Thermon’s Q2 Earnings Call: Our Top 5 Analyst Questions

August 14, 2025 at 01:38 AM EDT

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Thermon’s second quarter was marked by a notable revenue shortfall and a significant negative market reaction, as sales fell due to delayed backlog conversion and project execution timing. Management attributed the year-over-year decline primarily to temporary disruptions, including a longer-than-anticipated production shutdown for capital improvements and supply chain challenges. CEO Bruce Thames acknowledged these setbacks, stating they were "not indicative of lost revenue opportunity" and expressed confidence that affected orders will convert to revenue in the coming quarters.

Is now the time to buy THR? Find out in our full research report (it’s free).

Thermon (THR) Q2 CY2025 Highlights:

Revenue: $108.9 million vs analyst estimates of $122.5 million (5.4% year-on-year decline, 11.1% miss)
Adjusted EPS: $0.36 vs analyst estimates of $0.36 (in line)
Adjusted EBITDA: $21.24 million vs analyst estimates of $22.03 million (19.5% margin, 3.6% miss)
The company reconfirmed its revenue guidance for the full year of $515 million at the midpoint
Management reiterated its full-year Adjusted EPS guidance of $1.88 at the midpoint
EBITDA guidance for the full year is $109 million at the midpoint, above analyst estimates of $108 million
Operating Margin: 10.8%, down from 13.8% in the same quarter last year
Market Capitalization: $859 million

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Thermon’s Q2 Earnings Call

Brian Paul Drab (William Blair): Drab questioned the resolution of production delays and the timing for recognizing delayed revenue. CEO Bruce Thames confirmed all disruptions are resolved and expects the majority of affected revenue to be realized in the upcoming quarters.
Brian Paul Drab (William Blair): Drab asked for details on the data center liquid load bank product and order pipeline. Thames described the product’s function in testing cooling and power systems, and projected revenue contributions to begin in the back half of the year.
Brian Paul Drab (William Blair): Drab inquired about gross margin expectations for coming quarters. Thames noted some margin headwinds in Q2 due to tariffs, but expects pricing actions to offset these pressures later in the year.
Justin Ian Ages (CJS Securities): Ages sought clarification on demand trends for the F.A.T.I. business. Thames highlighted strong European electrification activity, with bookings and backlog growth attributed to regulatory drivers and LNG projects.
Alfred Shopland Moore (ROTH MKM): Moore asked about large project pipeline and timing in the heat trace segment. Thames reported a robust opportunity set, with revenue distribution now expected to be weighted toward the second half of the year.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts are monitoring (1) the pace of revenue recognition from the cleared backlog and whether delayed orders convert as expected, (2) adoption rates for Thermon’s new liquid load bank products in the data center market, and (3) continued expansion and backlog growth in the rail, transit, and European electrification segments. Execution of pricing strategies to counteract tariff headwinds will also be a critical area to track.

Thermon currently trades at $25.98, down from $28.22 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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Thermon’s Q2 Earnings Call: Our Top 5 Analyst Questions

Thermon (THR) Q2 CY2025 Highlights:

Our Top 5 Analyst Questions From Thermon’s Q2 Earnings Call

Catalysts in Upcoming Quarters

The Best Stocks for High-Quality Investors

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