Emerson Electric Company (EMR) Q4 2026 Earnings Report

The call was predominantly positive. Emerson reported strong orders, sales, margins, earnings, free cash flow, backlog, project activity, and growth-vertical performance, while meeting its strategic objectives and remaining on track for its 2028 commitments. The principal challenges were persistent weakness in Europe and China, Middle East conflict exposure, modest growth in Intelligent Devices and Safety and Productivity, and a more cautious semiconductor outlook. Management nevertheless expressed confidence in the 2027 plan.

For fiscal 2027, Emerson is guiding GAAP and underlying sales growth of approximately 5%, adjusted segment EBITDA margin of 29%, up 80 basis points year over year, adjusted earnings per share of $7.25 up 10%, and free cash flow of $3.8 billion to $3.9 billion, with 2% price realization built into the plan; software and systems are expected to grow 8% to 9% in the first quarter and 7% to 8% for the full year, ACV is expected to grow approximately 10%, intelligent devices 3% to 4% in the first quarter and 4% for the full year, and safety and productivity 3% to 4% in both Q1 and the full year, while growth verticals are expected to deliver low double digit growth, the Americas mid single digit growth, Europe low single digit growth, The Middle East up high single digits again assuming the conflict does not escalate, the rest of Asia mid single digit growth, and other automation markets a moderate increase to low single digit growth; first-quarter guidance is GAAP and underlying sales growth of approximately 5%, adjusted segment EBITDA margin of 28%, adjusted earnings per share of $1.58 to $1.62, and approximately $1.5 billion of share repurchase, while Emerson plans to return approximately $3.8 billion to shareholders through $2.5 billion of share repurchases and $1.3 billion in dividends, including raising dividend per share by 7% and $0.16.