It has been about a month since the last earnings report for Vertiv Holdings Co. (VRT Quick QuoteVRT - Free Report) . Shares have lost about 7.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Vertiv due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent drivers for Vertiv Holdings Co. before we dive into how investors and analysts have reacted as of late.

Vertiv Q2 Earnings Beat Estimates, Net Sales Up Y/Y

Vertiv Holdings reported second-quarter 2025 non-GAAP earnings of 95 cents per share, beating the Zacks Consensus Estimate by 14.46%. The figure jumped 41.8% year over year.

Net sales increased 35.1% year over year to $2.64 billion, surpassing the Zacks Consensus Estimate by 11.86%. Net sales on an organic basis increased 34% year over year.

Vertiv stock gained 2.19% in pre-market trading. The uptick can be attributed to strong organic sales growth, driven by higher adjusted operating profit and robust performance across its regional segments.

VRT Prospects Ride on Strong Backlog

Organic orders (excluding foreign exchange) rose 11% year over year, and the book-to-bill ratio was roughly 1.2x in the second quarter. The backlog at the end of the second quarter was $8.5 billion. Backlog was 21% higher than 2024-end and up 7% from the end of the first quarter of 2025.

Product revenues (which accounted for 82.1% of total revenues) increased 39.3% year over year to $2.16 billion. Service revenues (17.9% of total revenues) increased 18.7% year over year to $472.1 million.

Americas' revenues increased 42.9% year over year (43.2% organic) to $1.60 billion and accounted for 60.7% of total revenues. Product revenues increased 48.1% year over year (48.3% organic) to $1.32 billion. Service & spares revenues increased 22.9% (23.4% organic) to $281.5 million in the reported quarter.

Asia and Pacific (APAC) revenues increased 36.9% year over year (36.8% organic) to $560.2 million and accounted for 21.2% of total revenues. Product revenues increased 44.7% year over year (44.4% organic) to $424 million. Service & spares revenues increased 17.4% (17.7% organic) year over year to $136.2 million in the reported quarter.

Europe, Middle East, and Africa (EMEA) revenues increased 12.5% year over year (7% organic) to $475.6 million and accounted for 18% of total revenues. Product revenues increased 12.6% year over year (6.9% organic) to $374.1 million. Service & spares revenues increased 12.2% year over year (7.4% organic) to $101.5 million in the second quarter of 2025.

VRT’s Operating Details

Selling, general and administrative (SG&A) expenses increased 8.7% year over year to $395.6 million. As a percentage of sales, SG&A expenses decreased 360 basis points (bps) year over year to 15%.

Adjusted operating profit jumped 28.2% year over year to $489.3 million. The second-quarter non-GAAP operating margin was 18.5%, down 100 bps year over year.

Americas adjusted operating profit surged 34.9% year over year to $384.6 million. EMEA’s adjusted operating profit decreased 4.8% year over year to $104.2 million. APAC’s adjusted operating profit surged 83.3% year over year to $59.2 million.

VRT’s Balance Sheet Remains Strong

As of June 30, 2025, cash, cash equivalents, and marketable securities totaled $1.64 billion, compared with $1.47 billion as of March 31, 2025.

Long-term debt at the end of the second quarter was $2.900 billion, down from $2.904 billion reported in the previous quarter.

Cash flow from operating activities was $322.9 million for the reported quarter, up from $303.3 million in the prior quarter. Free cash flow was $277 million for the second quarter.

VRT Raises 2025 Guidance

For 2025, revenues are now expected to be between $9.925 billion and $10.075 billion. Organic net sales growth is expected to be between 23% and 25%.

Vertiv expects adjusted operating profit between $1.950 billion and $2.030 billion. Operating margin is expected to be in the 19.7-20.3% range.

VRT expects 2025 non-GAAP earnings between $3.75 per share and $3.85 per share. 

Free cash flow for 2025 is expected to be between $1.375 billion and $1.425 billion.

For third-quarter 2025, revenues are expected to be between $2.510 billion and $2.590 billion. 

Organic net sales are expected to increase in the 20% to 24% range.

Vertiv expects adjusted operating profit between $490 million and $530 million. Operating margin is expected to be in the 19.75%-20.25% range.

VRT expects third-quarter 2025 non-GAAP earnings between 94 cents and $1 per share.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates revision.

VGM Scores

At this time, Vertiv has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock has a score of D on the value side, putting it in the bottom 40% for value investors.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Vertiv has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.