Whirlpool Q1 Earnings & Sales Miss Estimates, Margins Expand

Whirlpool Corporation WHR posted dismal first-quarter fiscal 2025 results, wherein both the top and bottom lines missed the Zacks Consensus Estimate and declined on a year-over-year basis.

Amid an uncertain macro environment that pressured consumer confidence and demand across key markets, Whirlpool delivered a notable margin expansion, driven by strategic pricing actions and disciplined cost takeout initiatives. This performance reinforces the company’s commitment to sustainable growth and consistent value creation for its shareholders, even in the face of external headwinds.

Whirlpool’s Quarterly Performance: Key Metrics and Insights

The appliance maker reported first-quarter adjusted earnings per share (EPS) of $1.70, down from $1.78 reported in the year-ago period. Also, the metric fell short of the Zacks Consensus Estimate of $1.76 per share. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Whirlpool Corporation Price, Consensus and EPS Surprise

Whirlpool Corporation price-consensus-eps-surprise-chart | Whirlpool Corporation Quote

Net sales of $3.62 billion missed the Zacks Consensus Estimate of $3.68 billion and declined 19.4% year over year. The decline in sales was primarily due to the impact of the Europe divestiture. Excluding the unfavorable impacts of foreign exchange, organic net sales were $3.77 billion, up 2.2% year over year, supported by strong performance in the Small Domestic Appliances (SDA) Global segment and in the Major Domestic Appliances (MDA) Asia business.

Quarterly gross profit was $607 million, down 5.5% from $642 million reported in the year-ago quarter. The gross margin expanded 250 basis points (bps) year over year to 16.8%.

Selling, general and administrative (SG&A) expenses declined 14.9% year over year to $406 million. As a percentage of net sales, SG&A expenses expanded 60 bps year over year to 11.2%.

The ongoing EBIT of $214 million increased 9.7% from $195 million in the year-ago quarter. The ongoing EBIT margin of 5.9% expanded 160 bps year over year.

WHR’s Region-Wise Performance Details

Net sales for the MDA North America segment declined 0.3% year over year to $2.48 billion. Excluding currency, net sales increased 0.1% year over year despite the decline of consumer confidence and loading of Asian imports by foreign competitors ahead of tariffs. The segment’s EBIT gained 10.9% year over year to $149 million, and the EBIT margin expanded 60 bps to 6.2% owing to pricing and cost take-out actions. The Zacks Consensus Estimate for net sales of the MDA North America segment was pegged at $2.42 billion.

Net sales from MDA Latin America declined 11.9% year over year to $737 million. Excluding currency, the segment’s sales rose 2.4% year over year, driven by implemented pricing actions. The segment’s EBIT of $49 million declined 24.8% year over year. The EBIT margin decreased 120 bps year over year to 6.6%, attributable to a 200 bps operating tax benefit in the prior year. The Zacks Consensus Estimate for net sales of the MDA Latin America segment was pegged at $736 million.

Net sales in MDA Asia increased 12.3% year over year to $268 million. Excluding the currency impacts, sales rose 16.5%, driven by higher volume from share gains and industry growth. The segment’s EBIT of $19 million increased 71.5% year over year. Segmental EBIT margin of 7% expanded 240 bps, benefiting from fixed cost leverage and cost take-out actions. The Zacks Consensus Estimate for net sales of the MDA Asia segment was pegged at $270 million.

Net sales in SDA Global increased 7.9% year over year to $196 million. Excluding the currency impacts, sales increased 9.9%, driven by growth from new product launches and a robust direct-to-consumer business. The segment’s EBIT of $36 million reflected a 9.5% increase from the $33 million reported in the year-ago quarter. Segmental EBIT margin of 18.5% expanded 40 bps from 18.1% in the prior-year quarter, fueled by favorable price/mix. The Zacks Consensus Estimate for net sales of the SDA Global segment was pegged at $191 million.

Whirlpool’s Financial Health Snapshot

Whirlpool ended the first quarter with cash and cash equivalents of $1.02 billion, long-term debt of $4.8 billion, and total stockholders’ equity of $2.83 billion. The company declared a dividend of $1.75 per share in the first quarter of 2025.

In the first quarter of 2025, Whirlpool used cash of $721 million from operating activities. It reported a negative free cash flow of $793 million. WHR incurred capital expenditure of $72 million in the same period.

WHR’s 2025 Outlook

Whirlpool provided its sales guidance for 2025, anticipating net sales of $15.8 billion, down from $16.6 billion reported in the year-ago period. The company anticipates an ongoing EBIT margin of 6.8%, indicating a rise from 5.3% reported in 2024. Management anticipates a GAAP and adjusted tax rate to be 20-25% for 2025.

Whirlpool expects its GAAP EPS for 2025 to be $8.75 against a loss of $5.87 per share in 2024. Ongoing EPS is expected to be $10, down from $12.21 reported in 2024. The ongoing earnings guidance includes approximately $200 million of cost actions.

Cash provided by operating activities is expected to be nearly $1 billion, with an estimated free cash flow of roughly $500-$600 million. The company intends to take action to offset the incremental impact of tariff changes.

The Zacks Rank #4 (Sell) company’s shares have lost 40.6% in the three-month period against the industry’s 39.9% growth.

WHR's Stock Three Month Price Performance

Stocks to Consider

We have highlighted three better-ranked stocks, namely, Under Armour UAA , G-III Apparel Group, Ltd. GIII and Duluth Holdings DLTH

Under Armour is one of the leading designers, marketers and distributors of authentic athletic footwear, apparel and accessories for a wide variety of sports and fitness activities in the United States and internationally. It has a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for UAA’s fiscal 2024 sales and earnings indicates declines of 9.8% and 44.4%, respectively, from the year-ago reported figures. Under Armour delivered an earnings surprise of 98.6% in the trailing four quarters, on average.

G-III Apparel is a manufacturer, designer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. It carries a Zacks Rank #2 at present.

The Zacks Consensus Estimate for GIII’s fiscal 2025 earnings and revenues implies declines of 4.5% and 1.2%, respectively, from the year-ago actuals. GIII delivered a trailing four-quarter average earnings surprise of 117.8%.

Duluth Holdings, a casual wear, workwear and accessories dealer, currently carries a Zacks Rank #2 at present. Duluth Holdings has a trailing four-quarter earnings surprise of 37.2%, on average. 

The Zacks Consensus Estimate for DLTH’s current financial-year EPS indicates growth of 5.6% from the year-ago figure.

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This article originally published on Zacks Investment Research (zacks.com).

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