Itron(US:ITRI)2026-02-17 16:02Financial Data and Key Metrics Changes - Revenue for Q4 2025 was $572 million, with adjusted EBITDA of $99 million and non-GAAP EPS of $2.46, reflecting strong execution and demand for Grid Edge Intelligence [5][11] - Free cash flow reached $112 million in Q4, up from $70 million a year ago, indicating improved earnings growth and working capital management [12] - Full year 2025 revenue was $2.37 billion, down 3% year-over-year, attributed to the absence of catch-up revenue seen in 2024 [17] Business Line Data and Key Metrics Changes - Device Solutions revenue decreased by 7% year-over-year, primarily due to a decline in legacy electricity products [13] - Network Solutions revenue fell by 15% year-over-year, mainly due to project deployment timing [14] - Outcomes revenue increased by 22% year-over-year, driven by delivery services and recurring revenue growth [14] - The new Resiliency Solutions segment contributed $3 million in revenue since its inception in November 2025 [14] Market Data and Key Metrics Changes - Fourth quarter bookings totaled $737 million, with a backlog of $4.5 billion, indicating strong demand for Grid Edge solutions [7] - Annual recurring revenue (ARR) reached approximately $368 million at the end of Q4, up 20% year-over-year [30] Company Strategy and Development Direction - The company is focused on enhancing utility resiliency through strategic acquisitions, including Urbint and Locusview, which will expand its offerings in emergency preparedness and digital construction management [9][10] - Itron aims to support customers throughout the asset lifecycle, emphasizing the importance of data-driven solutions for grid transformation [24][25] Management's Comments on Operating Environment and Future Outlook - Management noted that the operating environment for utilities is evolving, creating both opportunities and challenges, but remains confident in the company's strategic direction [23] - The company anticipates 2026 revenue to be between $2.35 billion and $2.45 billion, with non-GAAP EPS expected to range from $5.75 to $6.25 [19][20] Other Important Information - Total debt at the end of Q4 was $1.265 billion, with cash and equivalents at $1.02 billion, reflecting a decrease due to acquisitions and stock buybacks [18] - The company expects the two recent acquisitions to be accretive to revenue growth and gross margins but dilutive to EPS in 2026 [20][21] Q&A Session Summary Question: Update on utility demand and behavior trends - Management reported strong fourth quarter bookings of $737 million and noted that the market is constructive, with no further delays in project timelines [28][29] Question: Clarification on ARR metric - The ARR of $368 million at the end of Q4 is an annualized run rate, with expectations for continued growth in 2026 [31][35] Question: Barriers to entry in resiliency solutions - Management highlighted the stickiness of their solutions due to extensive field service usage, which enhances customer value and retention [44][46] Question: Revenue and margin seasonality in new segment - Management does not anticipate significant seasonality in the Resiliency Solutions segment, expecting steady growth over time [48] Question: Utility ordering patterns and project trends - Management indicated that ordering patterns have normalized, with a healthy book and ship business, particularly in the electricity sector [52][54] Question: Insights on pipeline growth and market share - Management noted a 27% increase in pipeline growth and indicated that the company is gaining market share in core markets [29][64] Question: Expectations for future bookings and growth - Management expressed confidence in the trajectory of the business, with a focus on the growing Outcomes backlog and normalized project activity [81][82]