentum as support for the raised outlook. United Rentals currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Here are some other companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat. Sterling Infrastructure, Inc. STRL has an Earnings ESP of +0.80% and a Zacks Rank of 2 at present. Sterling's earnings beat estimates in each of the last four quarters, the average surprise being 27.2%. The company's earnings for the third quarter of 2026 are expected to grow 74.4% year over year. AAON, Inc. AAON currently has an Earnings ESP of +2.66% and a Zacks Rank #3 (Hold). AAON's earnings beat estimates in three of the last four quarters and missed on the remaining occasion, the average surprise being 21.6%. The company's earnings for the third quarter of 2026 are expected to increase 54.1% year over year. Argan, Inc. AGX has an Earnings ESP of +4.79% and a Zacks Rank of 3. Argan's earnings beat estimates in each of the last four quarters, the average surprise being 44.2%. The company's earnings for the third quarter of fiscal 2027 are expected to increase 53.9% year over year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report United Rentals, Inc. (URI) : Free Stock Analysis Report AAON, Inc. (AAON) : Free Stock Analysis Report Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report Argan, Inc. (AGX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

United Rentals, Inc. URI is scheduled to report its third-quarter 2026 results on Oct. 21, after market close. In the last reported quarter, the company's adjusted earnings per share (EPS) and total revenues topped the Zacks Consensus Estimate by 9.3% and 4.1%, respectively. Year over year, the metrics also grew 21.9% and 11.8%, respectively. URI's earnings surpassed estimates in two of the trailing four quarters and missed on the other two occasions, with an average surprise of 1%. The Zacks Consensus Estimate for third-quarter EPS has moved upward to $13.75 from $13.64 over the past 30 days. However, the estimated figure indicates a 17.5% increase from the year-ago quarter's earnings of $11.70 per share. The consensus estimate for total revenues is pegged at $4.67 billion, indicating growth of 10.4% from the prior-year quarter's level. United Rentals, Inc. price-eps-surprise | United Rentals, Inc. Quote Revenues The top-line performance of United Rentals is expected to have improved year over year from favorable secular trends in non-residential construction, infrastructure modernization, power, manufacturing, mining and data center development. These are likely to have resulted in healthy equipment rental demand, thus boosting the contributions from the General Rentals business segment (which contributed 54.8% to second-quarter 2026 total revenues) and the Specialty business segment (which contributed 32.4% to second-quarter 2026 total revenues). Specialty rentals, which offer higher margins and remain central to United Rentals' expansion strategy, are expected to have supported revenue growth both organically and through cold starts that added capacity in new markets. Moreover, URI's extensive and diverse fleet allows it to manage its rental fleet through a life-cycle approach that focuses on satisfying customer demand and optimizing utilization levels. This business approach is expected to have enabled the company to serve large customers that require a wide range of equipment. Also, acquisitions and joint ventures are likely to have catalyzed the growth trends in the to-be-reported quarter. For the third quarter, the Zacks Consensus Estimate for revenues from General Rentals and Specialty business segments is pegged at $3.02 billion and $1.69 billion, reflecting year-over-year growth of 6.9% and 20.4%, respectively. The consensus mark for revenues from equipment rentals is $4.07 billion, up from $3.67 billion reported a year ago. Earnings & Margins United Rentals is expected to report year-over-year earnings growth in the third quarter, attributable to higher fleet productivity and disciplined rate management. These factors, along with continued cost control, are likely to have contributed to improved profitability and earnings performance. Although inflationary pressures and elevated delivery costs are likely to have partly offset these gains, the ongoing in-house initiatives by URI and elevated top-line leverage are expected to have more than overpowered the headwinds. The consensus estimate for equipment rentals gross profit under the General Rentals and Specialty business segments is pegged at $957 million and $640 million, indicating year-over-year growth from $881 million and $570 million, respectively. Our proven model conclusively predicts an earnings beat for United Rentals this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. URI's Earnings ESP: URI has an Earnings ESP of +1.79%. You can uncover the best stocks before they're reported with our Earnings ESP Filter. Zacks Rank of URI: The stock currently has a Zacks Rank of 2. You can see the complete list of today's Zacks #1 Rank stocks here. Here are some other companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat. Sterling Infrastructure, Inc. STRL has an Earnings ESP of +0.80% and a Zacks Rank of 2 at present. Sterling's earnings beat estimates in each of the last four quarters, the average surprise being 27.2%. The company's earnings for the third quarter of 2026 are expected to grow 74.4% year over year. AAON, Inc. AAON currently has an Earnings ESP of +2.66% and a Zacks Rank of 3. AAON's earnings beat estimates in three of the last four quarters and missed on the remaining occasion, the average surprise being 21.6%. The company's earnings for the third quarter of 2026 are expected to increase 54.1% year over year. Argan, Inc. AGX has an Earnings ESP of +4.79% and a Zacks Rank of 3. Argan's earnings beat estimates in each of the last four quarters, the average surprise being 44.2%. The company's earnings for the third quarter of fiscal 2027 are expected to increase 53.9% year over year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report United Rentals, Inc. (URI) : Free Stock Analysis Report AAON, Inc. (AAON) : Free Stock Analysis Report Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report Argan, Inc. (AGX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Looking for a stock that has been consistently beating earnings estimates and might be well positioned to keep the streak alive in its next quarterly report? Aaon (AAON), which belongs to the Zacks Building Products - Air Conditioner and Heating industry, could be a great candidate to consider. When looking at the last two reports, this maker of air conditioning and heating equipment has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 43.77%, on average, in the last two quarters. For the last reported quarter, Aaon came out with earnings of $0.69 per share versus the Zacks Consensus Estimate of $0.52 per share, representing a surprise of 32.69%. For the previous quarter, the company was expected to post earnings of $0.31 per share and it actually produced earnings of $0.48 per share, delivering a surprise of 54.84%. With this earnings history in mind, recent estimates have been moving higher for Aaon. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the company is positive, which is a great sign of an earnings beat, especially when you combine this metric with its nice Zacks Rank. Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Aaon currently has an Earnings ESP of +2.11%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #3 (Hold) indicates that another beat is possibly around the corner. Investors should note, however, that a negative Earnings ESP reading is not indicative of an earnings miss, but a negative value does reduce the predictive power of this metric. Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate. Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AAON, Inc. (AAON) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

AAON has pulled back in recent months, even after upbeat headlines around its heating and cooling business, which puts fresh focus on what investors are really paying for its earnings today. With the share price near US$75.54 after a weak short term run, the central issue is how that quote lines up with the profit power of the underlying operations. Over the past 5 years the stock has gained 77.0%, so anyone looking at AAON now is weighing a strong longer term run against the income stream the business currently produces. Recent revenue momentum and earnings strength suggest the market may be reassessing how durable AAON's demand and profitability can be, which feeds directly into what feels like a sensible earnings multiple for the stock. There is a second opinion on AAON worth weighing. See what analysts think AAON's shares could be worth. For investors, the debate is whether AAON's current share price is adequately supported by the earnings it generates today and what those profits imply for a fair P/E level. If you want a wider earnings-based watchlist alongside AAON, a focused screen of 35 high quality undervalued stocks can be a useful next stop in your research process. For a business like AAON that is already profitable, the P/E ratio is a straightforward way to see how much investors are paying for each dollar of earnings. At about 39.1x earnings, AAON trades well above the building industry average of 20.9x and also above the broader peer group around 26.9x. This indicates the equity market is putting a richer label on its profits than many comparable HVAC and capital goods companies. Because the fair multiple implied by the valuation work is higher than where AAON trades today, the stock screens as undervalued on this specific earnings lens even with that premium to sector benchmarks. The strong Q2 revenue and profit beat in 2024, despite the share price falling after the report, suggests that investor expectations have not fully chased the recent operating performance. This keeps the P/E discussion front and center for anyone assessing what they are willing to pay for the next dollar of income. Explore the numbers behind AAON's P/E valuation. Narratives for AAON pick up where the P/E puzzle leaves off and explain what would need to happen to future growth, profitability and earnings quality for the share price to look meaningfully higher or lower than it does today. Each one turns AAON's implied fair value into a specific, trackable claim about the business so you can see over time whether the real world is moving toward or away from that thesis. Narratives are available on Simply Wall St's Community page. One of the top community narratives on AAON: 44% undervalued Discover why this Narrative puts AAON at 44% undervalued. Before parking AAON in any watchlist, it is worth knowing that Simply Wall St's broader review has flagged specific concerns that deserve a look alongside the pricing work already covered. Take a closer look at 2 warning signs (2 major) before settling on a valuation. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include AAON. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Let’s dig into the relative performance of AAON (NASDAQ:AAON) and its peers as we unravel the now-completed Q2 hvac and water systems earnings season. Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates. The 9 hvac and water systems stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.7%. Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 8.5% since the latest earnings results. Backed by two million square feet of lab testing space, AAON (NASDAQ:AAON) makes heating, ventilation, and air conditioning equipment for different types of buildings. AAON reported revenues of $627 million, up 101% year on year. This print exceeded analysts’ expectations by 24.6%. Overall, it was an incredible quarter for the company with a beat of analysts’ EPS and EBITDA estimates. "Our second quarter results demonstrate the continued strength of demand for our solutions and the progress we are making scaling the company to meet that demand," said Matt Tobolski, President and CEO of AAON. AAON pulled off the biggest analyst estimate beat and fastest revenue growth among its peers. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 17.4% since reporting and currently trades at $78.31. We think AAON is a good business, but is it a buy today? Read our full report here, it’s free. Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe (NASDAQ:NWPX) is a manufacturer of pipeline systems for water infrastructure. Northwest Pipe reported revenues of $159.5 million, up 19.7% year on year, outperforming analysts’ expectations by 3.1%. The business had a stunning quarter with a beat of analysts’ EPS estimates. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 10.4% since reporting. It currently trades at $110.35. Is now the time to buy Northwest Pipe? Access our full analysis of the earnings results here, it’s free. Based in Texas and founded over a century ago, Lennox (NYSE:LII) is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods. Lennox reported revenues of $1.55 billion, up 3% year on year, falling short of analysts’ expectations by 1%. It was a mixed quarter as it posted an impressive beat of analysts’ organic revenue estimates but full-year EPS guidance missing analysts’ expectations significantly. Lennox delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 28.8% since the results and currently trades at $387.25. Read our full analysis of Lennox’s results here. Claiming to have saved more than 30 billion gallons of water, Zurn Elkay (NYSE:ZWS) provides water management solutions to various industries. Zurn Elkay reported revenues of $491 million, up 10.5% year on year. This number surpassed analysts’ expectations by 1.6%. Overall, it was a strong quarter as it also logged a decent beat of analysts’ EBITDA and EPS estimates. The stock is down 3.4% since reporting and currently trades at $47.63. Read our full, actionable report on Zurn Elkay here, it’s free. Originally started as a farm water drainage company, Advanced Drainage Systems (NYSE:WMS) provides clean water management solutions to communities across America. Advanced Drainage reported revenues of $1.00 billion, up 20.6% year on year. This result beat analysts’ expectations by 2%. It was a very strong quarter as it also recorded a solid beat of analysts’ EBITDA and EPS estimates. Advanced Drainage had the weakest full-year guidance update of the whole group. The stock is down 9.9% since reporting and currently trades at $134.85. Read our full, actionable report on Advanced Drainage here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

Image source: The Motley Fool. Monday, Aug. 10, 2026 at 5:00 p.m. ET Director of Investor Relations-Joseph Mondillo President and Chief Executive Officer-Matthew Tobolski Chief Financial Officer-Andy Cheung Operator: Thank you for standing by. At this time, I would like to welcome everyone to the AAON Inc. Second Quarter 2026 Earnings Release Conference Call. [Operator Instructions] I would now like to turn the conference over to Joe Mondillo, Director of Investor Relations. The floor is yours. Joseph Mondillo: Thank you, operator, and good afternoon, everyone. The press release announcing our second quarter 2026 financial results was issued earlier this afternoon and can be found on our corporate website, aaon.com. The call today is accompanied by a presentation that you can also find on our website as well as on our listen-only webcast. We begin with our customary forward-looking statement policy. During the call, any statement presented dealing with information that is not historical is considered forward-looking and made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995, the Securities Act of 1933 and the Securities Exchange Act of 1934, each as amended. As such, it is subject to the occurrence of many events outside of AAON's control that could cause AAON's results to differ materially from those anticipated. You are all aware of the inherent difficulties, risks and uncertainties in making predictive statements. Our press release and Form 10-Q that we filed this afternoon detail some of the important risk factors that may cause our actual results to differ from those in our predictions. Please note that we do not have a duty to update our forward-looking statements. Our press release and portions of today's call use non-GAAP financial measures as defined in Regulation G. You can find the related reconciliations to GAAP measures in our press release and presentation. Joining me on today's call is Matt Tobolski, President and CEO; and Andy Cheung, our CFO. Matt will start off with some opening remarks, Andy will follow with a walk-through of the quarterly results, and Matt will finish up with our updated outlook for 2026. With that, I will turn the call over to Matt. Matthew Tobolski: Thanks, Joe, and good afternoon. Q2 was another strong quarter, building on the momentum established in Q1 and reflecting continued execution across the business. Higher throughput across all four of our major facilities resulted in substantial volume growth, demonstrating the value of recent investments we have made across the organization, including supply chain management, lean manufacturing, operational excellence initiatives, expanded capacity and leadership development. These efforts translated into our fourth consecutive quarterly revenue record with sales increasing 101% year-over-year and 26% sequentially. EBITDA more than doubled from the prior year period, and we generated substantial earnings growth while converting backlog at a much faster pace across the enterprise. These results are tangible evidence that the investments we have made are translating into measurable operating progress. For an industrial manufacturing company, this level of organic growth and operational scaling is exceptional, and it reflects the strength of our markets, our strategy and our people. Despite the substantial increase in production rates during the first half of the year, backlog remains nearly double prior year levels. Sequentially, backlog declined because production and shipments increased significantly across the enterprise, resulting in accelerated backlog conversion. That is exactly the outcome we have been working to achieve. Customer engagement remains strong. Our pipeline of opportunities remains healthy, and backlog continues to provide meaningful visibility into future growth. Let me begin our brand discussion with BASX. The long-term market opportunity remains compelling, supported by continued investment in data center infrastructure and the differentiated solutions we provide to the market. BASX branded sales were a record, increasing 216% year-over-year in the quarter and 501% on a 2-year stack. For the first half of the year, sales were up 137% year-over-year and 570% on a 2-year stack. Achieving and sustaining this level of growth requires coordination across engineering, operations, supply chain, manufacturing and our field teams. Production increased across our facilities, and I hope all of our stakeholders appreciate the significance of what our teams have accomplished. As we have scaled at an unprecedented pace, maintaining high standards across quality, delivery and customer support has remained a major focus. We continue to see meaningful improvement as the systems, processes and teams we have been building become more mature and effective. The progress is translating into better outcomes for our customers and stronger execution across the enterprise. BASX branded bookings were below the unusually elevated levels experienced in recent quarters. However, we do not view that as a change in the long-term opportunity. These projects are large in scale and can generate quarter-to-quarter variability in booking activity and award timing. Customer engagement remains strong. Our opportunity pipeline remains healthy and backlog continues to provide substantial visibility into future growth opportunities. More importantly, our ability to support customers continues to improve as throughput increases, lead times come down and additional capacity comes online. The underlying market opportunity remains very favorable, and we continue to see substantial long-term opportunities for growth. Turning to the AAON brand. The AAON brand continued to perform exceptionally well, gaining market share despite a relatively soft commercial HVAC market. AAON branded sales increased 40% year-over-year and 5% sequentially, reflecting improved production throughput, strong demand and continued execution improvement across the business. These results point to meaningful market share gains and reinforce the strength of our product offering, sales channel and customer relationships. Increased production volumes also drove further lead time improvement during the quarter, although additional improvement remains a priority as we continue increasing throughput. Bookings of AAON branded equipment increased approximately 16% year-over-year during the quarter and were up approximately 45% on a 2-year stack. Year-to-date, bookings increased 12% year-over-year and 25% on a 2-year stack. Growth was primarily driven by continued strength in our traditional transactional business, which is particularly encouraging given the softness we experienced throughout much of last year. National account activity remained healthy and generally consistent with prior year levels. We also continue to see strong momentum with Alpha Class, our fully electric heat pump platform. Alpha Class orders increased 50% during the quarter and 54% year-to-date, and customer adoption continues to build. This platform is an important long-term growth opportunity as customers increasingly focus on electrification, sustainability and energy efficiency. Strong AAON branded bookings resulted in a 6% sequential increase in AAON branded backlog despite significantly higher production rates. As a result, we remain focused on continuing to drive throughput, work down backlog, shorten lead times and deliver for our customers. Turning now to margins. As we have discussed for several quarters, the level of demand we are experiencing has required us to scale the business rapidly. We have expanded our manufacturing footprint, brought new capacity online, invested in equipment and infrastructure, strengthened our supply chain capabilities and significantly increased talent across operations, engineering, manufacturing and support functions. These actions have been deliberate. They allow us to better serve customers, convert backlog faster, capture market share opportunities and build the operating platform required for the company AAON is becoming. Importantly, the underlying economics of the business continue to improve. Oklahoma's core operations are performing well. Memphis continues to perform meaningfully ahead of our expectations and production throughput across the enterprise continues to increase. Consolidated margins remain pressured by the mix impact of exceptionally strong growth, ramp-up activity associated with new capacity and price/cost timing dynamics. We continue to expect margin improvement through higher facility utilization, productivity gains, sourcing initiatives, improved price/cost realization and a continued maturation of recently added capacity. The key point here is that we are not simply growing revenue. We are building a stronger operating company with scale, infrastructure, systems and discipline to support higher revenue, stronger execution, improved margins, greater cash generation and durable earnings growth over time. We are confident in our ability to continue demonstrating the earnings power of this business as we move through the balance of 2026 and into 2027. And with that, I will now turn the call over to Andy. Chung Cheung: Thank you, Matt, and good afternoon, everyone. Second quarter net sales were a record $627 million, an increase of 101% year-over-year. Growth reflected robust BASX and AAON brand performance as well as enhanced manufacturing throughput enabled by strategic capacity investments and ongoing productivity initiatives. BASX branded sales increased 216.2% year-over-year, reflecting the combination of sustained momentum in data center cooling demand, higher production output and greater utilization of recently added manufacturing capacity. AAON branded sales grew 39.3% in the second quarter, driven by a healthy backlog and improved production throughput as we work to reduce lead times at both our Tulsa and Longview facilities. Gross profit in the second quarter increased 84.3% to $152.5 million compared with $82.7 million in the prior year period, reflecting the company's strong revenue growth. Gross margin was 24.3%, down from 26.6% in the second quarter of 2025. Results reflected the impact of ramping recently added manufacturing capacity, including the Memphis facility, along with the increased use of outsourcing to support accelerated growth and ongoing inflationary cost pressures. Importantly, these factors are temporary and largely reflect deliberate investments to support long-term growth. As throughput and utilization continue to increase, productivity improves and better-priced backlog is converted, there is clear sight into gross margin improvement in the coming quarters. SG&A expenses as a percent of sales declined 570 basis points to 13.3%, demonstrating strong operating leverage as revenue growth outpaced our continued investments in the organization. On a dollar basis, SG&A increased $24.5 million to $83.6 million as the company continues to make intentional investments to drive long-term growth. Non-GAAP adjusted EBITDA increased 102.3% from the prior year period to $94.2 million. Adjusted EBITDA margin was 15% compared to 14.9% a year ago. Adjusted diluted earnings per share grew 213.6% to $0.69. Turning now to the segment's financials, beginning with AAON Oklahoma. Second quarter net sales increased 42% to $262.3 million, driven by strong execution against a robust beginning backlog and accelerated conversion enabled by production improvements. Results also benefited from favorable price realization and a beneficial comparison to the prior year period, which was impacted by the industry refrigerant transition and other operational challenges. AAON Oklahoma gross profit increased 18.9% to $63.6 million. Gross margin was 24.3%, a decline of 460 basis points from 28.9% in the second quarter of 2025. Overhead expenses associated with the Memphis facility impacted segment margin by $18.1 million compared with just $3 million in the prior year period. Excluding these costs, Oklahoma margins expanded approximately 60 basis points to 31.2% compared to 30.5% last year. Adjusted for Memphis overhead expenses, the increase in AAON Oklahoma gross margins was largely due to increased production rates. These gains were partially offset by elevated outsourcing levels and inflationary pressures, both of which are temporary and do not change the long-term margin profile of the segment. These factors have been addressed in recent quarters with actions embedded in backlog and new pricing actions. We expect these temporary headwinds to moderate as the year progresses. AAON Coil Products sales were $146.7 million in the second quarter, an increase of $88.2 million or 151% compared to the prior year period. Growth was driven by $126.6 million in BASX branded liquid cooling product sales, which increased 208% during the quarter. This strength was also supported by a 15.1% increase in AAON branded output within the segment. AAON Coil Products gross profit increased 130% to $23.5 million. Gross margin was 16% in the second quarter compared to 17.5% in the prior year period. The margin contraction reflected temporary inflationary pressures that we expect will moderate in Q3 and Q4. The segment continues to deliver strong profit growth supported by higher sales volumes that are expected to continue throughout 2026. Along with the expected margin improvement, we expect profit growth will accelerate in the second half of the year. BASX segment sales grew 221% in the second quarter to $218 million. The outsized growth was driven by sustained demand for data center solutions and a robust backlog. Increased utilization at the Memphis facility contributed meaningfully to quarterly results by expanding production capacity, accelerating backlog conversion and driving higher sales volume. BASX segment gross profit increased 244.2% to $65.3 million compared with $19 million in the prior year period. Gross margin was 30%, up from 27.9% in the prior year period. The improvement in margin reflected strong volume growth, partially offset by incremental resources and investments to support future growth and share gains. Lastly, a quick update on the Memphis facility. We understand the accounting treatment can make performance difficult to evaluate, and we intend to provide greater clarity going forward. When considering the facility's revenue generation to date and fully burdening results with all associated expenses, including overhead currently allocated to the Oklahoma segment, Memphis is performing exceptionally well and ahead of plan. Production and revenue have significantly outpaced expectations and margins have expanded for two straight quarters, reaching levels well ahead of where we expected them to be at this point in the facility's development. Now turning to the balance sheet. Cash, cash equivalents and restricted cash balances totaled $12.7 million on June 30, 2026, and debt at the end of the quarter was $435 million. Our leverage ratio improved to 1.48, down from 1.71 on March 31 and 1.77 on December 31. In the first half of 2026, cash flow from operations was a positive $55 million, a significant improvement compared to a $31 million use of cash in the prior year period. This was driven by higher earnings and improved working capital efficiency. Capital expenditures totaled $102.6 million year-to-date, reflecting continued investment in incremental capacity to support future growth. Looking ahead, we continue to see significant opportunities to improve productivity, profitability and working capital efficiency. We expect these initiatives to support stronger cash flow generation and continued balance sheet improvement, providing a solid foundation for sustained long-term growth. I will now hand the call back to Matt. Matthew Tobolski: Thank you, Andy. We entered the second half of the year with strong momentum across the business. Production throughput has increased significantly. Backlog remains at elevated levels despite record revenue conversion and demand across both brands continues to be healthy. Importantly, the backlog we are converting today carries a more favorable margin profile than the backlog during the first half of the year. Combined with higher production volumes, improving facility utilization, pricing actions, sourcing initiatives and continued operational improvements, we believe the building blocks for margin improvement are firmly in place. Turning to our outlook for 2026. We now expect sales growth of 55% to 60%, gross margin of 25% to 26%, SG&A expense of 13% to 14% of sales, and depreciation and amortization expense of $95 million to $100 million. Our updated outlook reflects stronger-than-expected production, backlog conversion and execution across the enterprise. While we continue to see operational improvement across the business, our consolidated margin outlook reflects the mix impact of exceptionally strong growth from recently added capacity, continued ramp-up activity and price/cost timing. As we sit here more than halfway through the year, I want to provide a few thoughts on how we're thinking about the business beyond 2026. First, we continue to feel extremely positive about the long-term outlook for both the AAON and BASX brands. Both businesses continue to gain market share, supported by differentiated products, strong customer relationships, our industry best sales channel and highly engineered solutions that are difficult to replicate. Second, we continue to see substantial opportunity to improve margins over time. The drivers are straightforward and well understood, higher utilization of recently added capacity, improved fixed cost absorption, increased productivity, continued sourcing improvements and pricing actions already embedded within our backlog. We expect to see progress through the balance of the year and a more meaningful benefit as we move into 2027. Third, we see a significant opportunity to improve cash generation. We have already started to see encouraging progress with operating cash flow improving meaningfully during the first half of the year. As margins improve, growth investments begin to normalize and working capital efficiency continues to improve, we expect cash generation to become a more visible component of the AAON story. The business has undergone significant transformation over the past several years. We have expanded capacity, strengthened leadership, invested in supply chain and manufacturing capabilities, broadened our product portfolio and built the operational infrastructure necessary to support a much larger company. Those investments are increasingly showing up in the results. Today, we are seeing stronger throughput, faster backlog conversion, improved sales growth, expanding operating leverage and improving cash flow. These are the outcomes we expected to see as the investments we have made across the business matured. The key point is that we are not simply growing revenue. We are building a stronger operating company with the scale, infrastructure, systems and discipline to support higher revenues, stronger execution, improved margins, greater cash generation and durable earnings growth over time. We still have work ahead, particularly around margin improvement, but the direction is clear. The long-term opportunity remains strong and the actions required to improve margins and cash generation are underway. We are proud of what the team has accomplished, confident in the opportunity ahead and focused on demonstrating the earnings power of this business as we move through the balance of 2026 and into 2027. In closing, I want to thank our employees, customers, sales channel partners and shareholders for their continued support. Our employees have accomplished an extraordinary amount. The growth we are delivering today is a direct result of their efforts, discipline and commitment to serving customers while building a stronger company. We remain focused on execution, disciplined in our approach and excited about the opportunities ahead. And with that, I will open the call up for questions. Operator: [Operator Instructions] Your first question comes from Ryan Merkel with William Blair. Ryan Merkel: I want to start with the data center orders in the quarter. They're a little bit weaker than I think some of us were expecting. So Matt, just put a finer point on that, if you would. I know you mentioned the pipeline is healthy. And then could you provide any color on if you think orders will improve in the third quarter? Matthew Tobolski: Certainly, great question, one we anticipated was going to come out today. So just I want to start off maybe by stepping back for 1 second and just looking at the kind of trajectory that we've had in our data center bookings over the last four quarters. So at a high level, when we look at the momentum that we have going into this quarter, the prior four quarters had a book-to-bill approaching 3 over that time period. So we've had exceptionally strong bookings as we've been ramping up capacity. And we think about it from the standpoint of that trajectory that we see really highlights that, that differentiated offering that we have in the data center space has certainly been resonating within the marketplace. And so there's been a lot of great momentum, a lot of great trajectory and tremendous amount of pipeline opportunity. Now when we look at the size and the scale of the orders, it's important to kind of go back and recognize that these tend to be large orders. And so there is potential, as we talked about in prior quarters, and really highlighted that there's potential for there to be a little bit of lumpiness around how that flows through to actual backlog and bookings. But really just at a high level, the amount of activity that we have in the data center space, the amount of volume we're putting through, there's a tremendous amount of momentum that we have around our products and our orders. And really, it's a timing conversation around how that pipeline opportunity is converting to overall bookings. But the pipeline itself is the strongest that it's ever been. And it would be important to highlight that it's not just strength with existing customers. There's the great strength of our existing customer base, but our pipeline continues to expand in terms of diversification of our overall customer base. And so really from an outlook perspective, we're incredibly excited about the opportunity. We've seen acceleration in conversations and activity with our sales channel and engagement in the overall market. So while this quarter certainly had a little bit lighter bookings, we don't see that as indicative of anything in the overall market opportunity for our product. Ryan Merkel: Okay. That's helpful. And just a quick follow-up there just because it's an important topic. Was there a large order that slipped because of a timing issue? Or is it just the lumpiness that you talked about and the pipeline is still healthy? Matthew Tobolski: Yes, it's just lumpiness. There's no specific order pushout or movement. There's -- again, it's just really lining up the overall bookings in a given quarter. Ryan Merkel: All right. And then moving to gross margin. You cut the gross margin for the year 200 basis points. And my question is, I'm curious what changed versus when we spoke to you in May. It almost seems like you accelerated throughput and you were willing to eat the higher cost, but just tell us what happened. Matthew Tobolski: Well, let's maybe kind of unpack this for a bit. And so when we look about -- look at margin as a whole and looking at Q1 to Q2, I want to start off by saying, operationally, the margin in the Oklahoma segment is improving and the BASX Redmond segment is improving and the Memphis segment is improving, and there's a little bit of pressure from a price cost perspective in the ACP segment. But I want to start by framing there that the progression that we see operationally is improvement in the overall margin profile of this business. Now what is driving that conversation is the accelerated backlog conversion that we have within our Memphis site. And so from a mix perspective, the increasing revenue volume that we're driving through Memphis, while ramping that facility is at a lower margin point than the Oklahoma segment. And so as we're driving more volume through that Memphis segment, on a consolidated basis, it's pulling the margin down, but providing a net positive impact to the business. And more importantly, it's helping us build a stronger foundation to continue serving data center customers. And so us pushing a little bit harder in our Memphis site and really ramping this facility is giving us a foundation to then drive more business through, allowing us to turn on more production lines and continue growing the overall volume through our Memphis site. And so that mix conversation is one of the biggest drivers of kind of that consolidated margin coming down in the quarter. Ryan Merkel: I see. So of the 200 basis point cut, it was mix and lower-margin data centers accelerating and then it was price cost and then still a bit of outsourcing. Matthew Tobolski: Correct. I mean we think about bringing up the top line outlook for the year up about 20%. Obviously, the vast majority of that is coming through Memphis. And so there's a lot of drive that we're getting in throughput through Memphis. But obviously, it is burdened by a little bit more ramp pressure in outsourcing other things. Again, this facility, just a point of reference, in the quarter, Q2, we did roughly half of the total year 2025 revenue that BASX did out of Redmond. And so in one quarter, a brand-new facility did almost half of what an established mature facility was doing. And so there's inherently going to be some pressures to margin kind of as we ramp that from a productivity standpoint, onboarding new staff and really outsourcing some of the production as a lot of the new equipment continues to come online throughout that facility. And so really, that is the bigger pressure. It's just not a fundamental structural pricing issue. It's just ramping a large facility from scratch. Operator: Your next question comes from David Tarantino with KeyBanc Capital Markets. David Tarantino: Could you give us some color on what the sales outlook now embeds between AAON and BASX branded product sales? And maybe some thoughts on what's informing the confidence on your ability to deliver that growth relative to the capacity ramp that's ongoing? Matthew Tobolski: Yes. No, great question. And so from a kind of a branded perspective, the 2026 guide is assuming approximately 20% growth year-over-year in the AAON brand. And so then backing in, that implies that BASX will again more than double in the year. And so just in perspective, the overall data center market last year and this year is growing around 30%. And so more than doubling BASX, again, after having 140% growth rate the prior year, continue showing a good growth outperforming the overall market. So really strong acquisition from a market share perspective. When we look at confidence in supporting and executing that growth, you've seen us be intentional and disciplined around trying to not overcommit too much growth until we see the sort of legs get below it in the Memphis site. And so as we get more and more run time in Memphis, we get more and more visibility and confidence in that rate of ramp. And that's really what helps guide our approach to that backlog conversion and the messaging around the overall growth rates. You take that and kind of add in all the investments we've been making in our operational model and execution within manufacturing, within lean manufacturing process, continuous improvement in supply chain discipline. And really, it's making meaningful results in the overall ability for us to execute. Now I will say there's certainly a level of caution that is growing this rate in this environment certainly has a little bit of pressures. And so when we look at the implied growth rate in the back half of the year, obviously, it's not some acceleration beyond Q2 in the back half of the year. It's showing a relatively moderate kind of performance in the back half. And that's just recognizing that this rate of growth is going to have some level of pressures, whether it be supply chain or operationally. But that's embedded into our outlook, that's embedded into our guidance. And really, from our standpoint, we're intentional and we're also clear-eyed about some of the realities about growing this fast. David Tarantino: And then just to follow up on that last comment. Is that supply chain pressures and/or other pressures that you're seeing today? Or is that just conservatism? Matthew Tobolski: I mean I'd say there's always challenges that pop up. I mean, Q1 and Q2, there's certainly been a variety of issues we've tackled and continue to tackle. So there's nothing new or meaningful that's in there, but it's just a reality of this market that we're not wanting to dismiss the reality of some of the supply chain sensitivities and operation in this kind of environment today. David Tarantino: Okay. Great. And then maybe back on gross margins. Could you just give us the key buckets driving the second half improvement versus the first half, particularly between the better absorption and maybe improving price cost? And then maybe kind of give us some color on how these should progress between both 3Q and 4Q? Matthew Tobolski: So at a high level, the biggest driver of margin improvement in the back half is price cost. That certainly is the biggest driver. We messaged this back in the Q1 call as well. But at the very end of last year, we certainly noticed some price cost challenges that we intentionally took action on from a pricing perspective. And so the backlog that we have today is at a substantially different price point than the backlog that we executed in Q1 and Q2. And so that certainly is the biggest driver of margin improvement in the back half. But certainly, beyond that, productivity gains will certainly continue to be a positive from an overall margin perspective. Looking at Memphis as an example, as there's more run time, productivity gains will begin to materialize in overall margin profile. But the progression from Q2 is really improving in Q3, but Q4 certainly is the back half load of that overall margin improvement. Operator: Your next question comes from Noah Kaye with Oppenheimer. Noah Kaye: Maybe just double-clicking on margins. Can you help us understand the margin trends in ACP where we saw sequentially lower margins and liquid cooling was, I think, over 85% of the segment. So how should that segment, particularly the liquid cooling side of it, profile from a margin perspective? What happened in the quarter? And what is sort of embedded for improvement from here? Matthew Tobolski: Yes. The biggest driver in the ACP segment -- well, first off, the biggest driver in the segment margin kind of quarter-over-quarter was really on price cost, driven by inflation. So whether it's the kind of raw materials kind of inflationary pressures, a lot of freight pressure from a costing perspective, really, those are the biggest drivers in the quarter. And to be frank, we were behind on pricing actions to recover those. And so there's been a lot of work done in the ACP segment around pricing to basically make sure that inflationary pressure is captured properly. And I would just say, as we continue investing in our organization sophistication, whether in Andy's organization from a finance perspective or our supply chain organization, we're getting more and more visibility, which is allowing us to make more and more forward-looking actions to stay ahead of these inflationary pressures. And so this sophistication and investments we're making to really drive improvements in our operating model will continue to make meaningful impact in the overall margin profile to help capture this ahead of time. But the reality is we were behind on the overall pricing against the inflationary cost. And those actions have been taken and continue to be monitored and taken appropriately going forward to capture that. Chung Cheung: Noah, I would also just add that given the actions that we've taken, we're probably going to be toward the end of the year for us to see some meaningful rebound there. There's a bit of a backlog there as well. But we knew what it is, and we've been taking action. So I think to Matt's point, now that we have a more sophisticated view of our costing, product costs, so now we will be able to do more timely actions. But we knew that a lot of the actions already in place. Noah Kaye: Very helpful. And then I guess just to double-click on David's point. So I think you talked about 4Q being kind of where some of the margin improvement is weighted toward. So should we not assume kind of fairly ratable sequential margin improvement in 3Q and 4Q. And I think we can get there within 120 bps or so improvement quarter-over-quarter for the next couple of quarters. Do you think it's going to be more back-end weighted? Matthew Tobolski: Yes, you'll see modest improvement in Q3, but really Q4 is going to be where the more noticeable improvement is going to be weighted. Noah Kaye: Okay. And then just on the orders because to agree with Ryan, that was a big focus today. I just want to see if we can get some clarity here. Were there large orders or meaningful improvement in orders in July and early August versus the 2Q level? Can you share anything on that? Because you mentioned the pipeline expanding. And certainly, we know industry activity is very good. Can you just talk about trends quarter-to-date to the extent you can share? Matthew Tobolski: I would just say quarter-to-date, I don't have it specifically in front of me the overall bookings. But what I would say is from a pipeline perspective, with visible and high confidence conversions, there is a tremendous amount of pipeline with existing customers for '27 and '28 orders. And so there's a lot of work going into those existing relationships and really, they're planning for '27 and '28 deliveries that just didn't hit the books in Q2. But again, part of our normal planning process this time of year is where a lot of that planning actually begins to materialize into orders for the next year and beyond. So I would just keep reiterating that the amount of activity that we have is tremendously high, very strong with existing customer base. And again, we're continuing to turn on production capacity in Memphis, which is allowing us to, beyond that existing customer base, really accelerate new customer relationships from a diversification play. So the amount of activity that is out there that we're involved in with a lot of high probability closures of existing customers and new customers is as high as it's ever been. Noah Kaye: And that would be very consistent with kind of how the calendar year works where some of those '27, '28 commitments would start to flow through to your orders. So that would make sense. And Matt, just to follow up on that last point. You mentioned the diversification progress here. I'm not sure whether it was in the bookings this quarter or any other metrics, but what can you share with us around where you feel you're making real progress on that diversification? What are customers looking for? What wins have you had or what feels reasonably high probability? Matthew Tobolski: What's been great is it's relatively diverse across our product portfolio. So we're not looking at pipeline activity and new relationships just in one specific product. So whether it's liquid cooling products, whether it's airside products, chiller products, the conversations are happening across the entire portfolio. And really, it's a pretty good weighting across all of that. So it's not weighted like it's all 95% one or the other. It's actually pretty evenly spread across that product portfolio with new customers. And so really showing that, that portfolio really resonates across a broad spectrum of customers. Operator: Your next question comes from Timothy Wojs with Baird. Timothy Wojs: Maybe just my first question, just when you look at the Oklahoma segment and we talk about kind of mid- to high 30% gross margins and having visibility to that, I mean, I think we've kind of been talking about that for really the last 18 months. So we've still kind of been kind of hung up in this kind of 30%, 31% range. So I guess, could you put a little finer point on kind of when you would expect to get to that kind of mid- to high kind of 30s percent level? Or do you have backlog today that is kind of clearly at that level? Just some color on the timing and the visibility to when we'd actually start to see that. Matthew Tobolski: So on the Oklahoma segment, obviously, we talked about this in the Q1 call where we noticed some definite price cost dislocation at the end of last year and pricing actions started to get put in place. Well, that was getting put in place when we had a pretty healthy backlog. And so as that pricing went in, it takes time for that to really start hitting the overall production floor. But those actions, we're really starting to see movement, obviously, in this quarter. But really, we think about that meaningful pricing is going to really come in Q4. You'll see some very meaningful price impact hitting the Oklahoma margins and into 2027. So we anticipate with the overall pricing structure and our productivity gains that we're seeing across that facility that Q4 in 2027 is when we're going to really expect to see that kind of start to flow through as that mid- to high 30s. Timothy Wojs: Okay. Okay. And can you just step back and talk about what -- I mean, we've got some kind of trailing kind of price cost pressures in ACP. We've got it in Memphis or in Oklahoma. Can you just kind of step back and talk about what you've done over the last 6 to 9 months so that we're not as behind on price cost as we've been here in the last 6 to 9 months? Matthew Tobolski: Yes. No, it's a very fair question. And we've talked about this really for the last few quarters, which is the evolution of the investments we're making and the sophistication of how we run this business. And so as -- whether it comes down to the supply chain strategy, whether it comes down to the overall finance organization and partnership with the business and better insights and kind of forward-looking information to the business, all these investments we're making are really being made to provide better forward-looking visibility and better confidence in execution. And you and I have certainly talked about this, and I've made these comments before around the scaling, the rate of scaling at AAON, it's pretty phenomenal to think that 5 years ago, the revenue was a bit above $500 million and certainly substantially higher than that in this calendar year, more than 4x in this calendar year. So when you look at that dynamic, there was a lot of evolution that had to happen in the business to really provide the infrastructure and the discipline to not only run that fast, but to do it successfully and reliably time and time and time again. And so the investments we're making and, really, the operational improvements and sophistication of this business are really driven on that idea of getting better visibility and foresight into our execution and allow us to have actionable insights well in advance of when we have to make decisions. And so all of those investments are being made to allow us to see these things coming so that a year down the road, I'm not saying, hey, Tim, we didn't see this coming. Like we're going to be able to say, hey, we saw this coming, which is why we made these actions, which is why you see the margin maintaining where it's at. Chung Cheung: Tim, I'll add to that to Matt's point. So now that we have a handful of new finance leaders joining us, and we organized a bit a couple of months ago. So every executive now is partnering with finance insights and allowing us to do much more analytics to inform the action faster. And this can really go beyond gross margin as well. So we really have a lot of insight now into managing working capital. A lot of process change already been kicking off. So I'm pretty bullish that we'll quickly see some fruits coming out of these investments. So definitely, we have a next level of insight guiding the business right now. Timothy Wojs: Okay. Okay. That's helpful. And then just I'll sneak one last in. Just the BASX backlog, I know you ran through production more than you thought and you had some order lumpiness. But would you expect that backlog in BASX to be higher at the end of the year than it is today? Matthew Tobolski: Certainly, we anticipate there being -- I guess what I'll say is two parts. So first off, I want to just kind of keep reiterating that some of this acceleration in conversion, it is building us a stronger foundation to build off of. And so the faster we convert, the better visibility and clarity we get into the ability to execute at scale and then we build more production capacity, more lines out from there. It's allowing us to really continue taking this opportunity in the market and capturing as much as possible. And so that conversion of backlog, acceleration of conversion certainly makes the bookings become a big balancing point. But our goal is to get that operating foundation in place to keep growing it and then continue driving sales based on visibility into our ability to execute against the overall demand in the market. So we talked about this in the past, that the balance of confidence and execution and bookings kind of go hand in hand. And so as we keep getting this foundation built, it allows us and our sales team the opportunity to more aggressively go after the orders. And so just to say, I mean, the growth and the execution that our operations team is driving is pretty phenomenal when we think about all of this organic growth and the scale of growth and the pace of growth. And so that has been arming our sales channel to go out there in the marketplace and really drive more bookings. And so we certainly anticipate that being very, very good ammunition for our sales channel to keep driving more order cadence into the overall backlog, and really keep driving it up as we go into 2027. So that to us should be a driver to continue capturing more and more of the opportunity and driving more and more backlog in the business. Operator: Your next question comes from Chris Moore with CJS Securities. Christopher Moore: Maybe one more on gross margin. So recognizing that you're not giving specific guidance on '27, but what would be maybe the puts and takes that would make it possible or make it difficult to improve the 25% to 26% gross margin range in '26 by, say, 400 basis points in 2027? Matthew Tobolski: So I guess when we look at the margin trajectory through 2026, and again, we've talked about the fact that Q4 is certainly going to be the strongest margin quarter for the overall organization. That certainly means that we're entering 2027 at a much higher than 25% to 26% margin profile. So starting off to say we're ending the year at the high watermark and then driving that momentum into 2027. When we look at how do we drive that margin, again, people ask the question around when we get back to that 30-plus percent. My starting point is to say, well, we're exiting the year actually at a pretty healthy margin when you run the math on the momentum in the guidance. And really, the upside to keep driving beyond that comes down to higher volumes to absorb the fixed costs, continued discipline around price cost and continued overall focus on improving productivity across the business. And so all those things are what allow us to keep driving that margin higher and getting ourselves back into that 30-plus percent profile from a consolidated basis.I will just say that, obviously, mix is certainly a conversation. So as that BASX brand that, again, it's got improving margin quarter-over-quarter. But certainly, as we keep driving more volume through there, mix can be a little bit of a factor. But again, we anticipate on that side of the business as well to continue seeing progress in margin profile throughout the year. Christopher Moore: Got it. That makes sense. And as you said, Q4 is going to be the high on the margin side. I wasn't sure what you said earlier, Matt, in terms of from a revenue perspective, Q3 versus Q4. Is that relatively balanced? Or is Q3 meaningfully a bit higher than Q4? I'm just not sure how we should be looking at that. Matthew Tobolski: No, they'll be relatively balanced. But one thing I want to point out is we have holidays in Q4. So a balanced top line revenue Q3 to Q4 actually implies higher productivity in Q4. Just the holidays tend to certainly slow down production levels. So sales per day should be up, but overall top line relatively flat quarter-to-quarter. Christopher Moore: Got it. And maybe just last one from me. I mean many of the data center HVAC players dealing with significant supply chain issues, one of the bigger challenges being the sourcing of certain fans. I know you guys made a decision a couple of years ago to vertically integrate a little further, specifically with regard to plenum fans for your own HVAC units, external sales. Can you talk a little bit more about the current impact of that decision and just kind of overall supply chain challenges that you're seeing at this stage? Matthew Tobolski: Yes. Just a data point. I mean, certainly, on the AAON side of the business, we brought in the manufacturing of fans a couple of years back. But just as a data point, the BASX business from the day we started that business, we manufactured our own fans. And so whether recently, through some of our current supply chain challenges or during the COVID supply chain challenges, the in-sourcing of fans continues to be a competitive benefit for us with some of the overall volatility. Now that said, we still do buy fans, not -- we still use fans other than just our own. So we do also get a good eye into the overall marketplace and recognize that fans as an overall market certainly have some constraints around the amount of available capacity in the marketplace. And so there is some pressure kind of on the fan side, but we continue to look for opportunities to manufacture our fans or to multisource fans. I would say that the discipline and the continued focus around supply chain resiliency that our supply chain organization is focused on continues to look at ahead of being hit by a supply chain constraint. We tend to be looking at as many leading indicators as possible and driving multi-sourcing strategies or alternate vendor selections as early in the process as possible to mitigate the overall challenges. So I would say that at a high level, Chris, I mean, supply chain challenges certainly exist in this market. There definitely are constraints, and our team continues to very actively and proactively manage those constraints. We've actually had some very good success in mitigating the overall impacts to our overall volumes. That said, we also recognize there is potential for those to create some noise in the coming quarters. And so our focus is to continue looking as far ahead as possible to look for constraints in the overall supply base as soon as we can see them and really drive sourcing strategies to mitigate the overall impacts as soon as possible. Operator: Your next question comes from Julio Romero with Sidoti. Julio Romero: Matt, based on the comment earlier in the Q&A of the revised full year sales guide embedding AAON branded sales at 20% growth, I think that implies, if my math is right, second half BASX branded product sales of roughly $290 million to $330 million a quarter, and that would be below the $345 million of BASX branded sales you just did in the second quarter. Is that right, Matt? And if so, kind of help us understand why the step down there? Matthew Tobolski: I'd say more flattish on the BASX kind of sales kind of quarter-over-quarter in Q2, 3 and 4. So relatively flattish. I wouldn't say a big step down. And so just from that standpoint, I would say our focus and our drive is certainly to continue driving volume through our facilities. But also embedded in there is recognition that while we've had very good success in mitigating supply challenges, we're also not blind to the potential that there could be issues. And so we're looking at this from a standpoint of open eyes and reality around the overall market. And the reality is growing a business as fast as we are growing this business in a market that has some of the constraints that it has is not without challenge. And so embedded in that sort of back half on the BASX side is some recognition of some of that potential impact to the business. But I would just say that our focus every day that we wake up, is to mitigate those impacts and really drive the volume through that factory and continue delivering. But that really is the focus from an execution standpoint. Julio Romero: Got it. Okay. That is helpful. And then you did see some pretty good leverage on the SG&A line this quarter. Is that -- is there room for further leverage as kind of revenue continues to scale, especially as we head to '27? Matthew Tobolski: What I would say is we certainly rewind the clock last year and the year before. We've been making investments, very intentional investments to prepare this business to operate at the scale that it's operating at. And so we're seeing some of that leverage show through in the quarter, obviously, which is great. But I would say there continues to be some investments that we have to make to really kind of get all of the parts and pieces in place. So I wouldn't expect at least in the next quarter or two to see substantially more leverage. But what I would say as these investments that we're going to be making in the near term take effect and we keep driving revenue beyond that, we would anticipate seeing that kind of lever up or lever down, I should say, in the future, in more of the 2027 calendar year. Operator: That concludes our Q&A session. I will now turn the conference back over to Joe Mondillo for any closing remarks. Joseph Mondillo: Thank you, operator. I'd like to thank everyone for joining today's call. If anyone has any questions over the coming days and weeks, please feel free to reach out to myself. Have a great rest of the day, and we look forward to speaking with you in the future. Operator: This concludes today's call. Thank you for attending. You may now disconnect, and have a wonderful rest of your day. 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TULSA, Okla., Aug. 13, 2026 /PRNewswire/ -- AAON, Inc. (NASDAQ: AAON), a leader in high-performing, energy-efficient HVAC solutions that bring long-term value to customers and owners, today announced that its Board of Directors has declared the Company's next regular quarterly cash dividend of $0.10 per share (or $0.40 annually), payable on September 25, 2026, to stockholders of record as of the close of business on September 4, 2026. About AAONFounded in 1988, AAON is a global leader in HVAC solutions for commercial, industrial and data center indoor environments. The company's industry-leading approach to designing and manufacturing highly configurable and custom-made equipment to meet exact needs creates a premier ownership experience with greater efficiency, performance and long-term value. Its highly engineered equipment is sold under the AAON and BASX brands. AAON is headquartered in Tulsa, Oklahoma, where its world-class innovation center and testing lab allows AAON engineers to continuously push boundaries and advance the industry. For more information, please visit www.AAON.com. Forward-Looking StatementsThis press release may include "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", "should", "will", and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligations to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Important factors that could cause results to differ materially from those in the forward-looking statements include (1) the timing and extent of changes in raw material and component prices, (2) the effects of fluctuations in the commercial/industrial new construction market, (3) the timing and extent of changes in interest rates, as well as other competitive factors during the year, and (4) general economic, market or business conditions. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in any forward-looking statements, see "Risk Factors" and "Forward Looking Statements" in AAON's Annual Report on Form 10-K for the most recent fiscal year, as may be revised and updated by AAON's Quarterly Reports on Form 10-Q, and AAON's Current Reports on Form 8-K. Contact InformationJoseph MondilloDirector of Investor Relations & Corporate StrategyPhone: (617) 877-6346Email: [email protected] View original content to download multimedia:https://www.prnewswire.com/news-releases/aaon-announces-quarterly-cash-dividend-302850627.html

Track your investments for FREE with Simply Wall St, the portfolio command center trusted by over 7 million individual investors worldwide. AAON (AAON) drew fresh attention after reporting record second quarter 2026 results, with sales of US$626.98 million and net income of US$56.66 million, and management lifting its full year sales growth outlook. See our latest analysis for AAON. Despite the strong Q2 release and higher 2026 guidance, AAON’s recent momentum has cooled, with the share price down 21.83% over the past 30 days and 33.23% over 90 days. However, the 1 year total shareholder return of 24.34% and 5 year total shareholder return of 97.76% present a much stronger longer term picture. If AAON’s latest numbers have you rethinking where growth could come from next, this can be a good moment to broaden your watchlist with 37 power grid technology and infrastructure stocks AAON has just paired record growth figures with a sharp pullback in the share price. Does that reset leave more upside potential for new buyers, or does it mainly shift risk onto those stepping in now? Against AAON’s last close of $89.24, the most widely followed narrative anchors on a fair value of $151.33. This points to a sizeable valuation gap and puts extra weight on whether its growth plan can be delivered as modeled. Read the complete narrative. Want to see what sits behind that backlog story and margin recovery arc. The narrative leans on rising revenue, fatter margins and a richer earnings base. Curious which assumptions have to line up for AAON to reach that $151.33 fair value. Result: Fair Value of $151.33 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this AAON narrative still leans heavily on smooth ERP execution and rising data center demand, so any setbacks in systems rollout or cooling orders could quickly challenge it. Find out about the key risks to this AAON narrative. The SWS DCF model points to AAON trading below an estimated future cash flow value of $120.48, which suggests upside from the current $89.24 price. However, the P/E ratio of 61.9x stands well above both the fair ratio of 51.6x and the US Building industry average of 23.3x, as well as a 30.9x peer average. That leaves AAON looking expensive on earnings, even if the DCF sees value. The key question is which yardstick to put more weight on when expectations are already this high. See what the numbers say about this price — find out in our valuation breakdown. With AAON sitting between strong reported results and a mixed valuation picture, this is a good time to look through the numbers yourself and test the investment story from all angles. To weigh the potential rewards against the concerns in a single place, start with these 3 key rewards and 3 important warning signs. If you are serious about finding your next opportunity, do not stop with AAON. The Simply Wall Street Screener can help you quickly surface focused ideas tailored to what you care about most. Target potential value opportunities by scanning companies that currently screen as 51 high quality undervalued stocks, so you are not relying on headlines alone. Prioritize resilience by reviewing 83 resilient stocks with low risk scores that may offer steadier profiles when you want fewer surprises. Hunt for lesser known opportunities through a screener containing 21 high quality undiscovered gems before everyone else catches on. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include AAON. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved record revenue growth of 101% year-over-year, driven by exceptional throughput across all four major facilities and accelerated backlog conversion. BASX branded sales increased 216% in the quarter, reflecting sustained momentum in data center infrastructure and the successful ramp-up of the new Memphis facility. AAON branded sales grew 40% despite a soft commercial HVAC market, indicating significant market share gains supported by improved production lead times. Consolidated margins faced temporary pressure due to the mix impact of rapid growth in lower-margin ramp-up facilities and price/cost timing dynamics. Management emphasized that the company is not just growing revenue but building a durable operating platform with enhanced supply chain and leadership infrastructure. Backlog remains nearly double prior year levels, providing strong visibility despite the significant increase in production rates and shipments. The Alpha Class fully electric heat pump platform saw a 50% order increase, signaling strong customer adoption of sustainability-focused solutions. Updated 2026 sales growth guidance to 55%-60%, reflecting stronger-than-expected production and backlog conversion capabilities. Margin improvement is expected to be back-half weighted, with Q4 projected as the strongest quarter due to more favorable pricing embedded in the current backlog. Management anticipates a meaningful benefit to margins in 2027 as recently added capacity matures and fixed cost absorption improves. Cash generation is expected to become a more visible component of the corporate narrative as growth investments normalize and working capital efficiency improves. Guidance assumes relatively balanced revenue in Q3 and Q4, accounting for holiday-related production slowdowns in the final quarter. The Memphis facility is performing ahead of plan, though its rapid scaling currently exerts a mix-related drag on consolidated gross margins. Temporary inflationary pressures and freight costs impacted the AAON Coil Products segment, leading to a lag in price realization that management is now addressing. Increased use of outsourcing was a deliberate, temporary choice to support accelerated growth and meet customer delivery timelines. Supply chain sensitivities, particularly regarding fan components, remain a monitored risk, though vertical integration of fan manufacturing provides a competitive buffer. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management characterized the lower sequential bookings as natural 'lumpiness' inherent in large-scale data center projects rather than a market slowdown. The opportunity pipeline is at record levels, with increasing customer diversification and active planning for 2027 and 2028 deliveries. The reduction was primarily driven by a mix shift toward the Memphis facility, which is ramping up at a lower margin point than the mature Oklahoma operations. Other factors included temporary price/cost dislocation in the ACP segment and continued reliance on outsourcing to meet record demand. Management expects to reach these levels by Q4 2027. as higher-priced backlog begins to flow through the production floor. Productivity gains and improved fixed cost absorption from higher volumes will be the primary catalysts for this expansion. In-sourcing fan manufacturing has mitigated volatility seen by competitors, though the company still utilizes multi-sourcing for certain components. Proactive sourcing strategies are in place to identify and address potential constraints in the broader market before they impact production volumes.

Net sales increased 101%, Operating income increased 192%, Diluted EPS increased 258%Raises Full-Year Outlook Second Quarter 2026 Highlights(All comparisons are year-over-year, unless otherwise noted) Delivered record quarterly net sales and significant earnings growth as expanded capacity and improved execution accelerated backlog conversion Net sales increased 101.2% to a record $627.0 million Gross profit increased 84.3% to $152.5 million Operating income increased 192.1% to 68.9 million, reflecting strong net sales growth, improved overhead leverage, and disciplined SG&A management GAAP diluted EPS increased 257.9% to $0.68, Non-GAAP adjusted EPS increased 213.6% to $0.69 Total backlog increased 98.0% year-over-year to $2.0 billion, remaining nearly double the prior-year level despite record quarterly net sales and significantly higher production rates Year-to-date, operating cash flow improved to $55.0 million, compared with negative $31.0 million a year ago Raises 2026 Outlook 2026 outlook now reflects net sales growth of 55%-60%, gross margins of approximately 25-26%, and SG&A as a percent of sales of 13%-14%, supported by strong backlog, expanded capacity, and improving operational execution TULSA, Okla., Aug. 10, 2026 /PRNewswire/ -- AAON, INC. (NASDAQ-AAON), a leader in high-performing, energy-efficient HVAC solutions that bring long-term value to customers and owners, today announced its results for the second quarter of 2026. "Our second quarter results demonstrate the continued strength of demand for our solutions and the progress we are making scaling the company to meet that demand," said Matt Tobolski, President and CEO of AAON. "Net sales increased 101.2% to a fourth consecutive quarterly record, operating income increased 192.1%, and diluted EPS increased 257.9%, reflecting the power of higher throughput, strong backlog conversion, and continued execution across the business. "The investments we have made in capacity, leadership, supply chain, and manufacturing infrastructure are translating into measurable operating progress. Production increased across the enterprise, lead times are improving in key areas, and we are converting backlog at a much faster pace while continuing to see strong customer engagement. This is clear evidence that the operating foundation we have been building is working. "The long-term market opportunity remains compelling across both brands. The BASX brand continues to benefit from significant data center investment activity, a healthy customer pipeline, and strong engagement with strategic customers. The AAON brand continues to gain share despite a softer commercial HVAC market. Both businesses are well positioned, supported by differentiated products, highly engineered solutions, and strong customer relationships. "We are also clear-eyed about the margin work ahead. The pace of growth and capacity ramp is creating near-term margin pressure, but the drivers are known, the actions are underway, and the path to improvement is clear: higher utilization, productivity improvements, sourcing initiatives, pricing actions, and a more favorable backlog profile. We are not simply growing revenue. We are building a stronger operating company with the scale, systems, and discipline to deliver improved margins, stronger cash generation, and durable earnings power over time." Second Quarter 2026 Results Net sales for the second quarter of 2026 increased 101.2% to a record $627.0 million, compared with $311.6 million in the second quarter of 2025. Growth reflected strong demand across both the AAON and BASX brands, improved manufacturing throughput, and increased utilization of recently added production capacity. BASX-branded sales grew 216.2% to a record $345 million, reflecting momentum in data center demand, higher production output, and greater utilization of recently added manufacturing capacity. AAON-branded sales also increased to a record level, growing 39.3% to $282.2 million, benefitting by a healthy backlog and continued progress in production throughput. Booking activity remained solid across both brands, contributing to market share gains and elevated backlog levels. BASX-branded products ended the quarter with backlog up 185.4%, while AAON‑branded backlog increased 9.4% from the prior-year period. Gross profit increased 84.3% to $152.5 million, compared with $82.7 million in the second quarter of 2025. Gross profit margin was 24.3%, compared with 26.6% in the prior-year period. Results reflected the impact of ramping recently added manufacturing capacity, including the Memphis facility, the use of outsourced components to support accelerated growth, and inflationary cost pressures. These investments and actions supported substantially higher production levels and improved customer delivery performance during the quarter. These costs are being addressed through a combination of pricing, sourcing, productivity, and operational initiatives. Management expects margin performance to improve as production volumes increase, recently added capacity utilization increases, and backlog with improved pricing converts to revenue. Selling, general and administrative expenses as a percent of sales declined 570 basis points to 13.3%, reflecting continued operating leverage and disciplined cost management as revenue growth outpaced overhead investments. Operating income increased 192.1% to $68.9 million, compared with $23.6 million in the prior-year period. Diluted earnings per share were $0.68, an increase of 257.9% from $0.19 in the second quarter of 2025. Adjusted non-GAAP EPS increased 213.6% to $0.69, which includes a $1.4 million infrequent expense related to an incentive fee associated with our Memphis, Tenn. facility, net of the profit sharing and tax effect. Backlog Total backlog increased 98.0% year-over-year to $2.0 billion, compared to $995.3 million the prior year. Backlog remained nearly double the prior-year level even as the Company converted backlog into record quarterly revenue at significantly higher production rates. BASX-branded backlog increased 185.4% year-over-year, reflecting continued customer investment activity in data center infrastructure and the value customers place on BASX's custom-engineered solutions. AAON-branded backlog increased 9.4% year-over-year, supported by strong order activity despite soft end-market conditions. Compared to the first quarter of 2026, total backlog decreased 7.4%, primarily reflecting accelerated backlog conversion into record revenue and the inherent timing variability of large BASX project awards. We continue to see strong customer engagement and a healthy pipeline of opportunities across the data center market. As is typical with large, highly engineered projects, the timing of customer awards and order conversion can vary from quarter to quarter. We remain encouraged by the volume of opportunities under discussion and our position with key customers. AAON-branded backlog increased 6.0% sequentially, reflecting strong order activity and continued share gains despite a soft commercial HVAC market backdrop. 2026 Outlook Based on strong backlog, accelerating production throughput, expanded capacity, and current expectations for customer project timing, we are updating our full-year 2026 outlook as follows: "Our updated outlook reflects the strength of our backlog positions, continued customer activity across our end markets, and the significant progress we are making increasing throughput and converting backlog into revenue," said Matt Tobolski. "At the same time, the revised gross margin outlook reflects the near-term cost of scaling rapidly while we bring new capacity to higher utilization and work through price-cost timing. "The direction is clear. We expect sequential margin improvement in the second half of the year as higher production volumes, better utilization, pricing actions, sourcing initiatives, and continued operational discipline begin to show more clearly in reported results. We remain confident in the long-term earnings power of the business and believe the progress we are making today positions AAON for improved profitability and stronger cash generation as the year progresses." Segment Results AAON Oklahoma AAON Oklahoma generated net sales of $262.3 million, an increase of 41.7% from the prior-year period. Growth was driven by stronger execution against a robust backlog, supported by ongoing production improvements that accelerated backlog conversion. Performance also benefited from favorable price realization and a more normalized operating environment relative to the prior year, when the industry refrigerant transition and company-specific operational challenges weighed on results. Gross profit increased 18.9% to $63.6 million compared with $53.5 million in the prior-year period. Gross margin was 24.3%, compared to 28.9% in the second quarter of 2025. Segment profitability was impacted by $18.1 million of overhead expenses associated with the Memphis facility, compared with $3.0 million in the prior-year period. Excluding these costs, segment margins expanded 70 basis points to 31.2%, compared to 30.5% in the prior-year period. The year-over-year improvement excluding Memphis overhead reflects higher production rates, improved throughput, and favorable pricing, partially offset by elevated outsourcing levels and inflationary cost pressures. These pressures are being addressed through pricing and operational initiatives and are not expected to change the long-term margin profile of the segment. AAON Coil Products AAON Coil Products generated net sales of $146.7 million, an increase of 150.9% from the prior-year period. Growth was driven primarily by BASX-branded liquid cooling sales of $126.6 million, up 208.4% during the period. Gross profit increased 130.1% to $23.5 million, compared with $10.2 million in the prior-year period. Gross margin was 16.0%, compared with 17.5% in the second quarter of 2025. Margin performance reflected inflationary cost pressures, outsourcing-related costs, freight pressure, and price-cost timing within the segment. These pressures were partially offset by improved labor efficiency, better overhead absorption, and higher production volume. Management has clear visibility into the drivers and is taking action through pricing, sourcing, productivity, and operational discipline. While these actions are not yet fully reflected in the reported results, the Company expects the benefits to build through the second half of the year. Despite the margin pressure, AAON Coil Products delivered strong profit growth supported by higher sales volumes. BASX BASX segment generated net sales of $218.0 million and increase of 220.7% from the prior-year period. Growth was driven by strong backlog conversion, continued data center investment activity, and increased production capacity enabled by continued ramping of the Company's manufacturing footprint, including Memphis. Gross profit increased 244.2% to $65.3 million, compared with $19.0 million in the prior-year period. Gross margin was 30.0%, up from 27.9% in the second quarter of 2025. The year-over-year margin improvement reflected substantial volume growth, partially offset by incremental resources and investments required to support future growth, customer delivery, and continued share gains. Balance Sheet & Cash Flow As of June 30, 2026, the Company had cash, cash equivalents and restricted cash of $12.7 million and a balance on its revolving credit facility of $435.0 million. Andy Cheung, CFO and Treasurer, commented, "Our strong earnings performance and disciplined working capital initiatives have driven meaningful improvement in both financial leverage and operating cash flow generation through the first half of 2026. Operating cash flow totaled $55.0 million for the six-month period, a significant improvement compared with a $31.0 million use of cash in the first six months of 2025. As we move through the second half, we remain focused on productivity, margin improvement and working capital efficiency. These actions are expected to support stronger cash flow generation and continued balance sheet improvement over the long term." Conference Call The Company will host a conference call and webcast this afternoon at 5:00 p.m. EDT to discuss the second quarter of 2026 results and outlook. The conference call will be accessible via dial-in for those who wish to participate in Q&A as well as a listen-only webcast. The dial-in is accessible at 1-888-880-3330. To access the listen-only webcast, please register at https://app.webinar.net/8K3oQEbJrgq. On the next business day following the call, a replay of the call will be available on the company's website at https://aaon.com/investors. About AAON Founded in 1988, AAON is a global leader in HVAC solutions for commercial, industrial and data center indoor environments. The company's industry-leading approach to designing and manufacturing highly configurable and custom-made equipment to meet exact needs creates a premier ownership experience with greater efficiency, performance and long-term value. Its highly engineered equipment is sold under the AAON and BASX brands. AAON is headquartered in Tulsa, Oklahoma, where its world-class innovation center and testing lab allows AAON engineers to continuously push boundaries and advance the industry. For more information, please visit www.aaon.com. Forward-Looking Statements This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", "should", "will", and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligations to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Important factors that could cause results to differ materially from those in the forward-looking statements include (1) the timing and extent of changes in raw material and component prices, (2) the effects of fluctuations in the commercial/industrial new construction market, (3) the timing and extent of changes in interest rates, as well as other competitive factors during the year, and (4) general economic, market or business conditions. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in any forward-looking statements, see "Risk Factors" and "Forward Looking Statements" in AAON's Annual Report on Form 10-K for the most recent fiscal year, as may be revised and updated by AAON's Quarterly Reports on Form 10-Q, and AAON's Current Reports on Form 8-K. Contact Information Joseph MondilloDirector of Investor Relations & Corporate StrategyPhone: (617) 877-6346Email: [email protected] Use of Non-GAAP Financial Measures To supplement the Company's consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), additional non-GAAP financial measures are provided and reconciled in the following tables. The Company believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results. The Company believes that this non-GAAP financial measure enhances the ability of investors to analyze the Company's business trends and operating performance as they are used by management to better understand operating performance. Since adjusted net income, adjusted net income per diluted share, EBITDA, adjusted EBITDA, and adjusted EBITDA margin are non-GAAP measures and are susceptible to varying calculations, adjusted net income, adjusted net income per diluted share, EBITDA, adjusted EBITDA, and adjusted EBITDA margin, as presented, may not be directly comparable with other similarly titled measures used by other companies. Non-GAAP Adjusted Net Income The Company defines non-GAAP adjusted net income as net income adjusted for any infrequent events, such as litigation settlements, net of profit sharing and tax effect, in the periods presented. The following table provides a reconciliation of net income (GAAP) to non-GAAP adjusted net income for the periods indicated: EBITDA EBITDA (as defined below) is presented herein and reconciled from the GAAP measure of net income because of its wide acceptance by the investment community as a financial indicator of a company's ability to internally fund operations. The Company defines EBITDA as net income, plus (1) depreciation and amortization, (2) interest expense (income), net and (3) income tax expense. EBITDA is not a measure of net income or cash flows as determined by GAAP. EBITDA margin is defined as EBITDA as a percentage of net sales. The Company's EBITDA measure provides additional information which may be used to better understand the Company's operations. EBITDA is one of several metrics that the Company uses as a supplemental financial measurement in the evaluation of its business and should not be considered as an alternative to, or more meaningful than, net income, as an indicator of operating performance. Certain items excluded from EBITDA are significant components in understanding and assessing a Company's financial performance. EBITDA, as used by the Company, may not be comparable to similarly titled measures reported by other companies. The Company believes that EBITDA is a widely followed measure of operating performance and is one of many metrics used by the Company's management team and by other users of the Company's consolidated financial statements. Adjusted EBITDA is calculated as EBITDA adjusted by items in non-GAAP adjusted net income, above, except for taxes, as taxes are already excluded from EBITDA. The following table provides a reconciliation of net income (GAAP) to EBITDA (non-GAAP) and Adjusted EBITDA (non-GAAP) for the periods indicated: Non-GAAP Adjusted Selling, General and Administrative Expenses The following table provides a reconciliation of selling, general and administrative expenses (GAAP) to adjusted selling, general and administrative expenses (non-GAAP) for the periods indicated: Non-GAAP Adjusted AAON Oklahoma Gross Profit The following table provides a reconciliation of AAON Oklahoma gross profit (GAAP) to adjusted gross profit (non-GAAP) for the periods indicated: View original content to download multimedia:https://www.prnewswire.com/news-releases/aaon-reports-record-second-quarter-2026-results-driven-by-strong-demand-accelerating-throughput-and-improved-operating-execution-302846687.html