AAON Inc. Faces Challenges Amidst Signs of Recovery

In a recent turn of events, AAON Inc., a leading company in the design, manufacturing, and marketing of commercial rooftop air-conditioning, heating, and heat recovery equipment, has encountered significant challenges impacting its financial performance. Despite these hurdles, there are emerging signs of recovery that investors are closely monitoring.

Q2 2025 Financial Performance

On August 11, 2025, AAON reported its second-quarter results, revealing a mixed financial picture. The company’s net sales saw a slight decline of 0.6% year-over-year, totaling $311.6 million. This downturn was attributed to operational disruptions caused by an Enterprise Resource Planning (ERP) rollout and ongoing supply constraints. These challenges significantly impacted the company’s profitability, with GAAP diluted earnings per share (EPS) falling by 69.4% to $0.19 and Non-GAAP adjusted diluted EPS decreasing by 64.5% to $0.22.

The company’s Non-GAAP Adjusted EBITDA margin also took a hit, dropping 1,120 basis points to 14.9%. Despite these setbacks, AAON highlighted strong booking trends for both AAON- and BASX-branded equipment, suggesting potential for share gains in the future. The adjusted backlog increased by 71.9% year-over-year to $1.12 billion, indicating a robust demand for AAON’s products.

Outlook and Analyst Expectations

In light of these results, AAON has revised its full-year 2025 outlook downward. Prior to the earnings release, analysts had projected an average EPS of $0.33 for the quarter, a significant decrease from the $0.62 reported in the same period the previous year. Revenue expectations were set at $325 million, marking a modest 3.64% increase from the prior year’s $313.6 million. For the fiscal year, analysts anticipated an average EPS of $2.01, slightly down from $2.02.

Signs of Recovery

Despite the challenges faced in Q2, there are indications of a potential recovery. The company’s strong booking trends and the significant year-over-year increase in the adjusted backlog suggest that demand for AAON’s products remains strong. These factors could play a crucial role in the company’s ability to bounce back in the coming quarters.

Conclusion

AAON Inc. has navigated a challenging quarter, with ERP implementation issues and supply constraints impacting its financial performance. However, the company’s strong booking trends and increased backlog offer a glimmer of hope for recovery. As AAON works to address its operational challenges, investors and stakeholders will be watching closely to see how the company adapts and moves forward in the competitive building products sector.