Emerson Q3 Earnings Top Estimates, Software and Control Sales Rise

Emerson Electric Co. EMR reported third-quarter fiscal 2025 (ended June 30, 2025) adjusted earnings of $1.52 per share, which beat the Zacks Consensus Estimate of $1.51. The bottom line increased 6% year over year.

Emerson’s net sales of $4.55 billion missed the consensus estimate of $4.58 billion. However, the top line increased 4% year over year, driven by the solid performance of the Software and Control segment. The company’s underlying sales were up 3% year over year.

EMR Business Segments’ Performance

Effective from the first quarter of fiscal 2023, the company started reporting under two segments, namely Intelligent Devices and Software & Control.

The Intelligent Devices segment’s net sales were $3.13 billion, up 4% year over year. Our estimate was $3.10 billion. The segment consists of four subgroups, namely Final Control, Measurement & Analytical, Discrete Automation and Safety & Productivity.

Final Control’s sales increased 7% year over year to $1.12 billion. Measurement & Analytical generated sales of $1.01 billion, up 3% year over year. Discrete Automation’s sales totaled $649 million, reflecting an increase of 5% on a year-over-year basis. Safety & Productivity’s sales decreased 1% year over year to $346 million.

The Software and Control Automation Solutions segment generated net sales of $1.44 billion, up 3% year over year. Our estimate was $1.50 billion. The segment consists of two subgroups, namely Control Systems & Software and Test & Measurement.

Control Systems & Software reported sales of $1.08 billion, reflecting an increase of 4% year over year. Test & Measurement sales were $361 million, increasing 2% year over year.

Emerson’s Margin Details

The cost of sales increased 4.5% year over year to $2.16 billion. The pretax earnings margin was 16.1% compared with 10.4% in the year-ago period. Adjusted EBITA margin was 26% compared with 26.4% in the year-earlier quarter. Selling, general and administrative expenses increased 1% year over year to $1.27 billion.

EMR’s Balance Sheet & Cash Flow

Exiting the fiscal third quarter, Emerson had cash and cash equivalents of $2.22 billion compared with $3.6 billion at the end of fiscal 2024 (ended September 2024). Long-term debt was $8.28 billion compared with $7.2 billion at the end of fiscal 2024.

In the same period, the company generated net cash of $2.09 billion from operating activities, down 7.1% year over year. Capital expenditure was $263 million, up from $251 million in the year-ago period. Emerson paid out dividends of $895 million and repurchased shares worth $1.15 billion in the same period.

Emerson’s Q4 Fiscal 2025 Outlook

For the fourth quarter of fiscal 2025 (ending September 2025), Emerson anticipates year-over-year net sales growth to be in the band of 5.5-6.5% and underlying sales growth to be in the range of 5-6%.

EMR anticipates adjusted earnings per share to be in the range of $1.58-$1.62.

EMR’s FY25 Outlook

Emerson currently anticipates net sales growth of approximately 3.5% from the year-earlier level compared with 4% expected earlier. Underlying sales are expected to rise approximately 3.5%.

EMR projects earnings per share to be approximately $4.08 compared with $4.05-$4.20 expected earlier. Adjusted earnings per share are estimated to be approximately $6.00 compared with $5.90-$6.05 expected earlier. The company expects operating cash flow to be approximately $3.6 billion. Free cash flow is estimated to be about $3.2 billion.

EMR’s Zacks Rank

The company currently carries a Zacks Rank #3 (Hold). 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Companies

Dover Corporation DOV reported earnings of $2.44 per share in second-quarter 2025, beating the Zacks Consensus Estimate of $2.39. This compares with earnings of $2.36 per share a year ago.

Dover posted revenues of $2.05 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.6%. This compares with year-ago revenues of $2.18 billion.

Teck Resources Limited TECK came out with earnings of $0.27 per share in the second quarter of 2025, beating the Zacks Consensus Estimate of $0.2. This compares with earnings of $0.58 per share a year ago.

Teck Resources posted revenues of $1.46 billion in the quarter, missing the Zacks Consensus Estimate by 8.7%. This compares with year-ago revenues of $2.83 billion. 

Packaging Corporation of America PKG reported earnings of $2.48 per share, beating the Zacks Consensus Estimate of $2.44. This compares with earnings of $2.2 per share a year ago.

Packaging Corp. posted revenues of $2.17 billion in the quarter, surpassing the Zacks Consensus Estimate by 0.5%. This compares with year-ago revenues of $2.08 billion.

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