Lennox (USA) has announced its financial results for the full year 2025, reporting a 3% decrease in annual revenue but growth in segment profit and earnings per share. The company also provided its financial guidance for 2026.
In 2025, total revenue declined to $5.2 billion, down 3% year-over-year, primarily due to lower sales volumes. GAAP operating income remained stable at $1 billion, while segment profit increased by 2% to $1.1 billion. Segment margin improved by 90 basis points to 20.4%. Adjusted diluted earnings per share rose 2% to $23.16.
Net income for the year was $806 million, or $22.79 per share, compared to $811 million, or $22.66 per share, in 2024. Adjusted net income reached $819 million.
Home Comfort Solutions revenue totaled $3.3 billion, down 7% year-over-year. Segment profit decreased 4% to $729 million. The segment margin increased by 50 basis points to 21.8%. Profit decline was attributed to lower sales volumes, inflation-related product costs, and higher distribution expenses, partially offset by improved product mix and selling cost efficiencies.
Building Climate Solutions revenue grew 5% to $1.9 billion. Segment profit increased 8% to $434 million, with margins up 60 basis points to 23.4%. Profit growth was driven by favorable product mix and pricing, which offset cost inflation and increased investment in distribution and selling.
Operating cash flow for 2025 was $757 million, down from $946 million in the prior year, due to higher inventory levels related to refrigerant transition and emergency replacement stock deployment. Net capital expenditures totaled $117 million. Share repurchases amounted to $482 million. Corporate expenses decreased by $15 million to $105 million.
For full-year 2026, Lennox expects revenue growth of approximately 6% to 7%, including around 4% from completed acquisitions. Adjusted earnings per share are projected in the range of $23.50 to $25.00. Capital expenditures are expected to total approximately $250 million, and free cash flow is forecasted between $750 million and $850 million.
“We are pleased with our performance in 2025 given industry headwinds. For the first time in its history, Lennox delivered annual margins over 20%,” said Alok Maskara, CEO of Lennox. “We remain confident that our strategy and recent investments position us to grow revenue and profits in 2026 as the industry normalizes.”
