Electrical supply company WESCO (NYSE: WCC) reported revenue ahead of Wall Street’s expectations in Q2 CY2026, with sales up 13% year on year to $6.67 billion. Its non-GAAP profit of $4.57 per share was 15.2% above analysts’ consensus estimates.

Is now the time to buy WESCO? Find out by accessing our full research report, it’s free.

"We delivered another exceptional quarter marked by continued market outperformance and accelerating business momentum. Sales, backlog, adjusted EBITDA, and adjusted earnings per share all increased versus the prior year and achieved records that exceeded our plan. Free cash flow generation was also positive and exceeded our expectations. We have now posted four consecutive quarters of double-digit sales growth fueled by data centers. Beyond our outsized growth in data centers, demand remained strong across the rest of our diversified portfolio and end markets as customers continue to invest in major infrastructure projects. Especially noteworthy, backlog was up approximately 60%, to a new record level, reflecting the benefits of the ongoing secular growth trends and the continued effectiveness of our One Wesco cross-selling strategy. We achieved a major milestone this quarter with a significant multi-year Grid Services award in our UBS business from a hyperscale data center customer. This win represents an important step in diversifying our UBS customer base and expanding our comprehensive data center offerings to include power solutions in addition to our extensive white space and gray space product and service offerings. As recently announced, we also strengthened our end-to-end capabilities and cooling solutions for data center customers through the acquisition of Singapore-based Newark Engineering," said John Engel, Chairman, President, and CEO.

Company Overview

Based in Pittsburgh, WESCO (NYSE: WCC) provides electrical, industrial, and communications products and augments them with services such as supply chain management.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Luckily, WESCO’s sales grew at a decent 8.1% compounded annual growth rate over the last five years. Its growth was slightly above the average industrials company and shows its offerings resonate with customers.

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. WESCO’s recent performance shows its demand has slowed as its annualized revenue growth of 6.8% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

We can better understand 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, WESCO’s organic revenue averaged 7.6% 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, WESCO reported year-on-year revenue growth of 13%, and its $6.67 billion of revenue exceeded Wall Street’s estimates by 3.7%.

Looking ahead, sell-side analysts expect revenue to grow 4.7% over the next 12 months, a slight deceleration versus the last two years. This projection is underwhelming and suggests its products and services will face some demand challenges.

ALSO WORTH WATCHING: Nvidia’s Quiet Partner. Nvidia’s chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all.

Every AI server needs specialized infrastructure the chip companies don’t make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE.

Operating Margin

WESCO’s operating margin has more or less stayed the same over the last 12 months , averaging 5.8% over the last five years. This profitability was paltry for an industrials business and caused by its suboptimal cost structureand low gross margin.

Analyzing the trend in its profitability, WESCO’s operating margin might have fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

In Q2, WESCO generated an operating margin profit margin of 5.7%, in line with the same quarter last year. This indicates the company’s cost structure has recently been stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

WESCO’s EPS grew at 17% compounded annual growth rate over the last five years, higher than its 8.1% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

Diving into WESCO’s quality of earnings can give us a better understanding of its performance. A five-year view shows that WESCO has repurchased its stock, shrinking its share count by 5%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For WESCO, its two-year annual EPS growth of 9.8% was lower than its five-year trend. We hope its growth can accelerate in the future.

In Q2, WESCO reported adjusted EPS of $4.57, up from $3.39 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 WESCO’s full-year EPS to grow 14.8% from $15.26 to $17.52.

Key Takeaways from WESCO’s Q2 Results

We were impressed by how significantly WESCO blew past analysts’ organic revenue expectations this quarter. We were also excited its EBITDA outperformed Wall Street’s estimates by a wide margin. Zooming out, we think this was a solid print. The stock remained flat at $309.80 immediately following the results.

WESCO put up rock-solid earnings, but one quarter doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. 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).