Core Insights - Itron Inc. reported non-GAAP EPS of $1.52 for Q1 2025, exceeding the Zacks Consensus Estimate by 16.9% and up from $1.24 in the prior-year quarter [1][3] - Revenues increased by 1% year over year to $607 million, but fell short of the Zacks Consensus Estimate of $614.3 million and management's guidance of $610-$620 million [1][2] - The company experienced mixed performance across its segments, with steady customer demand driven by grid modernization and automation [2][3] Revenue Breakdown - Product revenues were $523.1 million, accounting for 86.2% of total revenues, down 0.9% year over year, while service revenues rose 11.1% to $84 million [2] - Device Solutions segment generated $125.9 million, down 1% year over year, while Networked Solutions revenues decreased by 1% to $402.7 million [4][5] - Outcomes segment saw a 14% increase in revenues to $78.5 million, driven by higher recurring revenues and increased software license sales [5] Operating Performance - Gross margin improved to 35.8%, up 180 basis points year over year, attributed to a favorable product mix and operational efficiencies [6] - Non-GAAP operating income rose to $80.3 million from $67.3 million in the previous year, reflecting improved gross profit and reduced operating costs [6] Financial Position - As of March 31, 2025, cash and cash equivalents were $1.123 billion, up from $1.05 billion at the end of 2024, with net long-term debt reduced to $786.1 million [8] - Free cash flow reached $67 million, doubling from $34 million in the prior-year quarter, due to stronger earnings and better working capital management [9] Future Guidance - For Q2 2025, Itron expects revenues between $605 million and $615 million, with non-GAAP EPS anticipated in the range of $1.30-$1.40, indicating about 12% growth at the midpoint compared to the previous year [10]

Financial Performance - Total revenues for Q1 2025 were $607,151,000, a slight increase of 0.12% compared to $603,442,000 in Q1 2024[9] - Net income for Q1 2025 was $65,350,000, representing a 26.2% increase from $51,787,000 in Q1 2024[9] - Gross profit increased to $217,219,000 in Q1 2025, up from $205,379,000 in Q1 2024, reflecting a gross margin improvement[9] - Operating income rose to $76,213,000 in Q1 2025, compared to $62,800,000 in Q1 2024, marking a 21.4% increase[9] - The company reported a comprehensive income of $78,898,000 for Q1 2025, significantly higher than $40,879,000 in Q1 2024[11] - Operating cash flow for Q1 2025 was $72,117,000, compared to $41,308,000 in Q1 2024, indicating improved cash generation[19] - Net income available to common shareholders for the three months ended March 31, 2025, was $65.474 million, compared to $51.721 million for the same period in 2024, representing a year-over-year increase of 26.5%[30] - Basic earnings per share (EPS) increased to $1.44 for Q1 2025 from $1.13 in Q1 2024, reflecting a growth of 27.5%[30] - Non-GAAP net income attributable to Itron, Inc. was $70.1 million in Q1 2025, compared to $57.3 million in Q1 2024[137] - Adjusted EBITDA for Q1 2025 was $87.9 million, compared to $76.5 million in Q1 2024[137] Assets and Liabilities - Cash and cash equivalents at the end of Q1 2025 were $1,123,267,000, up from $1,051,237,000 at the end of 2024[13] - Total assets increased to $3,503,142,000 as of March 31, 2025, compared to $3,407,623,000 at the end of 2024[13] - Itron's total liabilities decreased to $1,994,063,000 as of March 31, 2025, down from $1,996,195,000 at the end of 2024[13] - Total debt as of March 31, 2025, stands at $1,265,000,000, with a current portion of $457,747,000 and long-term debt of $786,137,000[43] - The company remains in compliance with debt covenants under the 2018 credit facility as of March 31, 2025[45] Revenue Segments - Product revenues in the Device Solutions segment were $125,387,000 for Q1 2025, compared to $125,908,000 in Q1 2024, indicating a decrease of 0.41%[113] - The Networked Solutions segment generated revenues of $402,732,000 in Q1 2025, up from $381,305,000 in Q1 2024, reflecting an increase of 5.8%[113] - The Outcomes segment reported revenues of $78,548,000 in Q1 2025, compared to $69,174,000 in Q1 2024, representing a growth of 13.6%[113] Expenses - Research and development expenses for the consolidated company in Q1 2025 were $42,224,000, compared to $43,600,000 in Q1 2024, a decrease of 3.16%[113] - Total stock-based compensation expense for the three months ended March 31, 2025, was $17,257,000, up from $12,878,000 in 2024, representing a year-over-year increase of approximately 33.5%[68] - Operating expenses decreased by $1.6 million, or 1%, compared to Q1 2024[137] Cash Flow and Backlog - Free cash flow for Q1 2025 was $67.478 million, a 97.6% increase from $34.163 million in Q1 2024, driven by higher operating cash flow and reduced capital expenditures[173] - Total backlog reached $4.7 billion as of March 31, 2025, compared to $4.3 billion a year earlier[137] - Twelve-month backlog was $1.6 billion at March 31, 2025, down from $1.9 billion at March 31, 2024[137] Tax and Compliance - The company’s tax rate for the three months ended March 31, 2025, was 21%, consistent with the federal statutory rate of 21%[73] - The income tax provision for the three months ended March 31, 2025, was $16.929 million, compared to $13.429 million in 2024, maintaining a tax rate of 21%[151] Stock and Shareholder Activities - The company authorized a stock repurchase program of up to $100 million effective September 19, 2024, with no shares repurchased under this program as of the reporting date[93] - The company completed the repurchase of 971,534 shares under the 2023 Stock Repurchase Program for a total of $100 million at an average price of $102.93 per share in June 2024[94] Restructuring and Future Plans - Total expected restructuring costs for the 2023 Projects were $51,256,000, with costs recognized during the three months ended March 31, 2025, amounting to $50,174,000, reflecting a slight increase of 2.2%[87] - The company’s restructuring activities are expected to optimize global supply chain and manufacturing operations, with projects substantially complete as of March 31, 2025[86] Risk Management - The company is focused on risk management strategies to hedge against foreign currency and interest rate risks, using derivative financial instruments[204] - As of March 31, 2025, the company had no outstanding variable rate debt, mitigating interest rate risk[205] - The company entered into 32 foreign exchange forward contracts to manage currency exposure, with notional amounts ranging from $112,486 thousand to $23.5 million[207]

Core Insights - Itron has achieved a significant milestone with the shipment of its 3 millionth Intelis gas meter, received by Peoples Natural Gas, the largest natural gas distribution company in Pennsylvania [1][2]. Company Overview - Itron is a global leader in energy, water, smart city, IIoT, and intelligent infrastructure services, focusing on building innovative systems and creating efficiencies for utilities and cities [3]. Product Features - The Intelis gas meter includes advanced safety features such as automatic valve closure during high pressure, high flow, or high temperature events, enhancing safety for users [5]. - It offers remote shut-off capabilities for safety events, move-outs, or line maintenance, improving operational efficiency [5]. - The meter supports both Automated Meter Reading (AMR) and Advanced Metering Infrastructure (AMI), allowing utilities to transition at their own pace [5]. - Itron provides advanced software for monitoring safety events and alarms generated by the Intelis gas meters, offering real-time visibility for gas distribution management [5]. - The Intelis gas meter is noted as the lightest residential gas meter in North America, weighing 4.35 pounds, which aids in installation and reduces carbon emissions [5]. Strategic Partnership - Peoples Natural Gas has been collaborating with Itron for nearly 30 years, emphasizing the importance of the Intelis gas meters in improving customer service and safety [2].

Core Insights - Itron reported revenue of $607.15 million for the quarter ended March 2025, reflecting a year-over-year increase of 0.6% and an EPS of $1.52, up from $1.24 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $614.27 million by 1.16%, while the EPS exceeded the consensus estimate of $1.30 by 16.92% [1] Revenue Breakdown - Revenue from Networked Solutions was $402.73 million, below the average estimate of $416.08 million, representing a year-over-year decline of 1.2% [4] - Revenue from Outcomes reached $78.55 million, slightly below the average estimate of $79.19 million, but showed a year-over-year increase of 13.6% [4] - Revenue from Device Solutions was $125.87 million, exceeding the average estimate of $119.66 million, with a year-over-year decrease of 0.7% [4] - Total Product Revenue was reported at $523.14 million, compared to the average estimate of $536.93 million [4] Service Revenue Insights - Service Revenue from Device Solutions was $0.48 million, significantly below the average estimate of $1.25 million [4] - Service Revenue from Networked Solutions was $28.21 million, surpassing the average estimate of $25.48 million [4] - Service Revenue from Outcomes was $55.32 million, exceeding the average estimate of $50.30 million [4] - Total Service Revenue was $84.01 million, above the average estimate of $77.03 million [4] Product Revenue Details - Product Revenue from Networked Solutions was $374.52 million, below the average estimate of $391.22 million [4] - Product Revenue from Device Solutions was $125.39 million, exceeding the average estimate of $117.60 million [4] - Product Revenue from Outcomes was $23.23 million, below the average estimate of $28.11 million [4] Profitability Metrics - Gross Profit from Device Solutions was $37.75 million, significantly higher than the average estimate of $31.19 million [4] Stock Performance - Itron's shares have returned +3.7% over the past month, outperforming the Zacks S&P 500 composite, which declined by -0.7% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $607 million, a 1% increase year over year, with adjusted EBITDA of $88 million and non-GAAP earnings per share of $1.52, reflecting a 22% increase from the previous year [6][13][14] - Free cash flow improved to $67 million compared to $34 million in the prior year, driven by operational earnings growth and improved working capital [15] Business Line Data and Key Metrics Changes - Device Solutions revenue decreased by 1% year over year to $126 million, but increased by 2% on a constant currency basis, with gross margin at 30% and operating margin at 24.2% [15][17] - Network Solutions revenue was $403 million, with a gross margin of 36.9% and operating margin of 28.8%, showing a slight decrease in gross margin due to product mix [17] - Outcomes revenue grew by 14% year over year to $79 million, with gross margin at 39.2% and operating margin at 18.2%, benefiting from a higher margin revenue mix [18] Market Data and Key Metrics Changes - Bookings for the quarter were in line with expectations, resulting in a book-to-bill ratio of 0.9, with a backlog of $4.7 billion, primarily driven by Network Solutions and Outcomes segments [8][9] Company Strategy and Development Direction - The company is focused on optimizing its factory footprint, strengthening supply chain resilience, and growing recurring revenue to capitalize on future opportunities [20] - Itron aims to enhance its industry leadership through innovative solutions that address environmental, operational, and consumer challenges faced by utilities and cities [20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increased macroeconomic and trade policy uncertainty but expressed confidence in the company's strategic focus and operational execution [20] - The company expects Q2 revenue to be in the range of $605 million to $615 million, with non-GAAP earnings per share anticipated to grow approximately 12% year over year [19] Other Important Information - The estimated EBITDA impact from tariffs for the year is approximately $15 million, with the majority of the impact expected in the latter half of the year [11][62] - The company has a strong liquidity position, with total debt at $1.265 billion and cash and equivalents at $1.1 billion [14] Q&A Session Summary Question: Impact of tariffs on guidance - Management indicated it is premature to update full-year guidance but noted strong Q1 performance and a positive outlook for Q2 [25][26] Question: Device Solutions segment margins - Management expressed satisfaction with the current margins but noted variability due to seasonal factors and product mix [28][29] Question: Backlog and coverage for the year - Management stated that the demand environment remains strong and the outlook is positive, despite potential macroeconomic uncertainties [32][33] Question: Regulatory environment for software capitalization - Management highlighted that the regulatory environment is constructive, with various mechanisms allowing software purchases to be included in rate bases [39] Question: Tariff mitigation efforts - Management clarified that the $15 million estimate includes mitigation measures and is based on current tariff protocols [43][62] Question: M&A and capital deployment - The company is actively seeking acquisitions to enhance software content and drive growth, prioritizing this over share buybacks [71] Question: Recurring revenue mix in Outcomes - Management reported approximately 70% recurring revenue in Q1, with a goal of reaching 80% in the future [76]

Itron (ITRI) came out with quarterly earnings of $1.52 per share, beating the Zacks Consensus Estimate of $1.30 per share. This compares to earnings of $1.24 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 16.92%. A quarter ago, it was expected that this energy and water meter company would post earnings of $1.05 per share when it actually produced earnings of $1.35, delivering a surprise of 28.57%.Over the last four quarters, ...

Financial Performance - Revenue reached $607 million, a 1% increase year-over-year[4, 9] - Adjusted EBITDA was $88 million[4] - Non-GAAP diluted EPS stood at $1.52[4] - Free cash flow amounted to $67 million[4] - Gross margin increased by 180 bps to 35.8%[9] - Non-GAAP operating margin increased by 200 bps to 13.2%[10] Bookings and Backlog - Q1 2025 bookings totaled $530 million[8] - The book-to-bill ratio was 0.9[8] - Ending backlog reached $4.7 billion[8] Segment Performance - Outcomes segment revenue increased by 14%[26, 28]

Financial Data and Key Metrics Changes - Revenue for the first quarter was $607 million, a 1% increase year over year, with adjusted EBITDA of $88 million and non-GAAP earnings per share of $1.52 [5][12] - Free cash flow improved to $67 million from $34 million a year ago, reflecting strong operational earnings growth [14] - GAAP net income was $65 million or $1.42 per diluted share, compared to $52 million or $1.12 per share in the prior year [13] Business Segment Data and Key Metrics Changes - Device Solutions revenue decreased by 1% year over year to $126 million, but increased by 2% on a constant currency basis, with gross margin at 30% and operating margin at 24.2% [14][16] - Network Solutions revenue was $403 million, with a gross margin of 36.9% and operating margin of 28.8%, showing a slight decrease in gross margin due to product mix [16] - Outcomes revenue grew by 14% year over year to $79 million, with gross margin at 39.2% and operating margin at 18.2% [17] Market Data and Key Metrics Changes - Bookings for the quarter resulted in a book-to-bill ratio of 0.9, with a backlog of $4.7 billion, remaining near record levels [6][7] - Customer demand is driven by the adoption of Itron's Great Edge Intelligence platform, enhancing distribution capacity and infrastructure agility [5][6] Company Strategy and Development Direction - The company is focused on optimizing its factory footprint, strengthening supply chain resilience, and growing recurring revenue to capitalize on future opportunities [19][20] - Itron aims to maintain its industry leadership through the deployment of innovative solutions, positioning itself as a partner of choice for utilities and cities [19][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increased macroeconomic and trade policy uncertainty but expressed confidence in navigating near-term challenges [19] - The company expects Q2 revenue to be in the range of $605 million to $615 million, with non-GAAP earnings per share anticipated to grow approximately 12% year over year [18] Other Important Information - The estimated EBITDA impact from tariffs for the year is approximately $15 million, net of mitigation measures [10][42] - The regulatory environment remains constructive for customers, with various mechanisms allowing software purchases to be included in rate bases [38] Q&A Session Summary Question: Impact of tariffs on full year guidance - Management stated it is premature to update full year guidance but noted strong performance in Q1 and expectations for Q2 [24][26] Question: Device Solutions segment margins - Management expressed satisfaction with current margins but indicated variability may occur due to seasonal factors [28][29] Question: Twelve-month backlog removal - Management clarified that the removal was to avoid confusion and stated that the demand environment remains positive [32][33] Question: Regulatory environment for software capitalization - Management noted that the regulatory environment is supportive, with various mechanisms in place for software purchases [36][38] Question: Tariff mitigation efforts - Management explained that the $15 million estimate includes current tariffs and mitigation measures, with most impacts expected in the latter half of the year [62] Question: M&A activity and capital deployment - The priority remains finding acquisitions that enhance software content, with ongoing activity in the M&A space [71][72] Question: Recurring revenue mix in Outcomes segment - Management reported approximately 70% recurring revenue in Q1, with a goal of reaching closer to 80% in the future [75]

Revenue Performance - Total first quarter revenue increased by 1% to $607 million, including a catch-up of previously constrained revenue from Q1 2024[3] - Device Solutions revenue decreased by 1%, while Networked Solutions revenue also decreased by 1% due to timing of shipments and project deployments[4] - Outcomes revenue increased by 14%, driven by higher recurring revenue and software licenses[4] Profitability Metrics - Gross margin improved to 35.8%, an increase of 180 basis points from the prior year, attributed to product mix and operational efficiencies[5] - GAAP operating income rose to $76 million, a $13 million increase from the prior year, due to higher gross profit and lower operating expenses[6] - Net income attributable to Itron, Inc. was $65 million, or $1.42 per diluted share, reflecting a $14 million increase compared to the previous year[7] - Non-GAAP operating income rose to $80,269 in Q1 2025, up from $67,325 in Q1 2024, reflecting a growth of 19.3%[42] - GAAP net income attributable to Itron, Inc. increased to $65,474 from $51,721, representing a growth of 26.5%[44] - Adjusted EBITDA rose to $87,931, up from $76,480, reflecting an increase of 15.5%[44] Cash Flow and Liquidity - Free cash flow increased to $67 million, up $33 million from the prior year, primarily due to higher earnings and interest income[10] - Net cash provided by operating activities was $72,117 in Q1 2025, up from $41,308 in Q1 2024, indicating a growth of 74.7%[29] - Free Cash Flow improved significantly to $67,478 compared to $34,163, marking an increase of 97.5%[44] - Cash and cash equivalents at the end of Q1 2025 were $1,123,267, significantly up from $300,606 at the end of Q1 2024[29] Balance Sheet Highlights - Total assets increased to $3,503,142 in Q1 2025, compared to $3,407,623 in Q1 2024, marking a growth of 2.8%[26] - Total liabilities decreased slightly to $1,994,063 in Q1 2025 from $1,996,195 in Q1 2024[26] - The total equity of Itron, Inc. increased to $1,509,079 in Q1 2025 from $1,411,428 in Q1 2024, showing a growth of 6.9%[26] Future Outlook - The outlook for Q2 2025 includes expected revenue between $605 million and $615 million, and non-GAAP diluted EPS between $1.30 and $1.40[15] Operational Changes - Interest income decreased to $(11,710) from $(3,846), showing a decline of 204.5%[44] - Interest expense increased to $5,593 from $1,893, which is an increase of 195.5%[44] - Income tax provision rose to $16,929 from $13,429, reflecting an increase of 25.5%[44] - Depreciation and amortization slightly decreased to $12,068 from $12,744, a decline of 5.3%[44] - Restructuring costs changed from $198 to $(553), indicating a shift in strategy[44] - Acquisition and integration costs decreased to $51 from $318, showing a reduction of 83.9%[44] Customer Demand and Market Position - Itron's leadership in grid edge intelligence solutions continues to drive customer demand for new technologies[2] Backlog and Bookings - Total backlog at the end of the quarter was $4.7 billion, compared to $4.3 billion in the prior year, with bookings totaling $530 million[11] Quarterly Comparison - Net income for Q1 2025 was $65,350, an increase of 26.2% compared to $51,787 in Q1 2024[28] - Non-GAAP diluted EPS increased to $1.52 in Q1 2025, compared to $1.24 in Q1 2024, representing a growth of 22.6%[42] - Non-GAAP operating expenses decreased to $136,950 in Q1 2025 from $138,054 in Q1 2024, a reduction of 0.8%[42] - The company reported an increase in unearned revenue to $187,812 in Q1 2025, compared to $150,720 in Q1 2024, reflecting a growth of 24.6%[26]

Core Insights - Itron, Inc. reported financial results for Q1 2025, showing margin expansion and earnings growth ahead of expectations due to a favorable product mix and strong execution [1][2][4] Revenue Performance - Total revenue for Q1 2025 increased by 1% to $607 million, including a catch-up of previously constrained revenue from Q1 2024 [2] - Device Solutions revenue decreased by 1%, but increased by 2% in constant currency, driven by higher smart water sales offset by lower legacy electricity sales [2] - Networked Solutions revenue also decreased by 1% due to shipment timing and project deployment delays [3] - Outcomes revenue increased by 14%, attributed to higher recurring revenue and software licenses [3] Profitability Metrics - Gross margin for Q1 2025 was 35.8%, an increase of 180 basis points from the previous year, due to product mix and operational efficiencies [4] - GAAP operating income rose to $76 million, a $13 million increase from the prior year, while non-GAAP operating income also increased by $13 million to $80 million [5] Net Income and Earnings Per Share - Net income attributable to Itron, Inc. for the quarter was $65 million, or $1.42 per diluted share, compared to $52 million, or $1.12 per diluted share in 2024 [6] - Non-GAAP net income was $70 million, or $1.52 per diluted share, up from $57 million, or $1.24 per diluted share in the previous year [7] Cash Flow and Backlog - Net cash provided by operating activities was $72 million, compared to $41 million in the prior year, while free cash flow increased to $67 million from $34 million [8][9] - Total backlog at the end of the quarter was $4.7 billion, up from $4.3 billion in the prior year, with bookings totaling $530 million [10]