Itron, Inc. reported fourth‑quarter fiscal 2025 results that beat expectations on both revenue and earnings. Total revenue reached $571.7 million, up $9.9 million (1.7%) from the consensus estimate of $561.79 million, while adjusted earnings per share climbed to $2.46, $0.27 (12%) above the $2.19 estimate. The earnings beat was driven by strong performance of the Outcomes segment, which grew 23% year‑over‑year, offsetting declines in Networked Solutions and Device Solutions that were impacted by portfolio optimization and project timing.
The Outcomes segment’s growth was the primary engine behind the revenue beat. It captured a 23% increase in recurring revenue, reflecting higher demand for grid‑edge intelligence and data‑analytics services. In contrast, Networked Solutions revenue fell as the company accelerated portfolio optimization, reducing exposure to legacy projects that were delayed or canceled. Device Solutions also saw a decline, but the mix shift toward higher‑margin Outcomes contracts helped lift gross margin to 40.5% from 36.2% in the prior year.
Gross margin expansion to 40.5% and operating margin improvement to 13.8% from 10.2% were largely attributable to the higher mix of Outcomes contracts and disciplined cost control. The company maintained pricing power in its high‑margin AI‑driven services while managing cost inflation in its legacy product lines. Operating income rose to $78.6 million, reflecting the combined effect of revenue growth in Outcomes and margin expansion.
Management guided for Q1 2026 revenue of $565 million to $575 million, with a midpoint of $570 million that is slightly below analyst expectations of $580.6 million. Full‑year 2026 non‑GAAP EPS guidance of $5.75 to $6.25, midpoint $6.00, beats the consensus estimate of $5.98, while full‑year revenue guidance of $2.35 billion to $2.45 billion signals a modest decline in top‑line growth but confidence in maintaining profitability.
The company also highlighted the completion of its $525 million cash‑funded acquisition of Locusview in January 2026 and the earlier acquisition of Urbint for $325 million. These moves are intended to strengthen Itron’s AI‑enhanced software portfolio and expand recurring revenue streams, reinforcing the company’s strategic shift toward grid‑edge intelligence and data‑analytics services.
The market reacted positively to the earnings release, with investors focusing on the EPS beat, revenue beat, margin expansion, and the strategic acquisitions that broaden the company’s AI and recurring revenue base. The results reinforce confidence in Itron’s execution and its ability to generate strong earnings even as revenue growth moderates.
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