Carrier Global (CARR) investor relations material

Growth strategy and market outlook

• Focus on accelerating growth through new product development, aftermarket expansion, and systems-level offerings, especially in data centers and energy management.

• Despite market headwinds in 2025, expect a return to 6%-8% growth with short-cycle market tailwinds.

• Americas residential HVAC volumes projected down 10%-15% in 2026, but inventory management and channel engagement are mitigating risks.

• Commercial HVAC and data center segments show strong order growth, with data center orders up 400% in Q4 and continued share gains.

• Europe and Asia present growth opportunities, with significant bidding activity in European data centers and robust demand in India, Japan, and the Middle East.

Operational efficiency and cost management

• Productivity initiatives and overhead reductions are driving cost savings, with $100 million in overhead savings expected in 2026.

• Material cost headwinds from steel, copper, and aluminum are being offset by productivity and price actions, with low single-digit price realization anticipated.

• Inventory levels are being tightly managed, with field inventory down and sequential increases expected as the season progresses.

• Americas business expects attractive incremental margins in the second half of 2026 as residential sales recover.

Innovation, technology, and aftermarket

• Significant investment in new products, including differentiated chillers and liquid cooling solutions for data centers.

• AI and digital platforms are being leveraged to enhance aftermarket services, predictive maintenance, and customer engagement.

• Aftermarket business is a major focus, with connected devices and service agreements expanding rapidly; only 25% of installed base currently captured, indicating large opportunity.

• Home energy management systems (HEMS) are being piloted and rolled out, integrating heat pumps and batteries to optimize grid demand and create new revenue streams.