Whirlpool Corp shares fell 8.5% to $74.00 in pre-market trading after the appliance-maker reported disappointing fourth-quarter results. According to reports from investingLive, the company's Q4 revenue came in at $4.10 billion versus expectations of $4.27 billion, while ongoing EPS stood at $1.10 compared to the expected $1.52. The company's full-year 2025 sales results declined 6.5% year-over-year, falling short of market expectations. The stock's decline underscores the power of a revenue miss, as management cited a 'challenging' end-of-year period for the shortfall, signaling near-term operational weakness that outweighed the bottom-line surprise.
The company's Q4 performance showed significant margin pressure, with quarterly gross profit declining 14.3% to $575 million from $671 million in the year-ago quarter. Gross margin fell 220 basis points year-over-year to 14%. Selling, general and administrative expenses increased 1.7% to $425 million, with SG&A expenses as a percentage of net sales expanding 30 basis points to 10.4%. The ongoing EBIT of $135 million fell 45.6% from $248 million in the year-ago quarter, with ongoing EBIT margin contracting 270 basis points to 2.7%. The company's GAAP EPS for 2026 is expected to reach $6.25 compared with $5.66 reported in 2025, with ongoing EPS expected to reach $7, up from $6.23 per share reported in 2025.
CEO Mark Bitzer expressed optimism about the company's prospects for 2026, stating that 'With a challenging 2025 behind us, our confidence for 2026 is based on our recent successful product launches, reduced promotional intensity and a gradual recovery of the housing market.' However, the company's guidance for 2026 revenue of $15.3-15.6 billion fell short of the $15.6 billion consensus, while ongoing EPS guidance of $7.00 was below the expected range of $7.11-$7.21. The company expects GAAP EPS for 2026 to be $6.25 compared with $5.66 reported in 2025, with ongoing EPS expected to reach $7, up from $6.23 per share reported in 2025.
The company's performance varied significantly by region, with North American Q4 sales declining 0.9% year-over-year to $2.57 billion. Canada was identified as a weak spot, with the segment's EBIT decreasing 59% year-over-year to $71 million and EBIT margin contracting 390 basis points to 2.8%, reflecting a highly promotional pricing environment. Latin American sales rose 0.8% to $927 million, though excluding currency effects, sales dropped 4.6% on weak volumes. Global sales showed resilience with an 8.0% increase to $423 million, with segmental EBIT margin expanding 130 basis points to 13.8% due to favorable price/mix and direct-to-consumer growth.
Despite the earnings miss, analysts note that Whirlpool remains attractively priced at 10.5x ongoing earnings and nearly 10% free cash flow yield at the guidance midpoint. However, significant debt concerns remain, with net debt to EBITDA at 5.5x and the company planning $400 million in debt payments this year. The company's price-to-sales ratio of 0.3x is historically low, trading in a 0.4-0.6x range, suggesting potential margin improvement opportunities. The company declared a dividend of 90 cents per share for the fourth quarter of 2025.
The earnings disappointment comes after hedge fund manager David Tepper disclosed a $432 million stake in Whirlpool Corp in November, representing approximately 10% of the company. Tepper's investment was seen as a bet on housing market normalization or potential interest rate cuts, as Whirlpool is viewed as a housing sector proxy. Shares of this company have lost 12.9% in the past three months compared with the industry's 12.8% decline. The stock's decline was driven by a 'challenging' end-of-year period, with management's narrative failing to convince investors looking for top-line strength.
