Rockwell Automation (ROK) Barclays 43rd Annual Industrial Select Conference summary

Business performance and growth outlook

• Achieved increased resilience through diversified verticals, with process now the largest served vertical.

• Annual recurring revenue from software and high-value services exceeds 10% and is growing profitably.

• Focus on operational excellence has led to expanding margins, with plans to continue margin improvement.

• Organic growth guidance for the year is 4% at midpoint, with potential to reach 5%-8% as the year progresses.

• Growth is broad-based across traditional and new verticals, including data centers and e-commerce.

Segment and product trends

• Lifecycle Services started the year with a strong Book-to-Bill Ratio of 1.16, with comparables expected to ease through the year.

• Logix platform saw over 20% global year-over-year growth in Q1, with North America exceeding 25%.

• Destocking in PLCs is considered complete, with stable distributor inventory.

• Continued investment in R&D, especially in Software and Control, with new product introductions and a healthy innovation pipeline.

• Data center vertical is expected to reach up to 5% of business in the near future.

Software and technology strategy

• Software business, including recurring revenue, is less than 10% of total revenue but is resilient and growing.

• Software is closely integrated with hardware, providing mission-critical, deterministic control in regulated environments.

• Net Dollar Retention rates exceed 100% for large parts of the software business.

• MES and programming tools for Logix are major components of the software portfolio.

• Domain expertise and lifecycle management are key differentiators in software value.