Carrier Global Corporation (CARR) shares plummeted 9.59% in intraday trading on Tuesday, reversing a sharp pre-market rally as investors reassessed the company's second-quarter results and engaged in heavy profit-taking.
The sell-off was triggered by mixed second-quarter earnings. While Carrier reported adjusted earnings per share of $0.86, beating the analyst consensus of $0.81, and net sales rose 4% to $6.35 billion, GAAP earnings fell 14% year-over-year to $0.60 per share. GAAP operating profit dropped 9% to $825 million, driving the operating margin down 1.8 percentage points to 13.0%. The company also raised its full-year adjusted EPS guidance to $2.90 and lifted its sales outlook to approximately $23 billion, both above estimates.
Despite the raised guidance, the weaker-than-expected bottom-line profitability and the year-over-year earnings contraction prompted investors to book profits. The stock had initially surged over 6% in pre-market trading following the release, but the gains quickly evaporated as the market focused on the decline in GAAP earnings and margin compression. The reversal intensified into the regular session, with the stock shedding more than 5% in regular trading alone, contributing to the steep intraday drop.
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