Trane Raises Revenue Outlook as Backlog Swells 73% to $12.5 Billion

Trane Technologies raised its full-year revenue outlook on Thursday after third-quarter bookings jumped 21% and its order backlog swelled 73% to $12.5 billion, led by surging demand for commercial heating and cooling systems in the Americas.

The climate-control equipment maker now expects 2026 reported revenue growth of about 13.5% and organic revenue growth of about 11%, according to the earnings release it filed with an 8-K on Thursday. It reaffirmed its earnings outlook, calling for adjusted continuing EPS of $15.20 to $15.30 and GAAP continuing EPS of about $15.00 to $15.10.

Earnings up 25%

Third-quarter net revenues rose 18% to $6.76 billion from $5.74 billion, with organic revenues up 16%. GAAP continuing EPS climbed 25% to $4.79 from $3.82, and adjusted continuing EPS rose 25% to $4.86 from $3.88.

Adjusted operating income increased 15% to $1.364 billion, a record according to the company, though the adjusted operating margin slipped 40 basis points to 20.2%. Bookings totaled $7.25 billion, and the book-to-bill ratio was 107%.

"Our focus on sustainability and energy efficiency continues to resonate with customers, driving bookings growth of 20 percent in the quarter and elevating our backlog to $12.5 billion," Chair and CEO Dave Regnery said in the release. He said the company is raising revenue guidance and reaffirming its EPS outlook "even as we navigate supply chain and inflationary headwinds."

Americas carries the quarter

The Americas segment, the company's largest, grew revenues 21% to $5.65 billion, including about 2 percentage points from acquisitions. Organic revenues rose 19%. Segment adjusted operating income climbed 24% to $1.258 billion, and adjusted operating margin widened 50 basis points to 22.3%. Backlog for Americas Commercial HVAC rose approximately 80%.

Overseas, orders surged but profitability weakened. In Europe, the Middle East and Africa, bookings rose 40% and the book-to-bill ratio reached 147%, but revenues edged up only about 1% to $755.8 million, and adjusted operating margin fell 250 basis points to 17.2%. In Asia Pacific, bookings rose 22% and revenues grew 8% to $356.0 million, while adjusted operating margin dropped 390 basis points to 18.6%.

By the numbers

• Net revenues: $6.76 billion, up 18%
• Organic bookings: up 20%
• Backlog: $12.5 billion, up 73%
• Adjusted continuing EPS: $4.86, up 25%
• Year-to-date free cash flow: $2.8 billion

Cash flow and capital deployment

Free cash flow through Sept. 30 was about $2.8 billion, up approximately 60% from $1.786 billion a year earlier. Cash from continuing operating activities totaled about $3.1 billion.

Through October, Trane deployed or committed about $3.4 billion of capital this year, including approximately $930 million for dividends, $1,080 million for acquisitions and $1.4 billion for share repurchases. The company said it expects to pay a competitive and growing dividend and to deploy 100% of excess cash to shareholders over time.

Trane ended the quarter with $1.227 billion of cash and $4.218 billion of debt, down from $4.616 billion a year earlier.

Sources

1. Trane Technologies Form 8-K with third-quarter 2026 earnings release (Exhibit 99.1), filed Oct. 29, 2026 (accession 0001466258-26-000001)

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