Itron's Q4 2024 Earnings Call: Contradictions Surface on Growth, Tariffs, and Outcomes Margins

These are the key contradictions discussed in Itron's latest 2024Q4 earnings call, specifically including: Growth expectations for 2025, impact of component tariffs, Outcomes margins expectations, and expectations for the growth in the Outcomes business:



Financial Performance and Revenue Growth:
- Itron reported record revenue of $613 million for the fourth quarter, with strong customer demand and operational execution being key drivers.
- Full-year 2024 revenue reached $2.44 billion, growing 12% year-over-year, reflecting solid customer demand and increased adoption of the Grid Edge Intelligence platform.

Record Bookings and Backlog:
- The company achieved record quarterly bookings of $1.4 billion, producing a new record total backlog level of $4.7 billion.
- Market demand was stable with a healthy pipeline driven by grid resiliency, capacity, safety, and automation, supported by the adoption of the Grid Intelligence platform.

Outcomes Segment Growth:
- Outcomes revenue grew 25% year-over-year in Q4, primarily due to increased software licenses and services.
- This growth is attributed to the expanding Grid Edge Intelligence platform and increased customer adoption of distributed intelligence capabilities.

Free Cash Flow Improvement:
- Itron reported free cash flow of $70 million for the fourth quarter, reflecting strong earnings growth and increased interest income.
- Continued improvement in free cash flow is expected in 2025, aligning with the target of 10% to 12% of revenue for free cash flow.