Slides
Page 1
Q2 2025 RESUL TS Record-high order intake and improved business performance Z U R I C H , S W I T Z E R L A N D | J U L Y 1 7 , 2 0 2 5 | M O R T E N W I E R O D , C E O ; T I M O I H A M U O T I L A , C F O
Page 2
— © 2025 ABB. All rights reserved. Slide 2 Important notices This presentation includes forward-looking information and statements including statements concerning the outlook for our businesses. These statements are based on current expectations, estimates and projections about the factors that may affect our future performance, including global economic conditions, and the economic conditions of the regions and industries that are major markets for ABB Ltd. These expectations, estimates and projections are generally identifiable by statements containing words such as “expects,” “believes,” “estimates,” “targets,” “guidance”, “plans,” “outlook,” “on track,” “framework” or similar expressions. There are numerous risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking information and statements made in this presentation and which could affect our ability to achieve any or all of our stated targets. The important factors that could cause such differences include, among others: • business risks associated with the volatile global economic environment and political conditions • costs associated with compliance activities • market acceptance of new products and services • changes in governmental regulations and currency exchange rates. Although ABB Ltd believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. This presentation contains alternative performance measures. Definitions of these measures and reconciliations between these measures and their US GAAP counterparts can be found in the “Supplemental Reconciliations and Definitions” section of the “Financial Information” booklet found under “Q2 2025” on our website at global.abb/group/en/investors/quarterly- results.
Page 3
© 2025 ABB. All rights reserved. Slide 3 Financial performance • Order growth +14%1 Revenue growth +6%1 • Op. EBITA margin 19.2%; Improvements in BAs more than offsetting ~30 bps headwind in Corp & Other from PY • FCF of $845 mn, -$73 mn YoY – on track to improve from last year’s annual level Organic growth investments • ABB strengthens China robotics leadership with three new robot families to automate industries with new mid-market value propositions • Launch of the upgraded EMAX technology- leading air circuit breaker, SACE World’s first cybersecurity SL2-certified ACB • Sensing, intelligence and advanced algorithms • Improves energy security and resilience of power systems in critical infrastructure Acquisitions • Announced acquisition of BrightLoop expanding our off-highway vehicle and marine vessel electrification business • ABB invests in renewable energy storage specialist HESStec • ABB acquires Bel Products Inc. to expand enclosures portfolio in North America Sustainability • ABB among TIME’s World’s Most Sustainable Companies • ABB receives CDP’s ‘A’ score for transparency on climate change Q2 2025 Selected highlights 1. YoY comparable. Record-high order intake and improved business performance © 2025 ABB. All rights reserved. Slide 3
Page 4
© 2025 ABB. All rights reserved. Slide 4 Strengthening Robotics’ Leadership in China © 2025 ABB. All rights reserved. Slide 4 Launch of three new robot families Tailored for key industries in China, including electronics and automotive, enhancing automation capabilities Strategic market positioning New mid-market offering meets demand from high growing segments Leveraging local value chain Builds on our comprehensive local capabilities in R&D, manufacturing and go-to-market to deliver innovative solutions for businesses of all sizes Lowers the barriers to automation No-code programming and plug-and-play capabilities Powered by ABB’s OmniCore controller platform Ensuring seamless integration and access to ABB’s industry-leading software suite
Page 5
— © 2025 ABB. All rights reserved. Slide 5 ABB SACE Emax 3. Anticipate change. Protect your future. Adaptive Evolve with an ever-changing future Zero adoption cost and 40% less advanced logic implementation time • Embedded programmable logics and 30+ Digital upgrades • 100% Backward compatibility with Emax2 Reliable Protect business critical uptime Save 30% operation cost and reduce up to 1M$ outage expense • Smart Sensors for predictive maintenance • Power Quality management 2x more accurate than any other solutions Secure Provide unmatched protection Protect your business from cyber attack and reduce by 80% fault damages • World’s first certified with SL2 cybersecurity • World’s first with embedded Arc flash protection 40% faster Emax 2 Leading the market for the last 13 years Emax 3 Setting the next level for Air Circuit Breakers •
Page 6
— © 2025 ABB. All rights reserved. Slide 6 — Record-high order intake Growth in all business areas 8,667 8,435 9,785 2% 0% 14% Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Orders ($ mn) Orders growth (comparable % YoY) Orders +14%1 8,163 8,239 8,900 17% 4% 6% Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Revenues ($ mn) Revenues growth (comparable % YoY) Revenues +6%1 Book-to-bill 1.10 Positive at ∼1.03 when excluding large order booking of ∼$600 million Notable orders developments (comparable % YoY, unless otherwise indicated) Discrete Robotics down due to delays in investment decisions by customers due to tariff-related uncertainty, with declines in most end markets excluding consumer electronics; Machine builders orders increased from low comparable Process O&G broadly stable; Mining improved despite cautious underlying market; Muted in chemicals and pulp & paper Short-cycle High single-digit growth, up in all Business Areas Data centers & Utilities Utilities very strong Data centers up double-digit Transport & infrastructure Strong growth in marine & ports; Strength in infrastructure; Rail down due to timing of order placement Order backlog at $25.0 bn, +9%1 1. YoY comparable Buildings Up year-on-year driven by commercial building outside of China; Residential declined with regional variances
Page 7
— © 2025 ABB. All rights reserved. Slide 7 Order growth across all regions Q2 2025 regional, country orders The Americas +28% USA Steep growth in PA; Strong growth in EL and MO; Steep decline in RA +37% Canada -3% Brazil +23% Europe +6% Germany Strong growth in MO, PA and RA; Slight decline in EL +16% Italy -10% Finland +24% AMEA +6% China Growth in MO and RA; EL and PA stable +2% India -9% U.A.E +71% All data presented on a YoY comparable basis; all growth comments refer to comparable growth trends. Performance highlighted for largest 3 countries in $ mn terms in each region. EL = Electrification. MO = Motion. PA = Process Automation. RA = Robotics & Discrete Automation.
Page 8
— © 2025 ABB. All rights reserved. Slide 8 — Operational EBITA Improvement in 3 out of 4 Business Areas Operational EBITA margin +20 bps Improvements in BAs more than offsetting ~30 bps headwind in Corp & Other from PY Profitability drivers 1. Constant currency. 1,425 1,564 1,708 17.5% 19.0% 19.2% Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Op. EBITA ($ mn) Op. EBITA margin (%) Operational EBITA +9% Gross Profit • +6%1; improvements in 3 out of 4 business areas • Gross margin improved 10 bps to 40.2%, favorable volume and price offset by unrealized FX & commodity timing differences and positive one-offs in PY Basic EPS Cash flow from operating activities $0.63 +$0.04 YoY $1,059 mn -$8 mn YoY Record-high Operational EBITA • $1.7 billion, +9% • Margin improvement in 2 out of 4 BAs Corporate and Other Operational EBITA • -$96 mn, -$29 mn vs prior year of which: • Corporate costs and other -$54 mn, -$74 mn vs prior year which included +$75mn of non-repeats • E-mobility -$42 mn, +$45 mn vs prior year which included -$48mn of impairments
Page 9
— © 2025 ABB. All rights reserved. Slide 9 Record orders and revenues lead to another positive book-to-bill Q2 2025 Electrification • Growth across the portfolio in service, short-cycle and system-related businesses • Positive development in most customer segments; particular strength in utilities and service • Commercial buildings positive, residential declined with regional variances • Data center grew double-digit • Backlog $8.7 bn (prior Q-end $8.2 bn) • Growth in all divisions • Growth driven by higher volume, with solid execution from the order backlog related to medium voltage and power protection offering as well as good customer activity in the short-cycle business • Pricing slightly up year-on-year • Book-to-bill 1.04x • Operational EBITA margin +70 bps YoY • A historical first was achieved with Operational EBITA above the $1 billion mark • Improvement was primarily supported by operational leverage on higher volumes and improved operational efficiency 3% 7% 9% -5% 10% 25% 3,000 4,000 5,000 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Orders ($ mn) Orders growth (comparable % YoY) 21.1% 23.2% 23.9% 14% 18% 22% 26% 0 400 800 1,200 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Op. EBITA ($ mn) Op. EBITA margin (%) 11% 7% 11% -5% 10% 25% 2,500 3,500 4,500 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Revenues ($ mn) Revenues growth (comparable % YoY) Orders $4,518 mn Revenues $4,331 mn Operational EBITA $1,033 mn, +16% YoY
Page 10
— © 2025 ABB. All rights reserved. Slide 10 Resilient demand and strong execution results in a solid quarter Q2 2025 Motion • Growth in short-cycle more than offset the impact from lower large order bookings • Strength in commercial building HVAC, power generation, water & wastewater and F&B • Orders stable in oil & gas, but declined in chemicals, pulp & paper and metals • Rail down due to timing of orders • Backlog $6.1 bn (prior Q-end $5.7 bn) • Growth driven by positive development in both the short-cycle as well as solid execution of the order backlog linked to the long-cycle divisions • Growth mainly related to volume increase, while pricing slightly up year-on-year • Book-to-bill 1.02x • Operational EBITA margin -10 bps YoY • Earnings were positively impacted by operational leverage on higher volumes and slight contribution from price. This was however offset by mainly higher SG&A expenses 20.4% 19.9% 19.8% 14% 18% 22% 0 250 500 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Op. EBITA ($ mn) Op. EBITA margin (%) 22% -1% 4% -10% 0% 10% 20% 30% 1,000 1,400 1,800 2,200 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Revenues ($ mn) Revenues growth (comparable % YoY) 3% -4% 3% -10% 5% 20% 35% 1,000 1,500 2,000 2,500 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Orders ($ mn) Orders growth (comparable % YoY) Orders $2,112 mn Revenues $2,065 mn Operational EBITA $407 mn, +5% YoY Organizational change, effective July 1 New division “High Power” combines former Systems Drives and Large Motor & Generator divisions Consolidation targets a more efficient and customer focused organization deploying go-to-market synergies in the medium voltage space
Page 11
— © 2025 ABB. All rights reserved. Slide 11 Record profitability and unprecedented order level Q2 2025 Process Automation • Orders included a large multi-year order of ~$600 mn which supported growth by 32% • Excluding the large order, growth was driven by marine, ports automation and electrification as well as short-cycle • Orders in mining up despite cautious underlying market • The oil & gas segment increased; Pulp & paper and chemicals remain muted • Backlog $9.3 bn (prior Q-end $8.1 bn) • Growth driven by execution of the order backlog resulting in higher volumes • Book-to-bill 1.45x • Operational EBITA margin +40 bps YoY • All divisions at or above mid-teen margin level • Driven by the execution of the order backlog, which had a higher gross margin, primarily in the project- and systems-related businesses • Partially offset by the product business where profitability softened year-on-year due to revenues hampered by customers’ inventory adjustments 15.4% 15.5% 15.9% 10% 13% 16% 0 150 300 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Op. EBITA ($ mn) Op. EBITA margin (%) 19% 12% 2% 0% 10% 20% 30% 1,000 1,500 2,000 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Revenues ($ mn) Revenues growth (comparable % YoY) 6% 10% 40% -40% -20% 0% 20% 40% 60% 1,200 2,000 2,800 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Orders ($ mn) Orders growth (comparable % YoY) Orders $2,620 mn Revenues $1,804 mn Operational EBITA $290 mn, +10% YoY
Page 12
— © 2025 ABB. All rights reserved. Slide 12 Solid performance in a challenging market Q2 2025 Robotics & Discrete Automation • Robotics orders declined as customers apply a wait- and-see stance on the back of continued uncertainties linked to potential tariffs. Negative development in most customer segments except consumer electronics; Anticipate absolute orders to increase sequentially • Machine Automation orders increased sharply from low comparable; absolute order level remains subdued as customers cautiously balance new ordering with inventory levels; Anticipate absolute orders to increase sequentially • Backlog $1.5 bn (prior Q-end $1.5 bn) • Operational EBITA margin -200 bps YoY • Machine Automation reported a slight loss as the impact of cost savings measures did not offset the adverse impacts from lower production volumes • Robotics earnings and margin improved year-on-year and margin remained in double-digit territory • Growth in Robotics driven by higher volumes was more than offset by a sharp volume decline in Machine Automation due to less support from the order backlog • Book-to-bill 0.9x 15.3% 11.1% 9.1% 5% 10% 15% 20% 0 75 150 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Op. EBITA ($ mn) Op. EBITA margin (%) 27% -8% -5% -35% -10% 15% 40% 0 400 800 1,200 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Revenues ($ mn) Revenues growth (comparable % YoY) -22% -17% 4% -35% -10% 15% 40% 0 400 800 1,200 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Orders ($ mn) Orders growth (comparable % YoY) Orders $729 mn Revenues $813 mn Operational EBITA $74 mn, -20% YoY
Page 13
— © 2025 ABB. All rights reserved. Slide 13 Remain confident in our ambition to improve from last year’s annual level — Cash generation analysis Q2 2025 cash flow drivers Free cash flow ($845 mn, -$73 mn YoY)($ mn) 162 551 652606 918 845 1,186 1,173 1,713 1,295 768 1,469 1,497 3,667 3,937 2023 2024 2025 Q1 Q2 Q3 Q4 H1 FY Q2 decrease driven by: • Faster buildup of NWC vs prior year linked to growth • Higher CAPEX • Partially offset by higher operational earnings Free cash flow slightly increased during first half of the year
Page 14
Q3 2025 FY 2025 — Outlook Revenues • Comparable growth at least in the mid- single digit range Operational EBITA % • Operational EBITA margin to remain broadly stable year-on-year Revenues • Comparable growth in the mid-single digit range • Book-to-bill above 1 Operational EBITA % • Operational EBITA margin to improve year-on-year. Acknowledging the uncertainty for the global business environment
Page 15
Q&A
Page 16
Appendix
Page 17
— © 2025 ABB. All rights reserved. Slide 17 $ mn unless otherwise stated Q2 25 Q3 25 framework 20251 framework Corporate and Other Operational EBITA2 (54) ~(90) ~(175) From ~(200) Non-operating items: PPA-related amortization (50) ~(50) ~(180) Restructuring and related3 (30) ~(100) ~(250) ABB Way transformation (43) ~(40) ~(150) 6M 25 2025 framework Finance net 32 ~50 From ~40 Effective tax rate4 28% ~25% Capital expenditure (419) ~(900) 2025 framework 1. Excludes one project estimated to a total of ~$100 million, that is ongoing in the non-core business. Exact exit timing is difficult to assess due to legal proceedings etc. 2. Excludes Operational EBITA from E-mobility business. 3. Includes restructuring and restructuring-related as well as separation & integration costs. 4. Excludes the impact of acquisitions or divestments or any significant non-operational items.
Page 18
— © 2025 ABB. All rights reserved. Slide 18 Operational EBITA bridge 228 44 Q2 2024 Volume/price -112 Operations -13 Items impacting comparability FX -3 Portfolio changes Q2 2025 1,564 1,708 Operational performance $116 million Comparable revenues 6% growth 19.2%19.0% Operational EBITA ($ mn) Operational EBITA margin (%) Accretion / dilution (%) +0.2 +0.2 Items impacting comparability: Non-core business. Portfolio changes: SEAM Group acquisition, Siemens Wiring Accessories acquisition, Niedax JV, Incharge divestment -0.1 -0.1