Data center products and services company Vertiv (NYSE: VRT) met Wall Street’s revenue expectations in Q1 CY2026, with sales up 30.1% year on year to $2.65 billion. On the other hand, next quarter’s revenue guidance of $3.35 billion was less impressive, coming in 2.3% below analysts’ estimates. Its non-GAAP profit of $1.40 per share was 38.4% above analysts’ consensus estimates.

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"We're seeing data center infrastructure requirements evolve significantly, with customers prioritizing optimized design, deployment speed, and operational efficiency - reshaping their approach to deployment," said Giordano Albertazzi, Vertiv's Chief Executive Officer.

Company Overview

Formerly part of Emerson Electric, Vertiv (NYSE: VRT) manufactures and services infrastructure technology products for data centers and communication networks.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Thankfully, Vertiv’s 18.9% annualized revenue growth over the last five years was incredible. Its growth surpassed the average industrials company and shows its offerings resonate with customers, a great starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Vertiv’s annualized revenue growth of 24.6% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated.

We can dig further into the company’s sales dynamics by analyzing its organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, Vertiv’s organic revenue averaged 23.7% year-on-year growth. Because this number aligns with its two-year revenue growth, we can see the company’s core operations (not acquisitions and divestitures) drove most of its results.

This quarter, Vertiv’s year-on-year revenue growth of 30.1% was wonderful, and its $2.65 billion of revenue was in line with Wall Street’s estimates. Company management is currently guiding for a 27% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 33.2% over the next 12 months, an improvement versus the last two years. This projection is eye-popping for a company of its scale and suggests its newer products and services will spur better top-line performance.

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Operating Margin

Vertiv has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 13.2%. This result isn’t too surprising as its gross margin gives it a favorable starting point.

Looking at the trend in its profitability, Vertiv’s operating margin rose by 15.6 percentage points over the last five years, as its sales growth gave it immense operating leverage.

In Q1, Vertiv generated an operating margin profit margin of 16.6%, up 2.3 percentage points year on year. Since its gross margin expanded more than its operating margin, we can infer that leverage on its cost of sales was the primary driver behind the recently higher efficiency.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Vertiv’s EPS grew at 35.1% compounded annual growth rate over the last five years, higher than its 18.9% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into Vertiv’s earnings to better understand the drivers of its performance. As we mentioned earlier, Vertiv’s operating margin expanded by 15.6 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Vertiv, its two-year annual EPS growth of 58.5% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q1, Vertiv reported adjusted EPS of $1.40, up from $0.64 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Vertiv’s full-year EPS of $4.95 to grow 33.1%.

Key Takeaways from Vertiv’s Q1 Results

It was good to see Vertiv beat analysts’ EPS expectations this quarter. We were also glad its full-year EPS guidance trumped Wall Street’s estimates. On the other hand, its adjusted operating income missed and its organic revenue fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 5.7% to $294.62 immediately following the results.

So should you invest in Vertiv right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).