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Call sheet · Q4'25

Carrier Global (CARR)

Q4'25 earnings call · held February 5, 2026 · compared with the Q3'25 call · management-credibility review
10/12
Disclosure score
3 medium, 2 low flags
Financial quality
Bottom line
The sleeper story is data centers have peaked for the next 2-3 quarters - orders exploded but deliveries pushed to March/April, and the $900M cash flow includes massive one-time inventory burn that reverses on recovery. Everyone will focus on the 50% data center growth guidance, but the real binding constraint is resi won't recover until consumers can afford replacement cycles again at these price levels. Gitlin's most revealing quote: 'We would love to see a little bit more pulled in' on data center deliveries, admitting timing is customer-driven, not their choice. My view changes if residential sell-through stabilizes above the mid-20s decline rate they're forecasting for early 2026.

The 30-second version

  • Data center revenue doubled to $1.5B but backlog peaked - this is as good as it gets for 2-3 quarters
  • Resi destocking created $900M inventory liquidation - biggest operational cash tailwind in company history
  • HEMS went from 'billions we can monetize' to 'planning market launch later this year' - AI monetization story is vaporware

What changed this quarter

MetricQ3'25Q4'25Change
Total Revenue$5.6B (down 9% YoY in Q3)$4.8B (down 9% YoY in Q4)Sequential decline accelerated
Adjusted EPS$0.67 (down 13% YoY in Q3)$0.34 (down significantly YoY in Q4)Nearly 50% sequential drop
CSA Organic SalesDown 8% in Q3Down 17% in Q4Deterioration doubled
CSA Operating Margin19.7% in Q3 (down 560 bps YoY)Just under 9% in Q4 (down ~10 points YoY)1,000+ bps sequential collapse
CSA Resi SalesDown 30% in Q3Down close to 40% in Q4Accelerating decline
Data Center OrdersStrong but unquantified in Q3Up more than five times in Q4Explosive order growth
Commercial HVAC SalesUp 30% in Q3Up 12% in Q4Deceleration despite data center wins
Free Cash Flow$225M in Q3$900M in Q44x jump from inventory liquidation
Total Company OrdersDown high single digits in Q3Up over 15% in Q4Sharp reversal driven by data centers
Connected ChillersUp 30% in Q370,000 total (vs 17,000 three years ago)Strong cumulative growth but rate not disclosed

Accountability tracked

7 new promises made5 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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