Carrier's operating margin has experienced extreme sensitivity to revenue shifts, collapsing from 15.0% in 2024Q4 to 2.1% in 2025Q4, which suggests significant challenges in scaling fixed overheads.
| Sales/Revenue | 21.87B | 21.75B | 22.49B | 18.95B | 17.29B | 20.61B | 17.46B | 18.61B | 18.91B | 17.81B |
| Revenue Growth % | -1.86% | -3.29% | 18.65% | 9.62% | -16.13% | 18.09% | -6.19% | -1.62% | 6.17% | - |
| Cost of Goods Sold | 16.44B | 16.11B | 16.46B | 13.78B | 12.98B | 14.61B | 12.33B | 13.15B | 13.31B | 12.58B |
| COGS % of Revenue | - | 74.09% | 73.21% | 72.69% | 75.11% | 70.85% | 70.62% | 70.68% | 70.37% | 70.62% |
| Gross Profit | 5.43B | 5.63B | 6.02B | 5.17B | 4.3B | 6.01B | 5.13B | 5.46B | 5.61B | 5.23B |
| Gross Margin % | 24.83% | 25.91% | 26.79% | 27.31% | 24.89% | 29.15% | 29.38% | 29.32% | 29.63% | 29.38% |
| Gross Profit Growth % | - | -6.46% | 16.39% | 20.26% | -28.38% | 17.14% | -5.98% | -2.68% | 7.11% | - |
| Operating Expenses | 3.65B | 3.48B | 3.38B | 3.02B | 319M | 3.36B | 2.05B | 2.96B | 1.97B | 2.2B |
| OpEx % of Revenue | - | 16.02% | 15.02% | 15.91% | 1.85% | 16.31% | 11.72% | 15.93% | 10.41% | 12.37% |
| Selling, General & Admin | 3.22B | 3.08B | 3.2B | 2.47B | 1.94B | 2.98B | 2.59B | 2.52B | 2.48B | 2.38B |
| SG&A % of Revenue | - | 14.16% | 14.22% | 13.01% | 11.21% | 14.45% | 14.84% | 13.53% | 13.1% | 13.37% |
| Research & Development | 615M | 625M | 686M | 493M | 416M | 503M | 419M | 401M | 400M | 364M |
| R&D % of Revenue | - | 2.87% | 3.05% | 2.6% | 2.41% | 2.44% | 2.4% | 2.15% | 2.11% | 2.04% |
| Other Operating Expenses | -4M | -220M | -506M | 56M | -2.04B | -119M | -963M | 46M | -909M | -543M |
| Operating Income | 1.78B | 2.15B | 2.65B | 2.16B | 3.98B | 2.65B | 3.08B | 2.49B | 3.64B | 3.03B |
| Operating Margin % | 8.14% | 9.89% | 11.77% | 11.4% | 23.04% | 12.83% | 17.66% | 13.39% | 19.23% | 17.01% |
| Operating Income Growth % | - | -18.75% | 22.5% | -45.78% | 50.62% | -14.21% | 23.77% | -31.51% | 20.03% | - |
| EBITDA | 3.07B | 3.1B | 3.88B | 2.65B | 4.31B | 2.98B | 3.42B | 2.83B | 3.99B | 3.4B |
| EBITDA Margin % | 14.02% | 14.23% | 17.25% | 13.99% | 24.94% | 14.47% | 19.59% | 15.19% | 21.12% | 19.1% |
| EBITDA Growth % | -25.53% | -20.19% | 46.28% | -38.52% | 44.55% | -12.75% | 20.98% | -29.24% | 17.4% | - |
| D&A (Non-Cash Add-back) | 1.29B | 945M | 1.23B | 491M | 328M | 338M | 336M | 335M | 357M | 372M |
| EBIT | 1.86B | 1.84B | 2.33B | 2.21B | 1.96B | 2.57B | 2.08B | 2.64B | 2.87B | 2.64B |
| Net Interest Income | -184M | -176M | -371M | -160M | -219M | -306M | -288M | 27M | 37M | -115M |
| Interest Income | 139M | 169M | 209M | 146M | 83M | 13M | 10M | 102M | 121M | 104M |
| Interest Expense | 323M | 345M | 580M | 306M | 302M | 319M | 298M | 75M | 84M | 219M |
| Other Income/Expense | -360M | -352M | -372M | -161M | -161M | -245M | -228M | 181M | 205M | 24M |
| Pretax Income | 1.42B | 1.8B | 2.27B | 2B | 3.82B | 2.4B | 2.85B | 2.67B | 3.84B | 3.05B |
| Pretax Margin % | 6.49% | 8.27% | 10.11% | 10.55% | 22.11% | 11.64% | 16.36% | 14.36% | 20.31% | 17.14% |
| Income Tax | 99M | 306M | 1.06B | 521M | 616M | 699M | 849M | 517M | 1.07B | 1.79B |
| Effective Tax Rate % | 6.97% | 17.02% | 46.7% | 26.06% | 16.11% | 29.13% | 29.74% | 19.35% | 27.93% | 58.51% |
| Net Income | 1.32B | 1.49B | 5.6B | 1.35B | 3.53B | 1.66B | 1.98B | 2.12B | 2.73B | 1.23B |
| Net Margin % | 6.03% | 6.87% | 24.92% | 7.12% | 20.44% | 8.07% | 11.35% | 11.37% | 14.45% | 6.89% |
| Net Income Growth % | -77.05% | -73.36% | 315.42% | -61.83% | 112.38% | -16.04% | -6.33% | -22.6% | 122.82% | - |
| Net Income (Continuing) | 1.32B | 1.49B | 1.21B | 1.48B | 3.21B | 1.7B | 2.01B | 2.15B | 2.77B | 1.27B |
| Discontinued Operations | -1000K | 4M | 4.5B | -38M | 377M | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 349M | 324M | 314M | 328M | 318M | 327M | 326M | 333M | 352M | 371M |
| EPS (Diluted) | 1.57 | 1.70 | 6.15 | 1.63 | 4.10 | 1.87 | 2.25 | 2.44 | 3.16 | 0.00 |
| EPS Growth % | -75.67% | -72.36% | 277.3% | -60.24% | 119.25% | -16.89% | -7.79% | -22.78% | - | - |
| EPS (Basic) | - | 1.74 | 6.24 | 1.61 | 4.19 | 1.92 | 2.29 | 2.44 | 3.16 | 0.00 |
| Diluted Shares Outstanding | 842.8M | 846.7M | 911.7M | 853M | 861.2M | 890.3M | 880.2M | 866.22M | 872.8M | 872.8M |
| Basic Shares Outstanding | 835M | 839.2M | 898.2M | 837.3M | 843.4M | 867.7M | 866.5M | 866.22M | 866.2M | 866.2M |
| Dividend Payout Ratio | - | 51.71% | 11.96% | 45.96% | 14.4% | 25.06% | 6.96% | - | - | - |
Portfolio transformation execution risk
According to the provided financial data, Carrier's revenue growth has exhibited significant volatility, fluctuating from a 21.3% expansion in 2024Q3 to a 6.0% contraction by 2025Q4, reflecting the ongoing impact of divestitures and the integration of new climate-focused assets into the core business model.
The inconsistent top-line performance suggests that the company is currently in a transitional phase where organic growth is being masked by the structural removal of non-core segments. Investors should monitor whether the pivot toward a pure-play HVAC model can stabilize revenue streams once the divestiture-related noise subsides.
As reported in the income statement, Carrier's gross margin has experienced notable compression, dropping from a peak of 29.1% in 2025Q2 to 23.3% in 2026Q1, which appears to indicate challenges in maintaining pricing power during the current phase of product redesign and portfolio realignment.
The margin degradation suggests that the company may be struggling to fully pass through inflationary costs or is facing a less favorable product mix during the transition. This performance warrants further investigation into whether the current margin levels represent a new baseline or a temporary trough caused by integration expenses.
Based on the reported figures, Carrier's operating margin has shown extreme sensitivity to revenue shifts, collapsing from 15.0% in 2024Q4 to 2.1% in 2025Q4, which suggests that the company's cost structure remains heavily burdened by fixed overheads that do not scale efficiently during periods of lower volume.
The lack of operating leverage implies that the company's current cost base is not yet optimized for its new, smaller portfolio. Analysts should scrutinize whether management can successfully rationalize SG&A expenses to protect profitability as the company moves toward its long-term climate-focused strategic objectives.
Analysis of the income statement reveals that net income has been significantly impacted by non-operating items, including a massive $2.6 billion profit in 2024Q4, which obscures the underlying operational performance and makes year-over-year earnings comparisons difficult for investors to interpret without significant adjustments.
The presence of such large, non-recurring gains suggests that GAAP net income is currently an unreliable metric for assessing the company's core earning power. Investors should focus on normalized operating income to gauge the true health of the business while the company works through its portfolio transformation.
While management emphasizes the transition to a pure-play HVAC model, the recent decline in gross margins to 23.3% in 2026Q1 raises concerns that the company may be losing its competitive edge to more efficient peers like Trane Technologies, which maintains significantly higher margin profiles.
The persistent margin gap compared to industry peers suggests that Carrier's hybrid distribution model may be less efficient than the direct-to-customer approaches used by competitors. This discrepancy warrants further investigation into whether the company's pricing power is structurally weaker than previously assumed by the market.
Quick answers to the most common questions about buying CARR stock.
For fiscal year 2025, Carrier Global Corporation (CARR) reported total revenue of $21.75B. This represents a 22.1% increase compared to $17.81B in 2017.
Carrier Global Corporation (CARR) is profitable, generating $1.49B in net income for the fiscal year ending 2025 with a net profit margin of 6.9%.
Carrier Global Corporation (CARR) reported an operating income of $2.15B, resulting in an operating profit margin of 9.9%. This margin reflects the operational efficiency of the business before interest and taxes.
Carrier Global Corporation (CARR) generated $5.63B in gross profit for the year, representing a gross profit margin of 25.9%. This demonstrates the company's core pricing power and production efficiency.