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Eaton Reports Record Third Quarter 2024 Results, with Accelerating Orders and Continued Backlog Growth
DUBLIN – Intelligent power management company Eaton Corporation plc (NYSE:ETN) today announced that earnings per share were $2.53 for the third quarter of 2024, up 14% over the third quarter of 2023. Excluding charges of $0.21 per share related to intangible amortization, $0.11 per share related to a multi-year restructuring program, and income of $0.01 per share related to acquisitions and divestitures, adjusted earnings per share of $2.84 were a record and up 15% over the third quarter of 2023.
Sales in the quarter were $6.3 billion, a third quarter record and up 8% from the third quarter of 2023, driven entirely by organic sales growth. Hurricane Helene and labor strikes in the aerospace industry negatively impacted sales by approximately $50 million, or 50 basis points.
Segment margins were 24.3%, a quarterly record and a 70-basis point improvement over the third quarter of 2023.
Operating cash flow was $1.3 billion and free cash flow was $1.1 billion, both quarterly records and up 15% and 23%, respectively, over the same period in 2023.
Craig Arnold, Eaton chairman and chief executive officer, said, “Our business and teams performed well in the quarter. We executed effectively, resulting in order acceleration and further backlog growth in an environment of continuing strong demand. As a result, we’re confident in our ability to close the year strong with raised earnings guidance and expect this positive momentum to continue into 2025.”
Guidance
For the full year 2024, the company is raising the following guidance:
For the fourth quarter of 2024, the company anticipates:
Business Segment Results
Sales for the Electrical Americas segment were a record $3.0 billion, up 14% from the third quarter of 2023, driven entirely by organic sales growth. Operating profits were a record $892 million, up 24% over the third quarter of 2023. Operating margins in the quarter were a record 30.1%, up 240 basis points over the third quarter of 2023.
The twelve-month rolling average of orders in the third quarter was up 16% organically. Backlog at the end of September remained at record levels, up 26% organically over September 2023.
Sales for the Electrical Global segment were a third quarter record $1.6 billion, up 5% from the third quarter of 2023. Organic sales were up 4%, and positive currency translation added 1%. Operating profits were $294 million and operating margins in the quarter were 18.7%.
The twelve-month rolling average of orders in the third quarter was up 6% organically. Backlog at the end of September was up 19% organically over September 2023.
On a rolling twelve-month basis, the book-to-bill ratio for the Electrical businesses remained strong at 1.1.
Aerospace segment sales were a third quarter record $946 million, up 9% from the third quarter of 2023. Organic sales were up 8%, and positive currency translation added 1%. Operating profits were a record $230 million, up 10% over the third quarter of 2023, and operating margins in the quarter were 24.4%, up 30 basis points over the third quarter of 2023.
The twelve-month rolling average of orders in the third quarter was up 6% organically. The backlog at the end of September was up 14% organically over September 2023. On a rolling twelve-month basis, the book-to-bill ratio for the Aerospace segment remained strong at 1.1.
The Vehicle segment posted sales of $696 million, down 7% from the third quarter of 2023, driven by organic sales decline of 6% and negative currency translation of 1%. Operating profits were $135 million, up 3% over the third quarter of 2023. Operating margins in the quarter were a record 19.4%, up 200 basis points over the third quarter of 2023.
eMobility segment sales were $167 million, a third quarter record and up 2% over the third quarter of 2023. Organic sales were up 1%, and positive currency translation added 1%. The segment recorded an operating loss of $7 million as we continue to incur launch costs related to new programs expected to ramp up over the upcoming quarters.
Eaton is an intelligent power management company dedicated to protecting the environment and improving the quality of life for people everywhere. We make products for the data center, utility, industrial, commercial, machine building, residential, aerospace and mobility markets. We are guided by our commitment to do business right, to operate sustainably and to help our customers manage power ─ today and well into the future. By capitalizing on the global growth trends of electrification and digitalization, we’re accelerating the planet’s transition to renewable energy sources, helping to solve the world’s most urgent power management challenges, and building a more sustainable society for people today and generations to come.
Eaton was founded in 1911 and has been listed on the New York Stock Exchange for more than a century. We reported revenues of $23.2 billion in 2023 and serve customers in more than 160 countries. For more information, visit www.eaton.com. Follow us on LinkedIn.
Notice of conference call: Eaton’s conference call to discuss its third quarter results is available to all interested parties today as a live audio webcast at 11 a.m. United States Eastern time via a link on Eaton’s home page. This news release can be accessed under its headline on the home page. Also available on the website before the call will be a presentation on third quarter results, which will be covered during the call.
This news release contains forward-looking statements concerning fourth quarter and full year 2024 earnings per share, adjusted earnings per share and segment margins; fourth quarter 2024 organic growth; 2025 earnings momentum; as well as anticipated multi-year restructuring program charges and savings. These statements should be used with caution and are subject to various risks and uncertainties, many of which are outside the company’s control. The following factors could cause actual results to differ materially from those in the forward-looking statements: a global pandemic such as COVID-19; geopolitical tensions or war, unanticipated changes in the markets for the company’s business segments; unanticipated downturns in business relationships with customers or their purchases from us; competitive pressures on sales and pricing; supply chain disruptions, unanticipated changes in the cost of material, labor, and other production costs, or unexpected costs that cannot be recouped in product pricing; the introduction of competing technologies; unexpected technical or marketing difficulties; unexpected claims, charges, litigation or dispute resolutions; strikes or other labor unrest at Eaton or at our customers or suppliers; natural disasters; the performance of recent acquisitions; unanticipated difficulties completing or integrating acquisitions; new laws and governmental regulations; interest rate changes; changes in tax laws or tax regulations; stock market and currency fluctuations; and unanticipated deterioration of economic and financial conditions in the United States and around the world. We do not assume any obligation to update these forward-looking statements.
Financial Results
The company’s comparative financial results for the three months ended September 30, 2024, are available here.
Contact:
Jennifer Tolhurst
Media Relations
+1 (440) 523-4006
jennifertolhurst@eaton.com
Yan Jin
Investor Relations
+1 (440) 523-7558
