Emerson Reports Second Quarter 2026 Results; Updates 2026 Outlook

(dollars in millions, except per share)

2025 Q2

2026 Q2

Change

Underlying Orders¹

5 %

Net Sales

$4,432

$4,562

3 %

Underlying Sales²

0.5 %

Pretax Earnings

$629

$793

Margin

14.2 %

17.4 %

320 bps

Adjusted Segment EBITA³

$1,240

$1,258

Margin

28.0 %

27.6 %

(40) bps

GAAP Earnings Per Share

$0.86

$1.10

28 %

Adjusted Earnings Per Share⁴

$1.48

$1.54

4 %

Operating Cash Flow

$825

$779

(6) %

Free Cash Flow

$738

$694

(6) %

Guidance figures are approximate.

2026 Q3

2026

Net Sales Growth

~5.5%

~4.5%

Underlying Sales Growth

~5%

~3%

Earnings Per Share

$1.22 - $1.27

$4.79 - $4.89

Amortization of intangibles

~$0.34

~$1.38

Restructuring and related costs

~$0.06

~$0.18

Acquisition/divestiture fees and related costs

~$0.02

~$0.06

Discrete taxes

~$0.01

~$0.04

Adjusted Earnings Per Share

$1.65 - $1.70

$6.45 - $6.55

Operating Cash Flow

$4.0B - $4.1B

Free Cash Flow

$3.5B - $3.6B

¹ Underlying orders do not include AspenTech.

² Underlying sales excludes the impact of currency translation, and significant acquisitions and divestitures.

³ Adjusted segment EBITA represents segment earnings excluding restructuring and intangibles amortization expense.

⁴ Adjusted EPS excludes intangibles amortization expense, restructuring and related costs, acquisition/divestiture gains, losses, fees and related costs, and discrete taxes.

Investors:

Media:

Doug Ashby

Joseph Sala / Greg Klassen

(314) 553-2197

Joele Frank, Wilkinson Brimmer Katcher

(212) 355-4449

Table 1

EMERSON AND SUBSIDIARIES

CONSOLIDATED OPERATING RESULTS

(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

Quarter Ended March 31,

Six Months Ended March 31,

2025

2026

2025

2026

Net sales

$   4,432

$   4,562

$   8,608

$   8,908

     Cost of sales

2,061

2,140

4,002

4,174

     SG&A expenses

1,283

1,316

2,506

2,559

     Other deductions, net

418

229

646

434

     Interest expense, net

41

84

50

173

Earnings before income taxes

629

793

1,404

1,568

Income taxes

199

175

382

344

Net earnings

430

618

1,022

1,224

Less: Noncontrolling interests in subsidiaries

(55)

—

(48)

1

Net earnings common stockholders

$      485

$      618

$   1,070

$   1,223

Diluted avg. shares outstanding

565.4

563.0

568.2

563.5

Diluted earnings per share common stockholders

  Diluted earnings per common share

$     0.86

$     1.10

$     1.88

$     2.17

Quarter Ended March 31,

Six Months Ended March 31,

2025

2026

2025

2026

Other deductions, net

     Amortization of intangibles

$      229

$      205

$      457

$      409

     Restructuring costs

21

45

32

53

     Other

168

(21)

157

(28)

          Total

$      418

$      229

$      646

$      434

Table 2

EMERSON AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(DOLLARS IN MILLIONS, UNAUDITED)

Sept 30, 2025

March 31, 2026

Assets

     Cash and equivalents

$           1,544

$                1,791

     Receivables, net

3,101

3,158

     Inventories

2,213

2,452

     Other current assets

1,725

1,850

Total current assets

8,583

9,251

     Property, plant & equipment, net

2,871

2,850

     Goodwill

18,193

18,153

     Other intangible assets

9,458

8,954

     Other

2,859

2,880

Total assets

$         41,964

$              42,088

Liabilities and equity

     Short-term borrowings and current maturities of long-term debt

$           4,797

$                5,804

     Accounts payable

1,384

1,468

     Accrued expenses

3,616

3,382

Total current liabilities

9,797

10,654

     Long-term debt

8,319

7,555

     Other liabilities

3,550

3,560

Equity

     Common stockholders' equity

20,282

20,303

     Noncontrolling interests in subsidiaries

16

16

Total equity

20,298

20,319

Total liabilities and equity

$         41,964

$              42,088

Table 3

EMERSON AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(DOLLARS IN MILLIONS, UNAUDITED)

Six Months Ended March 31,

2025

2026

Operating activities

Net earnings

$            1,022

$           1,224

Adjustments to reconcile net earnings to net cash provided by operating activities:

        Depreciation and amortization

767

728

        Stock compensation

127

113

        Changes in operating working capital

(203)

(613)

        Other, net

(110)

26

            Cash from continuing operations

1,603

1,478

            Cash from discontinued operations

(585)

—

            Cash provided by operating activities

1,018

1,478

Investing activities

Capital expenditures

(170)

(182)

Purchases of businesses, net of cash and equivalents acquired

(36)

—

Other, net

(58)

(24)

    Cash used in investing activities

(264)

(206)

Financing activities

Net increase in short-term borrowings

2,628

2,027

Proceeds from short-term borrowings greater than three months

2,496

4,447

Payments of short-term borrowings greater than three months

—

(5,611)

Proceeds from long-term debt

1,544

—

Payments of long-term debt

(2)

(587)

Dividends paid

(598)

(624)

Purchases of common stock

(1,122)

(542)

Purchase of noncontrolling interest

(7,171)

—

Settlement of AspenTech share awards

(76)

—

Other, net

(81)

(123)

    Cash used in financing activities

(2,382)

(1,013)

Effect of exchange rate changes on cash and equivalents

(73)

(12)

Increase (decrease) in cash and equivalents

(1,701)

247

Beginning cash and equivalents

3,588

1,544

Ending cash and equivalents

$            1,887

$           1,791

Table 4

EMERSON AND SUBSIDIARIES

SEGMENT SALES AND EARNINGS

(DOLLARS IN MILLIONS, UNAUDITED)

The following tables show results for the Company's segments on an adjusted segment EBITA basis and are intended to supplement the Company's results of operations, including its segment earnings which are defined as earnings before interest and taxes. The Company defines adjusted segment and total segment EBITA as segment earnings excluding intangibles amortization expense, and restructuring and related expense. Adjusted segment and total segment EBITA, and adjusted segment and total segment EBITA margin are measures used by management and may be useful for investors to evaluate the Company's segments' operational performance.

Quarter Ended March 31,

2025

2026

Reported

Underlying

Sales

Control Systems & Software

$           1,093

$           1,089

— %

(2) %

Test & Measurement

358

414

16 %

12 %

Software & Systems

$           1,451

$           1,503

4 %

1 %

Sensors

1,000

1,024

2 %

— %

Final Control

1,459

1,488

2 %

(1) %

Intelligent Devices

$           2,459

$           2,512

2 %

(1) %

Safety & Productivity

$              522

$              547

5 %

2 %

Total

$           4,432

$           4,562

3 %

0.5 %

Sales Growth by Geography

Quarter Ended

March 31,

Americas

5 %

Europe

(4) %

Asia, Middle East & Africa                                   

(5) %

Table 4 cont.

Six Months Ended March 31,

2025

2026

Reported

Underlying

Sales

Control Systems & Software

$           2,116

$           2,133

1 %

(1) %

Test & Measurement

717

823

15 %

12 %

Software & Systems

$           2,833

$           2,956

4 %

2 %

Sensors

1,972

2,020

2 %

— %

Final Control

2,793

2,882

3 %

— %

Intelligent Devices

$           4,765

$           4,902

3 %

— %

Safety & Productivity

$           1,010

$           1,050

4 %

2 %

Total

$           8,608

$           8,908

3 %

1 %

Sales Growth by Geography

Six Months Ended

 March 31,

Americas

4 %

Europe

(1) %

Asia, Middle East & Africa

(3) %

Table 4 cont.

Quarter Ended March 31,

Quarter Ended March 31,

2025

2026

As Reported (GAAP)

Adjusted EBITA

(Non-GAAP)

As Reported (GAAP)

Adjusted EBITA

(Non-GAAP)

Earnings

Control Systems & Software

$          238

$          375

$          224

$          329

 Margins

21.7 %

34.2 %

20.6 %

30.2 %

Test & Measurement

(24)

87

(5)

109

 Margins

(6.8) %

24.3 %

(1.2) %

26.3 %

Software & Systems

$          214

$          462

$          219

$          438

 Margins

14.6 %

31.7 %

14.6 %

29.2 %

Sensors

266

279

276

296

 Margins

26.6 %

27.9 %

27.0 %

28.9 %

Final Control

355

386

353

405

 Margins

24.4 %

26.5 %

23.7 %

27.2 %

Intelligent Devices

$          621

$          665

$          629

$          701

 Margins

25.3 %

27.1 %

25.0 %

27.9 %

Safety & Productivity

$          105

$          113

$          109

$          119

 Margins

20.2 %

21.8 %

19.8 %

21.7 %

Corporate items and interest expense, net:

Stock compensation

(59)

(50)

(57)

(53)

Unallocated pension and postretirement costs

27

27

28

28

Corporate and other

(238)

(74)

(51)

(39)

Interest expense, net

(41)

—

(84)

—

Pretax Earnings / Adjusted EBITA

$          629

$        1,143

$          793

$        1,194

 Margins

14.2 %

25.8 %

17.4 %

26.2 %

Supplemental Total Segment Earnings:

Adjusted Total Segment EBITA

$        1,240

$        1,258

 Margins

28.0 %

27.6 %

Table 4 cont

Quarter Ended March 31,

Quarter Ended March 31,

2025

2026

Amortization of

Intangibles¹

Restructuring

and

Related Costs²

Amortization of

Intangibles¹

Restructuring

and

Related Costs²

Control Systems & Software

$                 128

$                     9

$                 101

$                     4

Test & Measurement

105

6

107

7

Software & Systems

$                 233

$                   15

$                 208

$                   11

Sensors

11

2

12

8

Final Control

28

3

27

25

Intelligent Devices

$                   39

$                     5

$                   39

$                   33

Safety & Productivity

$                     6

$                     2

$                     7

$                     3

Corporate

—

5

—

6

Total

$                 278

$                   27

$                 254

$                   53

¹ Amortization of intangibles includes $49 and $49 reported in cost of sales for the three months ended March 31, 2025 and 2026,

respectively.

² Restructuring and related costs includes $6 and $8 reported in cost of sales and selling, general and administrative

expenses for the three months ended March 31, 2025 and 2026, respectively.

Quarter Ended March 31,

Depreciation and Amortization

2025

2026

Control Systems & Software

$              148

$              125

Test & Measurement

119

120

Software & Systems

267

245

Sensors

32

34

Final Control

56

58

Intelligent Devices

88

92

Safety & Productivity

18

19

Corporate

11

13

Total

$              384

$              369

Table 5

EMERSON AND SUBSIDIARIES

ADJUSTED CORPORATE AND OTHER SUPPLEMENTAL

(DOLLARS IN MILLIONS, UNAUDITED)

The following table shows the Company's stock compensation and corporate and other expenses on an adjusted basis. The Company's definition of adjusted stock compensation excludes integration-related stock compensation expense. The Company's definition of adjusted corporate and other excludes corporate restructuring and related costs, first year purchase accounting related items and transaction fees, and certain gains, losses or impairments. This metric is useful for reconciling from total adjusted segment EBITA to the Company's consolidated adjusted EBITA. 

Quarter Ended March 31,

2025

2026

 Stock compensation (GAAP)

$                  (59)

$                  (57)

 Integration-related stock compensation expense

9

¹

4

 Adjusted stock compensation (non-GAAP)

$                  (50)

$                  (53)

Quarter Ended March 31,

2025

2026

 Corporate and other (GAAP)

$                (238)

$                  (51)

 Corporate restructuring and related costs

4

5

 Acquisition / divestiture costs

160

7

 Adjusted corporate and other (non-GAAP)

$                  (74)

$                  (39)

¹ Integration-related stock compensation expense for the three months ended March 31, 2025 relates to AspenTech and includes $1 reported as restructuring costs.

Table 6

EMERSON AND SUBSIDIARIES

ADJUSTED EBITA & EPS SUPPLEMENTAL

(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

The following tables, which show results on an adjusted EBITA basis and diluted earnings per share on an adjusted basis, are intended to supplement the Company's discussion of its results of operations herein. The Company defines adjusted EBITA as earnings excluding interest expense, net, income taxes, intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction fees, and certain gains, losses or impairments. Adjusted earnings per share excludes intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction-related costs, discrete taxes, and certain gains, losses or impairments. Adjusted EBITA, adjusted EBITA margin, and adjusted earnings per share are measures used by management and may be useful for investors to evaluate the Company's operational performance.

Quarter Ended March 31,

2025

2026

Pretax earnings

$             629

$             793

Percent of sales

14.2 %

17.4 %

Interest expense, net

41

84

Amortization of intangibles

278

254

Restructuring and related costs

27

53

Acquisition/divestiture fees and related costs

168

10

Adjusted EBITA

$          1,143

$          1,194

Percent of sales

25.8 %

26.2 %

Quarter Ended March 31,

2025

2026

GAAP earnings per share

$            0.86

$            1.10

Amortization of intangibles

0.32

0.35

Restructuring and related costs

0.04

0.07

Discrete taxes

0.09

0.01

Acquisition/divestiture fees and related costs

0.17

0.01

Adjusted earnings per share

$            1.48

$            1.54

Table 6 cont.

Quarter Ended March 31, 2026

Pretax

Earnings

Income

Taxes

Net Earnings

Non-Controlling

Interests

Net

Earnings

Common

Stockholders

Diluted

Earnings

Per

Share

As reported (GAAP)

$         793

$         175

$         618

$           —

$            618

$        1.10

Amortization of intangibles

254

¹

59

195

—

195

0.35

Restructuring and related costs

53

²

11

42

—

42

0.07

Acquisition/divestiture fees and related costs

10

2

8

—

8

0.01

Discrete taxes

—

(6)

6

—

6

0.01

Adjusted (non-GAAP)

$      1,110

$         241

$         869

$           —

$            869

$        1.54

Interest expense, net

84

Adjusted EBITA (non-GAAP)

$      1,194

¹ Amortization of intangibles includes $49 reported in cost of sales.

² Restructuring and related costs includes $8 reported in cost of sales and selling, general and administrative expenses.

Reconciliations of Non-GAAP Financial Measures & Other

Table 7

Reconciliations of Non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts).

See tables 4 through 6 for additional non-GAAP reconciliations.

2026 Q2 Underlying Sales Change

Reported

(Favorable) /

Unfavorable FX

(Acquisitions) /

Divestitures

Underlying

Control Systems & Software                                                       

— %

(2) %

— %

(2) %

Test & Measurement

16 %

(4) %

— %

12 %

Software & Systems

4 %

(3) %

— %

1 %

Sensors

2 %

(2) %

— %

— %

Final Control

2 %

(3) %

— %

(1) %

Intelligent Devices

2 %

(3) %

— %

(1) %

Safety & Productivity

5 %

(3) %

— %

2 %

Emerson

3 %

(2.5) %

— %

0.5 %

Six Months Ended March 31, 2026 Underlying Sales Change

Reported

(Favorable) /

Unfavorable FX

(Acquisitions) /

Divestitures

Underlying

Control Systems & Software

1 %

(2) %

— %

(1) %

Test & Measurement

15 %

(3) %

— %

12 %

Software & Systems

4 %

(2) %

— %

2 %

Sensors

2 %

(2) %

— %

— %

Final Control

3 %

(3) %

— %

— %

Intelligent Devices

3 %

(3) %

— %

— %

Safety & Productivity

4 %

(2) %

— %

2 %

Emerson

3 %

(2) %

— %

1 %

Underlying Growth Guidance

2026 Q3

Guidance

2026

Guidance

Reported (GAAP)

~5.5%

~4.5%

(Favorable) / Unfavorable FX                              

~(0.5 pts)

~(1.5 pts)

(Acquisitions) / Divestitures

-

-

Underlying (non-GAAP)

~5%

~3%

2025 Q2 Adjusted Segment EBITA

EBIT

EBIT

Margin

Amortization

of

Intangibles

Restructuring

and Related

Costs

Adjusted

Segment 

EBITA

Adjusted

Segment 

EBITA

Margin

Control Systems & Software

$               238

21.7 %

$               128

$                     9

$               375

34.2 %

Test & Measurement

(24)

(6.8) %

105

6

87

24.3 %

Software & Systems

$               214

14.6 %

$               233

$                  15

$               462

31.7 %

Sensors

266

26.6 %

11

2

279

27.9 %

Final Control

355

24.4 %

28

3

386

26.5 %

Intelligent Devices

$               621

25.3 %

$                 39

$                     5

$               665

27.1 %

Safety & Productivity

$               105

20.2 %

$                    6

$                     2

$               113

21.8 %

2026 Q2 Adjusted Segment EBITA

EBIT

EBIT

Margin

Amortization

of

 Intangibles

Restructuring

and Related

Costs

Adjusted

Segment 

EBITA

Adjusted

Segment 

EBITA

Margin

Control Systems & Software

$               224

20.6 %

$               101

$                     4

$               329

30.2 %

Test & Measurement

(5)

(1.2) %

107

7

109

26.3 %

Software & Systems

$               219

14.6 %

$               208

$                  11

$               438

29.2 %

Sensors

276

27.0 %

12

8

296

28.9 %

Final Control

353

23.7 %

27

25

405

27.2 %

Intelligent Devices

$               629

25.0 %

$                 39

$                  33

$               701

27.9 %

Safety & Productivity

$               109

19.8 %

$                    7

$                     3

$               119

21.7 %

Total Adjusted Segment EBITA

2025 Q2

2026 Q2

Pretax earnings (GAAP)

$                 629

$                 793

Margin

14.2 %

17.4 %

Corporate items and interest expense, net

311

164

Amortization of intangibles

278

254

Restructuring and related costs

22

47

Adjusted segment EBITA (non-GAAP)

$              1,240

$              1,258

Margin

28.0 %

27.6 %

Free Cash Flow

2025 Q2

2026 Q2

2025E

($ in billions)

Operating cash flow (GAAP)

$                 825

$                 779

 $4.0 - $4.1

Capital expenditures

(87)

(85)

~(0.45)

Free cash flow (non-GAAP)

$                 738

$                 694

$3.5 - $3.6

Note 1: Underlying sales and orders exclude the impact of currency translation and significant acquisitions and divestitures.

Note 2: All fiscal year 2026E figures are approximate, except where range is given.