Tracking the Heat Pump & Water Heater Market in the United States

This data hub spotlights publicly available national HVAC and water heating shipment data from the Air Conditioning, Heating, & Refrigeration Institute (AHRI). Heat pump appliances play a vital role in the clean energy transition and lowering building emissions due to their ability to efficiently provide heating and cooling while replacing the use of on-site fossil fuels. Monthly charts reflect the average of the previous 12 months to remove seasonal variations. This page will be updated every 3 months.

Last updated: May 2026

Tracking Period: April 2025–March 2026

Heat Pumps for Space Heating

Heat pumps have outsold gas furnaces consistently since 2021. In 2025, manufacturers shipped 12% more heat pumps than gas furnaces (3.6M units versus 3.2M units). Heat pumps are averaging 3.9 million sales this decade, compared to 3.5 million average annual sales of gas furnaces.

Market factors continue to influence heat pump sales. All residential and light commercial air conditioners and heat pumps manufactured after January 1st, 2025 must use A2L refrigerants. This phase-in may have contributed to a surge in heat pump sales in 2024, as manufacturers rushed to ship systems using R-410a refrigerant to distributors and customers. The transition has introduced uncertainty into the HVAC market, with reports of shortages of A2L refrigerants, but heat pumps outsold gas furnaces in 2025 despite the uncertainty.

Over the past 20 years, annual heat pump sales have increased by 70% whereas gas furnace sales have decreased by 7%.

Heat Pumps for Cooling

Heat pumps are a two-in-one heating and cooling solution. Buyers of cooling equipment typically choose between heat pumps and traditional, one-way air conditioners. Over the past 10 years, heat pumps have increased in monthly market share of residential cooling equipment from 33% to 47%. In 2025, heat pumps made up 47% of cooling equipment sales, and for the first time ever, outsold one-way ACs in October, November, and December.

Water Heaters

Electric water heaters continue to make up the majority of both residential and commercial water heater shipments, maintaining a market share of 54% between 2024 and 2025. Electric water heaters had their second best sales month ever in December 2025 after setting the record in March 2025. The water heater market is generally less volatile than the space heating market.

While shipment and market share data is more limited specifically for heat pump water heaters, ENERGY STAR data suggests that heat pump water heaters made up 4% of residential electric water heater sales in 2023. ENERGY STAR data collection for 2024 and 2025 have not been published, and a release date has not been announced. The charts below will be updated when the data are available. 

Notes

• The term “sales” in these charts refer to shipments of equipment by manufacturers, which may not perfectly match product sales and installations in a given time period.
• Heat pump sales numbers are based on outdoor condensing units sold. Systems with multiple indoor heads but one outdoor condenser are counted as one unit.
• One-way air conditioning shipments count central units only (for example, they exclude window A/C units).
• Not all HVAC sales become a primary heating system: some homes use multiple heat pumps and/or multiple furnaces. EIA RECS data from 2015–202 suggests that 35% of heat pump sales replace an existing system, 30% become a new primary heating system, and 35% become a secondary heating system.
• Market share refers to the share of equipment in terms of annual shipments.
• The water heater market trends compare electric to gas water heaters, as data on heat pump water heaters is unavailable on a quarterly basis.
• These graphics are based on AHRI shipment data, which may not capture commercial space heating systems. We did not include less common fuel types including electric resistance, propane, wood, and gas boiler systems.