Johnson Controls Reports Q4 and FY25 Results; Initiates FY26 Guidance
* This earnings release contains non-GAAP financial measures. Definitions and reconciliations of the non-GAAP financial measures can be found in the attached footnotes. Non-GAAP measures should be considered in addition to, and not as replacements for, the most comparable GAAP measures.
CORK, Ireland, Nov. 5, 2025 /PRNewswire/ -- Johnson Controls International plc (NYSE: JCI), a global leader for smart, healthy and sustainable buildings, today reported fiscal fourth quarter 2025 GAAP earnings per share ("EPS") of $0.42. Adjusted EPS was $1.26.
Q4 sales increased 3% to $6.4 billion and organic sales increased 4%. Full year sales increased 3% to $23.6 billion and organic sales increased 6%.
For the quarter, GAAP net income from continuing operations attributable to JCI was $267 million and adjusted net income was $798 million.
"Johnson Controls delivered a strong year, with double-digit EPS growth and a record backlog of $15 billion, up 13%, reflecting sustained demand in our core verticals," said Joakim Weidemanis, CEO. "Our technology leadership in advanced data center cooling and decarbonization solutions continues to set us apart, as customers increasingly demand cutting-edge innovation and bold sustainability outcomes that only true technology leadership can deliver. Looking ahead, the deployment of our proprietary business system is accelerating, enhancing our ability to deliver consistent, predictable results and create long-term value for our customers and shareholders."
FISCAL Q4 SEGMENT RESULTS
The financial highlights presented in the tables below exclude discontinued operations and are in accordance with GAAP, unless otherwise indicated. All comparisons are to the fiscal fourth quarter of 2024. Orders and backlog metrics included in the release relate to the Company's Systems and Services based businesses.
A slide presentation to accompany the results can be found in the Investor Relations section of Johnson Controls' website at investors.johnsoncontrols.com.
Americas
Fiscal Q4
(in millions)
2025
2024
Change
Sales
$ 4,325
$ 4,265
1 %
Gross Margin
1,625
1,563
4 %
Segment EBITA
844
826
2 %
Adjusted Segment EBITA (non-GAAP)
862
826
4 %
Segment EBITA Margin %
19.5 %
19.4 %
10 bp
Adjusted Segment EBITA Margin % (non-GAAP)
19.9 %
19.4 %
50 bp
Segment EBIT
$ 763
$ 731
4 %
Sales in the quarter of $4.3 billion increased 1% over the prior year. Organic sales also increased 3% led by continued strength in both Applied HVAC & Controls.
Excluding M&A and adjusted for foreign currency, orders increased 9% year-over-year and backlog of $10.6 billion increased 13% year-over-year.
Segment EBITA margin of 19.5% increased 10 basis points versus the prior year as productivity gains and operational efficiency were partially offset by transformation costs. Adjusted segment EBITA in Q4 2025 excludes transformation costs.
EMEA (Europe, Middle East, Africa)
Fiscal Q4
(in millions)
2025
2024
Change
Sales
$ 1,337
$ 1,180
13 %
Gross Margin
482
415
16 %
Segment EBITA
201
164
23 %
Adjusted Segment EBITA (non-GAAP)
208
181
15 %
Segment EBITA Margin %
15.0 %
13.9 %
110 bp
Adjusted Segment EBITA Margin % (non-GAAP)
15.6 %
15.3 %
30 bp
Segment EBIT
$ 188
$ 144
31 %
Sales in the quarter of $1.3 billion increased 13% over the prior year. Organic sales grew 9% versus the prior year, with strong double-digit growth in Systems and high single-digit growth in Service.
Excluding M&A and adjusted for foreign currency, orders increased 3% year-over-year and backlog of $2.5 billion increased 14% year-over-year.
Segment EBITA margin of 15.0% expanded 110 basis points versus the prior year reflecting positive operating leverage from top-line growth and the benefit of non-recurring costs in the prior year. Adjusted segment EBITA excludes transformation costs in Q4 2025 and a non-recurring joint venture loss in Q4 2024.
APAC (Asia Pacific)
Fiscal Q4
(in millions)
2025
2024
Change
Sales
$ 780
$ 803
(3 %)
Gross Margin
276
297
(7 %)
Segment EBITA
139
158
(12 %)
Adjusted Segment EBITA (non-GAAP)
139
158
(12 %)
Segment EBITA Margin %
17.8 %
19.7 %
(190 bp)
Adjusted Segment EBITA Margin % (non-GAAP)
17.8 %
19.7 %
(190 bp)
Segment EBIT
$ 136
$ 154
(12) %
Sales in the quarter of $780 million declined 3% versus the prior year. Organic sales also declined 3% versus the prior year primarily due to lower volumes in China.
Excluding M&A and adjusted for foreign currency, orders decreased 1% year-over-year and backlog of $1.8 billion increased 15% year-over-year.
Segment EBITA margin of 17.8% declined 190 basis points versus the prior year as lower volumes in China created pressure on factory absorption.
Corporate
Fiscal Q4
(in millions)
2025
2024
Change
Corporate Expense
GAAP
$ 269
$ 131
105 %
Adjusted (non-GAAP)
124
114
9 %
Adjusted Corporate expense in Q4 2025 excludes certain transaction/separation costs, transformation costs, and accelerated depreciation of ERP assets.
OTHER Q4 ITEMS
GUIDANCE
The following forward-looking statements are non-GAAP financial measures. These non-GAAP financial measures are derived by excluding certain amounts from the corresponding financial measures determined in accordance with GAAP. The determination of the amounts excluded is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts recognized in a given period and the high variability of certain amounts, such as mark-to-market adjustments. Organic revenue growth excludes the effect of acquisitions, divestitures and foreign currency. The Company is unable to present a quantitative reconciliation of the aforementioned forward-looking non-GAAP financial measures to its most directly comparable forward-looking GAAP financial measures because such information is not available, and management cannot reliably predict the necessary components of such GAAP measures without unreasonable effort or expense. The unavailable information could have a significant impact on the Company's fiscal 2026 first quarter and full year GAAP financial results.
The Company initiated fiscal 2026 first quarter continuing operations guidance:
The Company initiated fiscal 2026 full year continuing operations guidance:
*Operating leverage is defined as the ratio of the change in adjusted EBIT for the current period less the prior period, divided by the change in net revenues for the current period less the prior period.
CONFERENCE CALL & WEBCAST INFO
Johnson Controls will host a conference call to discuss this quarter's results at 8:30 a.m. ET today, which can be accessed by dialing 855-979-6654 (in the United States) or +1-646-233-4753 (outside the United States) along with passcode 486945, or via webcast. A slide presentation will accompany the prepared remarks and has been posted on the investor relations section of the Johnson Controls website at https://investors.johnsoncontrols.com/news-and-events/events-and-presentations. A replay will be made available approximately two hours following the conclusion of the conference call.
ABOUT JOHNSON CONTROLS
At Johnson Controls (NYSE: JCI), we transform the environments where people live, work, learn and play. As the global leader in smart, healthy and sustainable buildings, our mission is to reimagine the performance of buildings to serve people, places and the planet.
Building on a proud history of 140 years of innovation, we deliver the blueprint of the future for industries such as healthcare, schools, data centers, airports, stadiums, manufacturing and beyond through OpenBlue, our comprehensive digital offering.
Today, Johnson Controls offers the world`s largest portfolio of building technology and software as well as service solutions from some of the most trusted names in the industry.
Visit johnsoncontrols.com for more information and follow @Johnsoncontrols on social platforms.
JOHNSON CONTROLS CONTACTS:
INVESTOR CONTACTS:
MEDIA CONTACT:
Jim Lucas
Danielle Canzanella
Direct: +1 414.340.1752
Direct: +1 203.499.8297
Email: jim.lucas@jci.com
Email: danielle.canzanella@jci.com
Michael Gates
Direct: +1 414.524.5785
Email: michael.j.gates@jci.com
JOHNSON CONTROLS INTERNATIONAL PLC CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
JOHNSON CONTROLS INTERNATIONAL PLC (the "Company") has made statements in this document that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In this document, statements regarding the Company's future financial position, sales, costs, earnings, cash flows, other measures of results of operations, synergies and integration opportunities, capital expenditures, debt levels and market outlook are forward-looking statements. Words such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "should," "forecast," "project" or "plan" and terms of similar meaning are also generally intended to identify forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. The Company cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond the Company's control, that could cause the Company's actual results to differ materially from those expressed or implied by such forward-looking statements, including, among others, risks related to: the ability to develop or acquire new products and technologies that achieve market acceptance and meet applicable quality and regulatory requirements; the ability to manage general economic, business and capital market conditions, including the impacts of trade restrictions, recessions, economic downturns and global price inflation; the ability to manage macroeconomic and geopolitical volatility, including changes to laws or policies governing foreign trade, including tariffs, economic sanctions, foreign exchange and capital controls, import/export controls or other trade restrictions as well as any associated supply chain disruptions; the ability to execute on the Company's operating model and drive organizational improvement; the ability to innovate and adapt to emerging technologies, ideas and trends in the marketplace, including the incorporation of technologies such as artificial intelligence; fluctuations in the cost and availability of public and private financing for customers; the ability to manage disruptions caused by international conflicts, including Russia and Ukraine and the ongoing conflicts in the Middle East; the ability to successfully execute and complete portfolio simplification actions, as well as the possibility that the expected benefits of such actions will not be realized or will not be realized within the expected time frame; managing the risks and impacts of potential and actual security breaches, cyberattacks, privacy breaches or data breaches, maintaining and improving the capacity, reliability and security of the Company's enterprise information technology infrastructure; the ability to manage the lifecycle cybersecurity risk in the development, deployment and operation of the Company's digital platforms and services; fluctuations in currency exchange rates; the ability to hire and retain senior management and other key personnel; changes or uncertainty in laws, regulations, rates, policies, or interpretations that impact business operations or tax status; the ability to adapt to global climate change, climate change regulation and successfully meet the Company's public sustainability commitments; the outcome of litigation and governmental proceedings; the risk of infringement or expiration of intellectual property rights; the ability to manage disruptions caused by catastrophic or geopolitical events, such as natural disasters, armed conflict, political change, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; any delay or inability of the Company to realize the expected benefits and synergies of recent portfolio transactions; the tax treatment of recent portfolio transactions; significant transaction costs and/or unknown liabilities associated with such transactions; labor shortages, work stoppages, union negotiations, labor disputes and other matters associated with the labor force; and the cancellation of or changes to commercial arrangements. A detailed discussion of risks related to Johnson Controls' business is included in the section entitled "Risk Factors" (refer to Part I, Item 1A, of this Annual Report on Form 10-K). The forward-looking statements included in this document are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this document.
FINANCIAL STATEMENTS
Johnson Controls International plc
Consolidated Statements of Income
(in millions, except per share data; unaudited)
Three Months Ended
September 30,
Twelve Months Ended
September 30,
2025
2024
2025
2024
Net sales
Products and systems
$ 4,452
$ 4,391
$ 16,124
$ 15,967
Services
1,990
1,857
7,472
6,985
6,442
6,248
23,596
22,952
Cost of sales
Products and systems
2,908
2,872
10,543
10,677
Services
1,183
1,108
4,461
4,198
4,091
3,980
15,004
14,875
Gross profit
2,351
2,268
8,592
8,077
Selling, general and administrative expenses
1,521
1,368
5,764
5,661
Restructuring and impairment costs
400
133
546
510
Net financing charges
76
96
319
342
Equity income (loss)
1
(23)
6
(42)
Income from continuing operations before income taxes
355
648
1,969
1,522
Income tax provision
85
110
245
111
Income from continuing operations
270
538
1,724
1,411
Income from discontinued operations, net of tax
1,488
140
1,789
489
Net income
1,758
678
3,513
1,900
Less: Income attributable to noncontrolling interests
3
2
3
4
Income from discontinued operations attributable to
noncontrolling interests
62
43
219
191
Net income attributable to Johnson Controls
$ 1,693
$ 633
$ 3,291
$ 1,705
Amounts attributable to Johnson Controls ordinary
shareholders:
Income from continuing operations
$ 267
$ 536
$ 1,721
$ 1,407
Income from discontinued operations
1,426
97
1,570
298
Net income
$ 1,693
$ 633
$ 3,291
$ 1,705
Basic earnings per share attributable to Johnson Controls
Continuing operations
$ 0.42
$ 0.80
$ 2.64
$ 2.09
Discontinued operations
2.26
0.15
2.40
0.44
Total
$ 2.68
$ 0.95
$ 5.04
$ 2.53
Diluted earnings per share attributable to Johnson Controls
Continuing operations
$ 0.42
$ 0.80
$ 2.63
$ 2.08
Discontinued operations
2.25
0.15
2.40
0.44
Total
$ 2.67
$ 0.95
$ 5.03
$ 2.52
Johnson Controls International plc
Condensed Consolidated Statements of Financial Position
(in millions; unaudited)
September 30, 2025
September 30, 2024
Assets
Cash and cash equivalents
$ 379
$ 606
Accounts receivable - net
6,269
6,051
Inventories
1,820
1,774
Current assets held for sale
14
1,595
Other current assets
1,680
1,153
Current assets
10,162
11,179
Property, plant and equipment - net
2,193
2,403
Goodwill
16,633
16,725
Other intangible assets - net
3,613
4,130
Noncurrent assets held for sale
140
3,210
Other noncurrent assets
5,198
5,048
Total assets
$ 37,939
$ 42,695
Liabilities and Equity
Short-term debt
$ 723
$ 953
Current portion of long-term debt
566
536
Accounts payable
3,614
3,389
Accrued compensation and benefits
1,268
1,048
Deferred revenue
2,470
2,160
Current liabilities held for sale
12
1,431
Other current liabilities
2,288
2,438
Current liabilities
10,941
11,955
Long-term debt
8,591
8,004
Pension and postretirement benefits
211
217
Noncurrent liabilities held for sale
9
405
Other noncurrent liabilities
5,233
4,753
Noncurrent liabilities
14,044
13,379
Shareholders' equity attributable to Johnson Controls
12,927
16,098
Noncontrolling interests
27
1,263
Total equity
12,954
17,361
Total liabilities and equity
$ 37,939
$ 42,695
Johnson Controls International plc
Consolidated Statements of Cash Flows
(in millions; unaudited)
Three Months Ended
September 30,
Twelve Months Ended
September 30,
2025
2024
2025
2024
Operating Activities of Continuing Operations
Income from continuing operations attributable to Johnson Controls
$ 267
$ 536
$ 1,721
$ 1,407
Income from continuing operations attributable to noncontrolling interests
3
2
3
4
Net income
270
538
1,724
1,411
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization
280
192
865
816
Pension and postretirement benefit expense (income)
19
(10)
(10)
(43)
Pension and postretirement contributions
(8)
10
(31)
(6)
Equity in earnings of partially-owned affiliates, net of dividends received
1
23
(2)
44
Deferred income taxes
341
—
195
(403)
Non-cash restructuring and impairment charges
371
78
427
411
Equity-based compensation expense
33
26
140
107
Other - net
(37)
15
(26)
(112)
Changes in assets and liabilities, excluding acquisitions and divestitures:
Accounts receivable
(132)
(46)
(211)
(537)
Inventories
4
168
(75)
(17)
Other assets
(292)
78
(581)
(482)
Restructuring reserves
(1)
5
1
(76)
Accounts payable and accrued liabilities
663
466
694
645
Accrued income taxes
(544)
(191)
(556)
(190)
Cash provided by operating activities from continuing operations
968
1,352
2,554
1,568
Investing Activities of Continuing Operations
Capital expenditures
(130)
(195)
(434)
(494)
Sale of property, plant and equipment
30
1
37
1
Acquisition of businesses, net of cash acquired
(1)
(4)
(10)
(3)
Business divestitures, net of cash divested
3
326
5
345
Other - net
(12)
(26)
(10)
(33)
Cash provided (used) by investing activities from continuing operations
(110)
102
(412)
(184)
Financing Activities of Continuing Operations
Net proceeds (payments) from borrowings with maturities less than three months
(245)
(655)
38
48
Proceeds from debt
396
—
1,765
1,281
Repayments of debt
(552)
(486)
(1,648)
(924)
Stock repurchases and retirements
(5,021)
(370)
(5,991)
(1,246)
Payment of cash dividends
(243)
(247)
(976)
(1,000)
Other - net
(8)
—
28
(107)
Cash used by financing activities from continuing operations
(5,673)
(1,758)
(6,784)
(1,948)
Discontinued Operations
Cash provided (used) by operating activities
(1,410)
174
(1,155)
530
Cash provided (used) by investing activities
6,598
(13)
6,546
(37)
Cash used by financing activities
(430)
—
(604)
(132)
Cash provided by discontinued operations
4,758
161
4,787
361
Effect of exchange rate changes on cash, cash equivalents and restricted cash
(43)
30
(259)
59
Change in cash, cash equivalents and restricted cash held for sale
(258)
(8)
(255)
(6)
Decrease in cash, cash equivalents and restricted cash
(358)
(121)
(369)
(150)
Cash, cash equivalents and restricted cash at beginning of period
756
888
767
917
Cash, cash equivalents and restricted cash at end of period
398
767
398
767
Less: Restricted cash
19
161
19
161
Cash and cash equivalents at end of period
$ 379
$ 606
$ 379
$ 606
FOOTNOTES
1. Sale of Residential and Light Commercial HVAC Business
In July 2025, the Company sold its Residential and Light Commercial ("R&LC") HVAC business, including the North America Ducted business and the global Residential joint venture with Hitachi Global Life Solutions, Inc. ("Hitachi"), of which Johnson Controls owned 60% and Hitachi owned 40%. The R&LC HVAC business, which was previously reported in the Global Products segment prior to the Company's resegmentation, met the criteria to be classified as a discontinued operation and, as a result, its historical financial results are reflected in the consolidated financial statements as a discontinued operation.
2. Non-GAAP Measures
The Company reports various non-GAAP measures in this earnings release and the related earnings presentation. Non-GAAP measures should be considered in addition to, and not as replacements for, the most comparable GAAP measures. Refer to the following footnotes for further information on the calculations of the non-GAAP measures and reconciliations of the non-GAAP measures to the most comparable GAAP measures.
Organic sales
Organic sales growth excludes the impact of acquisitions, divestitures and foreign currency. Management believes organic sales growth is useful to investors in understanding period-over-period sales results and trends.
Cash flow
Management believes free cash flow and adjusted free cash flow measures are useful to investors in understanding the strength of the Company and its ability to generate cash. These non-GAAP measures can also be used to evaluate the Company's ability to generate cash flow from operations and the impact that this cash flow has on its liquidity. Management also believes adjusted free cash flows are useful to investors in understanding period-over-period cash flows, cash trends and ongoing cash flows of the Company.
Adjusted free cash flow and adjusted free cash flow conversion are non-GAAP measures which exclude the impacts of the following:
Adjusted financial measures
Adjusted financial measures are non-GAAP measures that are derived by excluding certain amounts from the corresponding financial measures determined in accordance with GAAP. The determination of the excluded amounts is a matter of management judgment and depends upon the nature and variability of the underlying expense or income amounts and other factors.
As detailed in the tables included in footnotes four through seven, the following items were excluded from certain financial measures:
Management believes the exclusion of these items is useful to investors due to the unusual nature and/or magnitude of the amounts. When considered together with unadjusted amounts, adjusted financial measures are useful to investors in understanding period-over-period operating results, business trends and ongoing operations of the Company. Management may also use these metrics as guides in forecasting, budgeting and long-term planning processes and for compensation purposes.
Operating leverage
Operating leverage is defined as the ratio of the change in adjusted EBIT for the current period less the prior period, divided by the change in net revenues for the current period less the prior period. Management believes operating leverage is a useful metric to reflect enterprise value creation, capturing the impact of scale and cost discipline across the organization.
Debt ratios
Management believes that net debt to adjusted EBITDA, a non-GAAP measure, is useful to understanding the Company's financial condition as the ratio provides an overview of the extent to which the Company relies on external debt financing for its funding and also is a measure of risk to its shareholders.
3. Sales
The following tables detail the changes in sales from continuing operations attributable to organic growth, foreign currency, acquisitions, divestitures and other (unaudited):
Net sales
Three Months Ended September 30,
Twelve Months Ended September 30,
(in millions)
Americas
EMEA
APAC
Total
Americas
EMEA
APAC
Total
Net sales - 2024
$ 4,265
$ 1,180
$ 803
$ 6,248
$ 15,606
$ 4,620
$ 2,726
$ 22,952
Base year adjustments
Divestitures and other
(85)
—
—
(85)
(799)
(12)
—
(811)
Foreign currency
6
42
(1)
47
(34)
40
(6)
—
Adjusted base net sales
4,186
1,222
802
6,210
14,773
4,648
2,720
22,141
Acquisitions
—
7
—
7
—
25
—
25
Organic growth
139
108
(22)
225
1,058
295
77
1,430
Net sales - 2025
$ 4,325
$ 1,337
$ 780
$ 6,442
$ 15,831
$ 4,968
$ 2,797
$ 23,596
Growth %:
Net sales
1 %
13 %
(3) %
3 %
1 %
8 %
3 %
3 %
Organic growth
3 %
9 %
(3) %
4 %
7 %
6 %
3 %
6 %
Products and systems
revenue
Three Months Ended September 30,
Twelve Months Ended September 30,
(in millions)
Americas
EMEA
APAC
Total
Americas
EMEA
APAC
Total
Products and systems
revenue - 2024
$ 3,092
$ 703
$ 596
$ 4,391
$ 11,206
$ 2,789
$ 1,972
$ 15,967
Base year adjustments
Divestitures and other
(85)
—
—
(85)
(799)
(12)
—
(811)
Foreign currency
7
20
1
28
(23)
38
(2)
13
Adjusted products and
systems revenue
3,014
723
597
4,334
10,384
2,815
1,970
15,169
Acquisitions
—
6
—
6
—
19
—
19
Organic growth
79
71
(38)
112
803
143
(10)
936
Products and systems
revenue - 2025
$ 3,093
$ 800
$ 559
$ 4,452
$ 11,187
$ 2,977
$ 1,960
$ 16,124
Growth %:
Products and systems
revenue
— %
14 %
(6) %
1 %
— %
7 %
(1) %
1 %
Organic growth
3 %
10 %
(6) %
3 %
8 %
5 %
(1) %
6 %
Service revenue
Three Months Ended September 30,
Twelve Months Ended September 30,
(in millions)
Americas
EMEA
APAC
Total
Americas
EMEA
APAC
Total
Service revenue - 2024
$ 1,173
$ 477
$ 207
$ 1,857
$ 4,400
$ 1,831
$ 754
$ 6,985
Base year adjustments
Foreign currency
(1)
22
(2)
19
(11)
2
(4)
(13)
Adjusted base service revenue
1,172
499
205
1,876
4,389
1,833
750
6,972
Acquisitions
—
1
—
1
—
6
—
6
Organic growth
60
37
16
113
255
152
87
494
Service revenue - 2025
$ 1,232
$ 537
$ 221
$ 1,990
$ 4,644
$ 1,991
$ 837
$ 7,472
Growth %:
Service revenue
5 %
13 %
7 %
7 %
6 %
9 %
11 %
7 %
Organic growth
5 %
7 %
8 %
6 %
6 %
8 %
12 %
7 %
4. Cash Flow, Free Cash Flow and Free Cash Flow Conversion
The following table includes operating cash flow conversion, free cash flow and free cash flow conversion (unaudited):
Three Months Ended
September 30,
Twelve Months Ended
September 30,
(in millions)
2025
2024
2025
2024
Cash provided by operating activities from continuing operations
$ 968
$ 1,352
$ 2,554
$ 1,568
Income from continuing operations attributable to Johnson Controls
267
536
1,721
1,407
Operating cash flow conversion
363 %
252 %
148 %
111 %
Cash provided by operating activities from continuing operations
$ 968
$ 1,352
$ 2,554
$ 1,568
Capital expenditures
(130)
(195)
(434)
(494)
Free cash flow (non-GAAP)
$ 838
$ 1,157
$ 2,120
$ 1,074
Income from continuing operations attributable to Johnson Controls
$ 267
$ 536
$ 1,721
$ 1,407
Free cash flow conversion from net income (non-GAAP)
314 %
216 %
123 %
76 %
The following table includes adjusted free cash flow and adjusted free cash flow conversion (unaudited):
Three Months Ended
September 30,
Twelve Months Ended
September 30,
(in millions)
2025
2024
2025
2024
Free cash flow (non-GAAP)
$ 838
$ 1,157
$ 2,120
$ 1,074
Adjustments:
JC Capital cash used by operating activities
38
9
149
179
Water systems AFFF settlement cash payments and
insurance recoveries
3
(257)
386
(14)
York license prepayment receipt
(240)
—
(240)
—
Discrete tax payments
71
—
71
—
Impact of discontinued factoring program
—
17
15
599
Adjusted free cash flow (non-GAAP)
$ 710
$ 926
$ 2,501
$ 1,838
Adjusted net income attributable to JCI (non-GAAP)
$ 798
$ 742
$ 2,462
$ 2,167
JC Capital net income
1
(8)
(3)
(16)
Adjusted net income attributable to JCI, excluding
JC Capital (non-GAAP)
$ 799
$ 734
$ 2,459
$ 2,151
Adjusted free cash flow conversion (non-GAAP)
89 %
126 %
102 %
85 %
5. Segment Profitability and Corporate Expense
The Company evaluates the performance of its business units on segment EBITA (primary) and segment EBIT (secondary).
Three Months Ended September 30,
Twelve Months Ended September 30,
Actual
Adjusted
(Non-GAAP)
Actual
Adjusted
(Non-GAAP)
(in millions; unaudited)
2025
2024
2025
2024
2025
2024
2025
2024
Segment EBITA
Americas
$ 844
$ 826
$ 862
$ 826
2,882
$ 2,679
$ 2,906
$ 2,637
EMEA
201
164
208
181
649
561
658
582
APAC
139
158
139
158
476
478
476
481
Corporate expenses
(269)
(131)
(124)
(114)
(767)
(490)
(479)
(432)
Amortization
(97)
(119)
(97)
(119)
(439)
(476)
(439)
—
(476)
Restructuring and impairment costs
(400)
(133)
—
—
(546)
(510)
—
—
Other
13
(21)
—
—
33
(378)
—
—
EBIT (non-GAAP)
$ 431
$ 744
$ 988
$ 932
$ 2,288
$ 1,864
$ 3,122
$ 2,792
Income from continuing operations:
Attributable to Johnson Controls
$ 267
$ 536
$ 798
$ 742
$ 1,721
$ 1,407
$ 2,462
$ 2,167
Attributable to noncontrolling
interests
3
2
3
2
3
4
3
4
Income from continuing operations
270
538
801
744
1,724
1,411
2,465
2,171
Less: Income tax provision (1)
85
110
111
92
245
111
338
279
Income before income taxes
355
648
912
836
1,969
1,522
2,803
2,450
Net financing charges
76
96
76
96
319
342
319
342
EBIT (non-GAAP)
$ 431
$ 744
$ 988
$ 932
$ 2,288
$ 1,864
$ 3,122
$ 2,792
(1) Adjusted income tax provision excludes the net tax impacts of pre-tax adjusting items and discrete tax items.
The following tables include the reconciliations of segment EBITA as reported to adjusted segment EBITA and adjusted segment EBITA margin (unaudited):
Three Months Ended September 30,
(in millions)
Americas
EMEA
APAC
2025
2024
2025
2024
2025
2024
Sales
$ 4,325
$ 4,265
$ 1,337
$ 1,180
$ 780
$ 803
Segment EBITA
$ 844
$ 826
$ 201
$ 164
$ 139
$ 158
Adjusting items:
Transformation costs
18
—
7
—
—
—
EMEA joint venture loss
—
—
—
17
—
—
Adjusted segment EBITA
(non-GAAP)
$ 862
$ 826
$ 208
$ 181
$ 139
$ 158
Segment EBITA Margin %
19.5 %
19.4 %
15.0 %
13.9 %
17.8 %
19.7 %
Adjusted segment EBITA Margin % (non-GAAP)
19.9 %
19.4 %
15.6 %
15.3 %
17.8 %
19.7 %
Twelve Months Ended September 30,
(in millions)
Americas
EMEA
APAC
2025
2024
2025
2024
2025
2024
Sales
$ 15,831
$ 15,606
$ 4,968
$ 4,620
$ 2,797
$ 2,726
Segment EBITA
$ 2,882
$ 2,679
$ 649
$ 561
$ 476
$ 478
Adjusting items:
Transformation costs
24
—
9
—
—
—
Earn-out adjustments
—
(68)
—
—
—
—
EMEA joint venture loss
—
—
—
17
—
—
Product quality costs
—
26
—
4
—
3
Adjusted segment EBITA
(non-GAAP)
$ 2,906
$ 2,637
$ 658
$ 582
$ 476
$ 481
Segment EBITA Margin %
18.2 %
17.2 %
13.1 %
12.1 %
17.0 %
17.5 %
Adjusted segment EBITA Margin % (non-GAAP)
18.4 %
16.9 %
13.2 %
12.6 %
17.0 %
17.6 %
The following table reconciles Corporate expense from continuing operations as reported to the comparable adjusted amounts (unaudited):
Three Months Ended
September 30,
Twelve Months Ended
September 30,
(in millions)
2025
2024
2025
2024
Corporate expense (GAAP)
$ 269
$ 131
$ 767
$ 490
Adjusting items:
Transaction/separation costs
(12)
(17)
(39)
(31)
Transformation costs
(31)
—
(147)
—
ERP asset - accelerated depreciation
(102)
—
(102)
—
Cyber incident costs
—
—
—
(27)
Adjusted corporate expense (non-GAAP)
$ 124
$ 114
$ 479
$ 432
6. Net Income and Diluted Earnings Per Share
The following tables reconcile net income from continuing operations attributable to JCI and diluted earnings per share from continuing operations as reported to the comparable adjusted amounts (unaudited):
Three Months Ended September 30,
Income from continuing
operations attributable to
JCI
Diluted earnings
per share
(in millions, except per share)
2025
2024
2025
2024
As reported (GAAP)
$ 267
$ 536
$ 0.42
$ 0.80
Adjusting items:
Net mark-to-market adjustments
13
(5)
0.02
(0.01)
Loss on divestiture
—
42
—
0.06
Restructuring and impairment costs, net of NCI
400
133
0.63
0.20
EMEA joint venture loss
—
17
—
0.03
Water systems AFFF insurance recoveries
(26)
(16)
(0.04)
(0.02)
Transaction/separation costs
12
17
0.02
0.03
ERP asset - accelerated depreciation
102
—
0.16
—
Transformation costs
56
—
0.09
—
Discrete tax items
50
—
0.08
—
Related tax impact
(76)
18
(0.12)
0.02
Adjusted (non-GAAP)*
$ 798
$ 742
$ 1.26
$ 1.11
* May not sum due to rounding
Twelve Months Ended September 30
Income from continuing
operations attributable to
JCI
Diluted earnings
per share
(in millions, except per share)
2025
2024
2025
2024
As reported (GAAP)
$ 1,721
$ 1,407
$ 2.63
$ 2.08
Adjusting items:
Net mark-to-market adjustments
6
(47)
0.01
(0.07)
Loss on divestiture
—
42
—
0.06
Earn-out adjustments
—
(68)
—
(0.10)
Restructuring and impairment costs, net of NCI
546
510
0.83
0.75
EMEA joint venture loss
—
17
—
0.03
Water systems AFFF settlement
—
750
—
1.11
Water systems AFFF insurance recoveries
(39)
(367)
(0.06)
(0.54)
Product quality costs
—
33
—
0.05
Transaction/separation costs
39
31
0.06
0.05
ERP asset - accelerated depreciation
102
—
0.16
—
Transformation costs
180
—
0.28
—
Cyber incident costs
—
27
—
0.04
Discrete tax items
(36)
(57)
(0.06)
(0.08)
Related tax impact
(57)
(111)
(0.07)
(0.17)
Adjusted (non-GAAP)*
$ 2,462
$ 2,167
$ 3.76
$ 3.21
* May not sum due to rounding
The following table reconciles the denominators used to calculate basic and diluted earnings per share (in millions; unaudited):
Three Months Ended
September 30,
Twelve Months Ended
September 30,
2025
2024
2025
2024
Weighted average shares outstanding
Basic weighted average shares outstanding
630.8
665.3
651.8
673.8
Effect of dilutive securities:
Stock options, unvested restricted stock and
unvested performance share awards
2.6
2.8
2.3
2.2
Diluted weighted average shares outstanding
633.4
668.1
654.1
676.0
7. Debt Ratios
The following table includes continuing operations and details net debt to income before income taxes and net debt to adjusted EBITDA (unaudited):
(in millions)
September 30, 2025
June 30, 2025
September 30, 2024
Short-term debt
$ 723
$ 1,277
$ 953
Current portion of long-term debt
566
570
536
Long-term debt
8,591
8,446
8,004
Total debt
9,880
10,293
9,493
Less: cash and cash equivalents
379
731
606
Net debt
$ 9,501
$ 9,562
$ 8,887
Last twelve months income before income
taxes
$ 1,969
$ 2,262
$ 1,522
Net debt to income before income taxes
4.8x
4.2x
5.8x
Last twelve months adjusted EBITDA (non-
GAAP)
$ 3,987
$ 3,843
$ 3,608
Net debt to adjusted EBITDA (non-GAAP)
2.4x
2.5x
2.5x
The following table reconciles income from continuing operations to adjusted EBIT and adjusted EBITDA (unaudited):
Twelve Months Ended
(in millions)
September 30, 2025
June 30, 2025
September 30, 2024
Income from continuing operations
$ 1,724
$ 1,992
$ 1,411
Income tax provision
245
270
111
Income before income taxes
1,969
2,262
1,522
Net financing charges
319
339
342
EBIT (non-GAAP)
2,288
2,601
1,864
Adjusting items:
Net mark-to-market adjustments
6
(12)
(47)
Restructuring and impairment costs
546
279
510
Water systems AFFF settlement
—
—
750
Water systems AFFF insurance recoveries
(39)
(29)
(367)
Earn-out adjustments
—
—
(68)
Transaction/separation costs
39
44
31
Transformation costs
180
124
—
Cyber incident costs
—
—
27
Product quality costs
—
—
33
ERP asset - accelerated depreciation
102
—
—
Loss on divestiture
—
42
42
EMEA joint venture loss
—
17
17
Adjusted EBIT (non-GAAP)
3,122
3,066
2,792
Depreciation and amortization
865
777
816
Adjusted EBITDA (non-GAAP)
$ 3,987
$ 3,843
$ 3,608
8. Income Taxes
After adjusting for certain non-recurring items, the Company's effective tax rate for continuing operations was approximately 12% for the twelve months ended September 30, 2025 and approximately 11% for the twelve months ended September 30, 2024.
SOURCE Johnson Controls International plc