Shares of A.O. Smith (AOS) are surging 5.24% in pre-market trading on Thursday following the company's impressive second-quarter earnings report and an upward revision of its full-year outlook. The water technology company has demonstrated resilience in a challenging economic environment, beating analyst expectations and showing promising growth prospects.

A.O. Smith reported second-quarter earnings per share (EPS) of $1.07, surpassing the analyst consensus estimate of $0.98 by 8.63%. This represents a slight increase from $1.06 per share in the same period last year. The company's quarterly revenue came in at $1.01 billion, exceeding analyst expectations of $995.11 million and only showing a marginal 1.27% decrease from the previous year's $1.02 billion.

In a move that has further bolstered investor confidence, A.O. Smith has raised its 2025 sales outlook to 1%-3% growth. The company now projects full-year adjusted earnings per share in the range of $3.70 to $3.90, reflecting optimism about its future performance. Additionally, A.O. Smith announced plans to spend $400 million on share repurchases in 2025, signaling confidence in its financial position and commitment to delivering shareholder value. The company also disclosed that it is conducting a formal assessment of its China business, which could potentially lead to strategic decisions in one of its key markets.