Engineering and automation solutions company Emerson (NYSE:EMR) missed Wall Street’s revenue expectations in Q1 CY2026 as sales rose 2.9% year on year to $4.56 billion. On the other hand, the company expects next quarter’s revenue to be around $4.80 billion, close to analysts’ estimates. Its non-GAAP profit of $1.54 per share was in line with analysts’ consensus estimates.
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Emerson Electric (EMR) Q1 CY2026 Highlights:
- Revenue: $4.56 billion vs analyst estimates of $4.59 billion (2.9% year-on-year growth, 0.7% miss)
- Adjusted EPS: $1.54 vs analyst estimates of $1.53 (in line)
- Adjusted EBITDA: $1.24 billion vs analyst estimates of $1.29 billion (27.2% margin, 3.5% miss)
- Revenue Guidance for Q2 CY2026 is $4.80 billion at the midpoint, roughly in line with what analysts were expecting
- Management slightly raised its full-year Adjusted EPS guidance to $6.50 at the midpoint
- Operating Margin: 24.2%, up from 19.8% in the same quarter last year
- Free Cash Flow was $1.30 billion, up from -$87 million in the same quarter last year
- Market Capitalization: $76.13 billion
"Emerson's second quarter results reflect our ability to deliver in a dynamic environment," said Emerson President and Chief Executive Officer Lal Karsanbhai.
Company Overview
Founded in 1890, Emerson Electric (NYSE:EMR) is a multinational technology and engineering company providing solutions in the industrial, commercial, and residential markets.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, Emerson Electric’s 1.4% annualized revenue growth over the last five years was weak. This was below our standards and is a rough starting point for our analysis.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Emerson Electric’s annualized revenue growth of 5.3% over the last two years is above its five-year trend, which is encouraging. 
This quarter, Emerson Electric’s revenue grew by 2.9% year on year to $4.56 billion, falling short of Wall Street’s estimates. Company management is currently guiding for a 5.5% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 5.7% over the next 12 months, similar to its two-year rate. This projection doesn't excite us and indicates its newer products and services will not accelerate its top-line performance yet.
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Operating Margin
Emerson Electric has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 21.5%. This result isn’t surprising as its high gross margin gives it a favorable starting point.
Analyzing the trend in its profitability, Emerson Electric’s operating margin rose by 9.5 percentage points over the last five years, as its sales growth gave it operating leverage.
This quarter, Emerson Electric generated an operating margin profit margin of 24.2%, up 4.5 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Emerson Electric’s EPS grew at 10.7% compounded annual growth rate over the last five years, higher than its 1.4% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
We can take a deeper look into Emerson Electric’s earnings to better understand the drivers of its performance. As we mentioned earlier, Emerson Electric’s operating margin expanded by 9.5 percentage points over the last five years. On top of that, its share count shrank by 6.6%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For Emerson Electric, its two-year annual EPS growth of 9.1% was lower than its five-year trend. We hope its growth can accelerate in the future.
In Q1, Emerson Electric reported adjusted EPS of $1.54, up from $1.48 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Emerson Electric’s full-year EPS of $6.14 to grow 10.1%.
Key Takeaways from Emerson Electric’s Q1 Results
Revenue missed slightly and EPS was just in line. Looking ahead, revenue guidance for next quarter was also in line. Overall, this quarter didn't have many surprises, good or bad. The stock remained flat at $136.79 immediately following the results.
So should you invest in Emerson Electric right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).