CORK, Ireland - Johnson Controls (NYSE:JCI) reported third-quarter earnings that surpassed analyst expectations, with adjusted earnings per share (EPS) of $1.14, exceeding the consensus estimate by $0.06.
However, revenue fell short of expectations, coming in at $7.2 billion against the anticipated $7.33 billion. Despite the revenue miss, the company's stock responded positively, indicating investor confidence in the firm's financial health and future prospects.
The global leader for smart, healthy, and sustainable buildings saw a modest 1% increase in sales compared to the same quarter last year, with organic growth of 3%. The company's orders also grew organically by 5% year-over-year (YoY), and its Building Solutions backlog expanded by 10% organically YoY, reaching a record $12.9 billion.
Chairman and CEO George Oliver commented on the quarter's performance, stating, "Our third quarter results exceeded expectations with robust margin expansion, strong free cash flow generation, and continued Service demand." He further highlighted the company's strategic moves, including divestitures that streamline its focus on commercial building solutions, as a significant step toward unlocking shareholder value.
Looking ahead to the fourth quarter, Johnson Controls has initiated guidance with an adjusted EPS range of $1.23 to $1.26. The midpoint of this range, $1.245, is above the analyst consensus of $1.19, suggesting a positive outlook for the next quarter. The narrowing of guidance for the fourth quarter, a sign of management's confidence in the company's performance, has been identified as the driver behind the stock's positive movement.
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