On the company’s first-quarter earnings call Wednesday, CEO Marc Bitzer and North America president Juan Carlos Puente both reached for the same term to describe what the war in Iran has done to U.S. appliance demand. Industry shipments fell 7.4% in the first quarter, with March alone plunging 10%. “This level of industry decline is similar to what we have observed during the global financial crisis and even higher than during other recessionary periods,” Bitzer told analysts.

Puente, describing the segment’s results, said the North America business experienced “recession-level industry contractions, with discretionary demand down approximately 15%.”

The mechanism, executives explained, ran directly through consumer confidence. The war amplified already-elevated anxieties about the cost of living, sending the U.S. consumer sentiment index to the lowest level in 50 years in March. Whirlpool is acutely exposed to that kind of shock. Appliances are different, Bitzer noted, tied directly to how confident Americans feel about their financial future. “Ultimately, it’s a decision against the confidence the consumer has about the financial future,” he said. “It’s just a big-ticket item. It’s not a $50 purchase.” With discretionary demand down approximately 15% in the quarter, consumers who did buy were trading down to cheaper models rather than upgrading, compressing not just volume but mix.

One detail from Bitzer captured the depth of the pullback better than any chart: one of Whirlpool’s strongest businesses in Q1 was spare parts and repair. “Even consumers are holding back replacing product and rather repairing it,” he said.

The damage

Whirlpool reported an ongoing EBIT margin of just 1.3% and ongoing earnings per share of -$0.56, further dented by approximately $0.32 from a non-cash loss tied to its minority stake in Beko Europe, a leading global home appliance manufacturer. Free cash flow was negative $896 million. MDA North America, the company’s core business, delivered break-even performance after the company was forced to cut production volume 20% year-over-year to work down excess inventory, a move that cost roughly $60 million in the quarter alone.

“The combination of dropping consumer sentiment, decline of consumer demand, and the irrational industry pricing created an almost perfect storm during this first quarter,” Bitzer said.

The response

Whirlpool isn’t waiting. On April 17, the company announced what Bitzer called the largest price increase in more than a decade. “Honestly, three decades in the company, I’ve not seen that level of price increase,” he said. The action comes in two steps: a price increase of more than 10% already in effect, followed by a list price increase of approximately 4% taking effect July 9. The company is also pulling back on promotional weeks—two weeks for July 4th instead of the usual three—and skipping select house promotions entirely.

Alongside pricing, Whirlpool is executing $150 million-plus in cost takeouts for 2026, anchored by a $60 million investment in a new Perrysburg, Ohio factory (its 11th in the U.S.), a multi-year modernization of its Amana, Iowa plant, and a production shift from Argentina to its Rio Claro facility in Brazil. Those manufacturing moves are expected to deliver roughly $45 million in 2026 savings and $120 million in annualized EBIT benefits over time.

The company also raised $1.1 billion through an equity offering and used the proceeds to pay down more than $900 million of debt. And in perhaps the most visible sign of the moment’s severity, Whirlpool’s board suspended the quarterly dividend starting in Q2. “To suspend the dividend is a very, very painful decision,” Bitzer said, adding that resumption would require improved operating margins and continued debt reduction.

What comes next

Bitzer said April showed slight improvement from March’s cliff-edge drop, but demand remained negative, and he expects soft volumes and mix pressure to persist through Q2 and Q3.

Not everything is in crisis. The KitchenAid small appliances segment (the SDA Global business) delivered 10% revenue growth and a 21% EBIT margin in Q1, its sixth consecutive quarter of year-over-year revenue growth. And Bitzer noted that the updated Section 232 tariff framework, which now imposes a flat 25% tariff on the full declared value of every imported appliance, gives Whirlpool, which manufactures roughly 80% of what it sells in the U.S. domestically, a structural competitive advantage it has long sought.

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.