On Aug. 4, Emerson Electric reported third-quarter results that exceeded Wall Street estimates, with strength centered in its industrial automation offerings and software-connected test and measurement systems. Management said demand remained robust in North America and Asia for those products and services that support customers in bringing products to market through functions such as data acquisition and control.
Key financials for the quarter ended June 30:
- Adjusted earnings per share were $1.71, above the $1.68 per share analysts had expected, according to data compiled by LSEG.
- Total revenue was $4.87 billion, a 7% increase from the year-earlier quarter. The consensus revenue expectation was $4.8 billion.
Segment performance highlighted expansion in Emerson's software and systems business, which posted an 11% revenue increase in the quarter. Within that segment, sales of test and measurement products rose sharply, jumping 23% as customers sought automated, software-connected systems.
Regional performance, however, showed mixed results. Sales in Europe declined 1% compared with the prior year period. Earlier in the year the company had identified potential headwinds linked to flat activity and specific challenges in the European automotive, packaging and chemical industries.
Following the report, the company's shares were down about 2.4% in after-hours trading.
This quarter's results reflect a combination of resilient end-market demand for automation and measurement capabilities in North America and Asia and a contrasting softness in Europe. Emerson's software and systems growth, particularly in test and measurement, underpinned the beat on both revenue and adjusted EPS. At the same time, the modest decline in European sales and the prior caution about industry-specific headwinds highlight areas to monitor going forward.