Financial Data and Key Metrics Changes - Organic sales grew by 6% in Q3 2025, with segment margins expanding by 20 basis points to 17.6% [5][22] - Adjusted EPS increased by 11% year-over-year to $1.05, exceeding guidance [5][22] - Year-to-date adjusted free cash flow nearly doubled to $1.8 billion, with over 100% free cash flow conversion expected for the year [5][22] Business Line Data and Key Metrics Changes - Orders grew by 2%, with strength in The Americas offset by softness in China [6][23] - In the Americas, orders increased by 5%, while EMEA saw a 2% increase, and APAC experienced a decline [23][24] - Sales in the Americas rose by 7% organically, with EMEA growing by 4% and APAC by 6% [24][25] - The backlog grew by 11% to a record $14.6 billion, with both system and service backlogs increasing [6][26] Market Data and Key Metrics Changes - Orders in the Americas increased by 5%, while EMEA saw a 2% increase, and APAC orders declined [23][24] - The service business showed strong growth, particularly in EMEA with an 8% increase [24][25] - The data center market remains robust, contributing to healthy sales growth [94] Company Strategy and Development Direction - The company is focusing on customer centricity, operational efficiency, and innovation to drive growth [8][9] - A new business system is being implemented, emphasizing simplification, acceleration, and scaling through lean principles and digitization [12][13] - The company is evaluating its portfolio for potential acquisitions or exits to ensure sustainable growth [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the core vertical markets remaining healthy despite challenges in China [64] - The company anticipates low single-digit organic sales growth for Q4 and is raising its full-year guidance for adjusted EPS and free cash flow [27][28] - There is a focus on improving operational efficiency and addressing growth blockers identified in various business lines [15][16] Other Important Information - The sale of the residential and light commercial HVAC business to Bosch is expected to close in Q4, with most net proceeds returned to shareholders [28] - The company is committed to returning 100% of free cash flow to shareholders through dividends and share repurchases [27][28] Q&A Session Summary Question: Initial observations and KPIs focus - Management highlighted the importance of sharpening customer focus and driving growth through innovation and R&D investments [30][32] Question: Accelerating growth in Fire and Security - Management sees potential for growth in Fire and Security, with plans to apply new business system principles to improve performance [41][44] Question: Free cash flow opportunities - Management noted strong cash flow performance driven by improved accounts receivable management and ongoing lean transformation efforts [47][49] Question: Order trends and long-term outlook - Management acknowledged ongoing softness in China but expressed confidence in healthy pipelines and core vertical markets [62][64] Question: Framework for 2026 and Investor Day plans - Management is working on 2026 plans and aims to provide a clearer long-term outlook as the year progresses [71][73]