Total Revenue

+10% "

Driven by robust residential product shipments (especially home standby units), partially offset by lower C&I sales. Improved supply chain conditions and steady demand in core markets also supported growth. " "

Residential Products

+28% " "

Fueled by strong home standby and portable generator demand, spurred by outage events and enhanced sales/marketing initiatives. A rebound from prior weaker comparisons also contributed to the year-over-year increase. " "

Commercial & Industrial

-15% " "

Lower shipments to telecom and rental customers and weaker sales in certain international regions overshadowed growth in industrial distributor channels. Softer economic conditions in Europe further pressured volumes. " "

Domestic Segment

+14% " "

Gains from residential shipments and improved brand awareness drove higher demand. Some softness remains in select C&I channels, but stronger volumes in home standby generators lifted overall domestic results. " "

International Segment

-12% " "

Impacted by lower telecom-related sales and weaker portable generator demand in Europe, partially offset by growth in Latin America and India. Currency headwinds and sluggish economic conditions in certain markets added pressure. " "

Operating Income

+61% " "

Gross margin expansion (up from better sales mix and lower input costs) and controlled operating expenses boosted profitability. Enhanced production efficiencies contributed to stronger operating leverage. " "

Net Income

+95% " "

Higher operating income flowed through to the bottom line, supported by favorable product mix, improved margins, and a slightly lower effective tax rate. Steadier interest costs also contributed to net income growth. " "

Diluted EPS

+95% " "

Reflects net income gains and stable share count. Margin improvements, efficient cost management, and strong residential performance helped drive a nearly twofold increase in per-share earnings. " "

R&D Expense

+31% " "

Reflects ongoing investments in new product development, expanded engineering teams, and continued innovation in energy technologies. Management remains committed to maintaining a competitive edge through enhanced R&D efforts. " "

Net Sales Growth

FY 2024

4% to 8% "

5% to 9% "

raised

Residential Product Sales Growth

FY 2024

Mid-teens "

High teens "

raised

C&I Product Sales

FY 2024

No prior guidance

Down high single digits year-over-year "

no prior guidance

Other Sales Category

FY 2024

No prior guidance

Nearly flat year-over-year "

no prior guidance

Gross Margins

FY 2024

350 to 400 bps improvement over 2023 "

450 bps improvement over 2023 "

raised

Adjusted EBITDA Margins

FY 2024

17% to 18% "

17.5% to 18.5% "

raised

GAAP Effective Tax Rate

FY 2024

25% to 26% "

24% to 25% "

lowered

Gross Interest Expense

FY 2024

$92M to $94M "

$91M to $93M "

lowered

Stock Compensation Expense

FY 2024

$52M to $54M "

$50M to $52M "

lowered

Weighted Average Diluted Share Count

FY 2024

60.5M to 61M "

Approximately 60.5M "

lowered

Capital Expenditures

FY 2024

Approximately 3% of sales "

Approximately 3% of sales "

no change

Free Cash Flow

FY 2024

No prior guidance

~$500M "

no prior guidance

Free Cash Flow Conversion

FY 2024

Well above 100% "

Well above 100% "

no change

Incremental Residential Product Sales

FY 2024

No prior guidance

+$100M from higher power outage activity "

no prior guidance

Recurring focus on home standby generator demand driven by power outages and hurricanes

Q2 2024: Elevated demand from Hurricane Beryl, raised FY outlook. " " " Q1 2024: Slower start, but assumed major outage could add $50–$100M. " " Q4 2023: Baseline growth despite no big storms. " " "

Surged demand after Hurricanes Helen and Milton, with shipment growth at a high 20% rate and record power outage hours driving a new, higher baseline. Generac expects around $200M in incremental generator shipments from these events " " "

Consistent & intensifying due to recent hurricane activity.

Continued softness in the European market, particularly Germany, impacting C&I and portable products

Q2 2024: Noted Europe softness mainly for portable segments. " " Q1 2024 and Q4 2023: Mentioned lower European shipments but with less emphasis on Germany. " " "

Highlighted weaker demand in Germany for C&I and portable generators; cited economic challenges (e.g., automotive sector issues). Sales in Europe were down, partly offset by growth elsewhere. " "

Ongoing softness persists in Germany.

Ongoing weakness in telecom and rental sub-segments of the C&I business

Q2 2024: Ongoing softness in telecom/rental with hopes of late-year improvement. " " " Q1 2024 & Q4 2023: Similar declines noted, offset by strong industrial distributor channel. " " " " " "

Continuing weakness with some “green shoots” in telecom and cautious rental demand. Telecom sales may have bottomed, but rental remains muted. " " "

Persistent, but slight optimism in telecom.

Shifts in gross margin performance tied to sales mix, cost reductions, and supply chain improvements

Q2 2024: Margin up to 37.6% on mix and lower input costs. " " " Q1 2024 & Q4 2023: Similar margin expansions from improved mix, lower logistics, and production gains. " " " "

Gross margin reached 40.2%, driven ~50% by favorable sales mix (home standby) and ~50% by cost reductions and supply chain efficiencies. " "

Improving with continued mix shift to higher-margin products.

Significant investment in energy technology (solar, storage, PowerCell 2) creating near-term margin drag

Q2 2024 & Q1 2024: Not explicitly discussed. Q4 2023: Similar margin dilution from energy tech, ~350-400 bps for 2024, breakeven by 2026. " " "

Cited a 350-400 bps drag on EBITDA from energy tech investments (PowerCell 2, Ecobee Energy Hub). Aiming for breakeven by end of 2026. "

Ongoing R&D costs weigh on near-term margins.

Emerging emphasis on microgrids, EV charging solutions, and strategic acquisitions (e.g., SunGrid, Wallbox)

Q2 2024: Focus on microgrids expansion (SunGrid) and deeper tie-in with Wallbox. " " " Q1 2024: Additional push into EV charging (Wallbox shipments) and microgrid approach. " " " Q4 2023: Highlighted microgrid solutions and minority stake in Wallbox. " " "

Emphasized multi-asset microgrids (natural gas + battery) and EV charging integration through Wallbox investment. Mentioned DoE grant for microgrids and new C&I battery storage offerings via SunGrid. " " "

Steadily building a broader energy ecosystem.

International expansion opportunities, notably in India’s shift from diesel to natural gas

Q2 2024: Discussed India as a growing NG genset market with new factory and pipeline projects. " Q1 2024 & Q4 2023: No detailed updates on India’s diesel-to-gas shift. "

No mention in Q3 2024.

Mentioned previously, not cited this quarter.

Changes in home standby generator sentiment, from slower activations in early periods to renewed growth

Q2 2024: Renewed activations after Hurricane Beryl. " " " Q1 2024: Slower start, but shipments aligned with activations by quarter-end. " " " " Q4 2023: Activations at all-time high despite minimal storms. " " "

Activations returned to YOY growth in Q3, fueled by strong outage activity in the South and Southeast. Record consultations caused a brief dip in close rates, expected to improve. " " " " "

Rebounding after earlier slowdown, sustained by recent weather events.

Unpredictable weather events as a critical driver of residential demand and outlook

Q2 2024: Hurricane Beryl and storms lifted standby sales. " " " " " Q1 2024 & Q4 2023: Weather events remain major catalysts for demand, though Q4 2023 had fewer major outages. " " " " " "

Busy hurricane season boosted residential demand. Highest YTD outage hours since 2010, reinforcing product awareness. " " " " "

Consistent key driver; activity remains highly impactful.

Inventory buildup concerns from earlier periods no longer prominently mentioned

Q2 2024: Declared destocking resolved in Q1. " Q1 2024: Field inventory headwinds largely ended, shipments and activations aligned. " " Q4 2023: Expected final clearance by end of Q1 2024. "

No major overhang; instead, portable generator inventory is restocking after heavy Q3 sales. " "

Resolved; focus now on normal seasonal restocking.

Previous acquisitions (like Ecobee) not referenced in recent calls

Q2 2024: Ecobee driving services growth and improving gross margins. " " " Q1 2024 & Q4 2023: Ecobee integrated into unified smart energy platform, mention of new products and rising installed base. " " " " "

Ecobee remains integral to Generac’s energy management ecosystem, showing strong margin expansion and growing user base (~4M connected homes). Plans to extend Ecobee’s control to EV charging. "

Still core to long-term smart energy strategy.

Long-term growth potential vs near-term margin pressures from R&D and new product launches

Q2 2024: Cited ongoing investments (new storage, microinverters, EV) weighing opex. " " " Q1 2024 & Q4 2023: Similar dynamic; near-term EBITDA drag but bullish on future returns. " " " " " " "

Significant short-term margin hit (350-400 bps) due to R&D on energy tech, offset by optimism for microgrids, advanced storage, and EV solutions. Targeting breakeven on these ventures by 2026. " " "

Balancing present margin drag with robust future growth prospects.