HVAC Shipments Inch Up After Nine Months of Declines — Is the Market Finally Turning?

After nine straight months of declining shipments, US combined central air conditioning and air-source heat pump unit volumes ticked upward in February 2026, reaching nearly 639,000 units. The question the entire HVAC industry is asking is not whether the number moved — it's whether this is the beginning of a genuine recovery or a statistical blip in an ongoing correction.

The honest answer, backed by the data, is: cautious optimism is warranted, but the recovery will be slow. Here is the full breakdown of what the February numbers mean and what to watch for in the months ahead.

The February 2026 Shipment Numbers Unpacked

The Air-Conditioning, Heating, and Refrigeration Institute reported combined US shipments of central air conditioners and air-source heat pumps of approximately 639,000 units in February 2026. This represented a year-over-year improvement from February 2025 — the first positive comparison the residential cooling and heat pump segment had posted since the spring of the prior year.

February is not a high-volume shipping month. The cooling season has not started, and the data represents early stocking activity by distributors preparing for spring demand rather than installation activity. Reading too much into a single month is a mistake. What matters is the directional change after nine consecutive months of decline.

US combined shipments of central air conditioners and air-source heat pumps totalled approximately 639,000 units in February 2026 — the first year-over-year increase in nearly nine months, according to AHRI data.

What Drove Nine Months of Declines

To understand the February uptick, you need to understand what drove the preceding nine months of contraction. The declines were not primarily driven by weak consumer demand — homeowners still need HVAC equipment. They were driven by three overlapping factors:

• Channel inventory overhang: During the supply chain disruptions of 2021 and 2022, distributors and contractors over-ordered equipment to protect against stock-outs. By mid-2024, the channel was saturated. Distributors were working down existing inventory rather than placing new factory orders, which suppressed shipment figures even as end-user demand remained stable.

• Price shock at the consumer level: With average residential system replacement costs now running $12,000 to $15,000 — compared to $6,000 to $8,000 in 2019 — a segment of homeowners who would have replaced ageing equipment chose instead to repair and defer. This reduced the total number of replacement transactions reaching distributors and manufacturers.

• Regulatory transition uncertainty: The A2L refrigerant transition created uncertainty around which equipment models would be available, at what price, and with what service requirements. Some contractors and distributors held back on large orders while the market sorted out the supply of R-454B and compatible equipment.

The Bullwhip Effect and How It Distorts the Picture

HVAC market analysts frequently reference the bullwhip effect when discussing shipment data — and it is essential context for reading any monthly AHRI figure. The bullwhip effect describes how small changes in end-user demand create amplified swings in orders as they travel up the supply chain from consumer to contractor to distributor to manufacturer.

When a distributor reduces orders to work down inventory, factory shipment data can show declines far larger than what is actually happening at the consumer level. Conversely, when distributors begin restocking, shipment data can show recoveries that look sharper than the underlying consumer market supports.

The February 2026 uptick likely reflects a combination of genuine demand improvement and the beginning of distributor restocking as channel inventory reaches more normal levels. Disentangling the two requires watching several more months of data.

What OEMs Are Forecasting for the Rest of 2026

Original equipment manufacturers have been careful in their public guidance about 2026. The consensus view across major manufacturers is stabilisation rather than recovery — meaning the market is expected to stop declining but not to bounce strongly back to 2022 or 2023 peak levels.

The factors supporting stabilisation include declining channel inventory, the approaching replacement cycle for equipment installed during the 2015 to 2017 build boom, and the eventual return of the deferred-replacement consumers who have been repairing rather than replacing since 2023. The factors that limit a strong recovery include still-elevated equipment prices, a housing market that has slowed new construction, and persistent interest rate pressure on homeowner spending.

JPMorgan's HVAC sector analyst, one of the most closely followed voices in the investment community, has described the 2026 residential market as a "trough year" with recovery expected to build through 2027. That framing aligns with the OEM consensus.

What the Data Means for Contractors Right Now

For HVAC contractors, the February shipment data has practical implications:

• Equipment availability should improve. As channel inventory normalises and manufacturers calibrate production to actual demand, the supply disruptions that plagued the A2L transition should ease through the second half of 2026.

• The repair market remains strong. While replacement demand stabilises, repair revenue as a share of total HVAC revenue hit 31.3% in Q4 2025 — the highest level in recent history. Contractors who have built repair capacity are outperforming those focused primarily on installation.

• Pricing pressure is real. With the replacement market soft, contractors report increased price sensitivity from consumers. Transparent quoting, financing options, and strong service agreement programmes are the most effective tools for maintaining revenue in this environment.

Frequently Asked Questions

What are HVAC shipments?

HVAC shipments refer to the number of units shipped from manufacturers to distributors and dealers, as tracked by the Air-Conditioning, Heating, and Refrigeration Institute. Shipment data is a leading indicator of industry activity but differs from installation data, which lags by weeks or months.

Why did HVAC shipments decline for nine months?

The nine-month shipment decline reflected a combination of channel inventory overhang from over-ordering during supply chain disruptions, consumer price shock from equipment costs nearly doubling since 2019, and uncertainty around the A2L refrigerant transition.

Is the HVAC market recovering in 2026?

February 2026 showed the first year-over-year shipment increase in nine months. Industry consensus points to stabilisation in 2026, with a more meaningful recovery expected in 2027 as deferred replacements re-enter the market and channel inventory normalises.

What is the bullwhip effect in HVAC?

The bullwhip effect describes how small changes in consumer demand create amplified swings in factory orders as they travel up the supply chain. In HVAC, it means shipment data from manufacturers can show larger swings than actual end-user demand justifies, making monthly figures difficult to interpret in isolation.