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AAON stock jumped about 22% after record Q3 2026 sales of $707M, up 84%, as data-center cooling sales rose 218% and the company raised its growth outlook.
- Q3 net sales rose 84.1% to a record $707.4M; diluted EPS more than doubled to $0.83 from $0.37.
- BASX-branded data-center cooling sales rose 218.3% to $397.2M; backlog reached $1.9B, up 40.5%.
- Full-year 2026 sales growth guidance rose to 72%-75% from 55%-60%, alongside restated Q1 and Q2 results.
Lead
AAON (NASDAQ: AAON), the Tulsa-based maker of commercial heating and cooling equipment, reported record third-quarter results on November 9, 2026. Shares rose about 22% in trading the next session. Net sales reached $707.4M, against $384.2M a year earlier, as hyperscale and colocation customers bought more of the precision cooling units that keep AI-era server halls within operating temperatures. Operating income climbed 129.3% to $100.0M.What Happened in AAON's Third Quarter?
AAON's net sales rose 84.1% year over year to $707.4M, and data-center cooling supplied most of the gain. Sales of BASX-branded products, the data-center unit, rose 218.3% to a record $397.2M. They now account for more than half of company revenue. The company cited higher production throughput and greater use of newly added manufacturing capacity.
Diluted earnings per share were $0.83, up 124.3% from $0.37. Adjusted EBITDA was $127.2M, an 18.0% margin. Nine-month sales totaled $1.842B, against $1.018B in the same period of 2025. Shares had already gained 9.93% on Monday to close at $62.87, before the earnings release moved the stock further.
Why Did AAON Raise Its Full-Year Outlook?
AAON raised its 2026 net sales growth forecast to 72%-75% because order intake and production output both outran earlier plans. The prior range was 55%-60%. The company also guided to a gross margin of about 26%, selling, general and administrative expenses near 13% of sales, and depreciation and amortization of about $100M.
Backlog supports the higher range. Total orders on hand reached $1.9B, up 40.5%. BASX-branded backlog stood at $1.355B, up 51.1%, while the traditional AAON-branded backlog was $499.3M, up 18.0%. Management said the projects are permitted and under construction rather than speculative, and that more than 80% of the backlog sits with customers with strong balance sheets.
Margins and Capacity
Gross profit was $188.5M, a 26.7% margin. That is up 60 basis points from the second quarter but down 110 basis points from a year earlier. The faster-growing data-center line carries lower margins than the legacy business, and the mix shift weighed on the margin by more than 300 basis points. Pricing and sourcing actions and better overhead absorption partly offset it. Management expects a slightly lower margin in the fourth quarter because the holidays reduce production days.
Capacity remains a central lever. The Memphis facility is running at about one-third utilization, and BASX capacity above $2B is to come online gradually through 2027 and 2028. Operating cash flow for the first nine months was $146.9M, against an $18.8M outflow a year earlier. Funding growth still relies on credit: the company held $3.7M in cash and had drawn $386.7M on its revolving facility. Management expects capital spending to step down in 2027.
Is the Restatement a Concern for Investors?
The restatement is a real caveat, though it increased reported results rather than reducing them. AAON restated its first- and second-quarter 2026 financial statements after finding errors in revenue recognition and software subscription accounting. The corrections raised first-half net sales by $10.7M and diluted EPS by $0.09. The company also disclosed a material weakness in internal control over financial reporting. Management said it found no evidence of fraud or misconduct and has begun remediation. It plans to move to a brand-based segment structure with its fourth-quarter report.
What Does This Mean for Data-Center Cooling Demand?
AAON's results show that AI-driven construction is flowing through to the thermal-management supply chain, which has become a bottleneck as server racks draw more power. Cooling equipment is a long-lead item for new campuses, so orders placed now set revenue for several quarters. Management said less than one-third of its backlog is exposed to states where data-center development faces political or power-supply pressure.
The risks are execution and concentration. Rapid volume growth puts pressure on factory ramps, supplier deliveries and internal controls, and a rising share of low-margin data-center work will keep dilution in focus. No formal 2027 guidance was given.
Outlook
AAON has now delivered record quarterly sales while lifting its full-year growth range by roughly 17 points at the midpoint. The stock's 22% advance reflects a $1.9B backlog and a rising data-center share of revenue. The next checkpoints are the fourth-quarter report, which brings the new segment reporting, the progress of control remediation, and the pace at which new BASX capacity comes online through 2027.
Mentioned tickers: AAON
