01—Abstract
Summary
Summary of the 10-Q filed May 6, 2026. Cited figures are marked; the original filing is the authoritative source.
Johnson Controls International plc (JCI) reported strong financial performance for the quarter and six months ended March 31, 2026.
Net sales saw a significant increase of 8%a year-over-year for both periods, driven by robust organic growth across all segments, particularly in the Americas and APAC regions. This growth was fueled by increased demand for smart, efficient, and sustainable building solutions, especially in data centers. The company also demonstrated improved profitability, with gross profit increasing by 9% and significant year-over-year growth in Segment EBIT and Segment EBITA across all segments, reflecting effective pricing, productivity improvements, and higher volumes.
The company's financial position remains solid, with total assets increasing and a reduction in net debt. JCI's liquidity is adequate, supported by a strong cash flow from operations.
Shareholder returns were also a focus, with substantial share repurchases completed and dividends continuing to be paid. Despite a complex macroeconomic and geopolitical environment, JCI is navigating these challenges effectively through strategic sourcing and operational efficiencies.
02—Key points
Key Highlights
- Net sales increased by 8% year-over-year for both the three and six months ended March 31, 2026, reaching $6.14 billion and $11.94 billion, respectively.
- Gross profit grew by 9% for both periods, indicating improved profitability driven by organic sales growth, productivity, and operating leverage.
- Segment EBITA (non-GAAP) showed substantial growth, up 18% for the quarter ($1.11 billion) and 14% year-to-date ($2.01 billion), highlighting strong operational performance across segments.
- Backlog and orders saw significant increases of 26% and 30% respectively, signaling robust future demand, particularly driven by large projects and data center solutions.
- Net debt decreased by $676 million to $8.83 billion as of March 31, 2026, from $9.50 billion as of September 30, 2025, demonstrating effective debt management.
- The company repurchased approximately $5.0 billion of shares through accelerated share repurchase transactions and open market repurchases, underscoring a commitment to returning capital to shareholders.
- Significant progress was made in addressing environmental liabilities, notably the $750 million AFFF settlement with public water systems, with the final payment made in December 2024.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2026, Johnson Controls International plc kept $0.10.
- Revenue$6.14B100.0%
- Cost of revenue−$3.88B63.2%
- Gross profit$2.26B36.8%
- Operating costs−$1.10B17.9%
- Operating income$1.16B19.0%
- Interest, other & tax−$551.0M9.0%
- Net income$613.0M10.0%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed May 6, 2026Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $6.14B$5.68B | +8.2% |
| Cost of Revenue | $3.88B$3.61B | +7.6% |
| Gross Profit | $2.26B$2.07B | +9.3% |
| SG&A Expenses | $1.40B$1.43B | −1.8% |
| Operating Income | $1.16B$836.00M | +39.2% |
| Interest Expense | $60.00M$56.00M | +7.1% |
| Net Income | $613.00M$478.00M | +28.2% |
| EPS (Basic) | $1.01$0.73 | +38.4% |
| EPS (Diluted) | $1.00$0.72 | +38.9% |
| Shares Outstanding (Basic) | 612.00M659.00M | −7.1% |
| Shares Outstanding (Diluted) | 614.00M661.00M | −7.1% |
05—Questions
Frequently Asked Questions
What were the main drivers of Johnson Controls' revenue growth in this quarter?
Revenue growth was primarily driven by strong organic sales increases across all segments, particularly in the Americas and APAC. This growth was fueled by increased demand for smart, efficient, and sustainable building solutions, with a notable surge in data center applications.
How has the company's profitability evolved compared to the previous year?
Profitability improved significantly. Gross profit increased by 9% for both periods due to organic sales growth, productivity enhancements, and better operating leverage. Segment EBIT and Segment EBITA also showed substantial year-over-year increases, reflecting effective cost management and operational efficiencies.
What is the company's current financial health and liquidity position?
Johnson Controls maintains a strong financial position. Cash provided by operating activities increased significantly to $1.28 billion for the six months ended March 31, 2026. Net debt decreased, and the company has $698 million in cash and cash equivalents, which management believes is adequate to fund operations and meet cash obligations for the foreseeable future. The company also has access to a $2.5 billion revolving credit facility.
What are the key risks and contingencies the company is facing?
The company faces several risks and contingencies, including ongoing litigation and liabilities related to environmental matters such as Aqueous Film-Forming Foam (AFFF) and asbestos. The company has a substantial reserve for environmental liabilities and has entered into a significant settlement for AFFF claims. Cybersecurity threats, data privacy compliance, and potential disruptions from geopolitical events are also identified risks. However, management believes its accrued amounts for environmental liabilities and insurance recoveries will mitigate material adverse effects on its financial position.
06—Continue