Earnings call transcript: Pool Corp tops Q3 2026 estimates as shares jump

Pool Corp reported third-quarter earnings and revenue that slightly exceeded Wall Street expectations, while its shares jumped nearly 10% in premarket trading. The distributor of pool supplies posted adjusted earnings of $3.40 per share, surpassing the $3.36 forecast, and revenue of $1.5 billion, which surpassed the $1.48 billion estimate.

Revenue grew by 4% from the previous year, while adjusted earnings per share (EPS) remained nearly unchanged at $3.40 compared to $3.39 a year ago. Sales growth accelerated to 4% from 2% in the previous quarter, driven by pricing and improved volume trends. Gross margin fell to 29% from 29.6% a year earlier, due to freight costs and product mix pressures.

Management kept full-year guidance unchanged and indicated a path to margin recovery. The company's stock rose 9.82% to $189.37 in premarket trading, signaling investor optimism about the quarter and future outlook. Pool Corp's net sales for the quarter were $1.5 billion, with growth across various business segments. Pricing contributed 3 percentage points to the 4% sales increase, while volume added 1 point.

The quarter highlighted a mixed operating picture, with gross profit increasing by $7 million, but gross margin narrowing by 60 basis points to 29%. Operating income declined by 3% to $172 million, while adjusted diluted EPS held steady at $3.40. The pool industry remains resilient, driven by maintenance and replacement demand, but the broader market remains cautious due to soft housing turnover and delayed large projects.

Pool Corp is gaining market share in several regions, including Florida, Arizona, and Texas, while European sales grew by 8% in local currency.