Total and digital sales were on the downside in the second quarter for Watsco Inc. Watsco is one of the largest distributors of heating, ventilation, and air conditioning (HVAC) products.

For the quarter ended June 30, Miami-based Watsco reported sales of $2.003 billion. That’s a 6% decrease from sales of $2.133 billion for the second quarter of 2022. Net income was $205.4 million, versus $225.5 million in 2022’s second quarter.

Watsco ecommerce sales

Ecommerce now represents about 34% of Watsco’s total sales, but its online channel decreased in the second quarter. Digital Commerce 360 projects that ecommerce sales declined year over year to $682.0 million. That would be down from $703.8 million in Q2 2022.

Overall revenue and ecommerce sales dropped primarily because of shifting government HVAC product regulations and an ongoing product shortage.

“Our teams executed very well to generate this quarter’s results, which came with considerable challenges, including product availability,” Watsco CEO Albert H. Nahmad said yesterday on the company’s second-quarter earnings call. “The product shortages are a consequence of an immense product transition that is playing out this year following the step-up of minimum efficiency standards mandated across the United States.”

In the last 12 months, Watsco has spent more than $50 million on new investments in technology, the company says.

“Our technology platforms, which are unique to the industry, have transformed nearly every aspect of our business,” Nahmad said. “Consistent with our long-term focus, we remain committed to investing more over time as we believe these platforms provide a distinct, long-term competitive advantage.”

Check back for more earnings reports.

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