The surge in **Cash and Equivalents** in **Q3 2023** was primarily driven by the **Copeland transaction**, where the company received **$9.7 billion in upfront cash** (approximately **$8 billion after tax**) from the sale of its **Climate Technologies business (Copeland)** on **May 31, 2023**.  **[0000032604-23-000037_emr-20230630.htm:3]** **[EMR_3288816_1]** 

What drove the surge in Cash and Equivalents in Q3 2023?

The sharp drop in **Cash and Equivalents** in Q1 2024 was primarily driven by acquisition activity. Emerson spent **$8,339 million** on acquiring businesses during the quarter, which significantly reduced its cash balance. Although the company raised **$2,647 million** through short-term borrowings and generated **$444 million** from operating activities, these inflows were not enough to offset the acquisition-related cash outlay. Additionally, the company incurred further outflows with **$77 million** in capital expenditures and **$175 million** spent on repurchasing common stock.  **[0000032604-24-000004_a2024q1release_ex991.htm:3]** 

Why did Cash and Equivalents drop sharply in Q1 2024?

The spike in short-term borrowings in Q1 2024 was primarily due to a significant increase in short-term borrowings, which escalated from **$547 million** to **$3,227 million** – a net increase of **$2,647 million**. This surge was largely driven by financing activities that supported the company's business acquisitions, where EMR spent **$8,339 million** on the purchases of businesses, net of cash acquired.  **[0000032604-24-000008_emr-20231231.htm:3]** **[0000032604-24-000004_a2024q1release_ex991.htm:3]** **[0000032604-24-000008_emr-20231231.htm:4]** 

What caused the spike in short-term borrowings in Q1 2024?

The massive increase in Additional Paid-in-Capital in Q1 2024 is explained by the fact that it rose from **$62 million** at the beginning of the quarter to **$158 million** at the end of the quarter. This change was primarily driven by **contributions from stock plans which added $51 million** during the quarter, partly offset by **AspenTech’s purchases of common stock which reduced the balance by $33 million**.  **[0000032604-24-000024_emr-20240331.htm:3]** 

What explains the massive increase in Additional Paid-in-Capital in Q1 2024?

decc602da676d902e4e58d6174fef14ce1ec8ed589987f72579e79db3d20e29a

Earnings from continuing operations in Q3 2024 dropped due to a combination of factors. **Emerson recorded a significant pretax loss of $279 million from the Copeland Note Receivable transaction** – a loss that had a major impact on its results. Additionally, there was **a sharp increase in amortization of intangibles** (rising from $169 million to $313 million) driven by its Test & Measurement acquisition and **increased restructuring costs** (rising from $13 million to $60 million). Moreover, **SG&A expenses jumped by $212 million** due to the same acquisition and other operational costs, while **other deductions also increased substantially**. These elements collectively led to the noticeable decline in earnings from continuing operations for that quarter.  **[20240807NY77962:7]** **[0000032604-24-000036_emr-20240630.htm:23]** 

Why did earnings from continuing operations drop in Q3 2024?

The sharp decline in net earnings for common stockholders in Q3 2024 was primarily driven by a **significant loss on the Copeland Note Receivable** (a pretax loss of **$279 million**, or **$217 million after-tax**), a substantial **increase in the amortization of intangibles** (rising from **$120 million** in 2023 to **$264 million** in 2024), increased **restructuring costs** (rising from **$12 million** in 2023 to **$57 million** in 2024), and notably higher **other deductions, net** (which grew from **$130 million** in 2023 to **$294 million** in 2024).  **[0000032604-24-000036_emr-20240630.htm:23]** 

What factors contributed to the sharp decline in net earnings for common stockholders in Q3 2024?

The increase in cost of sales in Q4 2024 was primarily driven by **higher sales volume**, the **acquisition of the Test & Measurement business**, and a **$231 million acquisition-related inventory step-up amortization** that reduced gross margins by approximately **1.3 percentage points**.  **[0000032604-24-000041_emr-20240930.htm:39]** 

What drove the increase in cost of sales in Q4 2024?

323aa16baed8a976f1e9877e40ee57b100535475827587873e61cfba6f622682

Emerson Electric Co.'s operating cash flow jumped dramatically in **FY 2024** mainly due to **higher earnings from continuing operations** after excluding non‐cash items, a **significant reduction in income tax payments** (eliminating a roughly **$2.3 billion** cash drain seen in FY 2023), and improved **working capital management**. In addition, the positive **contribution from AspenTech** and increased **non-cash adjustments** (such as higher depreciation and amortization, and the impact of the loss on the Copeland note receivable) also played key roles in this improvement.  **[0000032604-24-000041_emr-20240930.htm:57]** **[0000032604-24-000041_emr-20240930.htm:46]** **[0000032604-24-000041_emr-20240930.htm:45]** 

What drove the dramatic jump in operating cash flow in FY 2024?

The higher **operating cash flow in Q3 2024** was driven by several factors. First, there was a significant adjustment to **net earnings**; a large gain from discontinued operations present in the previous period was excluded in Q3 2024, resulting in a substantial drop in reported earnings that was offset by other adjustments.  **[0000032604-24-000036_emr-20240630.htm:5]** **[0000032604-24-000035_a2024q3release_ex991.htm:3]**  Additionally, **depreciation and amortization** increased significantly, and the introduction of **amortization of acquisition-related inventory step-up** contributed positively.  **[0000032604-24-000036_emr-20240630.htm:5]** **[0000032604-24-000035_a2024q3release_ex991.htm:3]**  Furthermore, a **$279 million loss on the Copeland note receivable** was recorded, which was added back as a non-cash adjustment, and the negative impact of **changes in operating working capital** was reduced, indicating better management of working capital.  **[0000032604-24-000036_emr-20240630.htm:5]** **[0000032604-24-000035_a2024q3release_ex991.htm:3]**  Lastly, other adjustments, including **stock compensation and various non-cash items**, also played a part in raising the operating cash flow.  **[0000032604-24-000036_emr-20240630.htm:5]** **[0000032604-24-000035_a2024q3release_ex991.htm:3]** 

What factors contributed to the higher operating cash flow in Q3 2024?

The significant increase in operating cash flow in Q1 2025 compared to Q1 2024 was primarily due to **higher earnings** and **favorable receivables performance**. In addition, Q1 2024 experienced approximately **$100 million** of negative impact from acquisition-related costs and integration activities, which further widened the gap between the two periods.  **[0000032604-25-000012_emr-20241231.htm:4]** **[20250205NY11583:2]** **[0000032604-25-000012_emr-20241231.htm:21]** 

Why did operating cash flow nearly double in Q1 2025 compared to Q1 2024?

The documents do not provide any definitive information regarding a substantial improvement in free cash flow in Q3 2024. They only discuss factors affecting the ending cash and equivalents, including significant investing, financing, and operating activities in Q3 2024.  **[20240807NY77962:3]** **[0000032604-24-000035_a2024q3release_ex991.htm:3]** 

What drove the substantial improvement in free cash flow in Q3 2024?

The provided documents do not specifically address the change in **free cash flow** or offer a direct comparison of free cash flow between Q1 2024 and Q1 2025. They only explain the factors affecting **Ending Cash and Equivalents** in Q1 2025, which include strong operating cash inflows, significant outflows for financing activities, and minor impacts from investing activities and exchange rate changes.  **[20250205NY11583:0]** **[0000032604-25-000012_emr-20241231.htm:4]**  Without additional data explicitly discussing free cash flow, we cannot definitively explain why it nearly doubled in Q1 2025 compared to Q1 2024.

Why did free cash flow nearly double in Q1 2025 compared to Q1 2024?

08c9c240856fe1d0becdadfb716585068ea62512ca350586de14a442fef0759a

Net sales (USD, millions)

Cost of sales (USD, millions)

Selling, general and administrative expenses (USD, millions)

Other deductions, net (USD, millions)

Interest expense, net (USD, millions)

Interest income from related party (USD, millions)

Earnings from continuing operations before income taxes (USD, millions)

Income taxes (USD, millions)

Earnings from continuing operations (USD, millions)

Discontinued operations, net of tax (USD, millions)

Net earnings (USD, millions)

Less: Noncontrolling interests in subsidiaries (USD, millions)

Net earnings common stockholders (USD, millions)

Gain on subordinated interest (USD, millions)

1cfb6373b55afaca246747079252265aa62af41f3ece75116ba2a2ed4b2dab6e

Earnings from discontinued operations, net of tax (USD, millions)

Depreciation and amortization (USD, millions)

Stock compensation (USD, millions)

Amortization of acquisition-related inventory step-up (USD, millions)

Changes in operating working capital (USD, millions)

Other, net - Operating activities (USD, millions)

Cash from continuing operations - Operating activities (USD, millions)

Cash from discontinued operations - Operating activities (USD, millions)

Cash provided by operating activities (USD, millions)

Capital expenditures (USD, millions)

Purchases of businesses, net of cash and equivalents acquired (USD, millions)

Other, net - Investing activities (USD, millions)

Cash from continuing operations - Investing activities (USD, millions)

Cash from discontinued operations - Investing activities (USD, millions)

Cash used in investing activities (USD, millions)

Net increase in short-term borrowings (USD, millions)

Dividends paid (USD, millions)

Purchases of common stock (USD, millions)

AspenTech purchases of common stock (USD, millions)

Other, net - Financing activities (USD, millions)

Cash provided by (used in) financing activities (USD, millions)

Effect of exchange rate changes on cash and equivalents (USD, millions)

Decrease in cash and equivalents (USD, millions)

Beginning cash and equivalents (USD, millions)

Ending cash and equivalents (USD, millions)

2dad238091a3c692dd3b93f105b4552284df1fa5541dcbaa50a9a525be4ce0aa

Cash and Equivalents (USD, millions)

Receivables, less allowances (USD, millions)

Inventories (USD, millions)

Other Current Assets (USD, millions)

Total Current Assets (USD, millions)

Property, Plant and Equipment, net (USD, millions)

Goodwill (USD, millions)

Other Intangible Assets (USD, millions)

Other Assets (USD, millions)

Total Assets (USD, millions)

Short-term borrowings and current maturities of long-term debt (USD, millions)

Accounts Payable (USD, millions)

Accrued Expenses (USD, millions)

Total Current Liabilities (USD, millions)

Long-term Debt (USD, millions)

Other Liabilities (USD, millions)

Common Stockholders’ Equity (USD, millions)

Noncontrolling Interests in Subsidiaries (USD, millions)

Total Equity (USD, millions)

Total Liabilities and Equity (USD, millions)

b473a4301efa93e58300207d36a0013fbf17014c377efaad29eb21abc41f7326

454ebabf79b7bdc8e04e650948d7569f290e87e325b62cd1e44987d6f7276d14

32b6998a4cca900be81a801edabe47fe0b9b01caef083e28af47ce9342eefb9c

Adjustments for Non-Cash Items (USD, M)

Stock-Based Compensation (USD, M)

Changes in Working Capital (USD, M)

Capital Expenditures (USD, M)

Proceeds from / Repayments of Debt (USD, M)

Share Repurchases (USD, M)

Dividend Payments (USD, M)

Net Change in Cash (USD, M)

b7e80ae01a02f4ebad1ae2204f538a4e3f23ef035425f0212a4f57995d160794

Consolidated Order Backlog (USD billions)

Order Backlog for AspenTech (USD billions)

Backlog for Intelligent Devices (USD millions)

Backlog for Software and Control (USD millions)

Total Backlog (USD millions)

3cabc716e793060c067db5ba2937217045791026939f0302cd6ebfa2e1c7efc5

234fa99492ebe97fe07886bf2eefe8dd9e765022d170f4e156c01b1305e8cd6b

Americas

AMEA

Europe

- United States

- China

United States and Canada

Asia

Latin America

Middle East/Africa

Total Revenue

c626c4d6009843807c0c339fc82e3e639e7f617c6c4fec5012ff9a0561777176

EMERSON ELECTRIC (EMR)

Financials