It has been about a month since the last earnings report for Trimble Navigation (TRMB). Shares have added about 4.5% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Trimble due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Trimble Q3 Earnings Beat Estimates, Revenues Declined Y/Y

Trimble delivered non-GAAP earnings of 70 cents per share in the third quarter of 2024, surpassing the Zacks Consensus Estimate by 12.9%. The reported figure increased 2.9% year over year.

Revenues of $875.8 million beat the Zacks Consensus Estimate by 1.1% but declined 8.5% year over year (3% up on an organic basis).

Product revenues (35.1% of total revenues) were $307.6 million, down 30.7% year over year. Subscription and services revenues (64.9% of total revenues) increased 10.7% year over year to $568.2 million.

TRMB generated annualized recurring revenues (ARR) of $2.19 billion, which increased 13% year over year (up 14% on an organic basis).

TRMB’s Quarterly Details

The AECO (Architecture, Engineering, Construction, and Owners) segment’s revenues (34.9% of total revenues) were $306 million, up 13.5% year over year.

The AECO segment delivered 18% ARR growth, led by successful product and go-to-market innovations, contributing to strong Annual Contract Value booking growth and the adoption of common back-end systems.

Field Systems revenues (42.8% of total revenues) of $374.6 million fell 24.4% year over year. The segment achieved 19% ARR growth, driven by Positioning Services, Trimble Catalyst positioning-as-a-service, Works Plus and the launch of the subscription version of Trimble Business Center.

T&L revenues (22.3% of total revenues) of $195.2 million climbed 1.5% year over year. The segment saw 5% ARR growth, with Transporeon achieving a double-digit rise and Maps experiencing high-single-digit ARR growth.

In the third quarter of 2024, the non-GAAP gross margin was 68.5%, expanding 350 basis points (bps) year over year.

On a non-GAAP basis, operating expenses accounted for 42.8% of total revenues, up 410 bps year over year.

The non-GAAP operating margin was 25.7%, contracting 30 bps year over year.

Trimble’s Balance Sheet Remains Strong

At the end of the third quarter of 2024, cash and cash equivalents were $1036.9 million, up from $944.1 million at the end of the second quarter of 2024.

Total debt was $1.79 billion at the end of the third quarter, remaining unchanged from the previous quarter.

The free cash flow was $88.5 million compared with the previous quarter’s $73.3 million.