Johnson Controls International Plc (NYSE:JCI) stock was volatile in Wednesday trading after the building solutions company reported fiscal third-quarter 2026 results that topped Wall Street estimates and raised its full-year outlook.
Adjusted earnings were $1.42 per share, beating the analyst consensus estimate of $1.30. Revenue increased to $6.61 billion from a year earlier, exceeding the consensus estimate of $6.47 billion.
The company said its backlog reached $21 billion, up 32% organically from a year earlier.
Johnson Controls Quarterly Performance
Orders increased 27% year over year, excluding acquisitions and foreign currency impacts. Sales rose 9%, while organic sales increased 10%.
Gross profit increased 10.2% to $2.47 billion. Gross margin expanded to 37.4% from 37.1% a year earlier.
Regional Performance
Americas: Sales increased 11% to $4.50 billion, with organic sales also rising 11%, driven by continued strength in Applied HVAC and double-digit growth in Products and Systems and Services.
Orders increased 37%, excluding acquisitions and currency effects. Backlog rose 40% to $15.9 billion, supported by sustained demand from data centers and other mission-critical facilities. Segment EBITA margin expanded 260 basis points to 21.1%.
Europe, Middle East and Africa (EMEA): Sales declined 1% to $1.26 billion, while organic sales increased 1%, constrained by ongoing conflict in the Middle East.
Orders rose 6%, excluding acquisitions and currency effects, and backlog increased 14% to $3.1 billion. Segment EBITA margin improved 20 basis points to 14.3%, aided by pricing and productivity gains, partly offset by business divestitures.
Asia-Pacific: Sales increased 15% to $846 million, with organic sales also up 15%, led by 20% growth in Products and Systems and continued strength in Applied HVAC.
Orders increased 12%, excluding acquisitions and currency effects, while backlog grew 12% to $2.0 billion. Segment EBITA margin expanded 180 basis points to 21.2% on productivity improvements, favorable business mix and higher revenue.
Cash Flow And Outlook
Johnson Controls ended the quarter with $641 million in cash and cash equivalents.
Operating cash flow increased to $1.29 billion from $787 million a year earlier. Free cash flow rose to $1.19 billion from $693 million.
Chief Executive Officer Joakim Weidemanis said demand for AI data centers, biopharma manufacturing, hospitals and universities continued to support growth.
He said the company introduced an AI factory absorption chiller reference design that can reduce cooling electricity demand by about 44% by converting waste heat into cooling.
Weidemanis also highlighted the company’s investment in Armada for modular data centers and said Johnson Controls is making progress with its Alloy investment in cooling distribution units, including recent certification from NVIDIA Corp. (NASDAQ:NVDA).
Johnson Controls raised its full-year guidance and now expects organic sales growth of about 8%, up from its previous outlook of about 6%.
For the fourth quarter, the company expects organic sales growth of 9% to 10% and adjusted earnings of about $1.55 per share, compared with the analyst consensus estimate of $1.53.
Johnson Controls said data centers are expected to account for about one-third of its revenue over the next three to five years, up from the high teens as a percentage of fiscal 2026 sales.
Johnson Controls Price Action
JCI Price Action: Johnson Controls shares were down 1.80% at $137.76 at the time of publication on Wednesday, according to Benzinga Pro data.
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