ABB (ABB) Q3 2024 earnings summary

Executive summary

• Orders and revenues grew 2% year-over-year, with a record operational EBITA margin of 19.0% and strong cash flow, led by Electrification, while Robotics & Discrete Automation and E-mobility underperformed.

• Strategic acquisitions of Födisch Group and SEAM Group expanded emission measurement and asset management offerings, supporting growth.

• Cash flow from operations remained robust, with free cash flow for Q3 at $1.2 billion and year-to-date at $2.6 billion.

• Order backlog reached $22,881 million, up 7% year-over-year, providing revenue visibility into 2025.

• Leadership changes included new CEO and business area presidents appointed in August 2024.

Financial highlights

• Revenues grew 2% year-over-year to $8.2 billion, with operational EBITA up 12% to $1,553 million and margin at 19.0%.

• Gross margin improved to 38.2%, up 350 basis points year-over-year.

• Free cash flow for Q3 was $1.2 billion, with year-to-date at $2.6 billion, on track to match or exceed last year’s $3.7 billion.

• Basic EPS rose to $0.51, up $0.03 year-over-year, and net income increased 7% to $947 million.

• Net debt decreased to $2,158 million, with net debt/equity at 0.15 and net debt/EBITDA at 0.4.

Outlook and guidance

• Full-year 2024 comparable revenue growth expected below 5%, with operational EBITA margin slightly above 18% and positive book-to-bill.

• Q4 2024 guidance: low to mid-single-digit revenue growth, negative book-to-bill, and sequentially lower margin.

• Order backlog supports revenue visibility into 2025, with 29% to be fulfilled in 2024 and 47% in 2025.