Emerson reports weak quarter on hit from supply snarls, raises sales forecast
Reuters
Published Feb 08, 2023 07:12AM ET
Updated Feb 08, 2023 10:42AM ET
(Reuters) -Industrial conglomerate Emerson (NYSE:EMR) Electric Co missed Wall Street estimates for quarterly profit and revenue on Wednesday as lingering supply-chain snags affected its efforts to tap into a booming demand for automation.
The company's shares fell 5% to $86.02, even as Emerson slightly raised its full-year sales growth outlook.
A semiconductor shortage coupled with supply woes has weighed on Emerson at a time when demand remains robust from companies racing to add robots and revamp their assembly lines to offset a labor crunch.
The company has struck a string of deals over the last few years to turn into a provider of automation products and services, and recently disclosed a hostile $7 billion bid for National Instruments (NASDAQ:NATI) Corp to strengthen that business.
"We continue to actively pursue opportunities to deploy capital effectively," Emerson Chief Executive Lal Karsanbhai said in a statement. The company ended the quarter with cash and cash equivalents of $2.27 billion.
Meanwhile, the company said it sees no signs of weakness, but added that it will be carefully watching the automotive sector.
"Chemical investments, plant modernization and sustainability remain steady in North America and Asia, but we are keeping a close eye on this market as we assess our outlook for the balance of 2023," Chief Financial Officer Frank Dellaquila said.
On an adjusted basis, the company earned 78 cents per share, compared with analysts' estimates of 87 cents, according to Refinitiv data.
Revenue rose 7% to $3.37 billion, but fell short of estimates of $3.43 billion.
Emerson said it now expects net sales growth of 8% to 10% for 2023, higher than its previous forecast of 7% to 9%.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.