Johnson Controls Gears Up to Report Q1 Earnings: What to Expect?

Core Viewpoint - Johnson Controls International plc (JCI) is set to release its first-quarter fiscal 2025 financial results on February 5, 2025, with expectations of mixed performance across its segments [1][5]. Revenue Estimates - The consensus estimate for JCI's revenues is $5.33 billion, reflecting a decrease of 12.6% compared to the same quarter last year [2]. - Total revenues are expected to be $5.3 billion, indicating a slight increase of 2.1% year over year [5]. Earnings Estimates - The consensus estimate for adjusted earnings is 59 cents per share, which represents a 15.7% increase from the previous year [2]. - Adjusted earnings are anticipated to be 50 cents per share, showing a 9.2% increase from the year-ago quarter [5]. Segment Performance - The Building Solutions North America segment is projected to generate revenues of $2.7 billion, an increase of 8% from the previous year, driven by strong demand for HVAC platforms [3]. - The Building Solutions Europe, the Middle East, Africa/Latin America segment is expected to achieve revenues of $1.1 billion, indicating a 5% increase, supported by strength in control, security, and industrial refrigeration businesses [4]. - The Building Solutions Asia Pacific segment is anticipated to see a revenue decline of 14.3% year over year to $434.8 million, primarily due to weakness in system sales in China [6]. Cost and Margin Concerns - Escalating selling, general and administrative (SG&A) expenses, particularly due to higher insurance recovery costs, are expected to negatively impact JCI's margins [7]. - The company's significant international operations may face foreign currency headwinds, further affecting margins and profitability [7]. Earnings Prediction Model - The current model does not predict a definitive earnings beat for JCI, as it has a Zacks Rank of 4 (Sell) despite having a positive Earnings ESP of +0.60% [8][9].