Schneider Electric tumbles 7% on revenue miss in Q1, reduced margin outlook

Published 29/04/2025, 10:20

Investing.com -- Shares of Schneider Electric (EPA:SCHN) tumbled 7% on Tuesday after the company reported weaker-than-expected first-quarter revenue and revised down its core profit margin forecast for the year.

The French electrical equipment maker posted organic revenue growth of 7.4% in the first quarter, reaching 9.33 billion euros ($10.67 billion). The result fell short of analysts’ expectations of 9.47 billion euros and a projected growth rate of 8.9%.

Despite the weaker start to the year, Schneider remains on track to achieve its full-year 2025 organic revenue growth target of 7% to 10%, supported by an expected rebound in industrial automation in the second half and steady demand from data center clients.

RBC Capital Markets analysts said the company’s post-first-quarter call “reaffirmed the strong underlying picture, including crucially in the datacenter segment and continued recovery in discrete demand.”

"We recently upgraded Schneider to Outperform in part because of its more resilient business mix and we see the underlying performance and 2025 outlook as supporting this," they added. 

Schneider Electric CFO Hilary Maxson said that the decline in sales stemmed from weaker conditions in the residential building sector, especially in Western Europe and North America.

In Western Europe, Schneider saw limited growth as the residential sector remained under pressure from economic uncertainty and declining consumer confidence, while demand in non-residential segments proved more stable.

The group’s product division, which contributes around half of total revenue, posted a 1% increase for the quarter. In North America, the residential segment faced headwinds from macroeconomic uncertainty and elevated interest rates.

Schneider also reaffirmed its full-year outlook but lowered its adjusted EBITA margin forecast to between 18.7% and 19%, below the 19.3% consensus estimate from analysts.

Maxson said the margin revision reflects a full-year foreign exchange impact that “could be around 40 basis points.”

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.