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Generac expects full-year sales to decline between 10% and 12%.
Dreamstime
Generac Holdings
stock tumbled 20% early Wednesday after the back-up power provider warned of a sharper sales decline in the second half of the year.
The company beat revenue expectations for its second quarter, despite sales falling 23% from the year-ago period, but fell short of earnings estimates and disappointed investors with its guidance.
Generac
(ticker: GNRC) reported adjusted earnings of $1.08 a share on revenue of $1 billion in the second quarter. Analysts were expecting earnings of $1.16 a share on revenue of $980 million.
However, it now expects net sales to decline between 10% and 12% for the full year, compared with its previous guidance for a decline of 6% to 10%, citing the “softer-than-expected consumer environment.”
Residential sales were lower than the company’s expectations in the second quarter, CEO Aaron Jagdfeld said, citing softer consumer demand for home improvement.
“While our expectations for the consumer environment are now softer than previously projected, we believe the long-term mega-trends that are driving awareness for backup power solutions are compelling as ever,” he added.
The stock was down about 20% at $123.01 shortly after the market open Wednesday, and is now 22% up so far in 2023.
Write to Callum Keown at [email protected]
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