Johnson Controls reported fiscal Q3 2026 GAAP EPS of $1.23 and adjusted EPS of $1.42 on revenue of $6.61 billion, representing 9% sales growth and 10% organic growth. GAAP net income from continuing operations attributable to the company was $749 million, with adjusted net income of $868 million; free cash flow for the quarter was $1,194 million. Management raised full-year fiscal 2026 adjusted EPS guidance to approximately $5.05 and increased expected organic sales growth to ~8%.

Financial Highlights

  • Revenue: Net sales of $6,614 million for Q3 fiscal 2026 (up 9% year-over-year; organic sales +10%).
  • Gross profit: Reported gross profit of $2,474 million for the quarter (as shown on consolidated statements of income).
  • Operating income / EBIT: Reported EBIT of $988 million for the quarter; adjusted EBIT of $1,121 million (adjusted EBIT margin 16.9%).
  • Net income and EPS: GAAP net income from continuing operations attributable to Johnson Controls $749 million; GAAP diluted EPS $1.23. Adjusted net income $868 million; adjusted diluted EPS $1.42.
  • Cash flow and capital: Cash provided by operating activities $1,289 million; free cash flow (non-GAAP) $1,194 million; adjusted free cash flow $1,179 million. Company paid dividends of $245 million in the quarter.

Business Highlights

  • Regional performance: Americas sales of $4,504 million (up 11% year-over-year, organic +11%) led by Applied HVAC; EMEA sales ~ $1,264 million (down 1% reported, organic +1%) with margin improvements despite Middle East conflict impacts; APAC sales $846 million (up 15% organic) driven by Product & Systems strength.
  • Orders and backlog: Q3 orders increased 27% organically year-over-year for Solutions and Services; backlog stood at $21.0 billion (up 32% organically), with Americas backlog $15.9 billion (up 40% organically) supported by demand from data centers and mission-critical environments.
  • Margin and productivity: Segment EBIT and adjusted Segment EBITA margins expanded across regions—Americas adjusted EBITA margin improved ~260 basis points, APAC adjusted EBITA margin improved ~180 basis points—driven by operating leverage, productivity and favorable mix.
  • Transformation progress: Continued deployment of the company’s proprietary business system and ongoing transformation initiatives; adjusted results exclude transformation costs that management is using to realize productivity and portfolio simplification benefits.
  • Guidance and outlook: Company initiated Q4 FY26 guidance with organic sales growth of 9–10%, operating leverage of 45–50%, and adjusted EPS of ~ $1.55; raised FY26 adjusted EPS outlook to ~ $5.05 (from ~$4.85) and organic sales growth to ~8%.

Original SEC Filing:

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