EMERSON ELECTRIC (EMR) Company Report

Order intake accelerated, with trailing 3-month orders up 9% and backlog growth of 9%, driven by five growth vectors: power generation, LNG, semiconductors, life sciences, and aerospace & defense, led by the U.S. and select international markets.
2026 software ACV grew 9% in Q1, with expectations for high single-digit growth in Q2 and 10%+ for full-year 2026, despite a 2-point headwind from first-half software renewals.
Organic sales guidance assumes mid-single-digit underlying order rates, with no recovery expected in China and continued weakness in Europe factored into the outlook.
Pricing remains positive, with 2.5 points of price realization planned, supporting a 52%+ gross margin, and operating leverage targets of 40% on incremental profit improvements.
Capital allocation prioritizes dividends and share buybacks, while pursuing only strategic bolt-on M&A to support growth in key verticals.

4 days ago

Transcript

Emerson Electric outlines strong order growth and 2026 guidance

EMR

Guidance Update

Revenue Acceleration/Inflection

Emerson reported a 9% increase in trailing three-month orders and 6% in trailing twelve-month orders, with backlog up 9%, driven by strength in five growth verticals—LNG, semiconductors, life sciences, aerospace & defense—and concentrated in the US and Arabian Peninsula.
Management reiterated organic sales guidance assuming mid-single-digit underlying order rates (after a 2% software renewal drag) and acceleration in the back half of fiscal 2026, explicitly excluding reliance on a China recovery or European macro rebound.
The software business, with $1.6 billion in annual contract value, grew ACV by 9% in Q1 and is expected to deliver high-single-digit ACV growth in Q2 and 10%+ growth for full-year 2026, boosted by AI-enabled solutions like the Nigel Virtual Advisor.
Emerson aims for 40% operating leverage and 240 basis points of margin expansion, underpinned by 2.5% annual pricing power and productivity initiatives despite ongoing cost inflation.
Capital allocation will prioritize dividends and share repurchases, with selective bolt-on M&A in key verticals while maintaining a disciplined approach to sustain 4-7% through-cycle growth.

4 days ago

Transcript

Emerson Electric outlines order momentum, market trends, and AI software strategy at Barclays conference

EMR

Guidance Update

New Projects/Investments

Emerson reported 9% trailing three-month order growth, 6% trailing twelve-month order growth and a 9% backlog increase, driven by five growth vectors (power gen/LNG, semiconductor, life sciences, aerospace & defense) across the U.S., Arabian Peninsula, Brazil, Japan and Southeast Asia; orders are expected to moderate to mid-single-digit levels, with no recovery assumed in China and continued weakness in Europe.
In the U.S., Ovation automation orders jumped 74% and total power business revenues rose 20%, fueled by data center modernizations, a cyclical semiconductor rebound, aerospace/defense/New Space opportunities and life sciences expansion, while automotive and bulk chemicals remain weak.
Emerson’s DeltaV control systems now operate over 50% of the world’s liquefied natural gas plants, and the current LNG investment wave—half of which is yet to be awarded—is larger than the first two waves combined, reinforcing its strategic position in global energy projects.
The company’s $1.6 billion annual contract value software business grew 9% in Q1, with high-single-digit growth expected in Q2 and >10% ACV growth forecast for 2026; Emerson cites three moats against AI threats (vertical domain expertise, real-time/traceability in regulated industries, usage-based pricing) and has secured over $100 million in quotations for its Virtual Advisor offerings.

4 days ago

Transcript

Emerson reports Q1 2026 results

EMR

Earnings

Guidance Update

Share Buyback

Emerson delivered $4.3B in Q1 sales, with 2% underlying sales growth and $1.46 adjusted EPS.
Adjusted segment EBITA margin was 27.7%, and free cash flow totaled $602M (13.9% margin).
Underlying orders grew 9% YoY, and annual contract value (ACV) reached $1.6B, up 9%.
Raised full-year 2026 guidance to ~5.5% sales growth (~4% underlying), ~28% adjusted EBITA margin, and $6.40–$6.55 adjusted EPS; plans ~$1B share repurchase and 5% dividend increase.

Feb 3, 2026, 9:30 PM

Presentation

Emerson reports Q1 2026 results

EMR

Earnings

Guidance Update

Share Buyback

Robust demand drove underlying orders up 9% year-over-year in Q1, marking four consecutive quarters of double-digit order growth.
Underlying sales rose 2% YoY, with an adjusted segment EBITDA margin of 27.7% and adjusted EPS of $1.46.
Annual Contract Value of software expanded 9% to $1.6 billion, reflecting continued strength in subscription-based offerings.
Emerson reaffirmed 2026 guidance: 5.5% sales growth, 4% underlying sales growth, ~28% EBITDA margin, and raised adjusted EPS to $6.40–$6.55.
Returned capital to shareholders via $250 million of share repurchases in Q1, part of a plan to deliver approximately $2.2 billion in dividends and buybacks.

Feb 3, 2026, 9:30 PM

Transcript

Emerson reports Q1 2026 results

EMR

Earnings

Guidance Update

Share Buyback

Underlying orders grew 9% in Q1, with backlog at $7.9 billion (up 9% yoy) and a book-to-bill of 1.13.
Underlying sales rose 2% yoy; test & measurement increased 11% and Ovation accelerated 20%; adjusted segment EBITDA margin was 27.7%, and adjusted EPS was $1.46.
Software Annual Contract Value reached $1.6 billion (up 9% yoy); next-generation Nigel AI and DeltaV version 16 were released to enhance software-enabled automation.
Completed $250 million of share repurchases in Q1; reaffirmed full-year guidance of 5.5% sales growth, ~28% EBITDA margin, and raised EPS to $6.40–$6.55; targeting $2.2 billion in shareholder returns.
Regional demand remained robust in North America, India, and the Middle East & Africa, while Europe and China continued to soften.

Feb 3, 2026, 9:30 PM

Transcript

Emerson reports Q1 2026 results

EMR

Earnings

Guidance Update

Share Buyback

Underlying orders grew 9%, and underlying sales increased 2% year-over-year.
Adjusted segment EBITDA margin was 27.7%, with adjusted EPS of $1.46, up 6% year-over-year.
Annual Contract Value of software reached $1.6 billion, up 9% year-over-year.
Free cash flow of $602 million (14% margin) and $250 million of share repurchases executed in Q1.
Full-year guidance reiterated: 5.5% sales growth (4% underlying), 28% EBITDA margin, $6.40–$6.55 EPS; Q2 EPS guided at $1.50–$1.55.

Feb 3, 2026, 9:30 PM

Transcript

Emerson reports Q1 2026 results and updates 2026 outlook

EMR

Earnings

Guidance Update

Dividends

Emerson reported Q1 FY2026 net sales of $4.346 billion (up 4% yoy), with underlying orders growth of 9% and underlying sales up 2%.
GAAP EPS was $1.07, and adjusted EPS was $1.46, increases of 5% and 6% year-over-year, respectively.
Q1 operating cash flow was $699 million and free cash flow was $602 million.
The quarterly dividend was set at $0.555 per share, payable March 10, 2026; Emerson plans to return ~$2.2 billion in 2026 through ~$1.0 billion in share repurchases and ~$1.2 billion in dividends.
For fiscal 2026, the company expects ~5.5% net sales growth, adjusted EPS of $6.40–$6.55, operating cash flow of $4.0–$4.1 billion, and free cash flow of $3.5–$3.6 billion.

Feb 3, 2026, 9:05 PM

8-K

Emerson reports Q1 2026 earnings and updates full-year guidance

EMR

Earnings

Guidance Update

Dividends

Emerson posted $4.346 billion in net sales in Q1 FY2026, up 4% year-over-year, with adjusted EPS of $1.46, a 6% increase.
The board declared a $0.555/share quarterly dividend payable March 10, 2026.
Fiscal 2026 guidance raised to ~5.5% net sales growth and $6.40–$6.55 in adjusted EPS.
Capital return includes ~$1 billion in share repurchases and $1.2 billion in dividends for FY 2026.

Feb 3, 2026, 9:05 PM

Press Release

Emerson AGM 2026 approves directors and compensation, rejects board declassification

EMR

Proxy Vote Outcomes

M&A

136th Annual Meeting of Shareholders held on February 3, 2026; a quorum was achieved with 495.4 million shares (88% of outstanding) represented in person or by proxy.
Shareholders voted on four proposals: election of three incumbent directors, advisory approval of FY 2025 executive compensation, ratification of KPMG LLP as independent auditor, and amendment to declassify the board.
All three director nominees elected, executive compensation approved by ~90%, and KPMG ratification approved by ~92%, while the proposal to declassify the board failed to reach the 85% threshold.
Executive review highlighted FY 2025 results: sales +3%, operating cash flow +11%, free cash flow +12%, EPS +43%, completion of Aspen Technology and National Instruments acquisitions, and Copeland divestiture.