Key Highlights
- Annual revenue reaches $1.44B with 20% year-over-year increase, powered by BASX and core equipment lines.
- Profit margins compress to 26.7% as company invests in manufacturing capabilities and enterprise software.
- BASX sales double while total backlog climbs to $1.83B, representing 111% annual increase.
- Fourth quarter delivers 42.5% revenue jump with 30% EPS gain as Memphis and Longview facilities scale production.
- Management guides toward 18%-20% revenue expansion in 2026 with margin recovery and $190M infrastructure investment.
AAON, Inc. (AAON) delivered unprecedented revenue performance throughout 2025, achieving $1.44 billion in total sales—a 20.1% advancement compared to 2024 figures. Both the flagship AAON product line and the BASX subsidiary contributed to this milestone. The stock retreated to $99.00 during pre-market hours following the earnings release, declining from the previous close of $101.20.
The heating and cooling equipment manufacturer reported GAAP diluted earnings per share of $1.29 for the full year, representing a decrease from $2.02 recorded in 2024. Profitability metrics showed gross margin contracting to 26.7% versus 33.1% previously, attributed to deliberate expenditures in manufacturing infrastructure and enterprise resource planning systems. AAON concluded the period with an all-time high backlog totaling $1.83 billion, marking a 110.9% surge year-over-year.
Order momentum demonstrated AAON’s expanding competitive position, particularly in data center cooling and commercial HVAC applications. Revenue from BASX-branded products exceeded the prior year by more than 100%, while traditional AAON-branded equipment maintained consistent growth. These outcomes validate AAON’s capacity to increase manufacturing throughput while satisfying accelerating customer requirements.
Q4 Revenue Acceleration and Manufacturing Scale-Up
The company generated fourth-quarter revenue of $424.2 million, representing a 42.5% elevation compared to the equivalent 2024 period. BASX-branded product sales climbed 138.8% to reach $181.4 million, driven by heightened demand for liquid cooling and air-side thermal management equipment. AAON-branded revenue advanced 9.5% to $242.8 million, underpinned by healthy order books and consistent factory output.
Quarterly gross margin registered at 25.9%, experiencing minor compression from 26.1% in the year-ago quarter, reflecting fixed cost absorption as new manufacturing facilities reached operational status. Earnings per share improved to $0.39, achieving 30% growth versus the prior year. The company progressed production ramp-up activities at its Memphis, Tennessee location and enhanced efficiency metrics at the Longview, Texas operation.
AAON’s aggregate backlog stood at $1.83 billion at December 2025 month-end, with BASX accounting for $1.3 billion of this total. The AAON-branded backlog expanded 60.8%, while BASX orders surged 141.3% year-over-year. These metrics underscore AAON’s manufacturing preparedness for sustained revenue expansion and profitability enhancement throughout 2026.
Forward Guidance and Business Unit Results
Management projects 2026 revenue growth in the 18%-20% range, supported by substantial order backlog and enlarged manufacturing footprint. The organization anticipates gross margins recovering to the 29%-31% band with selling, general, and administrative expenses approximating 16% of total sales. Depreciation and amortization expenses are estimated at $95-$100 million, corresponding to ongoing capital deployment.
The AAON Oklahoma business unit generated Q4 revenue of $215.5 million, an 11.1% year-over-year increase. Gross margin declined to 27.5% due to overhead absorption from the newly operational Memphis manufacturing complex. AAON Coil Products revenue surged 93.6%, with gross margin expanding to 21.3% from 16.1% in the comparable 2024 quarter.
BASX segment revenue increased 109.1% to $106.1 million, accompanied by gross margin improvement to 27.1% versus 18.8% previously. Manufacturing ramp activities at Memphis contributed to elevated production volumes and enhanced profitability performance. AAON’s infrastructure investments establish the company to capture expanding demand for energy-efficient thermal management and data center cooling technologies.
AAON maintains robust financial flexibility with $1.2 million cash on hand and $398.3 million utilized from its revolving credit arrangement. Planned capital expenditures totaling $190 million target continued expansion and operational optimization. The organization enters 2026 positioned to accelerate revenue, restore margin performance, and solidify its competitive standing.
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