Emerson Electric (EMR) Q1 2026 earnings summary

Executive summary

• Q1 2026 net sales grew 4% year-over-year to $4.3B–$4,346M, with underlying orders up 9% and strong demand in North America, India, and Middle East & Africa, especially in automation and Software & Systems.

• Adjusted segment EBITA margin reached 27.7%, and adjusted EPS rose 6% to $1.46, despite a $0.06 headwind from software contract renewals.

• Robust growth in Test & Measurement (up 11–14%) and Power verticals, with Life Sciences also strong.

• Declared a quarterly dividend of $0.555 per share, payable March 10, 2026.

• Annual Contract Value (ACV) of software grew 9% year-over-year to $1.6B.

Financial highlights

• Free cash flow for Q1 2026 was $602M, with a margin of 13.9–14%.

• Backlog ended at $7.9B, up 9% year-over-year; book-to-bill ratio was 1.13.

• Price contributed 3 points to growth; MRO represented 65% of sales.

• Gross profit increased 3% to $2.31B; gross margin was 53.2%.

• SG&A expenses rose 2% to $1.24B, but as a percent of sales decreased 0.7 pts to 28.6%.

Outlook and guidance

• Full-year 2026 guidance: net sales growth ~5.5%, underlying sales growth 4%, adjusted segment EBITA margin ~28%.

• Adjusted EPS guidance raised to $6.40–$6.55.

• Free cash flow for 2026 expected at $3.5B–$3.6B, margin above 18%.

• Q2 sales growth expected at 3–4%, with adjusted EPS of $1.50–$1.55.

• Plans to return ~$2.2B to shareholders via ~$1B share repurchases and ~$1.2B dividends.