Financial Data and Key Metrics Changes - Emerson's underlying sales growth was 2% year-over-year, with adjusted segment EBITDA margin at 27.7% and adjusted earnings per share at $1.46, reflecting a 6% increase year-over-year [10][19][24] - The backlog ended the quarter at $7.9 billion, up 9% year-over-year, with a book-to-bill ratio of 1.13 [19][63] Business Line Data and Key Metrics Changes - Software and systems reported a 3% underlying sales growth, driven by test and measurement, which grew 11% [19][23] - Intelligent devices grew 2%, while safety and productivity increased by 1% [19][24] - Ovation business saw a significant increase of 74% in orders, driven by large project wins [14][40] Market Data and Key Metrics Changes - North America orders were up 18%, with strong performance in power and LNG sectors [38][97] - The Middle East and Africa experienced a 9% growth, while Europe and China showed ongoing softness [14][38][75] Company Strategy and Development Direction - Emerson aims to return $10 billion to shareholders through share repurchase and dividends, with a focus on organic growth and operational excellence [7][11] - The company is aligned with secular tailwinds such as electrification, energy security, and nearshoring, expecting these to drive growth over the next three years [5][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 targets, supported by a good start to the year and operational excellence [10][11] - The company anticipates continued strong demand in North America, India, and the Middle East, while acknowledging challenges in Europe and China [14][75] Other Important Information - Emerson was named the 2026 Industrial IoT Company of the Year, highlighting its leadership in industrial IoT technology [11] - The company released DeltaV version 16, enhancing its software-defined automation vision [12] Q&A Session Summary Question: Can you break down the 9% order growth in Q1 between process and hybrid? - Management noted that power orders were driven by modernization and behind-the-meter power generating capacity at data centers, with significant growth in test and measurement orders [34][36][40] Question: What is the expected impact of AI on software growth? - Management believes AI capabilities will accelerate growth in software offerings, with minimal disruption expected [41][43] Question: Are the orders in power pushing beyond this year into multi-year phases? - Management confirmed confidence in backlog timing supporting sales into 2027, particularly in power and LNG sectors [46][47] Question: What is the outlook for weak verticals like chemicals? - Management indicated continued flat activity in Europe, particularly in chemicals, with a bearish outlook for China [75][76] Question: What is the opportunity in Venezuela? - Management acknowledged a long-established history in Venezuela and plans to mobilize for potential growth, particularly in power generation [104][106] Question: Any updates on tariffs and mitigation activity? - Management reported some positive developments regarding tariffs, particularly with China, while noting challenges with Mexico [115] Question: What are the green shoots in China? - Management highlighted good activity in the test and measurement space and broad portfolio business, despite overall softness [117]

Financial Data and Key Metrics Changes - The company reported underlying sales growth of 2% year-over-year, with adjusted segment EBITDA margin at 27.7% and adjusted earnings per share (EPS) of $1.46, reflecting a 6% increase year-over-year [18][20][46] - The backlog ended the quarter at $7.9 billion, up 9% year-over-year, with a book-to-bill ratio of 1.13 [37][91] - Free cash flow for Q1 was $602 million, with a margin of 14%, positioning the company well for expected full-year growth of approximately 10% at greater than 18% margin [38][20] Business Line Data and Key Metrics Changes - The Software and Systems segment grew underlying sales by 3%, driven by strong performance in Test and Measurement, which was up 11% [42] - Intelligent Devices reported a 2% growth, while Safety and Productivity was up 1% [43] - The Ovation business saw a significant increase of 74% in orders, driven by large project wins in power generation [26][67] Market Data and Key Metrics Changes - North America orders were up 18%, with strong demand in Power and LNG sectors, while Europe and China experienced softness [65][66] - The Middle East and Africa saw a 9% growth driven by Greenfield project activity, while India orders increased by 22% [65][66] - The company noted ongoing challenges in the Chemical sector, particularly in Europe and China, impacting overall performance [102][104] Company Strategy and Development Direction - The company aims to return $10 billion, or 70% of cumulative cash, to shareholders through share repurchase and dividend payouts [10] - Emerson's automation portfolio is aligned with secular tailwinds such as electrification, energy security, and nearshoring, expected to drive growth over the next three years [8] - The company is focused on operational excellence and plans to expand adjusted segment EBITDA margins by 240 basis points by 2028 [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2028 targets, including $21 billion in revenue and 30% adjusted segment EBITDA margins [10] - The company anticipates continued strong demand in North America, India, and the Middle East, while acknowledging challenges in Europe and China [24][39] - Management highlighted the importance of AI and digital transformation in driving customer investments in automation [70][71] Other Important Information - Emerson was named the 2026 Industrial IoT Company of the Year, marking the fourth time in five years it received this recognition [21] - The company released DeltaV Version 16, enhancing its software-defined automation vision [22] - A strategic collaboration with Roche was announced to improve technology transfer processes in Life Sciences [23] Q&A Session Summary Question: Can you break down the 9% order growth in Q1 between process and hybrid? - Management noted that Power orders were driven by modernization and behind-the-meter power generation, with significant growth in Test and Measurement [60][62] Question: What is the expected impact of AI on software growth? - Management believes AI capabilities will accelerate growth in software offerings, with minimal disruption expected [69][71] Question: Are the orders in Power pushing beyond this year into multi-year phases? - Management confirmed confidence in backlog timing supporting growth into 2027, particularly in Power and LNG [75] Question: What is the outlook for weak verticals like Chemicals? - Management acknowledged continued flat activity in Chemicals, particularly in Europe, and a bearish outlook for China [102][104] Question: What is the company's strategy regarding Venezuela? - Management indicated a long-established relationship in Venezuela and plans to mobilize for potential growth opportunities as conditions improve [135][138] Question: Any updates on tariffs and mitigation activities? - Management reported some positive developments regarding tariffs, particularly with China, while noting challenges with Mexico [146]

Financial Data and Key Metrics Changes - In Q1 2026, underlying sales increased by 2% year-over-year, with adjusted segment EBITDA margin at 27.7% and adjusted earnings per share (EPS) at $1.46, reflecting a 6% increase year-over-year [9][10][17] - The company expects full-year sales growth of approximately 4% and adjusted EPS guidance raised to $6.40-$6.55 per share [10][23] Business Line Data and Key Metrics Changes - The software and systems segment saw underlying sales growth of 3%, driven by strong performance in test and measurement, which grew 11% [20][24] - Intelligent devices grew by 2%, while safety and productivity increased by 1% [20][22] - The Ovation business experienced a significant increase of 74% in orders, driven by large project wins [12][29] Market Data and Key Metrics Changes - North America, India, and the Middle East and Africa showed robust demand, with North America orders up 18% [12][32] - Europe and China experienced ongoing softness, with orders in Europe down low single digits and China down high single digits [12][32] - The overall order growth was 9%, with significant contributions from power and LNG sectors [12][29] Company Strategy and Development Direction - The company aims to return $10 billion to shareholders through share repurchases and dividends, with a focus on organic growth and operational excellence [5][10] - Emerson's automation portfolio is aligned with secular trends such as electrification and energy security, expected to drive growth over the next three years [4][5] - The company is committed to enhancing adjusted segment EBITDA margins by 240 basis points by 2028 [4] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 targets, supported by a strong start to the year and operational excellence [9][10] - The company noted that AI capabilities integrated into their software offerings are expected to accelerate growth rather than disrupt it [33] - Concerns were raised about the softness in Europe and China, particularly in the chemical sector, but there are signs of growth in test and measurement and power generation [44][60] Other Important Information - Emerson completed $250 million in share repurchases in Q1 and plans to return approximately $2.2 billion to shareholders [10][23] - The company was recognized as the 2026 Industrial IoT Company of the Year, highlighting its leadership in industrial IoT technology [10] Q&A Session Summary Question: Can you break down the 9% order growth in Q1 between process and hybrid? - Management noted that the growth was predominantly driven by modernization and behind-the-meter power generating capacity at data centers, with significant activity in test and measurement [29][30] Question: What are the expectations for the impact of AI on software growth? - Management indicated that AI capabilities are expected to complement and accelerate growth in software offerings, with minimal disruption anticipated [33] Question: How should we think about the cadence of longer-cycle orders translating into sales? - Management stated that the backlog supports mid-single-digit growth and that the build is across various business segments, particularly in control systems and software [40] Question: What is the outlook for the chemical sector in Europe and China? - Management acknowledged continued flat activity in Europe, particularly in chemicals, and a bearish outlook for China, with expectations of low single-digit declines [44][60] Question: What is the company's strategy regarding the opportunity in Venezuela? - Management highlighted a long-established history in Venezuela and plans to mobilize resources to capitalize on potential growth opportunities in the region, particularly in power generation [54][56]

2026 Q1 Earnings February 3, 2026 EMERSON | 1 Safe Harbor Statement Statements in this presentation and our commentary and responses to questions that are not strictly historical may be "forward-looking" statements, which represent management's expectations, based on currently available information. Actual results, performance or achievements could differ materially from those expressed in any forward-looking statement. Any forward-looking statements in this presentation speak only as of the date of this pr ...