Q1 2025 results

Strong start to the year; optimizing value creation with portfolio management

• Orders $9,213 million, +3%; comparable¹ +5%
• Revenues $7,935 million, +1%; comparable¹ +3%
• Income from operations $1,567 million; margin 19.7%
• Operational EBITA¹ $1,597 million; margin¹ 20.2%
• Basic EPS $0.60; +22%³
• Cash flow from operating activities $684 million; -6%

“ABB had a strong start to the year with progress on most lines of the income statement and solid cash flow. We confirm our 2025 outlook, but acknowledge that uncertainty for the business environment has increased. At the same time, we expect to create further value by actively managing our portfolio and spinning off our Robotics business.”

Morten Wierod, CEO

CEO summary

A robust business environment in the first quarter of 2025 supported the order increase of 3% (5% comparable). Despite the slightly slower than expected revenue growth of 1% (3% comparable) we delivered an Operational EBITA margin of 20.2%. All our business areas outpaced our original expectations with a strong finish in the quarter. Additional margin support stemmed from a capital gain linked to a real estate sale which lifted profitability by approximately 170 basis points. Free cash flow¹ of $652 million is a good start to us improving our full year 2025 free cash flow from last year’s $3.9 billion. Overall, I am pleased with the outcome.

We built order backlog as we again achieved another quarter with a positive book-to-bill, reaching 1.16. Order intake increased in three out of four business areas, with only Motion declining from last year’s record high level. Customer inventories in the Machine Automation division are seemingly approaching normalized levels, with some final adjustments spilling over into the second quarter. Sequentially, the general business activity remained largely stable, but with some signs of longer investment decision lead times towards the end of the quarter, linked to unclarity regarding trade tariffs.

As part of the annual reporting suite, we published our annual sustainability statement, and I am pleased about the progress we have made. Some highlights include that we are already close to fulfilling our 2030 target of 80% CO₂e emissions reduction as we ended 2024 at 78% below the 2019 base level. It makes me proud to see that our leading technology helped customers avoid another 66 megatons of emissions throughout the lifetime of products sold, and importantly our diligent focus on zero harm to our people resulted in another low score for Lost Time Injury Frequency Rate (LTIFR) of 0.15.

We acknowledge the increased uncertainty for the global business environment on the back of trade tariffs. We focus on what we can control and take action to defend our market position and profitability. Our legacy of a local-for-local footprint serves us well and in the United States we cover as much as 75%-80% of our sales with domestic production, with additional support from certain tariff exemptions. In Europe and China we have reached an even higher local footprint. The energy transition and expansion means increasing demand for advanced electrification technologies and we incrementally invest in the United States to support the anticipated long-term market development. We announced investments of $120 million in two of our manufacturing sites to expand local production of low voltage electrification products. This is in addition to the more than $500 million of US investments over the past three years.

We continue to be active with portfolio management and the Smart Building division completed the acquisition of Siemens’ Wiring Accessories business in China. This adds a comprehensive product portfolio and a robust distribution network across 230 cities. It generated more than $150 million in revenues in 2024 and will be margin accretive.

We have also decided to initiate the preparations to spin off our Robotics division as a separately listed pure play robotics company, planned for the second quarter of 2026. ABB Robotics holds a global number two market position with revenues of $2.3 billion in 2024 and as a strong performer in its industry it would benefit from being measured more directly against its peers. In addition, there are limited synergies between the ABB Robotics business and the remainder of the ABB divisions with different demand and market characteristics. We believe this change will support value creation in both units and now is a good time for both ABB and for the Robotics business. When it comes to ABB, the period of major operational change is behind us as we are on the final stretch of pushing the ABB Way operating model further down in the organization. For the Robotics business, it has proven its double-digit margin resilience and solid cash flow profile over the past few years in our decentralized operating model. It is well invested in their state-of-the-art main hubs in China and US and are just now starting the construction work for a major upgrade of the European hub in Sweden. It has the broadest customer offering and R&D efforts resulted in the unique Omnicore platform being launched last year. They have also made important acquisitions adding Autonomous Mobile Robots (AMRs) and Visual Simultaneous Localization and Mapping (VSLAM) technology. It is our view that a spin-off will optimize both companies’ abilities to create customer value, grow and attract talent and both will benefit from a more focused governance and capital allocation.

Upon completion of the spin-off ABB will consist of three business areas with clear sales and technology synergies. The Machine Automation division, which together with Robotics currently forms the Robotics & Discrete Automation business area, will become part of the Process Automation business area where customer value creation will benefit from synergies for software and control technologies, for example towards hybrid industries.

As part of our capital allocation strategy we launched a share buy-back program of up to $1.5 billion, which is in addition to the dividend of CHF 0.90 per share approved by shareholders at the annual general meeting.

Morten Wierod

CEO

Outlook

In the second quarter of 2025, we anticipate comparable revenue growth in the mid-single digit range, and the Operational EBITA margin to remain broadly stable with last year’s 19.0%; however acknowledging the increased uncertainty for the global business environment. We expect improved business results in 2025 to offset the year-on-year headwind from favorable net non-repeats of 30 basis points in Corporate & Other in the second quarter of 2024.

In full-year 2025, we expect a positive book-to-bill, comparable revenue growth in the mid-single digit range and the Operational EBITA margin to improve year-on-year, however acknowledging the increased uncertainty for the global business environment.

The complete press release including the appendices is available at www.abb.com/news

ABB is a global technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. By connecting its engineering and digitalization expertise, ABB helps industries run at high performance, while becoming more efficient, productive and sustainable so they outperform. At ABB, we call this ‘Engineered to Outrun’. The company has over 140 years of history and around 110,000 employees worldwide. ABB’s shares are listed on the SIX Swiss Exchange (ABBN) and Nasdaq Stockholm (ABB). www.abb.com