Good day and welcome to the nvent electric third quarter 2026 earnings conference call all participants will be in listen only mode should you need assistance please signal a conference specialist by pressing the star key followed after today's presentation there will be an opportunity to ask questions to ask a question you may press star then one on your telephone keypad to withdraw your question please press star then two please note this event is being recorded I would now like to turn the conference over to Tony Riter, Vice President of Investor Relations. Please go ahead.

Thank you and welcome to InVent's third quarter 2026 earnings call. On the call with me are Beth Wozniak, our Chair and Chief Executive Officer, and Gary Corona, our Chief Financial Officer. Today we'll provide details on our third quarter performance, an outlook for the fourth quarter, and an update to our full year outlook. All results referenced throughout this presentation are on a continuing operation basis unless otherwise stated. Before we begin, let me remind you that any statements made about the company's anticipated financial results are forward-looking statements subject to future risks and uncertainties, such as the risks outlined in today's press release and Inven's filings with the Security and Exchange Commission. Forward-looking statements are made as of today, and the company undertakes no obligation to update publicly such statements to reflect subsequent events or circumstances. Actual results could differ materially from anticipated results. Today's webcast is accompanied by a presentation, which you can find in the investor section of Envent's website. References to non-GAAP financials are reconciled in the appendix of the presentation. We'll have time for questions after our prepared remarks. With that, please turn to slide three and I will now turn the call over to Beth.

Good morning everyone. I'm pleased to share with you our outstanding third quarter results and cover some key business highlights. We had another tremendous quarter with record sales, orders, and earnings well ahead of our guidance. The better than expected sales were broad based with double digit growth across all verticals and geographies. In Q3 for Total Invent, we continued to have strong orders and backlog Organic orders grew low double digits on top of 65% growth a year ago. In addition, backlog remained healthy and grew sequentially to $2.6 billion. We also closed on the Maverick power acquisition on October 1st. Maverick brings to Invent a new power distribution platform and increases our offerings in data centers. We are raising our full year sales and EPS guidance to reflect our outstanding third quarter performance and continued broad-based growth led by data centers. Our guidance also incorporates the Maverick Power acquisition. Now onto slide four for a summary of our third quarter performance. Sales were up 44% both on a reported and organic basis led by the infrastructure vertical. New products contributed approximately 30 points to our sales growth and we launched 24 new products in the quarter. Adjusted operating income grew 57% year over year with return on sales up 190 basis points. Adjusted EPS grew 67% and we had robust free cash flow. Sales grew double digits across all verticals. Infrastructure led the way with organic sales up over 70 percent primarily driven by outstanding growth in data centers. Industrial grew in the high teens and commercial resi grew mid-teens turning to organic sales by geography. All geographies grew double digits led by the Americas growing approximately 50 percent Europe was up low double digits and Asia Pacific grew double digits. Infrastructure represents our largest long-term growth opportunity driven by the powerful secular trends of electrification, sustainability, and digitalization. We expect the infrastructure vertical to deliver record double digit organic growth this year with data center expansion and the need for power. We also forecast continued strong growth in 2027. We have been investing in new capacity for liquid cooling, engineered building solutions, power connections, and cable management. This week we announced a new 400,000 square foot facility in Arizona for engineered buildings that will expand our capacity to support growing demand in data centers and power utilities. with production expected to begin in mid-2027. In our high growth areas within infrastructure, our suppliers are working to keep pace with our growth and are also investing in capacity expansions. It is a lot of work to increase volumes with the velocity required. We are partnering closely with our suppliers to help ensure we are scaling rapidly together. Turning to industrial and commercial resi, we expect each to grow organic sales high single digits for the year versus mid single digits previously. We see industrial growth as broad based and see improving demand trends across our short cycle portfolio. I want to thank our Invent team for focusing on our customers and achieving record performance levels. This wraps up my opening remarks. I will now turn the call over to Gary for further details on our third quarter results, as well as our updated outlook. Gary, please go ahead.

Thank you, Beth. We had another excellent quarter, exceeding our guidance with record sales and adjusted EPS. Let's turn to slide five to review our results. Sales of $1,515,000,000 were up 44%. Both on a reported and organic basis as compared to last year. This was well ahead of our guidance, driven by broad base growth led by very strong data center sales. Adjusted operating income was $335 million, up 57%. Return on sales came in ahead of expectations at 22.1%, up 190 basis points versus last year. Price plus productivity offset inflation of nearly $60 million. including approximately $20 million in tariff impact. We also continued to make investments for growth in data centers and power utilities. We had record adjusted earnings well ahead of the high end of our guidance driven by exceptional sales growth and execution by the team. Adjusted EPS grew 67% year over year to $1.52. We generated robust free cash flow of $268 million. Now, please turn to slide six for a discussion on the third quarter segment performance. Starting with systems protection. Sales of $1,098,000,000 increased 53%. Organic sales grew 54%. Sales growth was broad based with double digit increases across all verticals and geographies. Infrastructure led the way, growing approximately 90% Driven by continued strength in data centers. Industrial and commercial resi each grew in the teens. Geographically, the Americas delivered very strong double digit growth, while Europe grew low double digits. Asia Pacific also delivered double digit growth in the quarter. Third quarter segment income was $253 million up 73%. Return on sales of 23% increased 260 basis points year over year on strong volume, price, and productivity. Moving on to electrical connections, growth exceeded expectations, reflecting continued momentum on our growth initiatives in infrastructure and industrial and stronger demand in commercial resi. Sales of $417 million increased 23% on both a reported and organic basis. Growth was broad-based across all verticals and geographies, all growing double digits. From a vertical perspective, infrastructure and industrial each grew strong double digits. Commercial resi was up high teens. Geographically, America's grew strong double digits while Europe was up mid-teens Asia Pacific also grew double digits in the quarter segment income was 118 million dollars up 16 percent versus last year return on sales of 28.2 percent was down 180 basis points year over year the margin performance was impacted by inflation and investments for growth partially offset by strong volume price and productivity importantly margins improved sequentially as expected turning to the balance sheet and cash flow on slide seven in addition to our strong free cash flow on the quarter we issued 800 million dollars of 10-year senior notes near quarter end to help fund the maverick power acquisition as a result we ended the quarter with more than 1.1 billion dollars in cash on hand and total debt of 2.2 billion dollars We also had $600 million available on our revolver. Including the Maverick Power Acquisition, we expect our leverage to be well within our target range of two to two and a half times by the end of the year. Our healthy balance sheet and strong liquidity provide financial flexibility to support our disciplined capital allocation strategy. Turning to slide 8 on capital allocation where we outline how we deploy capital to drive growth and sustain financial outperformance. Our framework has been consistent and is centered on disciplined growth investments and rigorous execution of our M&A strategy while maintaining the balance sheet flexibility to consistently return capital to shareholders. Our capital allocation priority is growth. This starts with reinvesting in the business by funding capacity expansion, innovation, and the capabilities required to win in high growth verticals. This year we expect to invest approximately $140 million in capex, up 50% inclusive of the Maverick Power acquisition. We have spent $95 million year to date. Most of this increased investment is for new capacity to support growth in data centers, Power Utilities, and Supply Chain Resiliency. Year to date, we returned $202 million to shareholders, including share repurchases of $100 million. And we have increased our quarterly dividend by 5% compared to last year. Overall, our disciplined capital allocation approach positions us to prioritize growth and create long-term shareholder value. Moving to slide nine. As Beth shared earlier, we are significantly raising our full year sales and EPS guidance again due to our strong performance in Q3, momentum across our portfolio, and the addition of Maverick Power. Now forecast reported sales growth of 48 to 49 percent, up from 37 to 39 percent previously. We are increasing our organic sales growth guidance. We now expect to grow 38 to 39% versus our prior guidance of 32 to 34%. We are raising our full year adjusted EPS range to 536 to 539 versus our prior guidance of $5 to 510. At the midpoint, adjusted EPS is expected to grow 60% versus last year. A few updated assumptions for modeling purposes. Acquisitions are expected to add approximately 10 points to sales growth, now including Maverick Power. Please note, Maverick Power will be reported as part of our systems protection segment. Tariff impact is expected to be approximately $105 million up from $100 million previously. Corporate costs are expected to be approximately $145 million compared to $140 million previously. An adjusted net interest is now expected to be approximately $88 million for the year. Looking at our fourth quarter outlook on slide 10, we forecast reported sales growth of 45 to 48% with Maverick Power contributing approximately 19 points to sales growth and foreign exchange roughly flat. Organic sales growth is expected to be up 26 to 29%. We continue to see very strong demand, particularly in data centers and power utilities. As Beth mentioned, we are working closely with our suppliers to support the pace of growth and have reflected the current environment in our guidance. Price and productivity are expected to offset the impact of inflation, including tariffs, and we continue to invest for growth. particularly in data centers and power utilities. We expect Maverick to contribute a few cents to adjusted EPS in the quarter, inclusive of the higher interest expense associated with the financing of the acquisition. For the fourth quarter, we forecast net interest expense of approximately $39 million. We expect adjusted EPS to be between $1.30 and $1.33. which at the midpoint reflects more than 45% growth versus last year. Overall, we expect a strong finish to an outstanding year. I will now turn the call back over to Beth.

Thank you, Gary. Please turn to slide 11. Our portfolio transformation to become a more focused, higher growth electrical connection and protection company is showing up in our results. We have intentionally increased our exposure to the high growth infrastructure vertical through both organic investments and M&A. Infrastructure made up 12% of sales at spin, expanded to 45% last year, and is nearly 60% year to date. Including Maverick Power, our 2026 sales are expected to be approximately three times what they were at SPIN and nearly 50% higher than last year. Overall, our total opportunity is now over $150 billion. Turning to slide 12 and an overview of Maverick Power. Maverick Power is a leading manufacturer of engineered power distribution and infrastructure solutions for data centers. The acquisition broadens our exposure to the high growth infrastructure vertical and adds a new power distribution platform that is highly complementary to our existing data center offerings. Maverick's portfolio includes low and medium voltage switchgear and switchboards, integrated modular solutions and services. Maverick also brings significant scale and capabilities to Invent with more than a thousand employees with key sites in Texas and Arizona and approximately 1.5 million square feet of manufacturing footprint. Looking ahead, Maverick's strong engineering capabilities expand our offerings into new power architectures and strengthens our ability to provide more system level solutions and services for data center customers. We plan to show Maverick's new 800 volt DC power rack at Supercomputing next month. Positioned alongside the IT rack, it integrates power conversion, protection, and controls to convert existing AC power to 800 volt DC, supporting high density AI computing without a facility-wide power redesign. And importantly, Maverick meaningfully expands our offerings and data centers. With Maverick, we estimate Invent's total data center opportunity We believe a combination of our complementary portfolios, engineering capabilities, and customer relationships creates significant opportunities to grow together and deliver even more value for our data center customers. Wrapping up on slide 13, we had another tremendous quarter with record sales We continue to deliver broad-based growth with infrastructure leading the way and expect another record year having significantly raised our full-year sales and adjusted EPS guidance. We remain very well positioned for the powerful trends of electrification, sustainability, and digitalization and are excited about the significant growth opportunities ahead. Our future is bright. With that, I will now turn the call over to the operator to start Q&A.

Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Please limit yourself to one question and one follow up. At this time, we will pause momentarily to assemble our roster. The first question today comes from Julian Mitchell with JP Morgan. Please go ahead.

Hi, good morning. Good morning. Good morning. Just wanted to start off on the top line outlook. Maybe just give us a little bit of context around the planning behind the latest And when you might sort of open up the order book for that. And when you're thinking about orders, you know, as a good result of a very difficult comp, is it natural to assume that that rate accelerates given the demand backdrop?

Well, Julian, thank you for the question. So to start, we just announced a new facility in Arizona, which will start to begin production, as I said, my prepared remarks, midway through 2027. You know, we also announced Blaine 2, which is another site for liquid cooling and data center solutions. And so again, that also will be into production going into mid, you know, first half 2027. So we're looking ahead as we see order rates and some of our backlog as to where we need capacity. And with respect to orders, we absolutely have a difficult comp that we had to overlap in Q3. But I will say this, starting off Q4, orders are very, you know, in October, orders are very strong.

That's helpful. Thank you. And then just my second question would be around the operating margins. So it looks like they're pegged at about 20% in the fourth quarter in the guidance. So sort of flattish year on year. Maybe just unpack that a little bit. You know, you're seeing maybe bigger cost headwinds. Is it something to do with the margin that Maverick Powers coming in at about 200 million in revenue. Any thoughts around that, please?

Yeah, sure. Julian, this is Gary. You know, I'll start by saying we were pleased with the margin performance in the third quarter. You know, margin up, you know, almost 200 basis points, incrementals, you know, well into the into the mid 20s. You know, in the fourth quarter, we do expect margins to be up year on year, approximately 60 basis points at the midpoint. and you know you put your finger on a bit of a headwind in the in the fourth quarter excluding Maverick we'll have incrementals you know well in the in the mid-20s which is our target but Q4 will be an investment quarter for Maverick as we prepare to to grow strongly in 2027 and that'll put margin incrementals more into the low low 20s so you know approximately 60 percent margin 60 points of margin growth basis points of margin growth in the fourth quarter and the core business has nice incrementals.

Great, thank you.

The next question comes from Nigel Coe with Wolf Research. Please go ahead.

Thanks, good morning everyone.

Good morning.

So, morning. So Maverick, stick with Maverick. So the Arizona expansion, is that more Maverick products than Core and Vent? And then maybe if you just give a few more details on Maverick, can you disclose the backlog acquired with Maverick and this investment spending? How does that profile look through 2027?

Okay, so to start with the new Arizona facility is actually for our engineered building solutions. So recall that is the combination of Tracti and Avail EPG. So this is to create those solutions that support both utilities and data centers and a lot of integration work. So that's what that facility is about. With respect to Maverick, we have not included a backlog yet. That is something that we will do, but I will say this, it is very healthy. Backlog and some of the investments that are being made is we mentioned that they have 1.5 million square feet and so they are fitting that out currently as they start to see this you know nice trajectory as we go into 2027 of growth and the backlog and the orders so we're investing in that capacity there to bring them up to speed and online.

Great. And then, you know, Maverick, if you look at some of their competitors, you know, the growth profile is in many cases 50% plus and in some cases as high as 100% for 2027. Is that the kind of growth profile you expect to see for Maverick next year?

Well, we're not, we're focused on, you know, our current integration. I'll just remind you, it's only been 30 days, but we do expect strong growth.

uh double-digit growth in Maverick as we go forward okay thanks beth the next question comes from steve tusa with wells fargo please go ahead hi good morning um the you just put a finer point on that i guess um when you say well into the mid-20s um incrementals um i know we're talking about like tens of basis points here sometimes but uh That would suggest Maverick kind of in the mid-teens from a margin perspective, like an operating margin perspective?

That's exactly right, Steve. That's what we're expecting in the fourth quarter for Maverick.

Okay. And then just into next year, I know there's a bit of inflation out there to say the least. How are you looking at what do you expect price to be for this year? And then how do you think about Do you need more actions to drive price costs next year?

Yeah, so Steve, in the third quarter, pricing productivity more than offset the $60 million of inflation that we saw. And price nearly covered it on its own. Our investments behind capacity and capability were significant. We've had a long track record of leveraging price to offset inflation as well as productivity, and the teams are working diligently to ensure that we forecast that's the case for Q4 and next year. Okay, thanks.

The next question comes from Jeff Hammond with KeyBank Capital Markets. Please go ahead.

Hey, good morning, everyone.

Morning.

Hey, so I know we had a lot of questions on this new modular liquid cooling product, but there seems to be some confusion on, you know, when you start taking orders, did you start taking orders in the third quarter? Or what's the timing around that? And then just kind of the the uptake and interest I know, you know, maybe it was initially for distribution, but you know, that, you know, that the initial interest seems to be broader than that.

Yes, so we have been taking orders for our new modular cooling products and platform. We'll also be showcasing that at Super Compute. There is a lot of interest in this product and we have said before we wanted to make it modular because it allows us to configure it to various types of customers and sell through distribution. But certainly there is significant interest in this product from from all types of data center companies. So it really is a broad-based platform with a lot of flexibility, and we're very excited that it gets to launch here in the back half of the year.

Okay, great. And then you mentioned the, you know, the Maverick 800-volt DC. And I guess we keep hearing, one, NextGen chips needing more liquid cooling intensity, but also 800-volt DC. having a lot more you know liquid cooling intensity so I'm just wondering you know kind of your approach and what you're seeing from early ops both with with maybe incorporating your liquid cooling into Maverick and other customers around 800 volt DC and just give us some parameters around you know that opportunity okay so as as we know uh there are the chips require more power more power means more heat

More heat means more cooling. So as we think about the future, the demand for liquid cooling is only going to increase. And as we think about these higher voltages, we're positioned well to think about our modular platform, how we can convert it and meet those needs. Similarly, on the power side, now having Maverick in our portfolio, They have an 800 volt DC offering. We're going to showcase that at Super Compute. I think as we think about cooling and power now having that in our portfolio, it gives us more opportunities to provide system solutions and different architectures. So we're excited. We're going to showcase some of this, like I said, at Super Compute. And, you know, we'll be working on the roadmaps and, you know, we'll have more to share in the future.

Great. Look forward to seeing you there.

The next question comes from Jacob Levingson with Milius. Please go ahead.

Good morning, everyone.

Hey, Jake.

Maverick seems like a nice ad for you folks, but can you give us a sense of are there other assets out there of that scale? Or maybe said a different way, are there gaps in the portfolio that you're still looking to fill through M&A?

Well, we have, and we've always said this, we have a very healthy M&A pipeline and we have a flywheel that we've had in place for a while because we're very disappointed about this and it is very strategic. I never say we have gaps in the portfolio, but more so we have opportunities to extend what we do. And if you think about our portfolio transformation, We have intentionally focused on infrastructure. So you've seen us do deals in the last little while in the data center space, in power utilities. And I think there are opportunities out there. We're also very disciplined in how we think about that value creation because we buy companies that we can invest it to grow and scale and then want to ensure that we can get good returns. So, you know, I feel we have Lots of opportunity there. And we, you know, we certainly at our investor day earlier in the year said we're going to see acquisitions contribute several points to our growth year over year. And I'd expect us, you know, to do some deals, you know, every year. And we have a good integration playbook.

Jake, and I would just add, as I mentioned in my prepared remarks, the balance sheet's healthy and we expect to end the year within our targeted leverage range.

Okay, that's helpful. And just on a different topic, it seems like there's been a notable pickup overseas. How much of that is just the data center build out starting to really come through in Europe and Asia? Or is that your more traditional industrial commercial markets recovering from depressed levels?

Well, when we look at Europe and Asia, actually, our growth is very broad based. Certainly we see the data center space growing and those opportunities are increasing there, but we're very pleased to say that industrial and our commercial resi and infrastructure power utilities, we just saw nice broad-based growth.

All right, that's helpful color. Thank you. I'll pass it on.

The next question comes from Joe Odia with Vertical Research. Please go ahead.

Hi, good morning. Could you just add a little bit of perspective on the capacity ramps, talking about the timing of the production volume ramp at blade one and two, as well as kind of Arizona and what you'll see through the first half of next year. Really looking for any detail on the timeline to reach scale efficiency

um you know and then ultimately what it means for revenue capacity versus your current footprint okay so lane one we're in production and it's been ramping up and we're actually very pleased and earlier in the year we said even you know it was a hundred days from when we business days to get that factory up and and going and i think that was like a record for us and so it's it's uh it's off to a great start and improving and improving efficiencies Blaine 2 will not come online until about midway through next year and similarly this new Arizona site for engineering building solutions that also is uh mid-2027 and you know then we expect those take time to ramp up but when we look at our backlog and opportunity We plan those investments to allow us to start meeting the capacity demand in 2027.

And then just on the product launches that you highlighted in the prepared remarks, any common denominators around capabilities or solutions that you're adding in terms of serving particular customer needs?

Well, when we look at our product opportunities, we actually prioritize all of our new products in those high growth verticals. So it's an array of things from our systems protection group where we're developing new solutions and power and cooling, for example. It's also in our electrical connections group where we look at some of our power connections and some of our other Thank you. The next question comes from Vlad Bystrycki with Citi. Please go ahead.

Hey, good morning. Thanks for taking my call. So just speaking with Maverick for a second, and maybe a little more broadly, you mentioned that Maverick, you know, in addition to their product portfolio brings some service capabilities. So can you talk about your overall service offering for data center customers today and how that's evolving and sort of where you see the service opportunities going in 27 and beyond?

Yes, so Maverick does have a service capability to support their offerings. We also have been building a service capability around our liquid cooling portfolio. and as we launch our new modular platform we believe because that will serve a wide array of customers that ability to help install help and commission help provide regular support is critical so we have this opportunity as i said that this now expands our service opportunity with maverick between what we do in liquid cooling and what we have in maverick i think we're going to be able to provide Further solutions for our data center customers. So we're building out a strong service capability and I think it's important, especially with more new products and with the breadth of the portfolio.

That's helpful. Appreciate that, Beth. And then just on the capacity side, I know you talked about Blaine in Arizona. You mentioned that Maverick was still sort of outfitting or building out their million and a half square feet of capacity. So can you just talk about sort of the timeline to Maverick's capacity ramp and when you see that coming more available?

Well, They've opened a lot of facilities over the last little while. And I would say much like we have with these new facilities, you know, it's ramping and it's going to provide capacity that is needed in 2027. So I think that continues to ramp through the first half of next year.

Yeah, that's helpful. Thanks, Beth. I'll get back to you.

The next question comes from Alexander Virgo with Evercore ISI. Please go ahead.

Yeah, thanks Fran. Talk a little bit to the new product introductions. Contribution of growth in the quarter was 30% or so. I guess we're lapping tougher comps as we go into Q4 but just wondering if you could give us a sense of that cadence into the end of the year and then I guess thinking about what that does as it wraps around into 2027. I appreciate you haven't given us any guidance for 2027 yet but obviously starting to think about Well, one of the things that we said at our investor day is that, you know, we wanted to have our new product vitality.

at around 30%. And we're effectively at that level. And to be able to do that, it means you have to innovate faster, you have to come up with new things. And certainly as we focus our portfolio onto these high growth verticals, we see that ability to do so. And certainly with data center growth, a lot of our new products are focused there. And so that's where we're seeing that tremendous uplift. And that's what will be our continued focus as we go into It's important new products have been a key driver of our growth. As we think about our strategy, it's high growth verticals, it's new products, it's growing globally, and then it's growth through M&A. So I think we've got a good pipeline of what we're working on, some good innovation, and we expect it to be a significant contributor to our overall performance of our portfolio.

Okay, thank you.

The next question comes from Neil Burke with UBS. Please go ahead.

Hey, good morning, everyone. Thanks for the questions. Good morning. So another question about Maverick. So just trying to think about the implications of Maverick doubling your content and data centers to 2 million per megawatt. I mean, this is probably simplistic, but does that mean that over time your data center revenues could double from what they were before the acquisition? Maverick Revenue started around $700 million. So clearly that isn't the impact right out of the gate, but just trying to think about the growth opportunity over time.

Well, it certainly allows us as we bid on new projects or new data center opportunities, we have more content and more capability. And not to mention, as I said previously, the ability for us to think about cooling and power and everything that we bring together. We certainly have Greater Opportunity and I and I think it's um it really for us is about just ensuring that as we see into the future about 800 volt dc and other needed solutions having power and cooling we think is very complementary and one follow-up on on orders um you clearly had a really tough 3q comp of last year orders were very strong are those

Now fully recognized in revenue at this point, I asked because you've had, you know, two quarters now organic sales grew, you know, well above orders, which are sort of low double digits. So I'm just trying to understand like conceptually, you know, I know you don't like to talk about future orders. But just conceptually, can we continue to see the sort of 30 to 40 plus top line growth that we've been seeing when orders are sort of growing well below that? Or would you expect these to sort of converge over time?

So this is Gary. I'll take that. And what's important to remember is that we've talked about orders being lumpy and the timing of those orders being lumpy. But I'll look at the two-year stack of orders for us just this quarter. And it's very strong. And you look at what Beth's comments were about October. As our business continues to evolve to more long cycle, we expect that backlog to build, especially as Maverick Power comes in to our portfolio and we report them with the broader business.

The next question comes from Varun Gobindaraj from Bernstein. Please go ahead.

Good morning, everyone. Thanks for the question. I wanted to understand how you think about opening new facilities and what you sort of look for before making that decision. Is it more just broader demand trends or do you need to see some level of customer commitment before breaking ground?

Well, it's a combination of many things when we look at a new facility. We look at, in some cases, the orders that we have on hand or orders that we can't fulfill, so to speak. We look at just what we see our customers telling us. And it's multiple factors there that we then decide to make that investment. So it's very prudent. We have a good sense of direction of where the market's headed, what our customers are saying, what the opportunities are. and then we are very disciplined as you can expect in terms of how we think about those returns. And I think Gary always likes to say those returns are very good every time that we've invested in new capacity expansion.

Yeah, just to build on the discipline, you know, we go back and take a look at our significant investments and ensure that they're delivering the returns that we expected. And many times, you know, they have over delivered our initial expectations from an ROI perspective.

No, absolutely. Thank you for the color. And then just as a quick follow up, can you talk about any of the actions you're taking right now on supply chain resilience? Obviously, at this level of growth, your suppliers are probably stretched as well. So anything you can share there would be helpful.

Yeah, certainly, you know, as we see this growth rate and the velocity and the demand and the ability to respond, you know, I mentioned it, you know, 100 days for us. You know many of our suppliers are they too are having to add capacity sometimes that is new lines sometimes that's new facilities so we're trying to work hand in hand with them to ensure that they understand our forecast that we're working through bringing new capacity online together because we're only going to be successful if they're successful with us so it's a lot of work we always say that you know we try to be very prudent When we give our guidance, given that there's a lot going on from our own capacity expansion to our suppliers as well.

Thank you so much. I'll pass it on.

The next question comes from Nicole DeBlaise from Deutsche Bank. Please go ahead.

Yeah, thanks. Good morning, Beth and Gary.

Good morning, Nicole.

Just wanted to ask one on 4Q. Gary, the revenue guidance kind of implies Thanks, Nicole. Our Q4 organic guide is still quite healthy.

and the two-year stack is is still um you know over 50 percent so great uh great growth for us it is a it is a tick down you know some of that is uh is seasonality in our business that we normally see a bit of a step back and look um you know in q4 we we could have uh we could maybe have delivered more but but as beth talked about you know we're navigating uh we're navigating um you know and being prudent with how we manage the supply chain. And that's something that is incorporated into our guidance. I will say we're really pleased with the year. We're gonna grow almost $2 billion year over year on the revenue basis and $2 of additional EPS. So we feel really good about the growth that we're delivering in 26.

Understood, thanks Gary. And then just coming back on Maverick, I think you said in response to a prior question that it's like mid-teens margins in the fourth quarter. Does that incorporate some of the growth investments that you're making? And I guess the question is, as you look out over the next several years and integrate Maverick, do you think it has the potential to get to systems protection or invent average margins?

Yeah, Nicole, exactly. Significant ramp happening in Maverick, and we've incorporated those investments into our guide. We expect those margins to improve, both from the growth and fully utilizing those facilities that Beth talked about. It's only 30 days, so I'm not ready to stripe the exact expectations for Maverick margins, but we do expect them to certainly improve as we get into 27 and beyond.

Thanks, Gary. I'll pass it on.

The next question comes from Luke Junk with Baird. Please go ahead.

Good morning. Thanks for taking questions. Beth, I'll say another Maverick question, but I want to take a little different direction in terms of a strategic question. Just be curious to get your color on initial engagement with customers, either after announcing the deal or now they've owned it for about a month here. Just in terms of walking them into your current relationship, and starting to lay the groundwork for selling thermal and power as a system model solution. Thank you.

Well, certainly we had very favorable reaction to the acquisition, you know, both from our Invent customers and from Mavericks customers because they know that just the capabilities that each company has, you know, there's more that we can bring together. And, you know, as we think about the opportunity, Certainly there, you know, as in anything, you know, we look at these synergies around growth about if you think about, you know, we have developed over the last several years a very strong commercial organization, which we believe with Maverick's offering, we're going to have the opportunity to, you know, drive their reach beyond what they had today. So overall, I think it's a great new platform for us and very complementary to what we do. And it kind of follows our flywheel of we find companies that have great products that we can invest in and scale to grow.

Got it. And then for my follow-up, I'll ask on electrical connections. Not sure if we kind of questioned Q&A yet. I'm just curious, were you surprised to see the growth accelerate sequentially there? I think it's maybe a bit better than expectations and kind of unpacking that. Any of the upside drivers on that low 20s plus kind of growth rate?

Hey, Luke, you were cutting in and out. We could not understand that question. Not sure if it's on your end or.

Yeah, let me try it again here. Yeah, let's go. Much better. Much better. Yeah. Growth accelerating there. I think that was a bit better than your expectations in the low 20 plus range here. Just kind of can you unpack what was better than expected there in any and other particular drivers that we should be focused on. Thank you.

And sorry, you meant the growth rate compared to what?

Electrical connections versus excitations and accelerating sequentially.

Yes, we had another great quarter for electrical connections, and I think it speaks to our focus on our growth initiatives. So as you know, you know, that has always been a very strong Segment focused on commercial and we've you know had the product portfolio there we focused it on infrastructure and industrial as well as some of our commercial actions so we've seen significant growth opportunities new products are contributing to this um and i would also say one of the things and this is not just electrical connections but the Invent portfolio we are seeing very strong growth through our distribution channel. And that speaks to the broad-based growth that we're seeing across industrial infrastructure and commercial for that matter.

I'll leave it there. Thank you.

Thank you. The next question comes from Scott Graham with Seaport Research Partners. Please go ahead.

Hi. Good morning, Beth, Gary, and Tony. I wanted to first ask about just 40,000 feet data centers um you know you see what's going on out there with you know there's pockets of suppliers saying a little slower a little pause and what have you obviously you're not seeing that but I'm just wondering your customer conversations I know it's you know kind of two-step but nevertheless you get good visibility on sales they're reading through to the OEM I'm just wondering, are you seeing any less urgency in that market? I know for a while there was really having trouble keeping up with things and you're adding capacity. I get all that, but is there a tenor of maybe less urgency for orders in that market?

So Scott, I will say that we also have direct relationships with those end customers. So we get a lot of feedback that way as well. and no I would say there's a sense of urgency in terms of are we able to do more I mean that's more you know can we have you know more output can we respond faster you know bring in lead times so we're not seeing that slow at all if anything it's just you know I talked earlier in my prepared remarks about the pace of growth and the velocity needed it's a lot of hard work and that's continuing

I appreciate that. Thank you. I just want to maybe ask a follow up question about the electrical connections margin, which has been declining for some time. And historically, I remember, you know, with Pentair and even in the early days with you, a spin out that pricing was always, you know, one of the strengths of this business. And I'm just wondering, I know acquisitions were a factor last year, but the continued decline in that

Segment's margins can you kind of give us some color on you know what where that's coming from you know again another 40,000 footer in that way thanks yeah yeah Scott it's Gary and I and I appreciate the question and I'll start with you know what we're focused on in electrical connections right now which is growth and you know to deliver a couple quarters in a row around 20 percent It is breakthrough growth for that business. And a lot of it has to do with the strategy change, with focus more on industrial and infrastructure, repositioning the portfolio. And that's really driving that nice growth. With that repositioning, we have some mix that is impacting the portfolio. But I will say the team's done a nice job to price away the inflation. We've been very consistent in what we expected from that business, which is sequential improvement in margins. I'll take that high 20s margin with approximately 20% growth. It's been a nice acceleration for that business this year and a bit different than what we had seen in the past.

Thank you.

This concludes our question and answer session. I would like to turn the conference back over to Beth Wozniak for any closing remarks.

Thank you for joining us today. We are confident in our strategy and our ability to execute. We have significant growth opportunities ahead and multiple levers to drive continued margin expansion. I'm very proud of our outstanding performance in the third quarter and the continued progress we're making across InVent. We remain focused on delivering for our customers, employees, and shareholders. Invent is a top tier high performance electrical company well positioned to win with the powerful trends of electrification, sustainability, and digitalization. We're excited about the opportunities ahead. Thank you again for joining us today. This concludes our call.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.