10/29/2026

speaker
Conference Operator
Operator

Hello and welcome to the West Coast 2026 Third Quarter Earnings Call. I would like to remind you that all lines are in a listen-only mode throughout the presentation. If you would like to ask a question, please press star followed by one on your telephone keypad. Please note that this event is being recorded. I will now hand the call over to Scott Gaffner, SVP, Investor Relations, to begin.

speaker
Scott Gaffner
Senior Vice President, Investor Relations

Thank you and good morning, everyone. Before we get started, I want to remind you that certain statements made on this call contain forward-looking information. Forward-looking statements are not guarantees of performance and by their nature are subject to uncertainty. Actual results may differ. Please see our webcast slides and the company's SEC filings for additional risk factors and disclosures. Any forward-looking information speaks only as of this date and the company undertakes no obligation to update the information or reflect changed circumstances. Additionally, today we will use certain non-GAAP financial measures. Required information about these measures is available on our webcast slides and in our press release, both of which are posted on our website at Wesco.com. On the call this morning, we have John Engel, Wesco's Chairman, President, and Chief Executive Officer, and Neal Dev, Executive Vice President and Chief Financial Officer. And with that, I'll turn the call over to John.

speaker
John Engel
Chairman, President and Chief Executive Officer

Thank you very much, Scott. Well, good morning, everyone, and thank you for joining our call today. We're very pleased with our record third quarter results, and we carry positive business momentum into the fourth quarter. Once again, sales, backlog, operating profit, and earnings per share all increased double digits versus the prior year. And importantly, they achieved records that exceeded our expectations. We are particularly pleased with our free cash flow generation during the quarter, which was strong given the sales growth that we delivered. The past five consecutive quarters of double-digit sales growth demonstrate Wesco's higher growth profile, which extends well beyond our important data center positioning. Customer demand is strong across the rest of our diversified portfolio and markets, with sales up high single digits, excluding data centers. Our customers continue to invest in major capital and infrastructure projects, and they're increasingly relying on Wesco to manage their needs. and this is all happening while we add more services to our portfolio and demonstrate the continued effectiveness of our OneWesco cross-selling strategy. Especially noteworthy, our backlog was up over 80% to a new record level for each of our three business units. The power of our customer value proposition, our global capabilities and our leading portfolio of products, services and solutions is clear as we continue to outperform the market. Our backlog growth is being fueled by multi-year customer commitments as our large customers recognize our unique capabilities across the communications, security, electrical, utility, and power markets. As a result, we are again significantly raising our full-year 2026 outlook, reflecting our continued confidence in our continued strong execution. Given the positive market momentum that we are seeing, I'm bullish that Wesco will continue to outperform our markets and deliver superior value to our customers, suppliers, and shareholders to close out 2026 and in 2027. With regards to 2027, we will provide our full year outlook when we report our fourth quarter earnings in February of next year. With that said, we expect to continue to outperform our markets again next year with sales up mid to high single digits along with continued margin expansion. Before turning it over to Neil, I would like to highlight that we'll be hosting a virtual investor event on Tuesday, November 10th, from 10 a.m. to 11.30 a.m. Eastern Time, where we'll discuss our leadership position in the data center space and our differentiated solutions across the data center lifecycle. Let's Go is uniquely positioned with our comprehensive product services and solutions offerings for data center white space, gray space, and power infrastructure applications. Our three business leaders will discuss our One West Coast strategy, our leading value proposition, and our end-to-end capabilities for our data center customers during this upcoming virtual investor event. With that, I will now turn it over to Neil to take you through our third quarter results and our RAISE full year outlook in more detail.

Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

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