Emerson Electric (EMR) Q1 2026 earnings summary

Executive summary

• Q1 2026 net sales grew 4% year-over-year to $4.3 billion, with underlying orders up 9% and strong demand in North America, India, and the 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.

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

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

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

Financial highlights

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

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

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

• Software & Systems margin was 31.3%; Intelligent Devices margin was 26.9%; Safety & Productivity margin was 20.9%.

• Operating cash flow for Q1 2026 was $699 million, down from $777 million a year ago.

Outlook and guidance

• Full-year 2026 net sales growth expected at ~5.5%, with underlying sales up ~4% and a 1.5% favorable FX impact.

• Adjusted segment EBITA margin guidance is ~28%.

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

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

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