Q4 2024 results

ZURICH, SWITZERLAND, JANUARY 30, 2025

ENDING RECORD-HIGH 2024 WITH STRONG ORDER GROWTH AND POSITIVE 2025 OUTLOOK

Q4 2024

• Orders $8.1 billion, +6%; comparable¹ +7%
• Revenues $8.6 billion, +4%; comparable +5%
• Income from operations $1,169 million; margin 13.6%
• Operational EBITA¹ $1,434 million; margin¹ 16.7%
• Basic EPS $0.54, +7%²
• Cash flow from operating activities $1,537 million; -19%

FY 2024

• Orders $33.7 billion, 0%; comparable¹ +1%
• Revenues $32.9 billion, +2%; comparable +3%
• Income from operations $5,071 million; margin 15.4%
• Operational EBITA¹ $5,968 million; margin¹ 18.1%
• Basic EPS $2.13, +6%²
• Cash flow from operating activities $4,675 million; +9%
• Return on Capital Employed 22.9%
• Dividend proposal of CHF0.90 per share

“I am proud of our teams delivering record high revenues, Operational EBITA and margin. I expect 2025 to be another year of progress, where we further build on the ABB Way and our strong market positions.”

Morten Wierod, CEO

CEO summary

For the fourth quarter, we delivered year-on-year improvements on virtually all lines of the income statement and with annual Free cash flow at $3.9 billion we achieved our ambition to step up from last year. On a sequential basis the general trading conditions remained similar, and we saw the usual historical fourth quarter pattern of a negative book-to-bill as well as softer orders and margins, as we had earlier indicated.

Overall, the market conditions remain favorable, and it was good to end the year with comparable order growth of 7% in the fourth quarter. This was led by a very strong growth in the Electrification business area, with particularly high demand in the data centers and utilities segments as well as an overall positive development in the buildings segment. Customer activity linked to discrete automation remained sequentially unchanged. On a year-on-year basis, orders in Robotics & Discrete Automation improved, albeit from last year’s very low base. Following a period of unusually turbulent markets, the business area has  completed a customer outreach to re-confirm the order backlog. This resulted in de-bookings weighing on order growth in the quarter. We still believe we are approaching the end of machine builders’ inventory adjustments towards the end of the first quarter or during the second quarter at the latest. Process Automation delivered yet another quarter with positive book-to-bill and despite the challenging large order comparable there was only a slight order decline from last year. In the Motion business area, we had a positive development in short-cycle orders, although this was more than offset by lower project orders.

I was pleased to see a couple of divisions announcing acquisitions, which when completed would add approximately $200 million of combined annual revenues linked to low carbon solutions. Some divisions also made additional investments in technology start-ups including industrial simulation software and real-time analytics of electrical infrastructure. I view these venture capital investments as an extension of our own R&D efforts.

The majority of our R&D workforce focuses on digital, AI and software. One example of these R&D investments generating customer value is the launch of ABB Ability™ Genix Copilot, a generative AI solution that helps energy, utilities and other industries improve efficiency, productivity, and sustainability by contextualizing vast amounts of real-time production data and providing actionable insights.

Another harvest of ABB’s innovation is the orders received for our unique medium voltage UPS offering HiPerGuard for use in data centers. We believe we can help customers to redesign the next generation of data centers to reduce complexity, capex spend and become more energy efficient by using our medium voltage UPS HiPerGuard, to help facilitate a more seamless UPS compatibility with AI driven increases in server rack power requirements.

2024 was a record year for Revenues, Gross margin, Operational EBITA earnings and margin. With Operational EBITA margin at 18.1% we took another step towards the high end of our target range. Earnings per share increased by 6% and we generated Free cash flow of $3.9 billion, representing a Free cash flow margin¹ of 12%. Despite the challenging large order base from the prior year period, we managed to slightly improve comparable order intake. Overall, a strong achievement by the ABB team and, in my view, a good indication of our strong market exposure, ability to create customer value and ongoing efforts to further improve internal efficiency.

Looking to 2025, we will continue to deliver on our strategy of driving the ABB Way operating model further into our divisions, whereby generating additional long-term accountability, transparency and speed. Our strong balance sheet supports acquisitions, and it is good to see that we are gaining some momentum in this area. Based on the deals we have already announced but not yet completed, we should approach our long-term target range for acquired growth. In addition, we intend to continue with share buybacks in line with our capital allocation principles. We acknowledge some market uncertainty and what currently seems to be an adverse impact on reported numbers from changes in exchange rates mainly due to the appreciation of the USD. That said, we expect another year of improving profitability, continued good cash flow and a positive book-to-bill.

The Board of Directors has decided to propose an ordinary dividend of CHF 0.90 per share, up from CHF 0.87 in the previous year. We also intend to launch a new larger share buyback program of up to $1.5 billion, running until January 28, 2026.

Morten Wierod

CEO

Outlook

In the first quarter of 2025 we anticipate comparable revenue growth in the mid-single digit range and Operational EBITA margin to be broadly stable, year-on-year. 

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.

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).