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nVent Electric plc (NVT)·Q1 2025 Earnings Summary

Executive Summary

  • Solid start to 2025: revenue up 11% to $809M, adjusted EPS up 10% to $0.67; both topped Wall Street consensus on revenue ($790M est) and EPS ($0.664 est). nVent raised FY25 sales and EPS guidance materially, incorporating Avail EPG and tariff impacts . Consensus values marked with * are from S&P Global (see Estimates Context).
  • Guidance raised: FY25 reported sales growth lifted to 19–21% (from 8–10%) and adjusted EPS to $3.03–$3.13 (from $2.98–$3.08), with organic growth to 5–7% (from 4–6%) .
  • Demand drivers: data centers and power utilities strength; backlog grew double digits sequentially in Q1, and organic orders rose mid-teens; Avail EPG (closed May 1) adds scale in electrical infrastructure with expected ~$0.05 FY25 EPS contribution (net) .
  • Offsets and risks: margin pressure from tariffs (~$120M headwind assumed for FY25) and near-term price/cost timing; Q2 margins guided down y/y but expected to improve in 2H as mitigations take hold .

What Went Well and What Went Wrong

  • What Went Well

    • Top-line and EPS beats with raised FY outlook; “double-digit growth in orders and sales” and backlog up double digits sequentially, providing visibility through the year .
    • Infrastructure vertical strength: data solutions and power utilities led growth; new products contributed >2 pts to sales, with 35 product launches in Q1 .
    • Portfolio transformation: Thermal Management sale completed ($1.7B proceeds expected ~$1.4B net) and Avail EPG acquisition ($975M) closed, further strengthening infrastructure exposure .

  • What Went Wrong

    • Margin compression: reported ROS fell 190 bps y/y; adjusted ROS down 130 bps y/y given tariff/investment timing and mix .
    • Price/cost timing from tariffs to weigh on Q2 profitability; Avail margins initially dilutive to reported margins (though accretive to EPS), with improvement planned over time .
    • Commercial/residential and some short-cycle exposure remains softer amid macro uncertainty and distribution inventory caution .

Financial Results

MetricQ1 2024Q4 2024Q1 2025
Revenue ($USD Millions)$732.1 $752.2 $809.3
Gross Margin (%)39.7% 39.8% 38.8%
Operating Income ($M)$131.9 $117.1 $130.0
Reported ROS (%)18.0% 15.6% 16.1%
Adjusted Operating Income ($M)$155.9 $158.3 $162.2
Adjusted ROS (%)21.3% 21.0% 20.0%
Diluted EPS – Continuing Ops (GAAP)$0.51 $(0.10) $0.52
Adjusted EPS – Continuing Ops$0.61 $0.59 $0.67

Vs. Estimates (S&P Global)

  • Revenue: Actual $809.3M vs $790.3M estimate* (beat) .
  • EPS: Actual $0.67 vs $0.664 estimate* (beat). Values marked with * are from S&P Global.

Segment Results (new segment names effective Q1 2025; legacy “Enclosures” now “Systems Protection,” “Electrical & Fastening” now “Electrical Connections”)

SegmentQ1 2024 Sales ($M)Q1 2025 Sales ($M)Adjusted ROS Q1 2024Adjusted ROS Q1 2025
Systems Protection$439.9 $508.2 21.6% 20.5%
Electrical Connections$292.2 $301.1 29.2% 28.3%
Total$732.1 $809.3 21.3% 20.0%

KPIs

KPIQ1 2024Q1 2025
Cash from Operations (cont. ops)$48.6M $63.9M
Free Cash Flow$33.6M $44.4M
Capex$15.3M $21.1M
Cash & Equivalents (end)$201.4M $1,343.0M
Net Interest Expense$22.2M $17.4M

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Reported Sales GrowthFY 2025+8% to +10% +19% to +21% Raised
Organic Sales GrowthFY 2025+4% to +6% +5% to +7% Raised
GAAP EPSFY 2025$2.45–$2.55 $2.48–$2.58 Raised
Adjusted EPSFY 2025$2.98–$3.08 $3.03–$3.13 Raised
Reported Sales GrowthQ2 2025—+22% to +24% Introduced
Organic Sales GrowthQ2 2025—+4% to +6% Introduced
GAAP EPSQ2 2025—$0.64–$0.66 Introduced
Adjusted EPSQ2 2025—$0.77–$0.79 Introduced
Net Interest ExpenseFY 2025~$60M ~$75M Raised
CapexFY 2025$75–$80M ~$100M Raised
Share CountFY 2025~166M ~165M Lower
Tax Rate (Adj.)FY 2025~22% Not updated in Q1 release/call—
Dividend2025$0.20 declared Feb 17 (paid May 9) $0.20 next payment Aug 1 Maintained

Notes:

  • FY25 guidance now includes tariff impacts; prior FY25 guide (Feb) had not yet reflected potential tariffs .
  • Avail EPG expected to add ~14 points to FY sales and ~$0.05 to FY EPS net; margin dilutive initially but accretive to top and bottom line .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3’24, Q4’24)Current Period (Q1’25)Trend
AI/Data Center Liquid CoolingNVIDIA collaboration; capacity expanded ~4x; 2024 Data Solutions >$575M, ~30% growth; robust backlog Strong demand; organic orders strong double digits; backlog up double digits sequentially; continued investment and new launches Strengthening
Tariffs/Price-CostPricing stable to positive into 2025; potential tariffs not reflected in Feb guide ~$120M FY25 tariff headwind assumed; mitigate via price, productivity, supply chain; Q2 margins pressured, 2H improvement expected Headwind near term, managed
Portfolio/M&AThermal sale planned; Trachte integration strong; M&A pipeline robust Thermal sale closed; Avail EPG closed ($975M); FY25 guide raised to reflect Avail, infrastructure strength Accelerating
Regional TrendsAPAC strong; Europe soft; distributors cautious on inventory Commercial/resi softer; Europe slightly down; APAC high-teens growth; channel still cautious but sell-out positive Mixed
R&D/New Products~90 launches in 2024; >2 pts growth; lab/test expansions 35 launches in Q1; >2 pts growth contribution; continued lab build-out Ongoing
Power UtilitiesRebound in H2’24; Trachte platform/backlog strong Avail + Trachte lift utility exposure to ~20% of sales; robust backlog into 2026 Strengthening

Management Commentary

  • “We reported double-digit growth in orders and sales, and continue to see our backlog grow, up double digits sequentially, giving us visibility through the year.” – CEO Beth Wozniak .
  • “We are raising our full-year sales and adjusted EPS guidance to reflect the Electrical Products Group acquisition, data solutions and power utility strength in the second half, and it also includes the impact of tariffs.” – CEO Beth Wozniak .
  • “This new guidance assumes tariff impacts of approximately $120 million based on what we know today. We expect to offset the impact with price, productivity and supply chain mitigating actions.” – CFO Gary Corona .
  • “EPG will be accretive in the first year… It drops an additional $0.05 to our EPS… and we also expect a nice cash tax benefit of approximately $15 million a year.” – CFO Gary Corona .

Q&A Highlights

  • Tariffs and margins: ~$120M tariff headwind baked into FY25; price + productivity + supply chain actions expected to offset by 2H; Q2 margin down y/y; Avail margin dilutive initially but accretive to EPS .
  • Avail EPG contribution: ~$0.05 net EPS in FY25; double-digit growth, mid-teens margins initially, with synergy playbook (procurement, lean) to improve over time .
  • Demand/backlog: Organic orders up mid-teens, with strong double-digit growth in Data Solutions; backlog up double digits sequentially; data center demand broadening beyond hyperscalers and outside U.S. .
  • Capex and capacity: FY25 capex raised to ~$100M to support Data Solutions capacity, supply chain resiliency, and Avail; lab/test capabilities expanding .
  • Segment divergence: Short-cycle commercial/resi softer; utilities and data centers remain key growth engines; distribution inventories broadly aligned but cautious .

Estimates Context

  • Q1 2025 vs S&P Global consensus: Revenue $809.3M vs $790.3M estimate* (beat); Adjusted EPS $0.67 vs $0.664 estimate* (beat). Values marked with * are from S&P Global.
  • Implications: Raised FY25 guide suggests upward estimate revisions for sales and EPS, offset by higher net interest and capex, and tariff-related 1H margin pressure; expect the Street to shift more earnings to 2H as price/cost actions flow through .

Key Takeaways for Investors

  • Raised FY25 sales and EPS guidance materially, now embedding tariffs and Avail EPG—nVent is leaning into secular electrification and AI infrastructure demand .
  • Beat-and-raise quarter driven by Data Solutions and Power Utilities, with backlog/order momentum providing visibility through 2025 .
  • Near-term margin pressure (Q2) from tariffs/price timing should abate in 2H as mitigations land; Avail dilutes margins but is EPS accretive and strategically scales utility exposure .
  • Balance sheet flexibility post Thermal sale supports continued M&A and buybacks; share count guided down (~165M), but net interest expense guided up as deployment proceeds .
  • Watch catalysts: execution on price/cost offset to tariffs, Avail synergy ramp, Data Solutions new product launches and NVIDIA-linked programs, and any incremental guidance updates in Q2 .
  • Segment rebranding clarifies strategy: Systems Protection (enclosures, cooling, control buildings) and Electrical Connections (power/electrical fastening), aligning to infrastructure growth vectors .
  • Dividend maintained ($0.20/quarter); capital returns balanced with growth investments .

Sourcing and documents:

  • Q1 2025 8-K press release and financials
  • Q1 2025 earnings call transcript
  • Q4 2024 8-K press release and historical data
  • Q4 2024 earnings call transcript (context, segment renaming, guidance basis)
  • Avail EPG acquisition PR ; Thermal sale PR ; Dividend PR

Values marked with * are from S&P Global.