Watsco, Inc. 3Q25 Investor Presentation
Investment Thesis
Market leader in a highly fragmented industry
Transforming customer experience with enhanced technology
Unique ownership culture with long-term focus on value creation
Deep ties to the industry's leading OEMs and suppliers
Proven track record of delivering superior shareholder returns
Robust capital position and balance sheet to fund any growth opportunity
Contractor visits homeowner to diagnose problem and recommend solutions
Contractor visits our store or e-commerce site to buy equipment, parts and supplies needed to remedy problem
What is Watsco's Business Model?
Broken or failing A/C unit at home or business
Contractor completes the repair or replacement of homeowner's system
Strategic Locations
United States 640
Canada 34
Latin America & Caribbean 24
TOTAL 698
Russell Sigler* 36
*WSO Minority Ownership Data as of FYE 9/30/25
Market Leader in a Fragmented Market
4
15
5
6
7
8
9
10
11
12
13
14
3
Watsco 2
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
Watsco vs. Industry Competitors
$8.0
Why scale matters:
Rich product availability and dense branch network to support customers
Purchasing power from 1,400+ OEMs and suppliers
Estimated Revenues in Billions
Greater share of wallet from customer spend
Talent acquisition and retention
Technology easily scalable across footprint
Significant barriers to entry:
Technical expertise needed to install and service HVAC units
Difficult for consumers to "do it yourself"
OEM approval required to enter distribution
Loyal customer base
Attractive End-Markets and Products
Latin America 5%
Canada 5%
REVENUES BY GEOGRAPHY
Commercial 15-20%
New Housing 10-15%
Other HVAC Products 26%
Refrigeration 4%
REVENUES BY PRODUCT
United States 90%
REVENUES BY SEGMENT
Residential 65-70%
Commercial HVAC Equipment 15%
Residential HVAC Equipment 55%
*Data as of FYE 12/31/24
Installed Base
100,000,000
90,000,000
Installed Base of Central A/C Units
80,000,000
Large and Growing Installed Base Drives Steady Replacement Business with Residential Focus
Installed base has increased every year
Over 120 million installed HVAC units in U.S.
Roughly 87 million ducted systems
9.6 million units shipped in 2024
Only ~12% of industry shipments tied to Residential New Construction
3.4% CAGR of Installed Base since 1980
3.9% CAGR of Shipments since 1980
70,000,000
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
2024
2022
2020
2018
2016
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
-
Annual Industry Shipments
12,000,000
Replacement Units OEM Shipments
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
2024
2022
2020
2018
2016
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
-
Source: Data through Dec 31, 2024. AHRI, Industry Data and Watsco estimates
Using Technology to Transform the HVAC Industry
2
Make Watsco more efficient and profitable, while improving speed to market
1
Make it easier to do business with Watsco through best-in-class 24/7 digital experience
3
Enable new profit streams that help our customers grow faster
Benefits of Technology
Traditional
Digital
Countless hours wasted on the phone and waiting in line
Ordering and pickups done in minutes, not hours
Sales becomes more pro-active and consultative vs. being order takers
People and resources spend time away from customers
VS
Inefficiencies eat into business profitability and growth
Resources better deployed to higher margin-generating activities
Scalable to future acquisitions
Customer loyalty increases leading to less attrition over time
Customers are more efficient and profitable
Technicians complete more jobs in a day
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