Itron (ITRI) investor relations material

Executive summary

• Q3 revenue rose 3% YoY to $599.3M; adjusted EBITDA reached a record $114.5M, up 18%, and non-GAAP diluted EPS was $1.94, up 26%.

• ARR increased 25% YoY to $423M; bookings rose 27% to $482M and quarter-end backlog was $4.292B.

• Nine-month revenue declined 3% to $1.749B, while adjusted EBITDA rose 10% to $303.3M and non-GAAP diluted EPS increased to $5.01.

• Service revenue rose 26% in Q3; Outcomes growth and Resiliency Solutions contributions helped offset softer product and Networked Solutions revenue.

Financial highlights

• GAAP net income attributable to shareholders rose 9% to $71.4M; diluted EPS was $1.61 versus $1.41 a year earlier.

• Non-GAAP operating income increased 20% to $106.8M; non-GAAP net income rose 20% to $86.3M, aided by higher operating income and lower non-GAAP taxes.

• Adjusted gross margin was 41.3%, up 350 bps YoY; GAAP gross margin was 40.9%, versus 37.7%.

• Net cash from operating activities was $102.0M, down 13% YoY; free cash flow was $95.5M, down 16%, reflecting working capital, taxes and lower interest income.

• Nine-month GAAP net income attributable to shareholders fell 11% to $178.1M, while non-GAAP net income rose 4% to $224.8M.

Outlook and guidance

• Q4 revenue guidance is $621M–$636M, with midpoint growth of 10% YoY; non-GAAP diluted EPS guidance is $1.70–$1.80.

• FY26 revenue guidance is $2.37B–$2.385B, with midpoint growth of 0.4% YoY; non-GAAP diluted EPS guidance is $6.72–$6.82.

• Q4 EPS midpoint is down 29% YoY, but up 9% normalized for tax rate and interest income; FY EPS midpoint is down 5% YoY, but up 14% normalized for those factors.

• Backlog was $4.292B at quarter-end, including $1.731B expected to deploy within 12 months; timing may shift with supply availability and customer schedules.

• Existing cash, operating cash flow and capital-market access are expected to fund operations and commitments for at least 12 months, subject to risks.