ABB(US:ABBNY)2021-10-21 12:00Financial Data and Key Metrics Changes - Strong order growth of 26% year-over-year, with margins at 15.1%, supported by low corporate costs [2][4][6] - Cash flow from operating activities reached $1.1 billion, an improvement of approximately $720 million from the previous year [16][17] - Full-year revenue guidance adjusted to a growth range of 6% to 8%, down from just below 10% [21][22] Business Line Data and Key Metrics Changes - Electrification orders grew by 17%, with a notable increase in the Americas and mid-single-digit growth in China [7][8] - Motion orders increased by 22%, but revenues were adversely impacted by semiconductor shortages, resulting in a 2% revenue growth [9][10] - Process Automation saw a 40% increase in orders and a 5% increase in revenues, with a significant order of $120 million booked in Australia [11][12] - Robotics and Discrete Automation had a 26% increase in order intake, but revenues declined by 3% due to supply chain issues [14][15] Market Data and Key Metrics Changes - Strong growth in the U.S. market at 31%, with double-digit growth in Europe and a 9% increase in China [5][6] - The order backlog reached a record high of $5.2 billion, indicating strong demand despite supply chain challenges [8][9] Company Strategy and Development Direction - The company aims to enhance its product offerings, including the launch of the world's fastest EV charger and a focus on sustainable mining solutions [2][3] - There is a commitment to maintaining stringent cost control and improving operational performance across all divisions [6][12] - The company is exploring options for the Turbo business, considering a spin-off or sale, while emphasizing the importance of the Process Automation segment [42][43][74] Management's Comments on Operating Environment and Future Outlook - Management anticipates continued challenges in supply chain delivery capabilities, with expectations for comparable revenue growth in Q4 to be similar to Q3 [20][21] - The company remains optimistic about the strong order book and expects to deliver on it despite supply chain constraints [40][41] - Management highlighted the importance of multiple sourcing strategies to mitigate supply chain risks moving forward [32][33] Other Important Information - The company is focusing on cash flow sustainability, with expectations of reaching approximately $2.5 billion in free cash flow for the full year [51] - There is a strong emphasis on quality in the order backlog, with no significant order cancellations reported [34][83] Q&A Session Questions and Answers Question: What is the expected margin for Electrification in 2022? - Management indicated that the margin for Electrification is expected to improve in principle in 2022 compared to 2021, despite current challenges [24] Question: What is the situation regarding supply chain issues in China? - Management stated that power shortages have not yet impacted operations significantly, and demand remains strong in the Chinese market [52][53] Question: How is the company addressing the semiconductor shortages? - Management acknowledged the challenges posed by semiconductor shortages but emphasized that there have been no order cancellations, indicating strong demand [60][63] Question: What is the outlook for the Turbo business? - Management confirmed that the Turbo business is resilient and has seen a strong demand pickup, with plans for a potential spin-off or sale [74][77] Question: What measures are being taken to improve Process Automation? - Management is focused on enhancing operational performance in Process Automation and believes there is significant potential for improvement [86]