The following is a summary of the Watsco, Inc. (WSO) Q2 2024 Earnings Call Transcript:

Financial Performance:

• Watsco delivered record sales this quarter, showing strength in both residential and commercial markets.

• Operating efficiency improved, reflected by lower SG&A as a percentage of sales.

• Strong cash flow was generated and the company maintains a pristine balance sheet to support growth.

Business Progress:

• Annualized e-commerce sales exceeded $2.5 billion with active users growing faster than non-users.

• OnCall Air platform presented quotes to approximately 160,000 households, generating significant sales.

• New low GWP A2L systems are being actively introduced, aligning with federal regulatory changes and tech enhancements.

Opportunities:

• Increased adoption of company platforms by contractors led to market share gains.

• Federal regulatory changes providing opportunities for growth, specifically through energy efficiency mandates and the shift towards electrification, are driving sales of high-efficiency systems like heat pumps.

Risks:

• The gross margin was down 100 basis points year-on-year, partly due to the timing of price increases with OEMs.

More details: Watsco IR

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