aos-20260331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________________________

FORM 10-Q

______________________________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026.


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number 1-475

________________________________

A. O. Smith Corporation

(Exact name of registrant as specified in its charter)

________________________________

Delaware

(State of Incorporation)

11270 West Park Place, Milwaukee, Wisconsin

(Address of Principal Executive Office)

39-0619790

(I.R.S. Employer

Identification No.)

53224-9508

(Zip Code)

(414) 359-4000

(Registrant’s telephone number, including area code)

_________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading
Symbol

Name of Each Exchange
on Which Registered

Common Stock (par value $1.00 per share)

AOS

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes o No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated Filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.) ☐ Yes ☒ No

Class A Common Stock Outstanding as of April 28, 2026 - 25,863,159 shares

Common Stock Outstanding as of April 28, 2026 - 111,965,465 shares

Index

A. O. Smith Corporation


		Page
Part I.	FINANCIAL INFORMATION

	Condensed Consolidated Statements of Earnings - Three Months Ended March 31 , 202 6 and 20 25	3

	Condensed Consolidated Statements of Comprehensive Earnings - Three Months Ended March 31, 202 6 and 20 25	3

	Condensed Consolidated Balance Sheets - March 31 , 202 6 and December 31, 20 25	4

	Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 202 6 and 20 25	5

	Condensed Consolidated Statements of Stockholders’ Equity - Three Months Ended March 31 , 202 6 and 20 25	6

	Notes to Condensed Consolidated Financial Statements - March 31 , 20 26	7-17

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18-23

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	23

Item 4.	Controls and Procedures	24

Part II.	OTHER INFORMATION

Item 1.	Legal Proceedings	24

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	24

Item 5.	Other Information	24

Item 6.	Exhibits	24

Index to Exhibits		25

Signatures		26


	Three Months Ended March 31,
	2026		2025
Net sales	$	945.6	$	963.9
Cost of products sold	579.9		588.5
Gross profit	365.7		375.4
Selling, general and administrative expenses	203.9		192.6
Interest expense	7.1		2.9
Other income, net	—		(1.2)
Earnings before provision for income taxes	154.7		181.1
Provision for income taxes	36.7		44.5
Net Earnings	$	118.0	$	136.6
Basic Net Earnings Per Share of Common Stock	$	0.85	$	0.95
Diluted Net Earnings Per Share of Common Stock	$	0.85	$	0.95
Dividends Per Share of Common Stock	$	0.36	$	0.34


	(unaudited) March 31, 2026		December 31, 2025
Assets
Current Assets
Cash and cash equivalents	$	185.2	$	174.5
Marketable securities	18.7		18.7
Receivables	634.1		582.3
Inventories	488.5		479.3
Other current assets	41.9		36.7
Total Current Assets	1,368.4		1,291.5
Property, plant and equipment	1,579.8		1,564.5
Less accumulated depreciation	(947.6)		(929.4)
Net property, plant and equipment	632.2		635.1
Goodwill	919.9		710.6
Other intangibles	598.7		362.3
Operating lease assets	51.8		46.3
Other assets	79.3		97.0
Total Assets	$	3,650.3	$	3,142.8
Liabilities
Current Liabilities
Trade payables	$	543.0	$	504.1
Accrued payroll and benefits	60.7		93.6
Accrued liabilities	159.4		147.5
Product warranties	73.4		75.0
Debt due within one year	41.6		42.3
Total Current Liabilities	878.1		862.5
Long-term debt	574.2		112.7
Product warranties	137.0		134.7
Long-term operating lease liabilities	40.7		37.1
Other liabilities	142.4		137.8
Total Liabilities	1,772.4		1,284.8
Stockholders’ Equity
Class A Common Stock (shares issued, 25,993,539 and 25,993,539 as of March 31, 2026 and December 31, 2025, respectively)	130.0		130.0
Common Stock (shares issued 164,714,053 and 164,714,053 as of March 31, 2026 and December 31, 2025, respectively)	164.7		164.7
Capital in excess of par value	619.0		614.4
Retained earnings	4,019.8		3,951.8
Accumulated other comprehensive loss	(100.7)		(98.6)
Treasury stock at cost	(2,954.9)		(2,904.3)
Total Stockholders’ Equity	1,877.9		1,858.0
Total Liabilities and Stockholders’ Equity	$	3,650.3	$	3,142.8


(dollars in millions)	Three Months Ended March 31,
	2026		2025
North America
Water heaters and related parts	$	611.8	$	624.6
Boilers, related parts, and components (1)	81.5		64.4
Water treatment products and related parts	60.1		59.7
Total North America	753.4		748.7
Rest of World
China	$	162.4	$	187.2
All other Rest of World	38.3		39.5
Total Rest of World	200.7		226.7
Inter-segment sales	(8.5)		(11.5)
Total Net Sales	$	945.6	$	963.9


(in millions)
Current assets	$	14.8
Property, plant and equipment	4.6
Intangible assets	244.5
Goodwill	212.2
Other assets	0.3
Total assets acquired	476.4
Current liabilities	(5.9)
Other liabilities	(0.5)
Net assets acquired	$	470.0


(dollars in millions)	March 31, 2026		December 31, 2025
Finished products	$	182.6	$	180.1
Work in process	43.6		43.7
Raw materials	311.0		311.3
Inventories, at FIFO cost	537.2		535.1
LIFO reserve	(48.7)		(55.8)
Inventories, at LIFO cost	$	488.5	$	479.3


	Number of Units	Weighted-Average Grant Date Value
Issued and unvested at January 1, 2026	631,307	$	68.92
Granted	182,070	79.03
Vested	(153,295)	67.14

Issued and unvested at March 31, 2026	660,082	72.09


	Three Months Ended March 31, 2026
(dollars in millions)	North America		Rest of World		Total Segments		Corporate Expenses		Total
Sales from external customers	$	748.9	$	196.7	$	945.6	$	—	$	945.6
Inter-segment sales	4.5		4.0		8.5		—		8.5
	753.4		200.7		954.1		—		954.1
Elimination of Inter-segment sales	(4.5)		(4.0)		(8.5)		—		(8.5)
Net Sales	748.9		196.7		945.6		—		945.6
Cost of products sold	451.7		128.2		579.9		—		579.9
Gross Profit	297.2		68.5		365.7		—		365.7

Selling, general and administrative expenses	122.2		54.9		177.1		26.8		203.9
Other (income) expense, net	(0.4)		1.2		0.8		(0.8)		—
Earnings	$	175.4	$	12.4	$	187.8	$	(26.0)	$	161.8
Interest expense									(7.1)
Earnings before provision for income taxes									$	154.7


	Three Months Ended March 31, 2025
(dollars in millions)	North America		Rest of World		Total Segments		Corporate Expenses		Total
Sales from external customers	$	743.4	$	220.5	$	963.9	$	—	$	963.9
Inter-segment sales	5.3		6.2		11.5		—		11.5
	748.7		226.7		975.4		—		975.4
Elimination of Inter-segment sales	(5.3)		(6.2)		(11.5)		—		(11.5)
Net Sales	743.4		220.5		963.9		—		963.9
Cost of products sold	445.7		142.8		588.5		—		588.5
Gross Profit	297.7		77.7		375.4		—		375.4

Selling, general and administrative expenses	113.4		57.4		170.8		21.8		192.6
Other (income) expense, net	(0.9)		0.6		(0.3)		(0.9)		(1.2)
Earnings	$	185.2	$	19.7	$	204.9	$	(20.9)	$	184.0
Interest expense									(2.9)
Earnings before provision for income taxes									$	181.1


Assets
(dollars in millions)	March 31, 2026		December 31, 2025
North America	$	2,858.8	$	2,325.7
Rest of World	532.7		547.3
Total Segments	3,391.5		2,873.0
Corporate(1)	258.8		269.8
Total	$	3,650.3	$	3,142.8


Depreciation and amortization	Three Months Ended March 31,
(dollars in millions)	2026		2025
North America	$	19.1	$	15.4
Rest of World	4.5		5.0
Total Segments	23.6		20.4
Corporate	0.3		0.3
Total	$	23.9	$	20.7


	Three Months Ended March 31,
	2026		2025
Operating Activities
Net earnings	$	118.0	$	136.6
Adjustments to reconcile net earnings to cash provided by (used in) operating activities:
Depreciation and amortization	23.9		20.7
Share based compensation expense	6.6		6.1
Deferred income taxes	18.3		(5.0)
Net changes in operating assets and liabilities:
Current assets and liabilities	(43.2)		(125.3)
Noncurrent assets and liabilities	5.8		5.6
Cash Provided by Operating Activities	129.4		38.7
Investing Activities
Capital expenditures	(10.5)		(21.3)
Acquisition of business	(470.0)		—
Investments in marketable securities	—		(22.6)
Net proceeds from sale of marketable securities	—		33.1
Cash Used in Investing Activities	(480.5)		(10.8)
Financing Activities
Proceeds from debt	564.4		240.5
Repayments of debt	(101.1)		(164.0)
Common stock repurchases	(51.3)		(120.6)

Net payments from stock option activity	(0.5)		(1.8)
Dividends paid	(50.2)		(49.2)
Cash Provided by (Used in) Financing Activities	361.3		(95.1)
Effect of exchange rate changes on cash and cash equivalents	0.5		0.6
Net increase (decrease) in cash and cash equivalents	10.7		(66.6)
Cash and cash equivalents - beginning of period	174.5		239.6
Cash and Cash Equivalents - End of Period	$	185.2	$	173.0


	Three Months Ended March 31,
	2026	2025
Denominator for basic earnings per share - weighted average shares	138,292,701	143,579,588
Effect of dilutive stock options and share units	874,679	828,132
Denominator for diluted earnings per share	139,167,380	144,407,720


Fair Value Measurement Using	Balance Sheet Location	March 31, 2026		December 31, 2025
Quoted prices in active markets for identical assets (Level 1)	Marketable Securities	$	18.7	$	18.7
Significant other observable inputs (Level 2)	Net Derivative Assets(1)	1.6		—


(dollars in millions)	March 31, 2026				December 31, 2025
	Buy		Sell		Buy		Sell

Canadian dollar	$	—	$	65.0	$	—	$	57.8
Euro	12.7		—		16.8		—
Mexican peso	13.3		—		18.7		—
Total	$	26.0	$	65.0	$	35.5	$	57.8


Derivatives in ASC 815 cash flow hedging relationships	Amount of gain (loss) recognized in other comprehensive loss on derivatives				Location of gain (loss) reclassified from accumulated other comprehensive loss into earnings	Amount of gain (loss) reclassified from accumulated other comprehensive loss into earnings
	2026		2025			2026		2025
Foreign currency contracts	$	1.5	$	1.3	Cost of products sold	$	0.6	$	(0.2)
Interest rate swap	0.6		(0.3)		Interest expense	(0.1)		—
	$	2.1	$	1.0		$	0.5	$	(0.2)


	2026 Guidance			2025
Diluted EPS (GAAP)	$	3.60-3.90		$	3.85
Restructuring and impairment expenses		0.10	(1)		—
Adjusted EPS (non-GAAP)	$	3.70-4.00		$	3.85


ISSUER PURCHASES OF EQUITY SECURITIES
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that may yet be Purchased Under the Plans or Programs
January 1 - January 31, 2026	287,383	$	70.47	287,383	5,516,141
February 1 - February 28, 2026	187,352	77.72		187,352	5,328,789
March 1 - March 31, 2026	240,758	68.34		240,758	5,088,031


Exhibit Number						Description

31.1						Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934

31.2						Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934

32.1						Written Statement of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350

32.2						Written Statement of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350

101						The following materials from A. O. Smith Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 are filed herewith, formatted in XBRL (Extensive Business Reporting Language): (i) the Condensed Consolidated Statement of Earnings for the three months ended March 31, 2026 and 2025, (ii) the Condensed Consolidated Statement of Comprehensive Earnings for the three months ended March 31, 2026 and 2025, (iii) the Condensed Consolidated Balance Sheets as of March 31, 2026, and December 31, 2025 (iv) the Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2026 and 2025 (v) the Condensed Consolidated Statement of Stockholders’ Equity for the three months ended March 31, 2026 and 2025 (vi) the Notes to Condensed Consolidated Financial Statements.


			A. O. SMITH CORPORATION

April 30, 2026			/s/ Benjamin A. Otchere
			Benjamin A. Otchere
			Vice President and Controller

			/s/ Charles T. Lauber
			Charles T. Lauber
			Executive Vice President and Chief Financial Officer

SEC Form 10-Q filed by A.O. Smith Corporation