Appliance maker Whirlpool Corp. sees the U.S. housing market improving in the second half of 2023, specifically for
"I do believe you'll begin to see some improvement, or increases, in new housing as we head into the back half of the year," Chief Financial Officer Jim Peters said in an interview. "We're hearing optimistic stuff from the builders we deal with."
The issue is a central one for the company, which makes washers, dryers and refrigerators. Peters said that a new American home, on average, needs five new appliances. "Existing-home sales — I still think with where mortgage rates are and that — are probably going to be relatively stable," he said.
Peters said with the limited housing stock, some will turn to remodeling — and newer appliances — instead of purchasing a new house. "If people aren't going to be moving, they're going to be investing in their homes and they're going to do more remodels, and keep their existing lower mortgage."
Whirlpool, which owns the KitchenAid and Maytag brands, has seen softer demand in the past year as high levels of inflation have pressured spending — especially for more-expensive items like refrigerators and washing machines.
Quarterly Earnings
The shares rose 1.5% at 4:08 p.m. in late trading in New York after the release of second-quarter results. The company posted adjusted earnings that outpaced analysts' average estimate, while sales fell short. It reiterated its outlook for the full year.
The company also confirmed that it still expects raw-material inflation this year that's $300 million to $400 million lower than last year, driven mostly by steel and resin deflation.
Whirlpool attributed a decline in sales from a year earlier in part to promotions that are "near pre-pandemic levels" — a change from recent years when consumers were willing to pay full price on home goods. Peters said U.S. consumer spending has stabilized.
"The consumer is kind of in that wait-and-see type mode, but beginning to turn the corner," he said.
The company is focusing on its higher-margin, higher-growth brands. Whirlpool bought garbage-disposal maker InSinkErator last year, while it's getting out of other areas, including a major domestic appliance line in Europe.
