Johnson Controls 2025 Q3 Earnings Earnings Drop 26.2%, Guidance Raised

Johnson Controls International (JCI) reported its Q3 fiscal 2025 earnings on August 6, 2025, with revenue up 2.6% to $6.05 billion and adjusted EPS guidance raised. The company fell short of earnings expectations, with a 26.2% decline in EPS and 26.0% drop in net income, yet it maintained a robust business outlook and raised full-year guidance.

Revenue
Revenue for the quarter reached $6.05 billion, a 2.6% increase from the prior year, driven by a $4.12 billion contribution from the Products and Systems segment and $1.93 billion in Services revenue. While the core products segment remained the largest revenue driver, the services division continued to show steady performance, reflecting the company’s ongoing focus on diversified offerings.

Earnings/Net Income
Earnings per share (EPS) declined 26.2% year-over-year to $1.07, with net income dropping 26.0% to $778 million. Despite the decline, the company has maintained profitability for over 20 years, demonstrating strong operational resilience.

Price Action
The stock price edged down 0.15% during the latest trading day, gained 0.62% for the week, and fell 1.24% month-to-date.

Post-Earnings Price Action Review
A strategy of buying JCI after earnings beats and holding for 30 days yielded a 23.45% return, though it significantly underperformed the 78.92% benchmark. The Sharpe ratio of 0.32 and zero maximum drawdown suggest the strategy was relatively conservative but limited in capturing broader market gains.

CEO Commentary
Joakim Weidemanis, CEO, highlighted the company’s strong Q3 performance, attributing it to customer prioritization, R&D investment, and a focus on empowering frontline colleagues. He emphasized the record backlog and 140-year innovation legacy, expressing confidence in the company’s ability to deliver long-term shareholder value.

Guidance
Johnson Controls raised its full-year 2025 adjusted EPS guidance to $3.65 to $3.68, from approximately $3.60, and maintained mid-single-digit organic sales growth. For Q4, it expects organic sales growth in the low single digits, with adjusted EPS of $1.14 to $1.17 and an EBITA margin of ~18.6%.

Additional News
Recent non-earnings announcements include the completion of the sale of the residential and light commercial HVAC business on August 1, 2025, and the appointment of Chris Scalia as Executive Vice President and Chief Human Resources Officer on July 15. On June 13, the company announced a $9 billion increase to its share repurchase program, supporting long-term value creation. These moves underscore Johnson Controls’ strategic shift and commitment to enhancing shareholder returns.