Hubbell 2025 Q1 Earnings Net Income Climbs 14.7%

Hubbell (HUBB) reported its fiscal 2025 Q1 earnings on May 2nd, 2025. The company's net income increased by 14.7% to $171 million compared to the previous year, demonstrating strong operational resilience. Hubbell's earnings per share also rose 14.9% to $3.16, surpassing the prior year's performance. The performance of Hubbell's various divisions was mixed, with some segments showing growth while others faced challenges. The company's guidance for the full year remains optimistic, projecting diluted earnings per share of $15.95 to $16.45, with adjusted EPS expected between $17.35 and $17.85.

Revenue

Hubbell's total revenue for Q1 2025 declined by 2.4% to $1.37 billion from the previous year's $1.40 billion. The Utility Solutions segment led with $857.10 million, followed by Grid Infrastructure at $617.70 million and Grid Automation at $239.40 million. Meanwhile, Electrical Solutions generated $508.10 million, with Electrical Products contributing $235.10 million and the Industrial segment adding $273 million.

Earnings/Net Income

Hubbell's EPS increased by 14.9% to $3.16 in Q1 2025 from $2.75 in Q1 2024, reflecting continued earnings growth. The company's net income rose to $171 million, marking a 14.7% increase from $149.10 million last year. This demonstrates strong financial performance and a positive outlook for Hubbell's future earnings growth.

Price Action

Post-Earnings Price Action Review

Historically, Hubbell's stock price tends to see positive short-to-medium-term gains following earnings reports. The backtest data indicates that the stock typically performs well in the immediate three days after earnings releases, boasting a 60% three-day win rate. Over a ten-day period, the win rate increases to 65%, while the thirty-day win rate reaches 80%. The maximum return observed was 10.77% over thirty days, suggesting potential for significant price appreciation in the aftermath of earnings reports. This pattern reflects investor confidence in the company's ability to deliver strong financial results consistently, and it underscores the positive market sentiment that often follows Hubbell's earnings announcements.

CEO Commentary

“Our results in the first quarter were driven by continued strong operating performance in our Electrical Solutions segment and a return to organic growth in Grid Infrastructure, offset by anticipated softness in Grid Automation and the impact of higher cost inflation,” said Gerben Bakker, Chairman, President, and CEO. Bakker highlighted that Electrical Solutions achieved organic growth of 5%, propelled by strength in datacenter markets and effective execution of their segment unification strategy. He noted that utility customers are investing in transmission and substation markets, although Grid Automation faced double-digit sales declines due to challenging comparisons. He expressed confidence in mitigating inflationary impacts through pricing and productivity initiatives.

Guidance

Hubbell anticipates diluted earnings per share ("EPS") in the range of $15.95 to $16.45 for 2025, with adjusted diluted EPS expected between $17.35 and $17.85. The company projects total sales growth and organic net sales growth of 6-8%, factoring in pricing actions due to cost inflation. The guidance is based on an adjusted tax rate of 22.0% to 22.5% and includes roughly $20 million of anticipated restructuring and related investment, while aiming for a free cash flow conversion of 90% or greater on adjusted net income.

Additional News

In recent developments, Hubbell Incorporated has announced several strategic moves. The company declared a regular quarterly dividend of $1.32 per share on April 25, 2025, payable on June 16, 2025, to shareholders of record as of May 30, 2025. Additionally, Hubbell has authorized a new share repurchase program of up to $500 million, set to expire in February 2028, complementing its existing program. This move underscores the company's commitment to returning value to shareholders. Lastly, Hubbell participated in the J.P. Morgan 2025 Industrials Conference, marking a significant engagement with investors and industry stakeholders.