Carrier Global’s third quarter was shaped by significant softness in North American residential sales and continued declines in the European heating market, which management indicated drove much of the year-over-year revenue and margin reduction. CEO David Gitlin cited “about a $500 million sales challenge and a $0.20 to $0.25 adjusted EPS headwind” tied to residential, but noted that better-than-expected performance in Commercial HVAC in the Americas and ongoing aftermarket growth helped partially offset these pressures. Cost containment initiatives and targeted headcount reductions were also implemented to mitigate the impact of lower volumes.

Is now the time to buy CARR? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Carrier Global’s Q3 Earnings Call

• Jeffrey Sprague (Vertical Research Partners) pressed on inventory levels and destocking pace; CFO Patrick Goris detailed elevated inventories, particularly in residential, and outlined expectations for gradual reductions by year-end.
• Scott Davis (Melius Research) questioned whether cost cuts were structural; CEO David Gitlin confirmed that the focus is on permanent headcount reductions and automating back-office functions, not just discretionary expense controls.
• Julian Mitchell (Barclays) asked about the outlook for residential HVAC in 2026; Goris indicated the company is assuming flat to slightly up volumes, with easier second-half comparisons but persistent first-half headwinds.
• Nigel Coe (Wolfe Research) inquired about data center backlog and revenue growth; Gitlin noted a targeted $1 billion in data center sales for the year, with backlog poised to drive further growth in 2026.
• Chris Snyder (Morgan Stanley) sought clarity on Americas margins next year; Goris said margins should improve absent a significant further decline in residential, attributing this to cost actions and recovery in commercial segments.

Catalysts in Upcoming Quarters

Heading into future quarters, our analysts will closely watch (1) the pace and effectiveness of residential inventory destocking and corresponding demand stabilization, (2) whether commercial HVAC, particularly data center-related business, can sustain its current growth trajectory, and (3) the realization of structural cost savings as operational changes take effect. Monitoring the adoption of digital platforms and the recovery of European and Chinese markets will also be important for assessing Carrier’s ability to rebound from recent softness.

Carrier Global currently trades at $58.45, in line with $58.27 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).

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