Oct 29, 2026 earnings call — Record quarter and raised full-year outlook
Raised full year 2026 sales outlook to approximately $26.8 billion to $27 billion.
Revenue $7.2B (est $6.9B) · EPS $5.77 (est $4.69)
Key quotes
"Third quarter data center sales increased approximately 55% year-over-year to a record $1.8 billion, marking another quarter of strong growth despite increasingly challenging year-over-year comparisons."
"We now expect organic sales growth of 13% to 14% and reported sales growth of 14% to 15%, resulting in expected full year sales of approximately $26.8 billion to $27 billion."
"So I'll just say that without updating the number, let's say, it's an at least 100 basis points of EBITDA margin expansion."
Analyst Q&A 7
digital transformation progress
Q (David Manthey · Baird): He asked for an update on the company digital transformation and whether the targeted 100 basis points of EBITDA benefit starts in 2027. He also asked about the company's exposure across hyperscalers, cloud, on-prem and enterprise data center work.
A: Management said the digital transformation is making very good progress and all three SBUs are running initial builds on the new platform in multiple locations. They said the 100 basis points is a floor — it will be at least 100 basis points of EBITDA margin expansion — and that data center demand is broad-based across hyperscalers, MTDCs, emerging AI players and enterprise customers.
"All 3 SBUs are running an initial build on the new digital platform in multiple locations." — John Engel (CEO·CHAIR)
Q4 margin guide and capacity
Q (Sam Darkatsh · Raymond James): He asked if the lower implied margins in the Q4 guide are structural or just conservative. He also asked about labor and physical footprint capacity given the growth and early stage of the digital program.
A: Management said the Q4 guide reflects normal seasonality risks (December, holidays), one less business day and continued investments, not a structural issue. They said nothing structural is hiding in the guide, and they have been actively optimizing facilities and adding larger, more capable locations (including a large Texas facility with Level 10–12 testing), so they feel good about capacity.
"So Sam, I think just to put the outlook in context, right, we're guiding to solid fourth quarter growth year-over-year." — Indraneel Dev (CFO)
2027 outlook and AI use
Q (Thomas Moll · Stephens): He pressed on whether the company may be conservative on 2027 sales given recent non-data-center acceleration. He also asked if AI changed their digital investment plans.
A: Management said they will give the full 2027 outlook with Q4 results but they see strong positive momentum exiting this year. They said their tech choice was correct: a new tech stack around a single data lake, and they are already using generative and agentic AI internally to gain productivity and analytics benefits before full global deployment.
"We absolutely picked the right architecture, it's a new tech stack wrapped around one world-class data lake that we've been hydrating all our data in, and we've made substantial progress on leveraging AI." — John Engel (CEO·CHAIR)
data center pricing and UBS margins
Q (Christopher Glynn · Oppenheimer): He asked whether gross margin improvement in CSS comes from pricing or other sources and whether pricing could be a future opportunity. He also asked if UBS margins will keep improving as PPU headwinds dissipate.
A: Management said gross margin gains in data center work come mainly from adding products and increasing services content over the project life cycle, not big product price moves. On UBS, they noted UBS had been an 11% EBITDA business, backlog is up strongly, IOUs and public power are growing, grid services has grown double digits, and margins have improved sequentially the last several quarters.
"I would really focus you on the gross margin improvement is because of our services' content increasing over time, and we're continuing to drive and accelerate that." — John Engel (CEO·CHAIR)
backlog vs stock-and-flow timing
Q (Kenneth Newman · KeyBanc): He asked if the mid- to high single-digit sales comment is mainly backlog-driven and how stock-and-flow performed versus project work this quarter. He also asked how much of CSS backlog is for projects that won't contribute until 2028 versus 2027.
A: Management said their momentum comment reflects current strength and they will provide full detail with Q4 results. They said stock-and-flow pickup is notable in EES and that current CSS benefits largely come from projects announced some time ago, because there is a meaningful time lag between announced CapEx and when Wesco supplies the work.
"What we're benefiting from now is projects that are spending that was announced quite some time ago on behalf of our end-user customers." — John Engel (CEO·CHAIR)
backlog timing and UBS grid share
Q (Guy Drummond Hardwick · Barclays): He asked if management can split backlog by delivery year (2027 versus 2028+) and what percent of UBS is now grid solutions.
A: Management said they have not historically parsed backlog by delivery year but will consider adding that disclosure; backlog generally includes near-term work and sometimes one to two years out for long-cycle products. On grid solutions, they said the business was $300-plus million last year, is growing faster than UBS overall, and the mix is shifting up; they will update mixes when 2026 closes.
"I will just tell you that in general, what's in backlog, it includes a broad mix of demand that can be tomorrow, next week, next month, next quarter." — John Engel (CEO·CHAIR)
grid services profit and price/cost
Q (Christopher Dankert · D.A. Davidson): He asked if grid services are currently accretive to UBS and whether margins could be even higher than the segment average. He also asked for an update on price versus cost.
A: Management said grid services is accretive to Wesco and will help UBS, that it has attractive margins and a large multiyear win starts contributing in 2027. On price/cost, management said their objective is generally price/cost neutrality, pricing is not a factor in CSS and is managed closely in EES.
"It's accretive to Wesco for sure and will obviously help UBS." — John Engel (CEO·CHAIR)