EX-99.1 2 a2025q1release_ex991.htm EX-99.1

Emerson Reports First Quarter 2025 Results; Updates 2025 Outlook

ST. LOUIS (February 5, 2025) - Emerson (NYSE: EMR) today reported results1 for its first quarter ended December 31, 2024 and updated its full year outlook for fiscal 2025. Emerson also declared a quarterly cash dividend of $0.5275 per share of common stock payable March 10, 2025 to stockholders of record on February 14, 2025.

(dollars in millions, except per share)			2024 Q1			2025 Q1			Change
Underlying Orders2									1%
Net Sales			$4,117			$4,175			1%
Underlying Sales3									2%
Pretax Earnings			$175			$775
Margin			4.2%			18.6%			1440 bps
Adjusted Segment EBITA4			$1,014			$1,169
Margin			24.6%			28.0%			340 bps
GAAP Earnings Per Share			$0.29			$1.02			252%
Adjusted Earnings Per Share5			$1.22			$1.38			13%
Operating Cash Flow			$444			$777			75%
Free Cash Flow			$367			$694			89%

Management Commentary

“Emerson began the fiscal year on a strong note, exceeding first quarter expectations for incremental operating margins and earnings per share with strong cash flow generation,” said Emerson President and Chief Executive Officer Lal Karsanbhai. “Our record gross profit margin and adjusted segment EBITA margin reflect the strength of our transformed industrial technology portfolio and Emerson Management System, as well as the talent and dedication of our world-class team.”

Karsanbhai continued, “We reiterate our guide for underlying sales, earnings per share and cash flow driven by resilient demand in process and hybrid markets, expected second half discrete recovery and our proven ability to execute. Our team remains energized, and we look forward to continuing the positive momentum across our business, including progressing in the final phase of our portfolio transformation.”

2025 Outlook

The following tables summarize the fiscal year 2025 guidance framework and does not include any impact from the recently announced portfolio transactions6 related to AspenTech and Safety & Productivity. The 2025 outlook assumes returning approximately $3.2 billion to shareholders through approximately $2.0 billion of share repurchases and approximately $1.2 billion of dividend payments. Guidance figures are approximate.

			2025 Q2			2025
Net Sales Growth			(0.5%) - 0.5%			1.5% - 3.5%
Underlying Sales Growth			1% - 2%			3% - 5%
Earnings Per Share			$1.01 - $1.05			$4.42 - $4.62
Amortization of Intangibles			~$0.31			~$1.21
Restructuring / Related Costs			~$0.04			~$0.14
Acquisition / Divestiture Fees and Related Costs			~$0.02			~$0.08
Adjusted Earnings Per Share			$1.38 - $1.42			$5.85 - $6.05
Operating Cash Flow						$3.6B - $3.7B
Free Cash Flow						$3.2B - $3.3B

1 Results are presented on a continuing operations basis.

2 Underlying orders do not include AspenTech.

3 Underlying sales excludes the impact of currency translation, and significant acquisitions and divestitures.

4 Adjusted segment EBITA represents segment earnings excluding restructuring and intangibles amortization expense.

5 Adjusted EPS excludes intangibles amortization expense, restructuring and related costs, the amortization of acquisition-related inventory step-up, acquisition/divestiture gains, losses, fees and related costs, and discrete taxes.

6 Guidance includes Safety & Productivity and assumes AspenTech at our current ownership of ~57% outstanding shares.

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Conference Call

Today, beginning at 7:30 a.m. Central Time / 8:30 a.m. Eastern Time, Emerson management will discuss the first quarter results during an investor conference call. Participants can access a live webcast available at www.emerson.com/investors at the time of the call. A replay of the call will be available for 90 days. Conference call slides will be posted in advance of the call on the company website.

About Emerson

Emerson (NYSE: EMR) is a global technology and software company providing innovative solutions for the world's essential industries. Through its leading automation portfolio, including its majority stake in AspenTech, Emerson helps hybrid, process and discrete manufacturers optimize operations, protect personnel, reduce emissions and achieve their sustainability goals. For more information, visit Emerson.com.

Forward-Looking and Cautionary Statements

Statements in this press release that are not strictly historical may be “forward-looking” statements, which involve risks and uncertainties, and Emerson undertakes no obligation to update any such statements to reflect later developments. These risks and uncertainties include the scope, duration and ultimate impacts of the Russia-Ukraine and other global conflicts, as well as economic and currency conditions, market demand, pricing, protection of intellectual property, cybersecurity, tariffs, competitive and technological factors, inflation, among others, as set forth in the Company's most recent Annual Report on Form 10-K and subsequent reports filed with the SEC. The outlook contained herein represents the Company's expectation for its consolidated results, other than as noted herein.

Emerson uses our Investor Relations website, www.Emerson.com/investors, as a means of disclosing information which may be of interest or material to our investors and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor our Investor Relations website, in addition to following our press releases, SEC filings, public conference calls, webcasts and social media. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.

Investors:			Media:
Colleen Mettler			Joseph Sala / Greg Klassen
(314) 553-2197			Joele Frank, Wilkinson Brimmer Katcher
			(212) 355-4449

(tables attached)

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									Table 1
EMERSON AND SUBSIDIARIES
CONSOLIDATED OPERATING RESULTS
(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)
			Quarter Ended Dec 31
			2023						2024
Net sales			$	4,117					$	4,175
Cost and expenses
Cost of sales			2,201						1,940
SG&A expenses			1,277						1,224
Other deductions, net			451						228
Interest expense, net			44						8
Interest income from related party1			(31)						—
Earnings from continuing operations before income taxes			175						775
Income taxes			16						182
Earnings from continuing operations			159						593
Discontinued operations, net of tax			(27)						—
Net earnings			132						593
Less: Noncontrolling interests in subsidiaries			(10)						8
Net earnings common stockholders			$	142					$	585
Earnings common stockholders
Earnings from continuing operations			$	169					$	585
Discontinued operations			(27)						—
Net earnings common stockholders			$	142					$	585
Diluted avg. shares outstanding			573.3						571.1
Diluted earnings per share common stockholders
Earnings from continuing operations			$	0.29					$	1.02
Discontinued operations			(0.04)						—
Diluted earnings per common share			$	0.25					$	1.02
			Quarter Ended Dec 31
			2023						2024
Other deductions, net
Amortization of intangibles			$	274					$	229
Restructuring costs			83						11
Other			94						(12)
Total			$	451					$	228
1 Represents interest on the Copeland note receivable

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									Table 2
EMERSON AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN MILLIONS, UNAUDITED)
			Sept 30, 2024						Dec 31, 2024
Assets
Cash and equivalents			$	3,588					$	2,834
Receivables, net			2,927						2,694
Inventories			2,180						2,200
Other current assets			1,497						1,466
Total current assets			10,192						9,194
Property, plant & equipment, net			2,807						2,743
Goodwill			18,067						17,906
Other Intangibles			10,436						10,025
Other			2,744						2,742
Total assets			$	44,246					$	42,610
Liabilities and equity
Short-term borrowings and current maturities of long-term debt			$	532					$	1,066
Accounts payable			1,335						1,260
Accrued expenses			3,875						3,632
Total current liabilities			5,742						5,958
Long-term debt			7,155						6,557
Other liabilities			3,840						3,716
Equity
Common stockholders' equity			21,636						20,490
Noncontrolling interests in subsidiaries			5,873						5,889
Total equity			27,509						26,379
Total liabilities and equity			$	44,246					$	42,610

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												Table 3
EMERSON AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN MILLIONS, UNAUDITED)
			Three Months Ended Dec 31
						2023						2024
Operating activities
Net earnings						$	132					$	593
Earnings from discontinued operations, net of tax						27						—
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization						422						383
Stock compensation						74						68
Amortization of acquisition-related inventory step-up						231						—
Changes in operating working capital						(238)						(154)
Other, net						(204)						(113)
Cash from continuing operations						444						777
Cash from discontinued operations						(29)						—
Cash provided by operating activities						415						777
Investing activities
Capital expenditures						(77)						(83)
Purchases of businesses, net of cash and equivalents acquired						(8,339)						(37)
Other, net						(37)						(22)
Cash from continuing operations						(8,453)						(142)
Cash from discontinued operations						1						—
Cash used in investing activities						(8,452)						(142)
Financing activities
Net increase in short-term borrowings						2,647						2
Payments of long-term debt						—						(2)
Dividends paid						(300)						(301)
Purchases of common stock						(175)						(899)
AspenTech purchases of common stock						(72)						—
Other, net						(45)						(91)
Cash provided by (used in) financing activities						2,055						(1,291)
Effect of exchange rate changes on cash and equivalents						7						(98)
Decrease in cash and equivalents						(5,975)						(754)
Beginning cash and equivalents						8,051						3,588
Ending cash and equivalents						$	2,076					$	2,834

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									Table 4
EMERSON AND SUBSIDIARIES
SEGMENT SALES AND EARNINGS
(DOLLARS IN MILLIONS, UNAUDITED)

The following tables show results for the Company's segments on an adjusted segment EBITA basis and are intended to supplement the Company's results of operations, including its segment earnings which are defined as earnings before interest and taxes. The Company defines adjusted segment and total segment EBITA as segment earnings excluding intangibles amortization expense, and restructuring and related expense. Adjusted segment and total segment EBITA, and adjusted segment and total segment EBITA margin are measures used by management and may be useful for investors to evaluate the Company's segments' operational performance.

			Quarter Ended Dec 31
			2023						2024						Reported						Underlying
Sales
Final Control			$	940					$	976					4		%				5		%
Measurement & Analytical			947						975						3		%				4		%
Discrete Automation			613						580						(5)		%				(4)		%
Safety & Productivity			322						312						(3)		%				(3)		%
Intelligent Devices			$	2,822					$	2,843					1		%				2		%
Control Systems & Software			675						690						2		%				3		%
Test & Measurement			382						359						(6)		%				(5)		%
AspenTech			257						303						18		%				18		%
Software and Control			$	1,314					$	1,352					3		%				4		%
Eliminations			(19)						(20)
Total			$	4,117					$	4,175					1		%				2		%

Sales Growth by Geography
			Quarter Ended Dec 31
Americas			3		%
Europe			(2)		%
Asia, Middle East & Africa			4		%

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									Table 4 cont.

			Quarter Ended Dec 31												Quarter Ended Dec 31
			2023												2024
			As Reported (GAAP)						Adjusted EBITA (Non-GAAP)						As Reported (GAAP)						Adjusted EBITA (Non-GAAP)
Earnings
Final Control			$	194					$	223					$	236					$	260
Margins			20.6		%				23.6		%				24.2		%				26.6		%
Measurement & Analytical			235						258						285						296
Margins			24.9		%				27.3		%				29.2		%				30.4		%
Discrete Automation			97						116						98						112
Margins			15.8		%				18.9		%				16.9		%				19.3		%
Safety & Productivity			68						74						67						73
Margins			21.1		%				23.1		%				21.6		%				23.8		%
Intelligent Devices			$	594					$	671					$	686					$	741
Margins			21.0		%				23.8		%				24.1		%				26.1		%
Control Systems & Software			149						155						193						200
Margins			22.1		%				23.1		%				27.9		%				28.8		%
Test & Measurement			(78)						101						(13)						91
Margins			(20.4)		%				26.5		%				(3.6)		%				25.5		%
AspenTech			(35)						87						15						137
Margins			(13.7)		%				33.6		%				4.8		%				45.1		%
Software and Control			$	36					$	343					$	195					$	428
Margins			2.8		%				26.1		%				14.4		%				31.6		%
Corporate items and interest expense, net:
Stock compensation			(74)						(44)						(68)						(66)
Unallocated pension and postretirement costs			31						31						27						27
Corporate and other			(399)						(38)						(57)						(34)
Interest expense, net			(44)						—						(8)						—
Interest income from related party1			31						—						—						—
Pretax Earnings / Adjusted EBITA			$	175					$	963					$	775					$	1,096
Margins			4.2		%				23.4		%				18.6		%				26.3		%
Supplemental Total Segment Earnings:
Adjusted Total Segment EBITA									$	1,014											$	1,169
Margins									24.6		%										28.0		%
1 Represents interest on the Copeland note receivable.

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									Table 4 cont.

			Quarter Ended Dec 31												Quarter Ended Dec 31
			2023												2024
			Amortization of Intangibles1						Restructuring and Related Costs2						Amortization of Intangibles1						Restructuring and Related Costs2
Final Control			$	22					$	7					$	22					$	2
Measurement & Analytical			20						3						10						1
Discrete Automation			9						10						8						6
Safety & Productivity			6						—						6						—
Intelligent Devices			$	57					$	20					$	46					$	9
Control Systems & Software			5						1						5						2
Test & Measurement			139						40						105						(1)
AspenTech			122						—						122						—
Software and Control			$	266					$	41					$	232					$	1
Corporate			—						26			3			—						3
Total			$	323					$	87					$	278					$	13
1 Amortization of intangibles includes $49 and $49 reported in cost of sales for the three months ended December 31, 2023 and 2024, respectively.
2 Restructuring and related costs includes $4 reported in cost of sales for the three months ended December 31, 2023. The three months ended December 31, 2024 includes $2 reported in selling, general and administrative expenses.
3 Corporate restructuring of $26 for the three months ended December 31, 2023 is comprised entirely of integration-related stock compensation expense attributable to NI.

			Quarter Ended Dec 31
Depreciation and Amortization			2023						2024
Final Control			$	40					$	40
Measurement & Analytical			40						31
Discrete Automation			22						21
Safety & Productivity			14						15
Intelligent Devices			116						107
Control Systems & Software			21						23
Test & Measurement			151						118
AspenTech			123						124
Software and Control			295						265
Corporate			11						11
Total			$	422					$	383

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									Table 5

EMERSON AND SUBSIDIARIES
ADJUSTED CORPORATE AND OTHER SUPPLEMENTAL
(DOLLARS IN MILLIONS, UNAUDITED)

The following table shows the Company's stock compensation and corporate and other expenses on an adjusted basis. The Company's definition of adjusted stock compensation excludes integration-related stock compensation expense. The Company's definition of adjusted corporate and other excludes corporate restructuring and related costs, first year purchase accounting related items and transaction fees, and certain gains, losses or impairments. This metric is useful for reconciling from total adjusted segment EBITA to the Company's consolidated adjusted EBITA.

															Quarter Ended Dec 31
															2023						2024
Stock compensation (GAAP)															$	(74)					$	(68)
Integration-related stock compensation expense1															30						2
Adjusted stock compensation (non-GAAP)															$	(44)					$	(66)

															Quarter Ended Dec 31
															2023						2024
Corporate and other (GAAP)															$	(399)					$	(57)
Corporate restructuring and related costs															—						3
Acquisition / divestiture costs															130						20
Amortization of acquisition-related inventory step-up															231						—
Adjusted corporate and other (non-GAAP)															$	(38)					$	(34)
1 Integration-related stock compensation expense relates to NI and includes $26 and $— reported as restructuring costs for the three months ended December 31, 2023 and 2024, respectively

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									Table 6
EMERSON AND SUBSIDIARIES
ADJUSTED EBITA & EPS SUPPLEMENTAL
(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

The following tables, which show results on an adjusted EBITA basis and diluted earnings per share on an adjusted basis, are intended to supplement the Company's discussion of its results of operations herein. The Company defines adjusted EBITA as earnings excluding interest expense, net, income taxes, intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction fees, and certain gains, losses or impairments. Adjusted earnings per share excludes intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction-related costs, and certain gains, losses or impairments. Adjusted EBITA, adjusted EBITA margin, and adjusted earnings per share are measures used by management and may be useful for investors to evaluate the Company's operational performance.

			Quarter Ended Dec 31
			2023						2024
Pretax earnings			$	175					$	775
Percent of sales			4.2		%				18.6		%
Interest expense, net			44						8
Interest income from related party1			(31)						—
Amortization of intangibles			323						278
Restructuring and related costs			87						13
Acquisition/divestiture fees and related costs			134						22
Amortization of acquisition-related inventory step-up			231						—
Adjusted EBITA			$	963					$	1,096
Percent of sales			23.4		%				26.3		%
			Quarter Ended Dec 31
			2023						2024
GAAP earnings from continuing operations per share			$	0.29					$	1.02
Amortization of intangibles			0.36						0.31
Restructuring and related costs			0.12						0.02
Acquisition/divestiture fees and related costs			0.17						0.03
Amortization of acquisition-related inventory step-up			0.38						—
Discrete taxes			(0.10)						—
Adjusted earnings from continuing operations per share			$	1.22					$	1.38
1 Represents interest on the Copeland note receivable

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Table 6 cont.

Quarter Ended December 31, 2024
			Pretax Earnings						Income Taxes						Earnings from Cont. Ops.						Non-Controlling Interests3						Net Earnings Common Stockholders						Diluted Earnings Per Share
As reported (GAAP)			$	775					$	182					$	593					$	8					$	585					$	1.02
Amortization of intangibles			278			1			62						216						41						175						0.31
Restructuring and related costs			13			2			—						13						—						13						0.02
Acquisition/divestiture fees and related costs			22						5						17						—						17						0.03
Adjusted (non-GAAP)			$	1,088					$	249					$	839					$	49					$	790					$	1.38
Interest expense, net			8
Adjusted EBITA (non-GAAP)			$	1,096
1 Amortization of intangibles includes $49 reported in cost of sales.
2 Restructuring and related costs includes $2 reported in selling, general and administrative expenses.
3 Represents the non-controlling interest in AspenTech applied to AspenTech's share of each adjustment presented herein and eliminated from Emerson's consolidated results.

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Table 7
EMERSON AND SUBSIDIARIES
ASPENTECH CONTRIBUTION TO EMERSON RESULTS SUPPLEMENTAL
(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

The following tables reconcile the financial results of AspenTech reported to its shareholders with the amounts included in Emerson's consolidated financial results. Emerson currently owns approximately 57 percent of the common shares outstanding of AspenTech, a separately traded public company (NASDAQ: AZPN), and consolidates AspenTech in its financial results. The 43 percent non-controlling interest in AspenTech is removed from Emerson's net earnings common stockholders through the non-controlling interest line item. AspenTech is also one of Emerson's segments and its GAAP segment earnings is reconciled below to its consolidated impact to clarify that certain items are reported outside of its segment earnings within Emerson corporate, including interest income and stock compensation.

Quarter Ended December 31, 2024
			Pretax Earnings						Income Taxes (Benefit)						Earnings from Cont. Ops.						Non-Controlling Interests4						Net Earnings Common Stockholders						Diluted Earnings Per Share
Standalone reporting (GAAP)			$	17		1			$	(3)					$	20
Other			—						2						(2)
Reported in Emerson consolidation (GAAP)			17						(1)						18						8						10						$	0.02
Adjustments:
Amortization of intangibles			122			2			26						96						41						55						0.09
Adjusted (Non-GAAP)			$	139					$	25					$	114					$	49					$	65					$	0.11
Interest income			(17)			3
Stock compensation			15			3
Adjusted segment EBITA (non-GAAP)			$	137
Reconciliation to Segment EBIT
Pre-tax earnings			$	17
Interest income			(17)			3
Stock compensation			15			3
Segment EBIT (GAAP)			$	15
Amortization of intangibles			122			2
Adjusted segment EBITA (non-GAAP)			$	137
1 Amount reflects AspenTech's pretax earnings for the three months ended December 31, 2024 as reported in its quarterly earnings release 8-K.
2 Amortization of intangibles includes $49 reported in cost of sales.
3 Reported in Emerson corporate line items.
4 Represents the non-controlling interest in AspenTech applied to each adjustment presented herein and eliminated from Emerson's consolidated results.

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Reconciliations of Non-GAAP Financial Measures & Other

Table 8

Reconciliations of Non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts). See tables 4 through 7 for additional non-GAAP reconciliations.

2025 Q1 Underlying Sales Change			Reported			(Favorable) / Unfavorable FX			(Acquisitions) / Divestitures			Underlying
Final Control			4		%	1		%	—		%	5		%
Measurement & Analytical			3		%	1		%	—		%	4		%
Discrete Automation			(5)		%	1		%	—		%	(4)		%
Safety & Productivity			(3)		%	—		%	—		%	(3)		%
Intelligent Devices			1		%	1		%	—		%	2		%
Control Systems & Software			2		%	1		%	—		%	3		%
Test & Measurement			(6)		%	1		%	—		%	(5)		%
AspenTech			18		%	—		%	—		%	18		%
Software and Control			3		%	1		%	—		%	4		%
Emerson			1		%	1		%	—		%	2		%

Underlying Growth Guidance			2025 Q2 Guidance			2025 Guidance
Reported (GAAP)			(0.5%) - 0.5%			1.5% - 3.5%
(Favorable) / Unfavorable FX			~1.5 pts			~1.5 pts
(Acquisitions) / Divestitures			-			-
Underlying (non-GAAP)			1% - 2%			3% - 5%

2024 Q1 Adjusted Segment EBITA			EBIT			EBIT Margin			Amortization of Intangibles			Restructuring and Related Costs			Adjusted Segment EBITA			Adjusted Segment EBITA Margin
Final Control			$	194		20.6		%	$	22		$	7		$	223		23.6		%
Measurement & Analytical			235			24.9		%	20			3			258			27.3		%
Discrete Automation			97			15.8		%	9			10			116			18.9		%
Safety & Productivity			68			21.1		%	6			—			74			23.1		%
Intelligent Devices			$	594		21.0		%	$	57		$	20		$	671		23.8		%
Control Systems & Software			149			22.1		%	5			1			155			23.1		%
Test & Measurement			(78)			(20.4)		%	139			40			101			26.5		%
AspenTech			(35)			(13.7)		%	122			—			87			33.6		%
Software and Control			$	36		2.8		%	$	266		$	41		$	343		26.1		%

2025 Q1 Adjusted Segment EBITA			EBIT			EBIT Margin			Amortization of Intangibles			Restructuring and Related Costs			Adjusted Segment EBITA			Adjusted Segment EBITA Margin
Final Control			$	236		24.2		%	$	22		$	2		$	260		26.6		%
Measurement & Analytical			285			29.2		%	10			1			296			30.4		%
Discrete Automation			98			16.9		%	8			6			112			19.3		%
Safety & Productivity			67			21.6		%	6			—			73			23.8		%
Intelligent Devices			$	686		24.1		%	$	46		$	9		$	741		26.1		%
Control Systems & Software			193			27.9		%	5			2			200			28.8		%
Test & Measurement			(13)			(3.6)		%	105			(1)			91			25.5		%
AspenTech			15			4.8		%	122			—			137			45.1		%
Software and Control			$	195		14.4		%	$	232		$	1		$	428		31.6		%

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Page 14

Total Adjusted Segment EBITA						2024 Q1			2025 Q1
Pretax earnings (GAAP)						$	175		$	775
Margin						4.2		%	18.6		%
Corporate items and interest expense, net						455			106
Amortization of intangibles						323			278
Restructuring and related costs						61			10
Adjusted segment EBITA (non-GAAP)						$	1,014		$	1,169
Margin						24.6		%	28.0		%

Free Cash Flow						2024 Q1			2025 Q1						2025E ($ in billions)
Operating cash flow (GAAP)						$	444		$	777					$3.6 - $3.7
Capital expenditures						(77)			(83)						~(0.4)
Free cash flow (non-GAAP)						$	367		$	694					$3.2 - $3.3

Note 1: Underlying sales and orders exclude the impact of currency translation and significant acquisitions and divestitures.

Note 2: All fiscal year 2025E figures are approximate, except where range is given.