Rockwell Automation (ROK) 2 Nov 212021 Q4 Earnings call transcript

Thank you for holding and welcome to Rockwell Automation's quarterly conference call. I need to remind everyone that today's conference call is being recorded. Later in the call, we will open up the lines for questions. [Operator Instructions]. At this time, I'd like to turn the call over to Jessica Kourakos, Head of Investor Relations. Ms. ahead. go please Kourakos,

and thank Fiscal joining call. XXXX Blake and today And CFO. Automation's With for Fourth is CEO, Chairman our Quarter earnings Moret, Gangestad, you morning. our us for Rockwell me Nick Good release conference

on this released our and our to and the Both call include in the press today Our charts earlier press been reference have results morning press were the charts will for posted website. non-GAAP release and release call reconciliations release and at include available these webcast days. the replay Both charts measures. of that A measures. this XX for be will non-GAAP website next

For your at also website the will convenience, conclusion of remarks a of prepared today's available our our be on call. transcript

found using Twitter information Rockwell's on Additional also Investor the R-O-K. @investorsrok, and feed that's @investors news. Company be handle Relations can

we I Before future are comments you will the that of statements remind therefore our our to expected related Company and to statements. results started, include need forward-looking get

results from actual in differ materially and and earnings that are filings. due of range detailed our risks release may to our our described wide SEC uncertainties Our a in projections

So, that, I'll Blake. call hand to with over the

good you us for Thanks everyone. today. Jessica, joining morning and Thank

core saw to in orders both performance very three strong software and grew results slide into turn and double-digits for had services. prior another year. XX% connected information chain and additional a grew reflecting to over Organic by and demand pipeline transformation the across automation year, that very core $X.X sales was orders $X.X supply on in solutions digital and revenue We Let's shifted of strong grew with in grew demand due prior security This XX automation demand cyber quarter services sales our billion business revenue. led XX% strong growth X. quarterly fiscal versus headwinds. exceptional surpassed We of solutions. Total of portfolio billion our all segments. Total XX% across over

make significant recurring to revenue. continue we ARR, progress drive to Turning to

Our top-line segment. XX% increased XXXX are of comment intake quarter organically with headwinds by with XX% and came QX. Segment versus over organic our supply performance now recent year consecutive planned the accounts order an X% on including expectations over total this with with Intelligent XX% above of Xth device's chain. ARR by fiscal this business sales is now execution sales. in orders XX% our in significant [Indiscernible], prior From investments our line of segment orders I'll perspective, from grew of in acquisition the record of margin levels. even

automation see We strength gains, across our continue independent by evident to motion, card the significant particularly technology. portfolio in and share led

momentum grew result sales and X.XX increased demand book-to-bill by even in organic growth QX Total XX% billion our over services, increased of backlog as projects network availability. Lifecycle the great life visualization backlog Company across year-over-year. logics. prior is delayed above led some and segment, year-over-year. X% Once including of business. levels. across XX% again, control seasonal of a related of was with grew and X% showing Orders Cycle control, versus the software, double-digit In portfolios. by sales Life approximately organic year grew Software strong Services, component cycle XX% XX% Over services to $X.X well sequentially, the

number infrastructure and great newest included services, revenue a digital of to Rockwell's software meaningful as quarter. Turning a wins. service represent of orders and we information connected Recent solutions many another streams, which had

notable in One quarter, Ardan of the with the Group. more and wins was

to like manufacturers resulting The sustainable to largest from world's automation respond Company demand. in is By a of core devices. products, unplanned $X we software had tremendous million dollars to and for new placed pulled One developed, packaging a relationship through increase order an our trying purchase additional of synergy million capabilities of QX reduce sharp a a showcasing QX fixed Ardan intelligent as the software companies. the in downtime. lot

ARR their our growing with overall been XXX months. new contributions able customers [Indiscernible] to the and X over make very With has just fixed business. XX% I'm happy added the last in to

win also We in food one with of key companies had areas. the a two great beverage and largest world's application

factory monitoring The suite first provide combine digital win and in our business, of with where to analytics area consulting is predictive analytics, who manufacturing real-time in technology the our their Calypso our innovation automation environment. talk

reduce and further their of very Calypso real-time Rockwell technology all and of water, develop area play carbon that in monitor be digital the the will projects KPIs in to gas, of usage transformation is manufacturing. is application some sustainability, air, spearheading electricity, software help within outcomes. to drive used automation second steam exciting quantifiable footprint, The where continues a to production and important role most and

recognizing customers O.T. the I.T. throughout strong partner journey. Our digital are be Rockwell's a to capabilities converge expanding and and transformation

our acquisition our of expand expertise. and outcomes software the In we our very since solutions, will customers. our Calypso's which supply a fact, yesterday that management to we combined connected of supply notched Avada, with are be charge excited our chain partners, it that domain This such is to area. our critical capabilities expanding expertise strengthen with adding chain for and high-growth great a We're in presence operations

on September. the look see factory-thought Plex The software the entire and to there. offering our to factory XX, of like you including with is forward Plex we talk at integration highlight also the showcasing going well XXXX Houston. to hope our see PTC accelerated also in offering we've We our upcoming traction I'd Investor partnership. We acquisition increasing with in November Day SaaS

number Our growing. a over both new all great We're sales think this the versatility is existing customers and our size and world. solution of ones with part combined A and way to of The number a diverse great this capabilities we partnership, industries of software the in I portfolio. saw happy wins the world. quarter sustained it's around with the were win, of engagements the force

including market very performance increase delivering in led XX%, off segment QX of tier EV manufacturers, Within growth. a great and Semiconductor automotive segment, had year. a one project growing sales sales XX% industry performance. EV versus good GEM discrete a exceptional, roughly activity, Slide Ford. capital growing few of win at providing in XX% our now turn quarter by last content for while the a Let's was top strategic to strong with E-commerce an with approximately one Magna, sales of about industry XX% prior We grew X highlights this strong was also auto our and year. performance

as gas had verticals. growth share. and and grew this XX%, growth we now vertical America quarter. opportunities Turning and strong market trends. to hybrid strong Once and and our also oil well taking Sensia segment a quarter. XX%, Food OEM life and XX% and brownfield over up sequential project We North across overall gas clearly the oil tire, JV. by and very evidenced our as the in segments, we're verticals XX% demand. year-over-year greenfield grew strong and again, over discrete was in in in Process about are in market hybrid the segment In well that improving terrific was with seeing in markets the EMEA, especially segment, our as fastest-growing led growth hybrid our summary, see in QX strong about which in of continued industry as double-digit grew beverage Life one sciences top remains growth sciences

metals. and and broad-based X QX performance. strength tire beverage, Sales life EMEA versus slide Asia-Pacific EV. tire, grew X%, EV, sciences, regional and strong by organic In saw in food by growth semiconductor, now driven mining. we the China, region across increased XX% driven double-digit and growth with sales strength Turning our grew prior segments. in in all by led the sales mining, growth with to in three by sales America organic North year, XX% double-digit industry

sales productivity Let's ISCS now X grew strong exceeded Slide as and included future orders growth. Adjusted in our XXXX, on financial investments. once fiscal In XX% At million we grew constraints. investments X%. discipline. significant profitable turn our framework, significant investments EPS inorganic organically. with a accelerate cash profitable year-end and generated $X.X highlights chain That same financial $XXX and as due time, XXXX. focus supply made we well at we XX%. organic to flow the to software very Organic shareowners in to again review XX% sales deployed investments. approximately inorganic of and almost grew the its to billion million even buybacks. accelerated dividends form $XXX projects revenue At funding for of of billion and to double-digits back grew fiscal Record $X.X returned the Reported and development same of time, we

X, fiscal strong in investments these helping in 'XX. our top-line can momentum Turning Slide accelerate to backlog see order how are performance heading into you to our

year. prior latest supply XX.X%, total reported expects account Our XX.X% new versus into fiscal sales constraints. projections 'XX organic view including growth the of growth our take of chain outlook These

the doubt need people, capacity to highly emerge commitments no to and to support supplier this they will this challenges dynamic continue plant in manage as but new environment. have We we growth,

Core double-digit both Solutions We Acquisitions growth. growth expect Automation profitable Connected to expected as points contribute X Information are and well in Services. as of

margin We XX.X% up XXX expectations points prior the are over year. to increasing our basis

more market me about and $XXX totals Our new compared by prior adjusted XXXX but recurring our on recent outlook Nick, fiscal EPS our fiscal the year double-digit Plex fiscal go broad-based on fiscal detailed turn can XXXX. expect into approximately Slide we X. let for to won't XX% midpoint year. in growth to should this our annual now the the organic revenue Nick. adds we details the at it acquisition, ARR view on to outlook growth expect including A sales XXXX. I as slide, found growth, With will over that, another range that in you of add to is end results financial XXXX. who of $XX.XX represents target of which our continue I elaborate million into see,

The year not shown a over to morning, higher start margin working cash quarter. the prior in total point information. translation Fourth was adjusted quarter in line a year-over-year Fourth the on other of operating flow the discrete than Thank slide, year free year-over-year you, the the we were sales last investment free was quarter key tax Adjusted a impact anticipation support growth. acquisition. primarily in-line decline flow were costs offset EPS The partially for X.X impact current our repurchased was to shares much The actions, inventory slide. our of X%, pay restoration up accelerated to $X.XX of the X. and Currency and deal everyone. was in and to related The points. rate flow generation contributed Segment increased fiscal our versus increase current million. cover adjusted good associated was recognized thousand And quarter. compared sales XXXX. expectations. XXX in one-time and capital with expectations. affected better Fourth $XX from prior build rate XX.X%, year. XX% lower at of EPS quarter expected XX% levels on XXX-basis by negative One revenue Corporate in The QX the in $XX Free sales. X financial to on expected, grew later of with of incentive of several Blake. the cumulative percentage compensation, bridge XX.X%, point million the reported We was of with I'll higher the The revenue higher $XXX levels cash up of the cost item includes planned in the performance organic in lower-than-expected XX% Slide million. Plex by acquisitions year. cash sales the than related was generated was Quarter reversal increasing items temporary additional year. and expense I'll spend.

up repurchase This share and in with available for by All gas, software benefited Organic Cycle life EPS were the For XX margin double-digits. July margins September actions, organic and sales were million control see remained organic both provides year-over-year Compared quarter. XXXX sales. compensation, segment segment by of were XXXX. spend XXth, planned by Slide sales year, On including reinstatement X% beverage. input cost repurchases Services deliver did by control price of year-over-year of costs, oil up the Segment compared led offset driven devices sales. basis costs XX, segments performance devices of higher well in totaled to and QX growth line XXX partially these sciences, offset This the operating our orders. declined intelligence Cycle the $XXX The were segment XXX margin full-year, saw three and to higher was authorization. and unfavorable sequentially QX our points year, on XXX strong from $XXX double-digit basis Life intelligent positive up our the largely guidance. million sequentially last up in sales segments. last points and price. basis with Services, segment, and higher our margins both software from higher pay mix X.X% Life Slide, walk as sales. as partially by declined reversal offset incentive points provides adjusted and fiscal temporary next the to the fiscal higher investment under

investments a restoration was accelerated compensation you costs due were to XX.X% $X.XX of investments our with associated in Software Control we Plex As that negative core deal mostly acquisition. the Approximately segment. Acquisitions organic of year. the and up earlier sales headwind about and performance increase. reversal non-recurring pay are to actions $X.XX. related contributed a can on $X.XX $X.X incentive The temporary this announced These see, was

incremental of what of to effective and chain. unforeseen we As Delta Slide the our further Variance QX don't I QX show mix. EPS in Asia, this in July. the $X.XX lower was of favorable East provide incentive $X.XX. quarter back played the our impact pressure out contributed volume midpoint our the But to had productivity, mitigated previously added adjusted lower provides walk in guided rate noted, impact relative from We South midpoint how but a the actual supply information, to wanted guidance usually XX a adjusted the to compensation, tax misses results. July to The our of

$X.XX. of All which contributed

more As favorable a EPS noted, benefited $X.XX. guidance previously tax our by rate versus

order slide Moving shows This our to average Slide trends our XX, includes daily portfolio. products product trends. which our for order software

sales double-digit at Xth which pre -pandemic trends Order XXXX improved and XX including Slide our in increasingly above financial software that year quarter. were a process automation transformation. the reminder, end order account expense million full in QX from about overall in shown acquisitions. in markets sequentially fiscal our sales consecutive a X% including prior close up segment increased and key Reported accelerated to about are provides core levels essential information XXXX. and of sales. year drive one-time XX% XX.X% here grew digital to fiscal XX% versus for of $XX hybrid XXXX. X over Full-year the interested to for levels sales grew X.X% led from mostly was by up are percent to XX%, investments, as X/X was As broad-based our R&D discrete as R&D the improving sales fiscal the intake about of in verticals. product point both are coming and remained of control growth Organic customers for well our outcomes investing and the margins of compared come and further segment. at software, and

XXX% which Corporate costs our the conversion, Adjusted investments, mostly EPS of conversion excludes core and accelerated was our XX%. adjusted the $XX can in was remains one-time over Free the acquisition. and Automation, impact flow just Free year-over-year July Core up flow which was of your strong associated for detailed performance was up be impact acquisitions, million, with the and excludes Plex XX%. currency, Our to cash reference. EPS A related income. our was acquisition expectations. walk appendix others in-line cash with -- found adjusted

above remained target ROIC of Finally, our XX%. over well

repurchases towards acquisitions, billion $X.X deployed the and For XX. year, share in fiscal of dividends, about we capital

liquidity remain Our and capital strong. structure

for onto XXXX. fiscal XX, move guidance Let's slide next the

'XX are at to up midpoint As XX.X% mentioned, $X.X billion we of about in range. the the expecting fiscal sales Blake

sales to organic assumptions chain be This the XX.X% latest the XX% in outlook of range. XX% to our expect of and about range growth We on at constraints. midpoint our supply includes

We to XX.X%. expect about margins segment be full-year operating

this We expect for from month. year positive cost price we additional implemented increase price full the the

to this guidance XX% XXXX and our earnings XX%. the we stages We believe the of of assumes cycle in As conversion making a growth growth of early of investments beyond. in full-year fuel and midpoint are are core sustained and between

Our double-digits. outlook fiscal and our other growth-related to conversion plan R&D increase core margin by XXXX includes and segment investments

tax the anticipate under changes. is material discrete current items to with any full-year we rate an rate do these around This tax provide will tax impact effective XX%. not expect from adjusted be XXXX. the We in Should We impacts tax outlook law. to change laws fiscal updated

fiscal on represents $XX.XX. compares EPS adjusted growth. page. QX supply our we next a the range, adjusted expect Our our to to be EPS EPS sales to 'XX. EPS $X.XX. $XX.XX year-over-year the walk fiscal to a on based will of compared availability, From This this adjusted is First adjusted At current guidance midpoint cover chain XX% flat Quarter I viewpoint, calendarization the our XXXX of of relatively

Quarter, the over First the the we Following to improve expect sequential balance sales of year.

in and margins price sales line segment included throughout a EPS more given timing quarters, of the legal gain throughout the of and fiscal volume in a year QX, increases sequentially when subsequent non-recurring settlement substantial increases. related to the the matter. the as $X.XX to a expect have our the customer benefit Also, price to are year. recent improve and We of then agreements with QX, a in 'XX anticipate decline reminder, adjusted renewed We timing

of for million and cash reflects we the fiscal This full support Finally, a to payout expenditures of capital XXXX sales. higher million income. levels of fiscal about capital flow performance, expect $XXX XX% $XXX working of year conversion higher 'XX, Adjusted bonus free funding

XXXX comments few to -- be expense And million. $XXX expected targeted for at XX% assuming fiscal outstanding capital next Corporate guidance our additional sales. provides amounts $XXX with average comments historic be expense interest we're be working around XX, Our aligned to from fiscal other expected million. to fiscal finally, Net the midpoint. on and of about million A of fiscal XXXX XXXX guidance. shares. is The the is about EPS about XXXX to $XXX.X adjusted diluted walk shares Slide, of is

right, to left cost contribute $X.XX. exceed from higher will This includes Moving price anticipate realization $X.XX. by to about inflation benefit We performance expected input is core the sales. of organic

in are additional built several is one-time increasing light taken have removal prepared from bring pricing be a matter Our needed. a the this about is high the settled we The The Plex legal to XXXX we in customers. mitigate will year, impact $X.XX made $X.XX value take investments that to of philosophy benefit. fiscal In on tailwind was input headwind. interest. as we and $X.XX accelerated costs, year be adjustments a that one-time the fiscal incremental our of of price including gaining price actions a in prior XXXX, will the

included changes We XXXX the our impact have of showing information in what Plex fiscal significant in to we No in further both appendix. fiscal real July. showed XXXX and

is headwind. We share impact be expect the from dilution. about to $X.XX higher coming a about a And expected $X.XX tax rate

next deployment a make onto I'll comments framework. the our Slide few on XX, Moving capital

the long-term remain priorities same. deployment Our capital

After first then we focus through is and to deployment our shareholders then organic that, returns on priority capital Our share we growth. capital repurchases. activities, focus on inorganic and dividend

'XX the capital sales combination midpoint backlog organic at delivering. include sales inorganic addition $X growth of deployment of million. over order reaches guidance returns billion. $XXX and to a In summary, investments, drives for repurchases our In XX.X% focus $XXX our a of a and about organic of share Dividends that assumes and on total in our million fiscal plans

of actions through segment We offset pressures additional inflationary continue margins price to XX.X%. yielding

EPS growth start adjusted With remarks and closing we to turn flow. XX% for some it I'll Blake continued that, free of over cash the strong Q&A. We expect before

Nick. Thanks

robust future making order and look forward strong technology 'XX, As to We're a underpin growth. to trends our record in we investments top-line backlog capacity, and people our outlook. Fiscal support

delivered moment challenging during great take results tremendous and people this especially work a year their want Our the recognize times. I to to

automation be Nobody customers top-of-mind. in been digital and industrial transformation and investments resilient, to never more sustainable. help recovers, world agile have is the more positioned better As

manufacturing taking to see level a As of Investor great a many we're ahead. look forward our upcoming whole you year Day, to new will at and

to the Q&A session. pass now baton the begin me Let back to Jessica

Thanks, Blake.

start you Before possible. get say many to wanted I of to we the as we Q&A, just as you like that to would

take please X quick first our limit and So Press, a yourselves question. Thank you. let's follow-up. to question

Certainly.

Just your question from as ask is Instructions] is to Milia's Scott you'd question, a open. Research, Davis first like reminder, a if with line [Operators Our

Good morning everybody.

morning. Good

Hi Scott.

the get it also Good. folks when just mean, there's think who that projects. not and What you the like materials reality multi-billion-dollar here so this sort of can are saying customers every there's about issue cadencing your of stuff done. announcement day of that with kind some just but, see we other seems integrators and labor many I

backward know that, about your but things you XQ projects think at So or today least -- are least ability ability time done saying they at get your looks relatively I guide is their after like? fiscal customers what for their what conservative hopping have to on

to are think capacity our at industries that in of what our win. of think lines in And from sometimes looking lot we've find well. I used customers the they doing. also, useful the different that new to as and a investments, plans I own a of ways look our right. They're make looking our that's hearing to lot sure indicative as capacity have get own that Well, broadly launch it's to in place customers to language a of but new meet are but business manufacturer demand, current the we're And to

of the well-known current sciences. of it's known look cases best the with to meet launch that. are we some capacity probably and of in business looking we demands when in So, some in being semiconductor, life new areas. other areas, look these just lines EV when cases, meeting In capacity people at to at it's

they're the sight the and things these as when line that through delivery our needed. salespeople, of well products, to driving as of You very take that one is are to eager the have demand we our are own of projects through and intimacy our of distribution

expected projects not customers start. might we're as projects they're delays as that capacity these So, projects those what and up trying those in some be get soon running when but possible. to know we just need are into and seeing, To they're they these there's going to are products, sure, guessing when certainly just our

lot pricing have you I assume just that think you about -- a you Is tremendous pass makes the has mean, power industry there -- sense. And a on? it that right of in about to now. That mean, -- shortage -- you you talk do can have some how I pricing be semblance, the overall. are I pricing then I'll

and for I'll coming expanding and can and Yeah. the to make as a of we're looking select share add the We're in important in couple product increases. Nick taking with building then and it doing comments that well. pricing foundation margins at the areas some future, year, industries

Bear things mentioning, for was over implemented the tools pricing of last one think the dramatically the is have that of is improved years. I that couple

the so the Nick? I So, to we've win that, the can bears we aggressive significantly pricing but upgraded the of where share. selectively can tools lot price, with and we where talent can reserve right a be to and science analytics be a think market that get real also

a Yeah. I things, Scott. couple would of just add

than 'XX, And have -- and price at year price fiscal increase as is input if are point. to taken we're actions bringing we anticipating we're this what this our more what additional Our on we value input take increasing costs we're this with prepared pricing seeing in to high philosophy built costs, customers. several adjustments needed

And continue premium So, for market to focus relationships margins. our on we're there. prices creating we the we customers [Indiscernible] the in our in do and the have value we command

Thank you. See Good next luck, you guys. week.

Thanks, Scott.

you. Thank

Our of next is Bank question America. from Obin Andrew with

Your open. line is

morning. Good Hi,

Hi, Andrew.

Andrew. Hi,

drivers, talk plus what you the think should [Indiscernible] XXXX? strong into Can how the about in the about quarter. key highlighted rate You we just XX% are exit and

Yeah.

happy the we So, step from with that change ARR, very like growth, and our the we're terms percentage then the acquisitions both Plex. received of of development in

ARR And that over X% at so, we're continuing and we're total, an of path. currently of Company's the looking on

the a software, either we software as as a delivered and subscriptions, technical the service. separate contract of also Company, But have being bundled software still in service you interesting also software the If is with so subscription elements main delivered ARR support, that's or some about security software as as start and which perpetual the sold think a as with a cyber additional license. areas. infrastructure for associated a

So, on that services decision-makers. to be Data traffic because also of it's our pulls of the premise hardware, and And with it's bundled Industrial additional a lot right. monitor able we've -- has offering different its a a good set in been network It's opportunities it comes software had. own Center to great that through the business

areas, those continue to a of be of introductions, I'm are you'll So Automation develop at year, as week existing of our that Fair. this new primary very are we offer really software services see release to organically next subscription, robust product the and new as offerings a which the in look for with growth Cloud. plus happy to with expand bought the to SOC opening able developed we additional outlook that sold as-a-service the that's running number and

[Indiscernible] just color you just greenfield, Could I'm then. gas looking midstream, at especially just until detail you more a America? brownfield, can but North wait to we'll there. [Indiscernible] improvement? oil about guess give I that little hear highlight and Thank upstream, Yeah. bit more you. more

Yeah.

we So, outlook XXXX. the oil the -- did for encouraged quarter in fiscal the we fourth gas development by and of and were

in gas of and midstream. oil remainder XX% the in are upstream, about Our most with

was In downstream, quarter, upstream with all we Maverick saw of we're in do from and and work growth the safety really is the year-over-year particularly products and side. that but majority we in and power Sensia So, of doing the the growth. were doing our see to downstream often businesses fourth strong not both sequential We to regions. by provide our offering, control happy orders the whole contributed the lot a

Thank you very much.

Thank Andrew. you,

Sprague with Research. from Jeff Our Vertical next is question

Research, line Your line Sprague is your with Jeff is ahead. go Vertical open. Please, open.

got I'm couple a sorry, me you there now? Just of questions.

XXXX? Just XXXX achieved I We see cost actual be I'm embedded amount capture of but know said on $X.XX of you price nominal it, but if on in price could you don't the in and first you out on curious positive the spread actually specific the price obviously price, what's [Indiscernible]

Yes, 'XX. X% price And a Jeff. little growth projecting net X% price in we're approximately growth fiscal We had 'XX. over year in

However, We're in I cost more we that in see our is coming be latest of anticipated price we to if haven't increase current to adjustments. want additional cost to that increases on prepared that based level increases. caution, our quick

spend the core also, embedded then investment would guess And I be number. in

less at rate could if growth Are what you core I speak is inside than is. actually a to the just double-digit. growth? wonder growing at you you of think you're said Nick, that tailwind Actually, growing sales number? it I actual

Yeah.

to creative those, said, as It's it ourselves see of in growth, double-digits. so and cycle on and same R&D we and sales, are both And making from our color just the but it's Because investments that are on investments. we -- stages fuel increasing sustained in other beyond XXXX growth-related pace double-digits. is put we in the of and and the spending growth, XXXX to XXXX our early that Jeff, I not to as in our in in the margin? low some growing need Just at it, is to

development you're the Those investing Jeff. have Jeff, 'XX. the we're areas, of investing plant’s that customer expenses projects, investment also software in pandemic. and and investments capacity. expanding and control. during seeing the And, we're some resources in some Some facing facing where spend our We're customer mostly are in increase some and products key big of those software gone down We're places in selling investing of travel addition in

QX, for it could I squeeze And I if more think. a sequentially, to sales sorry you you have decline I'm more elaborate little in, flat. on actually them would Nick, I normal bit could just one mean, QX be And

out idea elaborate just Maybe cost the EPS does jump little that going you. that sequentially with or bit. outcome may So, Thank price just things a decline quarter. other what's drive the on to in to

increases with revenues impacting supply That's than Yeah. price some implemented 'XX we -- be from that and will we an they a as be what perspective, impacting QX what our our standpoint that more from of is move be later of from QX quarters are based first based margin QX. are Jeff, From we we really the seeing keeping a chain constraints will quarter have our EPS flat on sequential 'XX. that revenue standpoint it's into QX. will and of the anticipating

what price the sharing say go the expect is revenue quarter in impacted through by So, we for first year. margin what 'XX the timing I'm our of I margins our as part of of and as impacting we increases

last that also EPS that year a first then just most had And We increases our we settlement quarter. be legal first expect will will quarter from a pronounced gain I a will in perspective, out point cost and from of year-on-year be perspective $X.XX repeating. from an not

you. Thank

Thanks, Jeff.

Our next Morgan Pokrzywinski question is with Stanley. from Josh

Your line is open.

guys. morning, good Hey,

Hey, Josh.

Hey, Josh.

it's about year. next you Blake, the of first this end or conversion backlog. really versus the maybe markets? or times, of backlog underlying much on on How several question it growth this is the excess in talked Just up a strength source a elevated of commentary catch maybe

course, a XX% huge at of backlog in $X.X is high Services and those quarters billion about the longer And and control. of project strengthening of software process you, content. that being intelligent Life our backlog talked product order of includes level. As about we a built then said the in reflecting have dynamic by is cycle devices And also that's Cycle we which business enormous

tailwind in. demand remains The but we from we demand. coming coming see So, that, have strong continuing a huge

themes as so, we sharply into be of is subsequent in And we're investments operations, and investment number we're agility in is of making sales and mix. the XXXX. to But beyond growth and general, And that think say part well. -- their the orders and the XXXX tailwinds, building serving, secular our and resilience XXXX the we've people is really intake increase reflected sales strength to in as in are a a that those what's due a in let's just that of being industries basic beneficiary trends

but the level that that level. can also end-market at the it's coincidence be be perspective basis a product also one says standing or economic on Is anything story? but strangely I up that different out. anything at guess, indicator, And there tells added Okay. may good nothing maybe then is an a that XX% a it pretty maybe just to strong end-market everything hand, but is from

Sure.

projects, some deeper that's of and obviously I in coming think automotive, at one capital out level. a those you in so level go is investment if for end-markets high EV

speak. You the the with look We're of surprised a again, pack vaccines. it so little Oil think to love associated be by they're each work sciences, to at and life we'd gas, part I story. own there's obviously treatments COVID uniformity, but the has one and its

go some obviously can one, and that there's think I variation you each then if So, you see as well. regional through

it. That's guys. Thanks helpful. lot, Got a

Thanks, Josh.

Mitchell is Julian with question Our Barclays. next from

open. Your line is

Hi, just I flow topic. same cash the guided number dollar was that X free that in in cash up wanted remarks, is on some billion the free $X.X years think follow sort the around prepared a about the I now. of flow, row comments know morning. good to I but you free for flow cash implied made Nick,

as would wondered the on shifting drag just is that's shifts, -- the they're business number as that becoming of one-time just each free keeping the of So most that at it sort as and the view is cash a as there's business some even stuck cash if ARR kind software in mix or or sort there of growing. adjusted that maybe year model headwinds more something profit sales are flow focus towards near-term flow you

higher to that really place the 'XX capital higher for biggest thing. that is biggest go That's the XX% the and the those working cash with story -- conversion free putting single we're and us Yeah. the Julian, flow in in in revenues revenues.

'XX light the higher terms really also the having to impact, that products. of mix perspective, in Julian. and investments But of payout we're performance. an Julian, from the in on our 'XX CapEX for in our demand of thing And are related increasing our not that that's then no, bonus we're seeing, our going Secondary anything

backlog trying Thank the And then Understood. topic just of on follow to and conversion. up you.

guide [Indiscernible] you billion, is was it look assumption $X.X of X/X sort January, and supply incoming the February grow from your orders? balance is the the it's conversion conversion said because over revenue year. XXXX you at the pace and your right into slower as to of of of orders accelerates also now -- of don't Your worth way and to that backlog backlog about fiscal Is revenue today, main I that just sort that think backlog wanted continues about constraints,

the of than In a a in terms would with those longer the backlog normally traditional is a products think should I percentage good of some yes. higher of That's mention, of lead the word, right. of because quality expect we you our split backlog since of it's And times products.

Perfect. much. Thank very you

you. Thank

Our is Steve next Tusa with question from J.P. Morgan.

Your line open. is

Good Hi. morning.

Hi Steve.

to on guys investment bucks spend, this you like of used that think X topic have bucket a P&L about billion spend. investment I Just on like of the this you talk

threw I in the with $X What this runs spend Jeff, one-time? CapEx typically what was. the is And include is net billion of billion discussion that investment think number talk you through P&L? want what So, the in you headwind, about that then to however year? absolute $X going to growth if in of is maybe it decline the that impact, on year-over-year one-time the or it the grow

XXXX fiscal it's of did year that's million total approximately saying spend investment up not year Then our XXXX going double-digits of we roughly So, one-time what actually. billion in $XX spend, that the of in fiscal Low to double-digits repeating. that's we're we had Steve, $X XXXX.

investment of little increase in the $XXX a over spend. there's million So, there

parts that the Got Okay. a to incentive then call you some Whether of sorry, -- was I it. want it's comp this the earlier. other call on or that And on of bridge front? out any on

a may moving around? You but else in have highlighted anything bridge

Also, based some in change. tax year We Steve, law. of just current tax not us a does what we couple Its would that but, for had we're will update are that expect XXXX repeat. is the out things We on impacted point fiscal those that that one-time law the pointing I'll tax those rate out.

a Okay. Great. lot. Thanks

Thanks, Steve.

is question from Andy Citigroup. Kaplowitz next Our with

Your line is open.

Hey, guys. good morning,

Andy. Hey

Andy. Hey

row it before, been Blake projects I without strength do does they've or any continued has know quarter third some to in this of billion with this you but sense asked and a quarter. orders larger the $X that you your or of we've go more next higher get line double automation inorganic in few you've to early can getting over these that recovery and orders Company, and the given still the it or reasonable levels ordering quarters? maintain additions grow your even is customers at in think seems from made process

across of our is think sales as seeing QX, demand XX% there were distribution, the broad-based in quarter, Yeah, well majority the vast We we and force what to multiple the certainly poll-ins and some of we're think so total. in but industries. under it's underlying it's we talk

do seeing and we're October. we believe So, this into

in chemicals. expected growth strong as pick about to see secular these chemicals continue some for life talked and from in customers transportation sciences, chemical, coming building the We or beverage, tailwinds the industry Whether packaging we've year that decent demand are is and you to of have investing. it's coming

it places. from You a of can see variety

new we're customers optimistic so, about significant there's expansion we we our new the in of to customers to in pretty very talking what things, order capabilities have talk enough did business of we're of months continued all But because about portfolio. about year, And growth that ago, segments. particularly XX, a can XX X

during And mentioned from the additional there up quarter you obviously, wanted And several made by led plan that big your automotive your battery the of of some customers. on comments business your production growth you announcements customers. to Blake, capex of follow on declines I facilities. any EV were XX% despite EV

for So and could how recovery is build mid color auto just what that you're automotive much could EV? you EV more of into FYXX, the you And saying us up expecting give versus what in you're be related for opportunity business teams.

that is in a in on return getting getting it out of have majority made owners these our been investments startups and the there models think the the I business, traditional brand new stay with the getting how them. That's are how road. on Yeah, EV

MES associated China over For Rockwell business tier we with us. it's 's a scale, getting EV total And card Battery wins have being you the EV opportunities you to growth with with and at in quarter a think about in that I strong look providers. the battery with EV, so X% at about for around And about look we're that for calling We we the that's years, a and mean, the be software, are driver going of clearly Associated multiple of of XX%. about expect our the us. that, automotive wins And Plex world.

I All us. think of things positive are these for

Blake. it, Appreciate

Yes. Thanks.

Our Meyer next UBS. from question with Markus is

is open. Your line

good Hi, Yes. morning.

Good morning, Marcus.

Good morning, Marcus.

adjust good there wondered back I Hey, have prices in you how to if and come existing link I pricing backlog if X. much morning. to to and I backlog agility the wanted could be? will need

Mark backlog more the relatively we dynamic that is prices not There are has significant small repricing. us, backlog, adjust. portion can our we that a of majority our of

changing 'XX, backlog, we So, But in terms look product mentioned when we're as favorable backlog. there. seeing some of as the Blake we're mix and favorable. the it's earlier, that our of that in It's work at not we prices our in total through

we to be expect to us So, expect to be it accretive dilutive. 'XX. don't We actually it in

could mentioned elaborate share motion. on little if in gains what's driver you've I there? that, That's helpful. Thanks. categories then ultimate you which bit And product Blake the wonder a and

a seeing places. gains of Sure. I and from couple we're motion share control mentioned

releases traditional are motion product well. very a And more we that there of we've they're products control And developed to and the kinetics uptick had the is some we've sensitive fit. quarters, of controlling overall, seen some strong doing Information Technology. get last and Card area motor, are some We First products few our talked of, Independent that But our last all, architecture organically integrated of traditional had products about products in China. there. that an markets in like good price especially more the year very

offering really due differentiated the machinery, a linear fundamental integration and on ability around space very And the a variety a the and as us industries so, to part save of it's give world. acceleration of the rates, motion its in deceleration machinery, to control,

in applications be and food for in in can power in used mining. building, be sciences. it in packaging entire So, even we're and used There’re life it interesting that can beverage on some vehicles, working transmission

invest and into automation And and set to companies had build to that many architecture. we've bought it a small complement We two technology technology. continue actually to overall years, so, versatile get then it's we'll of the very into

double-digits. strong with we're which the happy very growth that we're continues here, So, seeing at

last Operator, question. X we'll take

Certainly.

Oppenheimer. Our Noah with from is final question Kaye

Your line is open.

you've taking with case Blake, great Thanks for of manufacturing rampant Rockwell chain talked very you question. Curious, 's in think test for Avada, own supply industries. Certainly, about management across challenges a often how the And seem timely journey the seems being customers. acquisition that gain ability it do increased to going Avada manage benefiting own and supply able impact Cloud control chain solution? how and forward just supply that you in the to you to the chain see in over having How be or might and the your customers? impact visibility do

using operation. We're in own the excited our technology about

with a today. businesses the solution a implementation medium-sized But got have same it data for good Rockwell on and the in So, small pretty ease Cloud-based able we've more like Company that and reasons the be the information one come is taking may may appropriate. that of system not When systems not open traditional we like plants. their around big floor excitements computers exciting is Cloud-based lift fleet into make heavy most because a to they of the have real that big more plants new to a for be the department world, in we IT ability when systems what's approach agile The of manage acquisitions. to would a an

the in no They a very quickly. you going that for so years, regulated ability be On that [Indiscernible] there. hand, and to on on-prime those can helpful the system change prem of do lot in change need system, have have other a many because with cannot with but well the we're particularly to our industry to companies maintain continue to - offering

two for we to the see come. so, And long co-existing a time

And helpful. comment from if curious just any in OpEx. customer That's spending then shifts to you on can potential capex Thanks.

gains capex the of be whether with and share result. Wondering You significant side on customer this seeing the being as investments, to Sensia potential recovering. a process mentioned transition, seems as many you're base, wallet is a any relatively are particularly disciplined

as disciplined high value and still their oil seeing with spend the into think are entered for Sensia when commodity as we mining, our being orders. we that we you capital companies in gas, is in as think In we strong with prices. Well, super those are proposition fundamental reflected it. said, even And

the haven't funds a release for seen dramatic We expenditures. in increase of capital big

growth Some and to the mention efficiently about yet. but see people construction it the chemicals vertical in as of haven't getting only that's business to that in year. they There's the to them. the market, process like them bring because by in are have quotes. over resources a because lots itself for well products to having there, talking seen in is going as things delivered of stay to we're I do used boxes packaging good And come still chemical teams did we ability it's to manifest earlier, resins, activity we

and perfect. Thanks, Yeah, forward next looking week. to

there. you see We'll Yeah.

Operator?

Q&A like Ms. to the back Kourakos over session. I'd concludes the any for closing remarks. call This turn Yes. to

Thanks, look a us. forward Chris. have We next Thanks for to great joining seeing everyone And hopefully. you day. week,

today's That call concludes conference at this time.

You may Thank now disconnect. you.