Vertiv Holdings Co (NYSE:VRT) delivered a standout quarter that beat Wall Street expectations, fueled by surging data center demand and surging orders.

The company lifted its full-year revenue, profit, and cash flow guidance as backlog and margins continued to expand, underscoring momentum in the global shift toward AI-driven infrastructure.

Goldman Sachs analyst Mark Delaney reiterated his Buy rating and $159 price forecast, noting that the financial performance substantially surpassed his and the broader Street’s expectations, even following the stock’s significant pre-earnings rally.

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Delaney highlighted Vertiv’s impressive financial beats: the reported revenue of $2.7 billion exceeded the Street’s estimate of $2.69 billion, and adjusted EPS of $1.24 substantially beat the consensus of 98 cents.

The analyst attributed this strong EPS upside primarily to a 3% increase in revenue and a roughly 240 basis point higher operating margin than he had estimated. He noted that the adjusted operating profit of $596 million also came in above the Street’s $519 million projection.

Backlog Growth

Delaney emphasized the exceptional demand trends, citing organic orders that surged 60% year-over-year, which he estimates implies $3.7 billion in orders for the quarter, further backed by a robust backlog of $9.5 billion that grew 30% year-over-year.

Outlook

For the near-term outlook, Delaney noted that Vertiv raised its full-year 2025 revenue, operating margin (to a 20.2% midpoint), and adjusted EPS guidance, with fourth quarter revenue and EPS guidance exceeding Street estimates.

However, he pointed out that fourth quarter EBIT and margin guidance fell modestly below consensus due to noted tariff and EMEA challenges.

Investor Focus

Looking ahead, Delaney identified key focus areas for investors, including sustained order trends, the path to achieving a 25% margin by 2029, competitive dynamics, and capital allocation strategy.

He cautioned that key downside risks to his view include challenges to revenue growth from shifts in the data center market and margin pressures arising from tariffs or competitive activity.

Price Action: VRT shares were trading lower by 4.19% to $167.47 at last check Wednesday.

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