German heat pump sales grew 40% year-on-year in the first half of 2026 to 195,000 units, according to the German heat pump association (BWP). Germany is one of NIBE's most important end-markets, and we view this as a strong data point. In addition, we have noted several other supportive market statistics over the past weeks. Taken together, these data points support our view of a continued recovery in the European heat pump market ahead of NIBE's Q2 report.

Supportive data points across Europe's key markets

BWP points to rising consumer awareness of the risks of fossil-fuel dependence and to the government's commitment to continue the building efficiency subsidy program (BEG) through 2030 as the key drivers behind the 40% growth. Forward-looking indicators point in the same direction, as subsidy applications showed a strong increase in both April (+44% y/y) and May (+64% y/y), supporting continued growth. Germany saw one of the sharpest declines during the 2024 industry downturn, so the strength of the rebound is particularly encouraging given the market's weight in NIBE's Climate Solutions business.

Also in Sweden, data last week showed heat pump sales up 14% in Q2'26, with ground-source units up 22% and air-to-water up 14%. An important explanation is the country's extensive installed base. Many systems installed in the 1990s and 2000s have now reached an age when they need to be replaced. This replacement market constitutes an increasingly large share of sales and contributes to a steady demand over time, a dynamic that reduces the market's cyclicality and underpins volumes even in a more subdued new-build environment.

Industry data in the Netherlands likewise showed growth, albeit at a more moderate pace. According to Vereniging Warmtepompen, 238,548 residential heat pumps were sold in the first half of 2026, 6% more than in the same period of 2025, with growth led by air-to-water units.

We have also noted positive commentary from peers in their Q2 reports. Carrier reported that residential sales increased by high single digits in Europe, with heat pump sales up around 20%, citing high natural-gas prices and Germany's continued subsidies as favorable market factors. The Italian heating group Ariston likewise grew its European sales by 8% in Q2'26, citing strong organic growth in most countries, especially in Germany, and continued growth in heat pumps.

Taken together, we view these data points positively, as they support our view of a continued recovery in the European heat pump market. NIBE reports its Q2 earnings on August 21, 2026, which will provide the next concrete read on how much of this improving market momentum is translating into the company's own volumes.