Eaton Corp. plc: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 5 May 2026: press release. Guidance figures: 4 raised, 5 lowered, 7 new, 2 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Record sales up 17%: Sales of $7.5 billion were a record, up 17%: 10% organic growth, 4% from acquisitions and 3% from foreign exchange. Source
• Adjusted EPS record, reported EPS lower: Diluted EPS was $2.22 against $2.45 a year earlier. Excluding intangible amortization, acquisition and restructuring charges, adjusted EPS was $2.81 against $2.72. Source
• Electrical Americas sales up 20%: Organic sales rose 14%, with 5% from acquisitions and 1% from foreign exchange. Operating profit was a first-quarter record $922 million, up 2%, at a 25.6% margin. Source
• Mobility sales declined 2%: Organic sales fell 6%, partly offset by 4% from currency translation. Operating profit was $89 million, at an 11.7% margin. Source
• Boyd Thermal closed in March: Boyd Thermal, a thermal components and ruggedized solutions maker employing more than 6,000 people, is reported in Electrical Global. Source
• Segment margin fell year over year: Segment margin was down 120bps from a year earlier, while cost of products sold rose to $4,799 million from $3,930 million. Source
• Free cash flow up 245%: Operating cash flow was $507 million, up 113%, and capital expenditures were $193 million, leaving free cash flow of $314 million. Source

“We've taken bold actions to shape the portfolio, deliver the solutions our customers need and position ourselves to meet or exceed our 2030 targets.”

Paulo Ruiz, Eaton chief executive officer

Guidance

What changed from last quarter

• Guidance raised: Full-year 2026 organic growth guidance raised to 9-11% from 7-9%. Source
• Guidance lowered: Full-year 2026 segment margin guidance lowered to 24.1-24.5% from 24.6-25.0%. Source
• Guidance lowered: Full-year 2026 diluted EPS guidance lowered to $10.88-$11.33 from $11.57-$12.07. Source
• Guidance raised: Full-year 2026 adjusted EPS guidance low end raised to $13.05 from $13.00; high end unchanged at $13.50. Source
• New guidance: Second-quarter 2026 guidance given for organic growth, segment margins, diluted EPS and adjusted EPS. Source
• Guidance lowered: Estimated remaining restructuring charges lowered: workforce reductions to $78 million from $102 million, plant closing and other to $24 million from $38 million. Source
• New: Boyd Thermal acquisition closed on March 12, 2026, reported within Electrical Global. Source
• New: Vehicle and eMobility segments combined into one Mobility segment, with historical information recast. Source

Results and growth drivers

• Record sales up 17%: Sales of $7.5 billion were a record, up 17%: 10% organic growth, 4% from acquisitions and 3% from foreign exchange. Source
• Adjusted EPS record, reported EPS lower: Diluted EPS was $2.22 against $2.45 a year earlier. Excluding intangible amortization, acquisition and restructuring charges, adjusted EPS was $2.81 against $2.72. Source
• Net income attributable to Eaton lower: Net income attributable to Eaton ordinary shareholders was $866 million against $964 million. Income tax expense was $240 million against $212 million. Source

Segments and regions

• Electrical Americas sales up 20%: Organic sales rose 14%, with 5% from acquisitions and 1% from foreign exchange. Operating profit was a first-quarter record $922 million, up 2%, at a 25.6% margin. Source
• Electrical Global sales up 21%: Organic sales rose 9%, with 6% from acquisitions and 6% from foreign exchange. Operating profit was a record $373 million, up 24%, at a 19.2% margin, up 60 basis points. Source
• Aerospace margin reached record 26.7%: Sales were a record $1.1 billion, up 16%, with 9% organic growth. Operating profit was a record $304 million, up 35%. Source
• Mobility sales declined 2%: Organic sales fell 6%, partly offset by 4% from currency translation. Operating profit was $89 million, at an 11.7% margin. Source

“Mobility delivered solid operational performance in a challenging market, and we remain on track toward its Q1 2027 planned spin-off into an independent, publicly traded company.”

Paulo Ruiz, Eaton chief executive officer

Acquisitions and portfolio changes

• Boyd Thermal closed in March: Boyd Thermal, a thermal components and ruggedized solutions maker employing more than 6,000 people, is reported in Electrical Global. Source
• Ultra PCS added to Aerospace: Ultra PCS Limited, which makes electronic controls, sensing and stores ejection systems for aerospace customers, is reported in Aerospace. Cost was $1.53 billion, net of cash acquired. Source
• Closed $11 billion of acquisitions: Management said the company closed $11 billion of value-enhancing strategic acquisitions in the quarter. Source
• SPAN minority stake taken: Eaton invested $75 million in SPAN, a home electrification manufacturer, for a stake of about 7%, accounted for at cost less impairment. Source

Costs, margins and charges

• Segment margin fell year over year: Segment margin was down 120bps from a year earlier, while cost of products sold rose to $4,799 million from $3,930 million. Source
• Acquisition charges rose: Acquisition integration, divestiture charges and transaction costs were $109 million, against $10 million. Fibrebond retention compensation was $14 million in the quarter. Source
• Restructuring and amortization charges higher: Restructuring program charges were $39 million, against $18 million. Intangible asset amortization was $140 million, against $106 million. Source

“These acquisitions reinforce Eaton’s disciplined M&A strategy - deploying capital to invest for growth by acquiring differentiated technologies in high‑growth, high‑margin markets”

Eaton Corp. plc, press release

Demand and the order book

• Electrical Americas adding capacity: Management said Electrical Americas is advancing capacity expansion investments to meet demand. Source
• Order growth cited by segment: Management attributed Electrical Americas order acceleration to data center momentum and reported order growth for Electrical Global and Aerospace. Source
• Mobility market described as challenging: Management described the Mobility market as challenging, while the segment delivered solid operational performance. Source

Capital, cash and balance sheet

• Free cash flow up 245%: Operating cash flow was $507 million, up 113%, and capital expenditures were $193 million, leaving free cash flow of $314 million. Source
• Long-term debt rose: Long-term debt was $18,535 million against $8,758 million at December 31, 2025. Short-term debt was $2,510 million against $1 million. Source
• Goodwill and intangibles climbed: Goodwill rose to $21,402 million and other intangible assets to $11,259 million from December 31, 2025. Source
• Interest expense rose: Interest expense, net, was $106 million against $33 million. Diluted weighted-average shares were 389.2 million against 393.6 million. Source

Strategy and portfolio

• Mobility re-segmented into one segment: Vehicle and eMobility were combined into a single Mobility segment in the first quarter, with historical figures recast. Source
• Restructuring charges to date: Charges since the program began total $374 million. The program is expected to be completed in 2026. Source
• Mobility spin-off announced: On January 26, 2026, Eaton announced its intention to spin off the Mobility business into an independent, publicly traded company. Source

Coming up, as management said on 5 May 2026

• Mobility spin-off target: Eaton expects to complete the Mobility spin-off by the end of the first quarter of 2027, subject to approvals. Source
• Fibrebond retention awards vest: Fibrebond transaction and retention awards vest in six equal annual installments starting in the second quarter of 2026. Source
• Resilient incentives paid through 2028: Resilient employee incentives, with a maximum payout of $50 million, are paid over three years from 2026 to 2028. Source

Figures management reported

Risks management discussed

• Demand: Mobility organic sales fell 6%, and management described its market as challenging. Source
• Regulatory: The Mobility spin-off depends on customary legal and regulatory approvals, final Board approval and an effective Form 10 registration statement. Source
• Operational: Acquisition integration and transaction charges are tied to recent acquisitions, including Boyd Thermal and Ultra PCS. Source

Earlier plans management reported on

• Ahead: Management said first-quarter organic growth was above the high end of the 5-7% guidance range. Source
• Ahead: Management said segment margin was above the first-quarter guidance range. Source
• On track: Management said it remains on track for the Mobility spin-off planned for Q1 2027. Source
• Not stated: The prior release expected the Boyd Thermal transaction to close in the second quarter of 2026; the current release reports it closed March 12.

Other quarters

• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.