Trane wraps industry earnings, echoes residential slump

Trane on Thursday wrapped up U.S. HVAC manufacturers’ third-quarter earnings reports, echoing sentiment from its peers about a challenged residential market. 

What’s happening: The company’s American residential “bookings” and revenue declined by roughly 30 and 20 percent year-over-year, respectively, during the quarter, as “channel inventory remains elevated,” according to a presentation. 

• The results mirror those of Carrier and Lennox, whose residential unit volumes fell 40 and 23 percent, respectively, during the same period — though they didn’t come as a surprise, as executives flagged in September. 

What they’re saying: “2025 was such an odd year for residential… it started with pre-buy,” CEO Dave Regnery said on the company’s earnings call. 

• “Then you had this refrigerant change that didn’t go very well because of the canister issue that was well-publicized,” he added. “And then you had a really short summer across the U.S.”
• “So those three factors are kind of anomalies that we look at in the residential space… That caused a bit of inventory in the channel that needs to be burned down.”

Of note: The residential segment represents roughly 15 percent of Trane’s overall business. 

Looking ahead: Trane expects the fourth quarter, residential-wise, to look similar to the third, CFO Chris Keuhn noted, but 2026 to be a “tale of two halves.”

• “A challenging first half due to tough comps,” Regnery added, “followed by improvement in the second half against easier comps.”

Related: HVAC distributor Watsco sales fall on A2L volatility