The Single Most Important Metric For Vertiv Stock

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At Vertiv (VRT), what matters most is the cash customers pay before delivery on its larger data center projects. Our data does not show that deposit amount on its own, so free cash flow is the closest measure here. Buyers pay a deposit with each order and add more at milestones, a structure management says is driving its cash performance. Even so, the stock lost 38.0% from April 27 to October 26, 2026, while the S&P 500 gained 7.6%. Deposits kept rolling in during the June quarter. But the stock was higher on June 30 than on April 27, so the fall came after that quarter, starting with a 17.3% drop on July 29. So how much cash is Vertiv bringing in?

Vertiv’s Quarterly Free Cash Flow Has More Than Tripled

So far, customers are paying ahead. Vertiv reported free cash flow of $925 million in fiscal Q2 2026, the quarter ended June 30, up from $277 million a year earlier. On the July 29 call, management said the quarter’s rise in deferred revenue came from project advance payments and milestone collections. They added that those deposits were behind the company’s working capital and cash performance.

Over the twelve months to June 30, 2026, Vertiv’s free cash flow came to 25.5% of revenue. That compares with 18.6% at Emerson Electric, the highest of the three peers Trefis tracks for the company. So Vertiv turns more of each dollar of sales into cash than any of those peers, though part of that cash is deposits customers paid ahead of the sales.

Are The Delays Vertiv Reported In July Only Timing?

So far, management says they are. On the July 29 call, management described minor timing shifts in second-quarter revenue, mainly from multiphase project execution and temporary supply chain dynamics. Revenue still reached $3.27 billion, up 24.1% from a year earlier. That growth was slower than in fiscal Q1 2026, when it was 30.1%.

Management also raised its full-year outlook and now expects 2026 net sales of $14 billion at the midpoint, up 37% from 2025. Asked on the call whether the delays would recur, management said Vertiv was still on a learning curve and had been prudent in its second-half outlook. Yet revenue in both quarters so far grew more slowly than the 37% the full-year outlook calls for, so the second half has to grow faster.

The deposits do not answer this worry. Upfront cash does not get a project delivered any faster, and management would not give the exact amount of revenue the delays pushed out. For now, the view that the delays are only timing is management’s own, backed by a raised outlook rather than by a reported result.

What Vertiv’s Cash Figure Leaves Out

Free cash flow does not show how much of the cash is customers’ money for work Vertiv has yet to finish. Management said its larger projects can carry several milestones before revenue is delivered, spanning from the order through design to the first shipped products. That cash arrives ahead of the sales, so it depends on new orders coming in. On the July 29 call, management said it expects another year of robust orders growth.

If orders slowed, fewer deposits would come in. If the delays turned into lost sales, the growth management expects for 2026 would shrink.

On the June quarter’s cash, customers are still paying ahead, while the view that the delays are only timing is management’s account. Management guided fiscal Q3 2026 net sales of $3.75 billion at the midpoint, up 40% from a year earlier. Those sales, for the quarter that ended September 30, 2026, are the number to watch when Vertiv reports that quarter.

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