Watsco, Inc. ( WSO ) shares are trading lower on Tuesday after reporting second-quarter results.

The company reported quarterly earnings per share of $4.49, missing the street view of $4.67. Sales of $2.14 billion missed the analyst consensus of $2.19 billion.

Revenue increased 7% year over year (4% increase on a same-store basis). Gross profit increased 3% to $580 million, with 27.1% gross margin.

Second quarter sales reflect 6% growth in ducted residential units and a 3% increase in average selling price. In addition, sales of commercial products grew 8% during the quarter on top of the 18% growth achieved during the comparable period last year.

“We now look ahead to the next important regulatory transition and the introduction of new products by our OEM partners later this year,” said Albert H. Nahmad, Watsco’s Chairman and CEO.

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As of June-end, Watsco ( WSO ) had $425 million of cash and short-term investments and no borrowings under its unsecured $600 million credit facility, providing significant access to capital to invest in new growth opportunities.

“We are also prepared to partner with other great family businesses in our industry. Our scale, technology and entrepreneurial culture gives us confidence in the growth outlook,” Nahmad added.

Price Action: WSO shares are trading lower by 4.8% to $479.48 at last check Tuesday.

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