WESCO Q2 Earnings Surpass Expectations, Revenues Increase Y/Y

WESCO International WCC posted strong second-quarter 2026 results, with adjusted earnings of $4.57 per share rising 35% year over year. The bottom line topped the Zacks Consensus Estimate of $3.96 by 15.4%.Net sales of $6.67 billion increased 13% from the year-ago quarter. Revenues also surpassed the Zacks Consensus Estimate of $6.4 billion by 4.17%. Organic sales increased 12.6% year over year.Data center activity remained a key growth engine. Data center sales totaled $1.5 billion in the quarter, up about 45% year over year, and accounted for roughly 22.5% of quarterly sales. The total company backlog rose approximately 60% year over year to a record level.WESCO International, Inc. Price, Consensus and EPS Surprise WESCO International, Inc. price-consensus-eps-surprise-chart | WESCO International, Inc. QuoteWCC's Top-Line DetailsThe EES Segment (37.7% of net sales): Sales in the segment were $2.51 billion, up 11.2% year over year. Organic sales increased 10.9% year over year.CSS (40.2%): Sales in the segment were $2.68 billion, up 18.4% year over year. Organic sales rose 17.5% on a year-over-year basis.UBS (22.1%): Sales in the segment were $1.47 billion, up 7% year over year. Organic sales increased 7% year over year.WCC's Operating DetailsThe second-quarter 2026 gross margin was 21.8%, which improved 70 basis points year over year.The adjusted EBITDA margin of 7.3% improved 60 basis points year over year.Selling, general, and administrative expenses were $1.02 billion, up 17.3% year over year. As a percentage of revenues, the figure increased 50 bps year over year to 15.3%.The adjusted operating margin was 6.1%, which improved 50 bps year over year.WCC's Balance Sheet Remains StrongAs of June 30, 2026, cash and cash equivalents were $808.9 million, up from $696.6 million as of March 31, 2026.The long-term debt was $5.91 billion at the end of the second quarter compared with $5.74 billion in the prior quarter, reflecting the issuance of new senior notes used to redeem the 2028 Notes.Net cash provided by operating activities for the second quarter of 2026 totaled $53.7 million. Free cash flow reached $32.3 million.WCC Raises 2026 Outlook After Strong First HalfGiven the exceptional first-half performance and accelerating business momentum, management significantly raised its 2026 outlook. WESCO now expects reported sales of $25.9 to $26.3 billion, organic sales growth of 9% to 11%, adjusted EBITDA margin of 6.9% to 7.1%, and adjusted earnings of $16 to $17.50 per share. Free cash flow guidance was revised to $300 to $600 million from the prior range of $500 to $800 million, reflecting higher working capital needs to support the double-digit sales growth.Zacks Rank & Stocks to ConsiderWESCO currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the broader Zacks Computer and Technology sector are AppFolio APPF, Amkor Technology AMKR and Amphenol APH, each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Shares of AppFolio have declined 19.6% year to date. The Zacks Consensus Estimate for APPF’s 2026 earnings is pegged at $6.9 per share, up by 2.2% over the past seven days, indicating an increase of 30.4% year over year.Shares of Amkor Technology have jumped 8.2% year to date. The Zacks Consensus Estimate for AMKR’s 2026 earnings is pegged at $2.08 per share, unchanged over the past 30 days, indicating a rise of 38.7% year over year.Amphenol shares have surged 11.3% year to date. The Zacks Consensus Estimate for APH’s 2026 earnings is pegged at $4.87 per share, up 7 cents over the past 30 days, indicating an increase of 45.8% year over year. Zacks' Research Chief Names "Stock Most Likely to Double" Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest. This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment Research