Company: AOS
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0000091142-25-000150
Chunk: 47

Company: SMITH A O CORP
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 2
Chunk 47
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.5 percent.

Rest of World Segment

(dollars in millions)Three Months EndedSeptember 30,Nine Months EndedSeptember 30,2025202420252024Net Sales$207.9 $210.3 $674.7 $682.0 Segment Earnings15.4 13.6 60.4 56.7 Segment margin7.4 %6.5 %9.0 %8.3 %

Sales in the Rest of World segment were $207.9 million in the third quarter of 2025, compared to $210.3 million in the third quarter of 2024. Sales in the first nine months of 2025 were $674.7 million, or $7.3 million lower than sales of $682.0 million in the same period last year. The decreases in sales in the third quarter and first nine months of 2025 compared to same periods in 2024 were primarily due to lower volumes of our residential water treatment and water heater products in China that were partially offset by incremental sales related to our 2024 acquisition of Pureit, which added approximately $17 million and $45 million in net sales in the third quarter and first nine month of 2025 respectively.

Rest of World segment earnings were $15.4 million in the third quarter of 2025, or $1.8 million higher compared to $13.6 million in the third quarter of 2024. Segment earnings in the first nine months of 2025 were $60.4 million, an increase of $3.7 million compared to segment earnings of $56.7 million in the first nine months of 2024. Segment margins were 7.4 percent and 6.5 percent in the third quarter of 2025 and 2024, respectively. Segment margins were 9.0 percent and 8.3 percent in the first nine months of 2025 and 2024, respectively. The higher segment earnings and segment margin in the third quarter and first nine months of 2025 compared to the prior quarter and prior year were primarily driven by benefits of our 2024 restructuring actions and tight spending controls in China that more than offset the lower China volumes. We estimate our 2025 Rest of World segment margin will be approximately eight percent.

Outlook

We expect our consolidated sales in 2025 to be flat to up one percent compared to 2024. Our projection is driven by expected boiler