Peak washing machine muddied up Whirlpool earnings.
Fueled likely by a combo of rising interest rates and inflation-related price hikes that is putting new appliance purchases out of reach for many consumers, Whirlpool said late Monday that North America sales plunged 8.3% from a year ago in the first quarter. Operating profits for the business fell 25% year over year.
Whirlpool's sales declines in North America were worse than the 4% drop in industry volumes the company estimated.
The company said in a presentation on its website it no longer sees industry growth in North America for this year. Previously it was looking for growth of 2% to 3%. Furthermore, the company raised its full year inflation outlook to $1.8 billion, a $600 million increase from three months earlier.
Here's how Whirlpool performed compared to Wall Street estimates:
Net Sales: $4.92 billion vs. $5.3 billion
Diluted EPS: $5.31 vs. $4.79
Trends elsewhere in the business painted a mixed picture on Whirlpool headed into the back half of the year.
Sales fell 7.4% in the Europe, Middle East and Africa segment while dropping 30.7% in the Asia Pacific. Sales rose 3.8% in Latin America. Operating profits fell year-over-year in all geographical regions as inflation in areas like steel remained elevated.
The worsening outlook for inflation and demand prompted Whirlpool to slash its full year profit outlook.
Whirlpool sees full year sales growth of 2% to 3%, down from 5% to 6% previously. In addition to North America no longer seeing industry growth this year, Whirlpool marked down its industry demand outlook for its European business to a drop of 3% to 5%. Industry demand outlooks were left unchanged for the Latin America and Asia Pacific businesses.
Earnings are pegged in a range of $24 to $26 a share from $27 to $29 previously. Wall Street analysts were modeling for earnings of $26.32 a share.
Whirlpool added it has put its European business up for strategic review.
Shares were up by about 1% in pre-market trading.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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