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WC

WHIRLPOOL CORP /DE/ (WHR)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered 2.2% organic net sales growth to $3.77B with strong SDA Global and MDA Asia, while reported net sales fell 19.4% to $3.62B due to the Europe divestiture; ongoing EBIT margin expanded 160 bps to 5.9% and GAAP net margin improved 780 bps to 2.0% .
  • Against S&P Global consensus, Whirlpool slightly beat EPS ($1.70 vs ~$1.70*) and modestly missed revenue ($3.62B vs ~$3.67B*); full-year 2025 guidance was reaffirmed (Net sales ~$15.8B, ongoing EBIT margin ~6.8%, GAAP EPS ~$8.75, ongoing EPS ~$10, CFO ~$1B, FCF $500–$600M) .
  • Management highlighted near-term tariff-related market disruption from competitors’ import “preloading,” but expects the new tariff policies to be a structural tailwind for domestic producers in 2H25; actions underway include pricing, cost take-out, and supply chain rewiring .
  • Dividend of $1.75 per share declared for Q1 and Q2, supporting capital return priorities amid planned ~$700M 2025 debt paydown and anticipated India transaction proceeds in 2H25 .

What Went Well and What Went Wrong

What Went Well

  • Margin expansion: Ongoing EBIT margin rose to 5.9% (+160 bps YoY), driven by pricing and structural cost actions; Marc Bitzer: “we delivered 160 basis points of margin expansion” .
  • Segment outperformance: MDA Asia net sales +12.3% with EBIT margin +240 bps to 7.0%; SDA Global net sales +7.9% with EBIT margin 18.5% reflecting favorable price/mix .
  • Guidance and dividend stability: Full-year 2025 outlook unchanged; ongoing EPS ~$10, CFO ~$1B, FCF $500–$600M; dividend $1.75 per share declared for Q1 and Q2 .

What Went Wrong

  • Reported net sales declined 19.4% YoY to $3.62B primarily due to the Europe divestiture; organic growth modest at 2.2% .
  • Latin America EBIT margin fell YoY (6.6% vs 7.8%) due to a ~200 bps operating tax benefit in prior year; FX headwind from ~20% BRL depreciation cost ~50 bps of margin .
  • Macroeconomic and competitive pressures: Declining consumer confidence and “loading” of Asian imports ahead of tariffs created near-term disruption; similar dynamics expected in Q2 .

Financial Results

Sequential performance (oldest → newest)

MetricQ3 2024Q4 2024Q1 2025
Net Sales ($USD Millions)$3,993 $4,136 $3,621
GAAP EPS ($)$2.00 $(7.10) $1.28
Ongoing EPS ($)$3.43 $4.57 $1.70
GAAP Net Margin (%)2.7% (9.5)% 2.0%
Ongoing EBIT ($USD Millions)$233 $248 $214
Ongoing EBIT Margin (%)5.8% 6.0% 5.9%

YoY comparison (oldest → newest)

MetricQ1 2024Q1 2025
Net Sales ($USD Millions)$4,490 $3,621
GAAP EPS ($)$(4.72) $1.28
Ongoing EPS ($)$1.78 $1.70
GAAP Net Margin (%)(5.8)% 2.0%
Ongoing EBIT ($USD Millions)$195 $214
Ongoing EBIT Margin (%)4.3% 5.9%

Actual vs S&P Global consensus (Q1 2025)

MetricActualConsensusSurprise
EPS (Ongoing) ($)$1.70 $1.69571*+$0.00 (in-line/beat)*
Revenue ($USD Millions)$3,621 $3,666.84*$(45.84) (miss)*

Values retrieved from S&P Global.*

Free Cash Flow and Operating Cash

MetricQ1 2024Q1 2025
Cash from Operations ($USD Millions)$(873) $(721)
Free Cash Flow ($USD Millions)$(988) $(793)

Segment performance (Q1 2025 vs Q1 2024)

SegmentNet Sales Q1 2024 ($M)Net Sales Q1 2025 ($M)EBIT Q1 2024 ($M)EBIT Q1 2025 ($M)EBIT Margin Q1 2024 (%)EBIT Margin Q1 2025 (%)
MDA North America$2,428 $2,419 $135 $149 5.6% 6.2%
MDA Latin America$837 $737 $65 $49 7.8% 6.6%
MDA Asia$239 $268 $11 $19 4.6% 7.0%
SDA Global$182 $196 $33 $36 18.1% 18.5%

Guidance Changes

MetricPeriodPrevious Guidance (Jan 29)Current Guidance (Apr 23)Change
Net Sales ($B)FY 2025~$15.8 ~$15.8 Maintained
Ongoing EBIT Margin (%)FY 2025~6.8% ~6.8% Maintained
GAAP EPS ($)FY 2025~$8.75 ~$8.75 Maintained
Ongoing EPS ($)FY 2025~$10.00 ~$10.00 Maintained
Cash from Operations ($M)FY 2025~$1,000 ~$1,000 Maintained
Free Cash Flow ($M)FY 2025$500–$600 $500–$600 Maintained
GAAP/Adj. Tax Rate (%)FY 202520–25% 20–25% Maintained
Debt Paydown ($M)FY 2025~700 ~700 Reiterated
Dividend ($/share)Q1/Q2 2025$1.75 (board-approved quarterly) $1.75 declared Apr 14 (Q2) ; Q1 disclosed Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2: Q3 2024; Q-1: Q4 2024)Current Period (Q1 2025)Trend
Tariffs/macroQ3: Pricing actions, ongoing Europe portfolio changes; macro unfavorable . Q4: No tariff quantification in guide; cautious on discretionary demand recovery .Asian “preloading” ahead of tariffs; expect reciprocal tariffs and closure of loopholes to level playing field; ~250 bps tariff headwind in 2025 to be mitigated via price/cost/sourcing .Near-term disruption but growing confidence in 2H tailwind.
Pricing/mixQ3: Sequential margin expansion from promotional pricing . Q4: December promotional price increase; ~75 bps price/mix uplift assumed for 2025 .April price increase; cumulative actions expected to drive >1–2 pts pricing contribution in 2025 .Pricing intensity increasing; benefits more back-half weighted.
Cost take-outQ3/Q4: ~$300M net cost reductions in 2024; >$200M targeted in 2025 .~100 bps margin benefit YoY from cost actions in Q1; >$200M structural actions planned .Ongoing structural savings continue.
Product innovationQ4: >30% NA MDA product transition in 2025; premium brand launches (KitchenAid, JennAir) .Strong pipeline; KBIS wins and premium features highlighted; anticipated mix lift in 2H .Accelerating product-led mix improvement.
Supply chain/inventoryQ4: Trade destocking suppressed Q4 NA margins; entered 2025 with lean inventories .Competitor-loaded imports elevate channel inventory; Whirlpool trade inventories “healthy”; expect Q2 to resemble Q1 .External channel disruption near-term; internal inventory discipline.
Regional trendsQ3/Q4: LatAm strength; Asia share gains; SDA investments .Asia and SDA remain bright spots; LatAm pricing offsets FX; NA margins to ramp 200–250 bps in 2H .Mixed: NA improving 2H; Asia/SDA strong; LatAm mixed on FX.
Capital allocationQ4: ~$700M debt paydown; India stake reduction to ~20%, proceeds $550–$600M .Reiterated priorities; refinance maturities; clear debt ladder plan .Balance sheet de-risking continues.

Management Commentary

  • “Despite the uncertain macro environment which impacted consumer confidence in the first quarter, we delivered 160 basis points of margin expansion… agile and disciplined operational execution.” — Marc Bitzer .
  • “We achieved 2% organic net sales growth… Global EBIT margins expanded 160 basis points… maintained our dividend of $1.75 for both Q1 and Q2.” — Marc Bitzer .
  • “MDA North America delivered an EBIT margin of 6.2%, driven by pricing actions and cost takeout… we expect to turn over more than 30% of our product portfolio this year.” — James Peters .
  • “No matter how you look at it, Whirlpool with its 10 large U.S. factories is a net winner of a new tariff policy… the new trade policies are finally putting an end to these disadvantages and will level the playing field.” — Marc Bitzer .
  • “We expect approximately 250 basis points impact from the incremental tariff changes… We expect to offset these impacts through cost-based pricing actions announced in April and by continuing to implement supply sourcing changes.” — James Peters .

Q&A Highlights

  • Tariff trajectory and magnitude: Management emphasized uncertainty but noted even 20% tariffs alter behaviors; gap-closing expected, with headwinds largely component-driven and skewed to 2H25 .
  • April pricing actions: Multiple actions across promotional depth, MAP, list; pricing contribution “well north of 1, probably closer to 2 points” for full-year, with benefits more visible around July and 2H promotions .
  • North America margin ramp: Q2 similar to Q1 (low-6% EBIT margin); 2H ramp of ~200–250 bps toward ~8.5–8.75% supported by price/mix, cost, volume leverage .
  • Demand composition: Replacement demand ~65% and relatively inelastic; discretionary demand soft with consumer confidence decline; limited consumer preloading to date .
  • SDA direct-to-consumer: Now ~25% of SDA sales; strong product launches and marketing; online predisposition supports growth and repeat purchasing .

Estimates Context

  • Q1 2025 results vs S&P Global consensus: ongoing EPS $1.70 vs ~$1.70* (in-line/slight beat); revenue $3.62B vs ~$3.67B* (slight miss). Sequentially, Q4 2024 beat EPS ($4.57 vs ~$4.34*) and missed revenue ($4.14B vs ~$4.24B*); Q3 2024 beat EPS ($3.43 vs ~$3.20*) and missed revenue ($3.99B vs ~$4.09B*) [GetEstimates].
  • Implications: Expect modest downward adjustments to near-term revenue models given channel import overhang, with EPS relatively resilient on pricing and cost actions; back-half models may need upward margin revisions if tariffs and mix lift materialize as outlined .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Pricing and structural cost actions are driving margin resilience despite macro softness and competitor preloading; expect 2H margin ramp, particularly in North America .
  • Tariffs present a short-term headwind (~250 bps) but a likely medium-term structural tailwind for Whirlpool’s U.S. manufacturing footprint; mitigation via pricing/sourcing already underway .
  • Product cycle is a catalyst: >30% NA product transition and premium launches (KitchenAid, JennAir) support mix improvement and share gains into 2H and 2026 .
  • Asia and SDA Global continue to outperform, diversifying growth and margin contributors while Latin America manages FX via pricing actions .
  • Capital allocation remains disciplined: ~$700M debt paydown, refinancing plan in place, India transaction proceeds targeted for 2H25; dividend maintained at $1.75 .
  • Near-term trading: Expect Q2 to mirror Q1 due to import overhang; set up improves post-July as tariffs “fully kick in” and promotional pricing resets flow through .
  • Medium-term thesis: Structural margin expansion via pricing, cost take-out, and domestic advantage under new trade regime; upside to 2025–2026 margin trajectory if tariff tailwinds and product mix deliver as planned .

KPIs and Additional Notes

  • Organic net sales: $3,765M (+2.2% YoY) vs reported $3,621M; reconciliation excludes EMEA and currency .
  • Non-GAAP adjustments: Q1 ongoing EPS excludes $0.17 restructuring and $0.09 transaction costs; includes normalized tax rate adjustment (+$0.22) and income tax impact (−$0.06) .
  • Dividend: $1.75 per share payable June 15, 2025 (record date May 16, 2025); Q1 dividend also declared .