Johnson Controls Q1 Earnings & Revenues Surpass Estimates, Rise Y/Y

Core Insights - Johnson Controls International plc (JCI) reported adjusted earnings of 64 cents per share for Q1 fiscal 2025, exceeding the Zacks Consensus Estimate of 59 cents, marking a 39.1% year-over-year increase [1] - Total revenues for continuing operations reached $5.43 billion, surpassing the consensus estimate of$ 5.33 billion, with a year-over-year increase of 4.2% and organic revenue growth of 10% [1] Q1 Segmental Results - Building Solutions North America: Revenues were $2.74 billion, up 10% year over year, with organic sales also increasing by 10%. Adjusted EBITA rose 16% to$ 332 million [2] - Building Solutions Europe, Middle East, Africa/Latin America: Revenues totaled $1.07 billion, a 3% increase year over year, with organic sales climbing 6%. Adjusted EBITA was$ 108 million, up 35% [3] - Building Solutions Asia Pacific: Revenues increased 4% to $527 million, with organic sales growing 5%. Adjusted EBITA was$ 49 million, up 7% [3] - Global Products: Revenues were $1.08 billion, down 8% year over year, but organic sales increased by 15%. Adjusted EBITA rose 21.6% to$ 326 million [4] Margin Profile - JCI's cost of sales increased 2% year over year to approximately $3.5 billion. Gross profit rose 8.3% to$ 1.9 billion, with a margin increase of 140 basis points to 35.5%. Selling, general and administrative expenses were $1.4 billion, up 4.9% year over year [5] Financial Position - As of December 31, 2024, JCI had cash and cash equivalents of$ 1.24 billion, up from $606 million at the end of fiscal 2024. Long-term debt increased to$ 8.6 billion from $8 billion [6] Cash Flow and Share Repurchase - In Q1 fiscal 2025, JCI generated net cash of$ 249 million from operating activities, compared to a cash outflow of $111 million in the same period last year. Free cash flow was$ 133 million, a turnaround from a free cash outflow of $193 million in the prior year. The company repurchased 4.1 million shares for approximately$ 330 million [7] Guidance - For Q2, JCI anticipates mid-single digit organic revenue growth and an adjusted segment EBITA margin of approximately 16.5%. Adjusted earnings are expected to be in the range of 77-79 cents per share [8] - For FY25, JCI expects organic revenue growth in the mid-single digit range and an adjusted segment EBITA margin improvement of more than 80 basis points. Adjusted earnings are projected to be between $3.50 and$ 3.60 per share [9][10]