10-QPeriod: Q1 FY2026

EMERSON ELECTRIC CO Quarterly Report for Q1 Ended Dec 31, 2025

Filed February 3, 2026For Securities:EMR

Summary

Emerson Electric Co. reported solid performance for the quarter ending December 31, 2025. Net sales increased by 4% to $4.3 billion, driven by broad-based growth across its key segments, particularly Software & Systems and Intelligent Devices. Underlying sales saw a 2% increase, reflecting a 3% rise in pricing partially offset by a 1% decrease in volume. Diluted earnings per share (EPS) grew by 5% to $1.07, while adjusted diluted EPS saw a more significant increase of 6% to $1.46, highlighting strong operational performance. The company's strategic focus on portfolio transformation and integration, including the full integration of AspenTech, appears to be yielding positive results. The company maintained its financial discipline, with a stable outlook for fiscal year 2026 forecasting consolidated net sales growth of approximately 5.5% and adjusted EPS between $6.40 and $6.55. While the interest coverage ratio saw a slight decrease due to higher interest expenses, Emerson's overall financial position remains robust with significant assets and equity. The company continues to return capital to shareholders through dividends and share repurchases, reinforcing its commitment to shareholder value.

Financial Highlights

53 data points
Beta

Revenue

$4.35B

53.2% Gross Margin

Net Income

$605.00M

13.9% Net Margin

EPS (Diluted)

$1.07

Total Assets

$41.94B

Cash & Equivalents

$1.75B

Free Cash Flow

$602.00M

Financial Statements
Beta
Revenue$4.35B
Cost of Revenue$2.04B
Gross Profit$2.31B
SG&A Expenses$1.24B
Net Income$605.00M
EPS (Basic)$1.08
EPS (Diluted)$1.07
Shares Outstanding (Basic)561.80M
Shares Outstanding (Diluted)564.10M

Key Highlights

  • 1Net sales increased 4% to $4.3 billion, driven by strong performance across major segments.
  • 2Diluted earnings per share (EPS) rose 5% to $1.07.
  • 3Adjusted diluted EPS increased 6% to $1.46, demonstrating improved operational profitability.
  • 4Underlying sales grew 2%, supported by a 3% increase in pricing, though volume saw a slight decline.
  • 5Software & Systems segment sales increased 5%, and Intelligent Devices segment sales grew 4%.
  • 6Company provided a positive outlook for FY2026, expecting net sales growth of 5.5% and adjusted EPS of $6.40-$6.55.
  • 7Operating cash flow was $699 million, a decrease from the prior year, primarily due to working capital changes.

Frequently Asked Questions

The 4% increase in net sales to $4.3 billion was primarily driven by broad-based growth across Emerson's key business segments. Specifically, the Software & Systems segment saw a 5% increase in sales, and the Intelligent Devices segment reported a 4% sales increase, indicating strong demand for their respective product and service offerings.

Profitability saw a notable improvement. Diluted EPS increased by 5% to $1.07. More significantly, adjusted diluted EPS, which excludes certain non-operational items, grew by 6% to $1.46. This suggests that underlying operational performance is strong and improving, even after accounting for significant integration and restructuring costs.

Emerson Electric Co. projects a positive outlook for fiscal year 2026. They anticipate consolidated net sales to increase by approximately 5.5%, with underlying sales expected to grow around 4%. Furthermore, the company forecasts adjusted diluted earnings per share to be in the range of $6.40 to $6.55, indicating continued expected growth and profitability.

While the total debt-to-total capital ratio increased slightly to 39.8% and the net debt-to-net capital ratio also rose to 36.5%, the company maintains a strong financial position. The interest coverage ratio decreased to 7.9X due to higher interest expenses but remains at a healthy level. Emerson continues to deploy cash strategically for operations, acquisitions, and shareholder returns through dividends and share repurchases.