What to Note Ahead of Johnson Controls' (JCI) Q2 Earnings?

Core Viewpoint - Johnson Controls International plc (JCI) is expected to report its second-quarter fiscal 2024 financial results on May 01, with mixed expectations regarding earnings performance and revenue growth [1][4]. Financial Performance Expectations - The consensus estimate for JCI's second-quarter fiscal 2024 revenues is $6.8 billion, indicating a 1% increase from the previous year [1]. - The consensus estimate for adjusted earnings is 75 cents per share, consistent with the year-ago quarter [1]. Segment Performance Insights - The Building Solutions North America segment is projected to generate revenues of $2.6 billion, reflecting a 2.4% increase year-over-year [2]. - The Building Solutions Europe, the Middle East, Africa/Latin America segment is expected to achieve revenues of $1 billion, suggesting a 0.2% increase from the prior year [2]. - Investments in digital offerings, particularly the OpenBlue digital platform, are anticipated to contribute positively to revenue growth [2]. Challenges and Risks - JCI is expected to face challenges in its Global Products and Building Solutions Asia Pacific segments, with declining global residential sales impacting the Global Products segment [3]. - The Building Solutions Asia Pacific segment is likely to be affected by difficult market conditions in China [3]. - An increase in the cost of sales, projected to rise by 2.5% year-over-year, may negatively impact profit margins [3]. Earnings Prediction Insights - The current Earnings ESP for JCI is -0.74%, indicating a lower Most Accurate Estimate of 75 cents per share compared to the Zacks Consensus Estimate of 76 cents [4]. - JCI holds a Zacks Rank of 4 (Sell), suggesting a lower likelihood of an earnings beat this quarter [4].