Total Revenue (Net Sales)

–25.6% decline (Q1 2025: $5.954B vs. Q1 2024: $8.003B)

Falling demand and unfavorable market conditions reduced overall sales compared to the prior period, with notable weakness in segments (e.g. Transportation & Electronics) offsetting stable performance in Safety & Industrial. This decline reflects a shift from the higher revenue levels recorded in Q1 2024. " "

Operating Income

–17% decline (Q1 2025: $1,246M vs. Q1 2024: $1,501M)

Lower sales volumes and compression of margins from weaker overall revenue contributed to a decline in operating income versus the previous year, despite ongoing efforts to control costs. The drop underscores how operating performance deteriorated in Q1 2025 relative to the stronger Q1 2024 results. " "

Net Income from Continuing Operations

+20.5% increase (Q1 2025: $1,116M vs. Q1 2024: $928M)

A reduction in special item charges, better tax management, and improved profitability helped drive higher net income despite lower revenues. These factors reversed the lower net results in Q1 2024 by mitigating one-time expenses and enhancing bottom‐line performance. " "

Other Expense (Income), Net

Reversed to –$139M in Q1 2025 vs. –$264M in Q1 2024

A dramatic reversal in non-operating factors—including lower interest expense and improved net interest income—resulted in a $403M improvement compared to the prior period’s expense. This shift highlights better management of financing costs and adjustments relative to Q1 2024. " "

Safety and Industrial Revenue

+0.5% increase (Q1 2025: $2,745M vs. Q1 2024: $2,732M)

Stable performance in this segment was marked by modest organic gains that were offset by currency and mix impacts, maintaining nearly flat revenue levels similar to Q1 2024. This reflects ongoing stability amid mixed industry demand. " "

Transportation and Electronics Revenue

–5.4% decline (Q1 2025: $1,990M vs. Q1 2024: $2,104M)

A notable decline driven by lower demand in high-tech and automotive markets contributed to a 5.4% reduction in revenue. This underperformance contrasts with previously higher Q1 2024 figures and is indicative of challenges such as weaker OEM build rates and market dynamics. " "

Cash and Cash Equivalents

Increased from $5,600M (Q4 2024) to $6,326M (Q1 2025)

Enhanced liquidity resulted from a strong net inflow through investing activities, particularly from marketable securities transactions, which improved cash balances relative to the end of FY 2024. This reflects proactive cash management contrasting with the lower liquidity position at the close of the previous period. " "

Net Cash Provided by Operating Activities

Swing to –$79M in Q1 2025 from $1,818M in Q4 2024

A sharp deterioration in operating cash flows is evident as the metric turned negative. This suggests temporary working capital challenges and lower cash conversion, contrasting with the robust inflow in Q4 2024 and raising caution about the sustainability of operating cash generation in Q1 2025. " "

Adjusted EPS

FY 2025

$7.60 to $7.90 "

$7.60 to $7.90 " "

no change

Organic Sales Growth

FY 2025

2% to 3% "

Trending towards the lower end of 2% to 3% "

no change

Free Cash Flow Conversion

FY 2025

Approximately 100% "

Approximately 100% adjusted free cash flow conversion expected "

no change

Operating Margins

FY 2025

Expected expansion of 130 to 190 basis points "

Expectation of upside toward the midpoint of the margin guidance range "

raised

Share Repurchases

FY 2025

Approximately $1.5 billion "

Increased to $2 billion "

raised

Tariff Impact

FY 2025

no prior guidance

$0.60 gross headwind and $0.30 net headwind " "

no prior guidance

Operational Performance & Margin Expansion

In Q4 2024, Q3 2024, and Q2 2024 the discussion centered on strong EPS contributions, consistent volume leverage, productivity initiatives, restructuring benefits, and clear drivers behind margin expansion – with detailed breakdowns of basis point improvements and operating margin drivers. " " " " "

Q1 2025 highlighted a robust start with adjusted EPS of $1.88, organic sales growth across groups, and operating margins up by 220 bps. There was emphasis on operational excellence, productivity improvements, and cost control driving margin expansion. " " " "

Consistent focus with improved performance: The messaging remains centered on margin expansion and operational performance, with the most recent period demonstrating slightly improved sentiment and a clear execution emphasis.

Supply Chain & Inventory Management

Across Q4 2024, Q3 2024, and Q2 2024, discussions focused on inventory reduction, improvements in OTIF and OEE, supply chain complexity remediation, supplier consolidation and performance, and cost‐and‐waste reduction measures. Details included inventory days reductions, productivity benefits from supply chain initiatives and establishing new forecasting processes. " " "

Q1 2025 emphasized increased OTIF (reaching 89%), a 10x improvement in OEE deployment to 58%, active tactical management of 90 days of inventory, tighter supply chain–commercial alignment, and proactive tariff mitigation within the supply chain. " " "

Enhanced operational alignment: The focus remains consistent but with stronger demonstrated improvements and proactive measures, suggesting a more efficient, aligned supply chain management approach.

Tariff Mitigation & Exposure

In Q4 2024, tariffs were mentioned in the context of modest front‐loading in China and potential impacts on industrial demand. Q3 2024 and Q2 2024 did not include specific discussions on tariffs. " "

Q1 2025 provided a detailed set of mitigation strategies including adjustments in sourcing, logistics actions, selective pricing, and leveraging the U.S. footprint. It also quantified tariff exposure at about $850 million annually with specific EPS impact estimates. " " " " "

New level of detail: Previously less emphasized, tariff issues have become a major discussion point in Q1 2025 with a more granular and proactive mitigation strategy.

PFAS Costs & Legal Liabilities

Q4 2024 and Q3 2024 discussions covered PFAS stranded costs impacting margins, insurance recoveries, legal liability settlements (e.g. $3 billion reserve), and plans for exiting PFAS manufacturing. Q2 2024 emphasized legal management, exit plans, and litigation along with associated cash flow implications. " " " " " " " " " "

Q1 2025 focused on PFAS stranded costs affecting the Transportation and Electronics Business Group margins and noted that incremental stranded costs from the exit of PFAS manufacturing would continue to weigh on margins in near‐term Q1/Q2, with no new legal liability details provided. " " "

Stable yet shifting focus: While the PFAS challenge is ongoing, the latest period emphasizes the operational cost impact more than legal liabilities, suggesting a slight shift from litigation to cost management.

Innovation & New Product Pipeline

In Q2 2024, the tone was reflective with concerns over a declining new product pipeline due to resource diversion and aging products. Q3 2024 noted efforts to reinvigorate the pipeline with process improvements and increasing new product introductions, while Q4 2024 showcased increased launches, improved governance, and a push toward higher-impact products. " " " " " " " "

Q1 2025 announced a strong acceleration with 62 new products launched—a 60% increase year-on-year—improved on-time launch performance (over 70%), and ambitious pipeline goals for 2025 and beyond, with a clear commitment to boosting sales from new product introductions. "

Renewed innovation momentum: The narrative has turned from recovery to acceleration, with more positive sentiment and clear targets to revitalize and expand the new product pipeline.

China Market Dynamics

Across Q2, Q3, and Q4 2024, China was consistently noted as contributing around 10% of global revenue. Earlier calls reported double-digit growth in certain segments, a mix of domestic and export contributions, and concerns about a potential slowdown and tariff impacts. " " "

Q1 2025 described China’s contribution remaining at 10% of sales with mid-single digit growth driven by industrial and electronics segments, active mitigation of tariff impacts, and minimal pre-buy adjustments, showing a stable yet proactive approach. " " " "

Stable with proactive adjustments: China remains a key market with steady performance; however, proactive measures to offset tariff and demand challenges indicate a well-managed outlook.

Automotive Demand Trends

Q2 2024 highlighted strong growth in the auto OEM business in H1 that was later moderated by caution for H2. Q3 2024 noted a mid-single-digit decline in some regions but a year-to-date outperformance against global build rates, and Q4 2024 reported flat to slightly declining builds in core regions with mixed regional performance and strategic repositioning. " " " " " "

Q1 2025 showed a more pronounced weakness in auto OEM demand with mid-single digit declines overall, significant downturns in the U.S. and Europe (high single digits down), while China held modest growth. This underscores persistent headwinds in mature markets. " " " "

Growing caution in mature markets: Although auto demand remains a strategic market, the recent narrative points to increasing weakness in key regions, suggesting mounting macro headwinds.

External Economic Uncertainty & Cost Pressures

In Q2 2024, discussions pointed to macro uncertainties including soft consumer spending, FX impacts, and cost pressures from stock-based compensation, wages, and inefficiencies in the supply chain. Q3 2024 reinforced concerns around inflation, wage pressures, and FX volatility while emphasizing positive pricing actions. " " " " " " "

Q1 2025 detailed significant tariff impacts, a softer macroeconomic outlook with GDP revisions, and emphasized the integration of cost control measures, selective pricing, and other mitigation strategies. While uncertainties remain, the company stressed robust operational performance to manage these pressures. " " " "

Sharpened focus amid uncertainty: The economic uncertainty remains a constant theme, yet Q1 2025 placed greater emphasis on quantifying and addressing external cost pressures, reflecting a more defensive posture.