Johnson Controls International (JCI) Q4 2024 earnings summary

Executive summary

• Achieved double-digit organic revenue growth and robust margin expansion in Q4 2024, with adjusted EBITA margin expanding by 260bps to 18.6% and adjusted EPS of $1.28, up 22% year-over-year.

• Record backlog of $13.1 billion at year-end, driven by strong data center demand and 8% order growth.

• Transformation to a pure-play commercial building solutions provider is nearly complete, with the pending sale of the Residential and Light Commercial business to Bosch expected to close in fiscal Q4 2025.

• FY24 adjusted free cash flow conversion reached 96%, with $2.2B returned to shareholders.

• Introduced fiscal 2025 guidance for adjusted EPS of $3.40-$3.50 from continuing operations, reflecting confidence in sustained growth and margin expansion.

Financial highlights

• Q4 organic revenue grew 10% year-over-year to $7.4B; segment margin expanded 260 basis points to 18.6%.

• Adjusted EPS of $1.28 in Q4, up 22% year-over-year; full-year adjusted EPS was $3.71.

• Adjusted free cash flow for FY24 was $2.4B, with 96% conversion.

• Returned $2.2 billion to shareholders via dividends and share repurchases in FY24.

• Ended Q4 with $600 million in available cash and net debt to EBITDA at 2x.

Outlook and guidance

• Fiscal 2025 guidance: mid-single-digit organic sales growth, adjusted segment margin expansion of over 50 basis points, and adjusted EPS of $3.40-$3.50 (6%-9% growth).

• Q1 2025 guidance: mid-single-digit organic sales growth, margin expansion to ~14.5%, and adjusted EPS of $0.57-$0.60 (24%-30% growth).

• Free cash flow conversion expected at 85% or greater; plan to return 100% of free cash flow to shareholders.

• Multi-year restructuring plan to address stranded costs, targeting $400 million in expenses and $500 million in annual cost savings.