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• Reported Sales: Down 6% year-over-year.

• Organic Sales: Declined 4% year-over-year.

• Segment Operating Margin: 20.4%, up from 19% a year ago.

• Adjusted EPS: $2.45, above expectations.

• Free Cash Flow: $171 million, $102 million higher than the prior year.

• Free Cash Flow Conversion: 61% in the second quarter.

• Intelligent Devices Organic Sales: Declined 6% year-over-year.

• Software & Control Organic Sales: Up 2% year-over-year.

• Lifecycle Services Organic Sales: Decreased 6% year-over-year.

• Annual Recurring Revenue (ARR): Grew 8% in the quarter.

• Full Year Segment Margin Target: Increased to 20%.

• Full Year Adjusted EPS Guidance: $9.20 to $10.20, midpoint at $9.70.

• Free Cash Flow Conversion Target: 100% for fiscal year 2025.

• Currency Impact: Negative 2 points on sales in the quarter.

• Book-to-Bill Ratio: In line with historical norm of about 1.0.

• Warning! GuruFocus has detected 6 Warning Signs with ROK.

Release Date: May 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Rockwell Automation Inc (NYSE:ROK) reported a solid sequential improvement in customer demand across many parts of its business, with a healthy intake of orders and a book-to-bill ratio in line with historical norms.

• The company's Intelligent Devices segment saw double-digit sequential growth across all key product lines, driven by strong performance in the Power Control business.

• Software & Control organic sales were up 2% year-over-year, with increased adoption of the FactoryTalk Design Studio, featuring a GenAI Copilot.

• Rockwell Automation Inc (NYSE:ROK) achieved a segment margin of 20.4% and adjusted EPS of $2.45, both above expectations, driven by cost reduction and margin expansion actions.

• The company is increasing its full-year segment margin target to 20% and expects adjusted EPS to be about $9.70 at the midpoint, reflecting strong execution and demand.

Negative Points

• Reported sales were down 6% year-over-year, with organic sales down 4% due to difficult year-over-year comparisons.

• Lifecycle Services organic sales decreased 6% year-over-year, impacted by trade and policy uncertainty affecting large CapEx projects.

• The company's energy business underperformed expectations due to customers exercising capital discipline and project delays.

• Unfavorable currency reduced sales by about 2 percentage points, impacting overall financial performance.

• Despite strong execution, there remains uncertainty in the second half regarding pricing to offset new tariffs and the timing of CapEx investments by customers.