Eaton Corporation (ETN) Q1 2025 earnings summary

Executive summary

• Achieved record Q1 2025 results with adjusted EPS of $2.72, up 13% year-over-year, and segment margins of 23.9%, in line with guidance.

• Organic growth accelerated to 9%, led by strong performance in Electrical Americas and Aerospace.

• Backlog increased in key segments, with Electrical Americas up 6% and Aerospace up 16%, and book-to-bill ratios above 1.0.

• Closed the $1.45 billion Fibrebond acquisition, enhancing data center and modular power offerings.

• Reaffirmed full-year guidance for adjusted EPS, cash flow, and share repurchases.

Financial highlights

• Q1 revenue reached a record $6.4 billion, up 7% year-over-year, with 9% organic sales growth and segment operating profit up 11% to $1.52 billion.

• Adjusted EPS was $2.72, up from $2.40; diluted EPS was $2.45, up 20% year-over-year.

• Segment margin expanded by 80 basis points to 23.9%.

• Gross profit margin improved to 38.4%, up 110 basis points year-over-year.

• Operating cash flow was $238 million, with free cash flow at $91 million, impacted by higher working capital and inventory build.

Outlook and guidance

• Raised 2025 organic growth outlook to 7.5–9.5%; segment margin guidance at 24.0–24.4%.

• Reaffirmed adjusted EPS guidance of $11.80–$12.20 for 2025, representing 11% growth at midpoint.

• Q2 2025 adjusted EPS outlook of $2.85–$2.95; organic growth 6–8%.

• Segment-specific organic growth guidance: Electrical Americas 12–14%, Aerospace 8–10%, Vehicle (5.5)–(3.5)%.

• Guidance assumes current tariff environment and a 90-day pause on reciprocal tariffs through year-end.