Johnson Controls International (JCI) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 delivered 6% organic sales growth, adjusted EPS up 17% to $3.76, and a record ~$15B backlog, with strong free cash flow conversion at 102%.

• Operational focus, proprietary business systems, and process improvements drove productivity, customer engagement, and margin expansion.

• Orders grew 7% for the year, with Americas strength offsetting APAC softness; backlog up 13% year-over-year.

• Strategic investments in technology, sustainability, and leadership, including data center cooling and decarbonization, position the company for long-term growth.

• Sale of Residential and Light Commercial HVAC business to Bosch for $8.3B, with $6.9B attributable to the company.

Financial highlights

• FY25 organic revenue up 6% year-over-year; Q4 organic revenue up 4%.

• Adjusted Segment EBITA margin expanded 100 bps to 17.1% for the year; Q4 margin at 18.8%.

• Adjusted EPS for FY25 was $3.76, up 17% year-over-year; Q4 adjusted EPS was $1.26, up 14%.

• Adjusted free cash flow for the year was $2.5B, with 102% conversion.

• Q4 sales were $6.44B, up 3% year-over-year; gross margin at 36.7%.

Outlook and guidance

• FY26 guidance: mid-single-digit organic sales growth, adjusted EPS of ~$4.55 (over 20% growth), operating leverage ~50%, and free cash flow conversion ~100%.

• Q1 FY26: organic sales growth ~3%, operating leverage ~55%, adjusted EPS ~$0.83.

• Corporate expense for FY26 projected at $375M–$400M; tax rate ~17%.

• Long-term targets: mid-single-digit revenue growth, 30%+ operating leverage, double-digit adjusted EPS growth, and ~100% free cash flow conversion.