Q224 JCI earnings

Adjusted EPS: Delivered at the high end of guidance; growth of 4% year-over-year to $0.78.
Sales Growth: Returned to growth this quarter, with organic sales growing 1% year-over-year.
Margin Expansion: Strong margin expansion driven by productivity and conversion of higher-margin backlog.
Orders: Rebounded significantly in the quarter, up 12% year-over-year.
Backlog: Remained at record levels, growing 10% to $12.6 billion.
Free Cash Flow: Improvement continues, with significant actions taken to strengthen the balance sheet.

Third Quarter Sales Guidance: Expected to be approximately low single-digit growth.
Third Quarter EBITDA Margin: Anticipated to be approximately 17%.
Third Quarter Adjusted EPS: Expected to be in the range of $1.05 to $1.10.
Full Year Sales Growth: Anticipates mid-single-digit growth.
Full Year Margin Expansion: Expected to expand approximately 50 to 75 basis points.
Full Year Adjusted EPS: Guidance range remains unchanged at approximately $3.60 to $3.75.
Adjusted Free Cash Flow Conversion: Expects around 85% for the full year, excluding the impact of unwinding the receivable factoring.

Market Strength in Data Centers: Significant demand in data centers with orders already surpassing the entirety of fiscal 2023 in the first half of fiscal 2024.
Service Business Growth: Service orders and revenue showing strong growth, particularly in North America and EMEA/LA regions.
China Market Conditions: While still facing revenue pressure, the momentum in China is expected to accelerate recovery, particularly in orders.
Residential HVAC Market: Facing some variability, with expectations of sequential growth improvement.
Investment in Growth Areas: Ongoing investments in capacity and technology to meet high demand, particularly in the data center market.

George Oliver (Chairman and CEO): “Customers continue to come to Johnson Controls because of our ability to deliver attractive outcomes… The transformation of our portfolio into a pure-play provider of comprehensive solutions for commercial buildings is an opportunity.”
Marc Vandiepenbeeck (CFO): “We are pleased with the strong adjusted EPS performance in the quarter… We remain confident in our ability to deliver on our financial and operational commitments.”
George Oliver on Data Centers: “We have intentionally positioned the company to benefit from this emerging trend due to our relentless innovation efforts and inherent strategic advantages.”
Marc Vandiepenbeeck on Q3 and Full Year Guidance: “We enter seasonal strong third quarter with good momentum… and we are maintaining our full year guide.”