Ovation 4.0 builds a software-defined AI-ready platform for the power and water industries, bringing a unifying data fabric across the organizations to optimize operations from device to enterprise. It also offers secure generative AI models to provide prescriptive operations and maintenance guidance together in a robust solutions portfolio.
— Lal Karsanbhai
03Detailed Report
EMR
Company EMR
Period
Q3 2024
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedMay 30, 2026
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Executive Summary
Emerson Electric’s QQ3 2024 results reflect resilience in a challenging industrial environment, underpinned by margin expansion and strong cash generation. The company reported underlying orders up 3% year-over-year, led by Process and Hybrid markets with notable life sciences and energy projects, while Discrete Automation remained softer. Management highlighted a robust capital project funnel and meaningful project wins, including Nemaska Lithium and green hydrogen initiatives, signaling nascent diversification into high-growth end markets. Gross margins improved meaningfully, with Q3 commentary citing 52.8% gross margin vs. prior year (+230 bps), and operating leverage delivered a 67% improvement excluding Test & Measurement, supporting a quarterly adjusted EPS of $1.43 and free cash flow of $975 million (FCF margin 22.3%). Emerson also advanced its transformation agenda, including Ovation 4.0 (software-defined automation) and synergy-driven profitability in Test & Measurement, along with the Copeland JV monetization that generated pretax cash proceeds of $1.9 billion to de-lever. As the year progresses, management increased the midpoint of the 2024 adjusted EPS guide to $5.45-$5.50 and raised free cash flow guidance toward $2.8 billion, while signaling a cautious but constructive 2025 trajectory driven by continued capital formation in energy transition and life sciences, offset by a gradual recovery in discrete end markets.
Key Performance Indicators
Revenue
Increasing
4.38B
QoQ: 0.09% | YoY: 11.00%
Gross Profit
Increasing
2.05B
46.74% margin
QoQ: 306.98% | YoY: 2.66%
Operating Income
Increasing
793.00M
QoQ: 134.70% | YoY: 31.51%
Net Income
Decreasing
329.00M
QoQ: -34.33% | YoY: -96.48%
EPS
Decreasing
0.58
QoQ: -34.09% | YoY: -96.46%
Revenue Trend
Margin Analysis
Financial Highlights
Overview of quarter and year-to-date metrics with relevant YoY and QoQ context.
- Revenue (GAAP): $4.38 billion; YoY growth 11.0%; QoQ 0.09%.
- Gross margin: 52.8% (Q3) per management commentary, vs. 50.6% year-to-date; data set shows GAAP gross margin around 46.7% from line items but management attributes a 52.8% figure for the quarter, highlighting potential definitional differences or adjustments.
- Operating income: $0.793 billion; operating margin 18.1%.
- EBITDA: $0.960 billion; EBITDA margin 21.9%.
- Net income: $0.329 billion; net margin 7.5%.
- Diluted EPS: $0.57 (GAAP) / $1.43 (adjusted in the quarter’s discussion); QoQ and YoY comparisons reflect rebalancing due to one-time Copeland-related items and synergy actions.
- Free cash flow: $0.975 billion; FCF margin 22.3%; net cash provided by operating activities $1.09 billion; capex $(0.092) billion; free cash flow reflects ongoing working-capital improvements.
- Backlog: $7.4 billion at end of Q3, down modestly from Q2.
- Cash & liquidity: cash and cash equivalents of ~$2.30 billion; net debt around $6.47 billion; interest coverage ~14.2x; debt-to-capitalization 34.1%; cash-to-debt headroom supports ongoing capital allocation flexibility.
- Guidance (fiscal 2024): underlying sales growth ~6%; reported net sales growth ~15% (Test & Measurement contribute ~9.5 points); adjusted EPS midpoint $5.45–$5.50; free cash flow ~ ~$2.8 billion; share repurchases targeted around $300 million; plan to pay down debt with Copeland proceeds; equity portion of Copeland JV to close later in August 2024.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
4.38B
11.00%
0.09%
Gross Profit
2.05B
2.66%
306.98%
Operating Income
793.00M
31.51%
134.70%
Net Income
329.00M
-96.48%
-34.33%
EPS
0.58
-96.46%
-34.09%
Key Financial Ratios
Gross Profit Margin
Good
46.70%
Gross profit margin is healthy and competitive within industry standards
Operating Profit Margin
Good
18.10%
Operating margin is healthy and competitive within industry standards
Net Profit Margin
Fair
7.51%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
0.72%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
1.58%
Return on equity suggests inefficient capital allocation
Current Ratio
Adequate
1.16
Current ratio meets minimum requirements but limited cushion
Debt to Equity
Moderate
0.52
Debt-to-equity indicates balanced capital structure with manageable debt
P/E Ratio
High Growth
46.96x
Very high P/E indicates aggressive growth expectations, higher risk
Price to Book
Fair Value
2.97x
Price-to-book ratio reasonable for profitable companies
Management Insights Available for Members
Get exclusive access to management commentary, earnings call quotes, and forward guidance from company leadership.
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