ABB (ABB) Q1 2026 earnings summary

Executive summary

• Orders reached a record $11.3 billion, up 32% year-over-year (24% comparable), with robust demand across all business areas and regions.

• Revenues grew 18% to $8.7 billion (11% comparable), exceeding expectations and driven by strong execution and high order backlog.

• Operational EBITA rose 37% to $2.05 billion, with margin up 320 basis points to 23.5%, supported by real estate gains and improved business performance.

• Free cash flow hit a record $1.25 billion, nearly doubling year-over-year, aided by earnings growth, real estate proceeds, and working capital management.

• Net income attributable to shareholders was $1.32 billion, up 20% year-over-year; basic EPS increased 21% to $0.73.

Financial highlights

• Gross profit rose 10% to $3.44 billion, but gross margin declined 290 bps to 39.4% due to unrealized FX and commodity hedges.

• Book-to-bill ratio at 1.29; order backlog at a record $27.5 billion, up 22% year-over-year.

• ROCE improved to 27.2%, up 280 bps year-over-year.

• Free cash flow conversion to net income at 103%.

• Average trade net working capital as a percentage of revenues improved to 12.5% from 14.1%.

Outlook and guidance

• Full-year 2026 guidance raised: expecting high single-digit to low double-digit comparable revenue growth and improved operational EBITA margin, even excluding real estate gains.

• Q2 2026 expected to deliver positive book-to-bill, high single-digit to low double-digit revenue growth, and margin improvement.

• Management expects to fulfill 58% of backlog in 2026, 22% in 2027, and the remainder thereafter.

• Free cash flow for the year expected to slightly improve from last year's $4.6 billion.