Fortive (FTV) 24 Apr 242024 Q1 Earnings call transcript

Good day. My name is Dennis, and I will be your conference operator today. At this time, I would like to welcome everyone to Fortive Corporation's First Quarter 2024 Earnings Results Conference Call. [Operator Instructions] I would now like to turn the conference over to Ms. Elena Rosman, Vice President of Investor Relations. Ms. your begin may you conference. Rossman,

Officer; and Thank on available at Chief us our Financial section everyone, our today's Executive joining Investors Officer. We is present financial Information you, today's you, President Vice call. measures fortive.com. and Chief Lico, call. Dennis, G on Jim With for are required on website McLaughlin, Regulation non-GAAP thank the us President Chuck our and certain of and Senior today by

or increases specified. period-to-period on refer to otherwise statements Our unless comparisons decreases year-over-year

including differ that is During forward-looking statements, that statements the may call, including our date update we to for actual factors December statements assume we today. materially to year make any future. These ended SEC these in turn expect we Form may risk of only any like the that, Jim. do will are on forward-looking statements make regarding of to available These speak from XX-K regarding forward-looking events or over filings, made, number call I'd any annual obligation and or we the they statements the and a or forward-looking will are to as anticipate XXXX. Information our subject XX, not occur report in risks developments statements. With forward-looking that the results

Slide Thanks, Elena. Hello, everyone, and joining us. X. thank begin on you I'll for

to earnings start year, our core exceeding strong a the cash the free and expansion, have flow first growth, We margin expectations for in revenue quarter.

for advantages flow durable earnings new for each anticipated X safety health more growth innovative outlook is strong to delivered and reflecting in and of year, of our sectors free to vital of execution competitive our and care unique the Fortive. cash in enhance enhanced which number growth. Fortive and segments, performance We customers' value for more benefit to and our portfolio our double-digit productivity dedication we raised capabilities, adjusted Business the for strategy confident includes a across System. By harnessing are the better-than-expected Our our delivering manufacturing positions, products customers

build of in delivers is rigorous after creation which reflected look we the strategy formula a a to and Slide results collection on and harness system by business revenues emerging for profile X. are products shown combined customers helping our businesses ahead, profitable of the more split differentiated Today, energy Fortive durable half transition. success compounding cycle As value approximately recurring higher the year. Further of evidence with from more our growth, power and differentiated embrace with is highly supportive the businesses, application technologies through strategy of faster of derived year revenue

to a continued these added result, the support have roughly electrification of benefit and customer our select grow Further, end markets XX% product today, despite revenues of slowing. revenues AI. of X/X with approximately in diversification, investments As

Moving billion to we $X markets, last our are global of side, growth and in million beyond. remaining recurring and growth of changes profitability. digits which health last improved right to and and It approximately software continue go-to-market which includes driving XX% $XXX consumables, health from the the the approximately and benefiting faster care our care year made revenue includes grown in to the accretive single high more will profitable be XXXX years revenues, also have few

outperformance safety toughest going customers' the our we help across challenges, As productivity solve and to continue enterprise solutions forward. sustained expect

sustainably. its all world safely, drivers positions software to our keeping is and leadership investments cycle evolve $X.X and manifestation efficiently the to cyclicality almost to planned really running inorganically, a playbook IOS The year, analytics, instrumentation, billion core to growth. and and of company investments strategic the secular full reduce align Slide With through increase data IOS megatrends, in Turning segment this X. continued of customer more on portfolio benefiting revenue key in build to organically

Over [indiscernible] helping strong businesses, to cases scalable the digit, the Today, play workflows. growing high X/X markets, durability now $XX segment further market have adding customers billion, and revenue this serve. million their $XXX markets single X models, have including companies IOS' streamline now recurring we in over revenue, and that end few built our diversification past Within secular-driven software IOS, and intentional roughly is customer of in the years, in through expanded bolt-ons addressable we last we in use of that year.

asset bookings Fluke continued growth digits contracting health logo last And strong resiliency through-cycle with has innovation safety, the faster and to growth. double and months. In the platform. order we driving PMIs improved despite and continue geographic few expansion, life and continued result, a growth multiyear accelerate have in in revenue new grown As cycle, underpinning XX facilities environmental over this last years,

an can PT. you in over value since has operating to excellent evolution and the including we for IOS, at points the AHS XXX adjusted as of As strong performance see formula chart, providing margin expansion this from in blueprint culminated continue execute Fortive for our sustained future creation of XXXX, basis

X. Turning to Slide

see systems, benefiting to adding faster computing storage, at in market and also and are energy networks considerable a and energy. high-performance of customers energy and is more sensors secular sustainable support cycles companies the future. then with long-term capacity world's Tektronix. The the to and a portfolio with from our growth including for provides the solutions, of compute life and new deployment is challenges to sector. intelligent stand across new is hydrogen These it efficiency equipment test and investments Tektronix Qualitrol EA sources epicenter is grid diverse end makes from monitoring transformation enabling EA, the for finally, drive how can new to sensors, high-performance tailwind grid Qualitrol will excellent start precision AI addition electrical the and the benefiting markets. leader the services. The You exposure an our of growing energy and investment solving energy government rise for high-power institutions, agencies, infrastructure and of the of markets, both electronics electronic to and their proliferation demand Fluke. the renewable in cycle academic which infrastructure; and complement mobility, shift technologies, semiconductors, defense of and through increasing ensure utility and software

at chargers maintenance Lastly, reliability of we equipment, power performance reliability and are ensuring to the the infrastructure Fluke, solar efficiency global stations. the tools and and including panels storage and investments EV including and these installation of support of

Turning to Slide X.

result system and more drive development velocity business innovation increased is to process our differentiated results. a revamp to our Our product of direct done work we've world-class the consistent

our our identified dream billion $X revenue new lean incorporate bench teams over of other portfolio our did Labs, in Pioneer process. Leveraging opportunities the of we with through Square technology example, year, working partnership and in development. to For best last practices early-stage companies with stage the product management

we metrics. lean a faster margin greater continued work and of time system development the prioritize our gross from and operating R&D have driving are products new of development, as than delivery bandwidth is companies new feature higher our XX% acceleration operating for creating reallocated in enabling AI, spend we adjusted on-time margin improving industry-leading capital of are customers. FPS also seeing product roughly to tools for legacy using Florida expansion sustaining funding and working innovation. our software our the innovation software XX% As product value Gen

seeing demand In We're growth products durable FPS knew declining outlook margins XXX summary, by and profitability first we've our PT, Over over at XXX currency the a our the the success IOS, operating segments, to capital continued and AHS, by to for electrification the strong strategy Sensing years, in the more global multiyear and positive quarter, performance, that years consumables expanded flow start would than software X. into compound working for in [indiscernible] QX. and our underpinning is the further book-to-bill we differentiated wrap more been year. operating XXX continued lapping and we growth drive our return driving including Tektronix on growth free and a high and At technologies accretive core to for points result net hardware generation, percent strategic up and and hardware strong momentum AI gross year. growth basis through growth single-digit coming saw demand demand including, create in to with each Fortive to adjusted last half, in in business. In as improvements continued value steady Slide points, growth. the we rates. In of several over margins ARR cash recovery for normalized we've growth basis seeing results are we're both the laid of software and year, our points, higher basis a innovation, the in with sales X reduced creation. I'll groundwork our has flywheel in fueling off accelerate

right the side. Turning to

execution innovation the laid enhancing record for double-digit us out the XXXX Day enabled shareholder and acceleration that, continued over track continue we turn free to to expansion Chuck take it well outlook with first that strong up and operational and FPS financials value achievement at on updated in the an ample software opportunities the with to sets Fortive remain secular targets growth fund margin and since attractive XXXX the our driven creation. And Investor M&A quarter nonrecurring in and of year. consistent formula of for details last by focused Continued us products by returns growth, underpinned flow cash fuel with investment May adjusted trends, XXXX. We for long-term long-term of improvement through will by I'll led earnings firepower and the to

over and reflecting unfavorable XX-month times. of We're performance, trailing The the X basis flow first million, and X cash performance. the hello, all up revenue XX% of record adjusted Adjusted all $X.XX guidance better-than-expected growth in operating full QX of earnings of in guidance of point across flow $X.XX everyone. cash free of with $X.XX strong billion, with the and our partially benefits points X% of performance $XXX X include, operating year-over-year, margins high and Jim, reflecting margin included was quarter outstanding representing year-over-year, XXX of Total year earnings segments approximately acquisitions, growth by X% with XX% expansion, our Thanks, driven per end offset strong execution free adjusted our of performance up FX. Highlights core quarter momentum is favorable share gross pleased towards our billion. segments. some our by including

to in beginning total with the segment. Turning consistent growth across growth, X favorable core X% IOS was across the points first to basis operating [indiscernible], by mid-single-digit and contributed price of XXX driven FX. Solutions. XX.X%, volume Operating X with growth partially in offset QX quarter to Slide XX all M&A increases performance Intelligent each expanded by platforms. Adjusted margins and point unfavorable realization core

driven life Fluke, its Facility from benefiting customer with we uptake adoption and strong move and and Environmental a growth innovation benefits through the of Safety at cycles growth in enabled continues FBS SaaS Overall, the pricing quarter, half, as launches Health customers. efficiencies. new by expansion cross-sell including multiple the by deals is growth accruent several the and pace service enabled ramping Additional of a product stable channel growth with Red Eye highlights operating iOS strong pipeline verticals. include had margin with asset in steady double-digit key innovation, in first year.

supply and identified strategic Tektronix certain and plan Moving down X%, fund, some sales We've services margins of in value partially are at adjusted EA XX the points the offset basis to reflected significant demand opportunities for serve headwinds combine the with the lines reflecting Total integration revenue of having XXX-day of normalizing power was businesses, offering by accretive FX productivity and on Tektronix Core margins the our to customers. PT by Sensing. initiatives. and in completed divestiture which acquisition, EA's Technologies. quarter to the XX.X%, of of [indiscernible]. Precision the more we EA operating EA, benefit expanded growth confident product in better combined driven

down order color in delayed quarter, investments. double-digit Additional in trajectory mid-single demand again markets utility move due the was digit as growth Sensing we and digit remain as growth China had to the includes, Tektronix in beverage through and the U.S. quarter. normalizing R&D with slower expected, driven by customer food strong. [indiscernible] and declined while mid-single improving Technologies once

than driven and Adjusted basis price to market to Solutions. points was headwinds. improved margins Now more volume XXX offsetting operating X%, on by strong growth growth driven QX Advanced XX.X%, conditions Healthcare consumable. expanded FX and realization core by

that efficiency, the America ASP last on technology [indiscernible] assurance Health ASP increased Additional transition completed biomedical hospitals plasma as channel proprietary quality growth equipment and XX% gaining improvements. than hydrogen is continue Further, their for compliance from well include, and as energy with share sterilizers. Book operational is year consumes year. benefiting steam North need to less gas supply chain energy as and from the safety in per focus benefited

SaaS logo year-over-year bookings And their order software new boosting their productivity AHS license continued offset is customer were next-gen businesses at recovery platform Our with processing instrument pace strong new revenue squared sterile a AI growth. of large lower in wins double-digit customer last by the by year. quarter. Provision driven with Sensing partially

XX. Slide to Turning

energy by driven hardware You see supporting by first conversion North can X% positive demand. by America, revenue an headwind. point up Western growth core product growth of expansion secular growth offset single-digit in driven total despite and the core low X core we have segments M&A revenue transition. quarter was approximately By in investments was in the FX digit, with of normalizing mid-single REIT, Europe backlog all contributions, and partially in

up was China single-digit double-digit IOS AHS growth growth by in a in more PT. expected low by in in was offset and slightly, decline by slowing partially offset Asia India, driven and low than

to our year. the guidance now and the XX full Turning second and quarter Slide for

offset revenue in driven flow of with by reflecting quarter, our half. to consistent half approximately core partially year-over-year. growth free first the up continued million, strength in in to at by performance. Adjusted decline PT, margin second up Adjusted anticipate to double-digit $XXX to of we and EPS X%, X% the first X% with For the operating diluted IOS mid-single-digit view prior guidance is $X.XX X%, growth profit core XX of XX.X%, points X% cash flat $X.XX, and basis of AHS, estimated

expected For increase partial profit X% approximately reducing to the margins the million operating XX% now revenues core an is of range X% million. guide to Adjusted and full growth expect growth X%, the to the to year, by to versus Invotec prior we continue headwind to at approximate including divestiture in XX% of is with XX.X%. X.X% FX $XX expected X%. Total $XX

X year-over-year XX% of last to $X.XX years. the We quarter. raising XX% in in to to EPS tax approximately with growth to expected average strength to are to cash a XX% of rate flow $X.XX, line adjusted be the XX.X%, billion, year-over-year to expected diluted the reflect is $X.XX and XX% Free is be representing first margin. range flow the the cash guidance free Effective up XX% of

closing questions, it for to Before to opening back remarks. up some Jim I'll provide pass

Chuck. execution Slide record wrap it on more our strong the and Thanks, to durable XX. build through-cycle strategy The I'll transformation improved to of year companies up track out. start and an performance, enviable playing

cash formula our of record to value EPS slowed is select continued value in come, as track Fortive our consecutive continuing core and last Elena. is operating for reflected in digits compounding the free positive XX the delivering more the we our even that, momentum to year, markets over opportunity We flow and double in of the to expansion, the XXXX quarters, an double best our our confident by think raised to X it flow yet and earnings turn for cash executing However, I'll strength strategy over taken adjusted growth consecutive next growth years. With the with are execution outlook creation. and of together, roughly demand is to adjusted in free reflected in dedication FPS the quarters customers. When end margin XX

now take first our Thank you. Dennis, will we question.

from Julian Your first with the question Barclays. of is Mitchell line

question or commentary of from revenue Maybe There's peers the instrument just some of one outlook. a Precision your the first around [indiscernible] clearly Tech concerns today.

growth QX? how maybe you'd balance And trajectory and how been and hardware tech wondered on thinking any those orders color of product the over that how Precision what in expected? year revenue just about particularly broad I the have trending So you're that versus

book-to-bill a Julian, and we QX. well of book-to-bill -- couple in thanks anticipate X, of book-to-bill. saw that was the saw what the things. the for Yes. high-level question. start say quarter as in about sort would I We a I'd of we we with

PTs to will on step half. QX the point. We to second be So basis, a Probably half orders a don't have lower, the probably up shipments probably back. Obviously, see revenue first yet. we're huge come starting not low

The the anticipated. way first we half is out playing really

of we're start sense, last we call see move that that said building. to growth that we to seeing seeing order in -- end quarter. to trajectory. would start So far seen an book tail the second We're orders, the at support sort Everything we've of would thus

to talk now tended some I the So effort business which about we've It's in seen can that. like in shoots revenue was and the first Things places. be high single-digit has to lead first the some the Tektronix green our return go to on where half. growth more going [indiscernible] down.

that to I'll and point there's see So starting things change. a follow-up. if trajectory that the would there we're see stop certainly to

And the sort laid sort core of you'd on guide the growth year out broadly I for guess quarter. of last guidance adjustments, your segment

Just if just P&L of of with in of the expense the proceeds EBIT redeployment net or sort sort trying slight the Just to to any that of reduction? interest income this adjustment of understand adjusted sort And those that guide, divestment Is time? understand something? changed had wondering raise a guide to trying guide.

of been about. the IOS, as similarly, a out down digit we strength little a talked feel a resilient mid-single the that. help, stood revenue good quarters to little quarter, backs good health saw bit Obviously, anticipated what stronger We've than of QX. the Well for we strengthening. we in bit. about we year, We now in We had about is places. a that's the has feel number very PT and good that guide. for at there. on good several Fluke

to up we're probably So flattish more slightly. the down

the is and absolute on we $XX FX think of worth other said, we I as better, be about -- being with absorbed, the able segments other terms we'll as the to thing well. So just million X

So think, the absorb the PT, XX with speaks as growth weaker that important I total basis to of at as kind in you to just to up really the the And even here strength were had. -- ability of revenue certainly, margin look we that, see the that we've points expansion.

So the power don't strong and and PT the in now occurring seeing that are -- in dollars second half going expansion We well we've I segments, Chuck a things us and thus total trajectory we're I'll second need confidence the of in give growth exceptionally that some we're the right the with big let with details. half supports perspective certainly talk margin what at managing little to seen of X the good are other bit. PT improves a that step-up think the about a little far bit that. And

Julian, last interest down we bond since a the expense guided, came we place. time in and the euro out primarily put because went

And X.X% better, in so came coupon. that like

So that's the the of -- the That major OP roughly FX. change. offsets impact impact

that's interest FX. $X the OP terms, we dollar of in $XX About of in that to have that Chuck's expense then first that forecast. million And do $XX million roughly point, put quarter. about about versus million from previous to just of hit our And reflected lower was

So the offset. that's really

Your next question is from Partners. with Research the line of Jeff Vertical Sprague

couple Just a of things.

of the expecting on growth? grew in mid-single businesses, this mid-single-digit of the that comment year group the trajectory kind the of balance you're kind Just Is and of sort then normalizing. on basically companies that FAL of for the digit

a We moving we'll high really -- had get quarter. single. at the comp Jeff, in back be we'll that first No, [indiscernible] big to

year XX% a plus ago. think they I were

about was digits, that it was X%. roughly for single growth high ARR So

growth So that year. supports high growth the of good single-digit ARR sort for

think, sense there? understand it But of maybe M&A the in performance right? then performed last EA trying on what the kind right? influenced kind the revenues EA's just you give actually actually own I some how the growth divestiture, didn't but us of quarter, just was of The year, in so is And impact, by quarter, to trajectory

the to of Yes, shows with about some Jeff, the million. FX, separate of couple divestiture things. a business couple it line. EA's [indiscernible] pushed of on that up $X the down revenue a million agreement And

impacted he is about by X think those I million. down $X things, So's

M&A in just higher were PT. than EA, dollars So overall [indiscernible] the for from the dollars obviously,

about by So EA is of tax. $XX $X roughly million million, offset

the next Jamie from Your line is with Securities. Truist of question Cook

$X.XXX on follow-up quarter, last wondering a $X.XX know revenue on billion. PT billion. X, to PTs Slide Just to guide. I'm the specifically you the I implied $X.X billion you guided

guide? then would revenue lower margins revenue get is So I your M&A last can guidance? front, you'd given the M&A you the think add, about you question, And you're that on before were guide, And top to points. relative actual prior comment saying X my the how thinking line

Now you're Is that just and saying FX X [indiscernible]? points.

Yes.

So come to PT to then yes, revenue Jamie, the just of come has out FX. point, on the guide, that's from another million your $XX prior the there's due [indiscernible]. probably out X% And

well Some of EA is obviously core for as that as business. the

guide midpoint out. as that So the PT pointed you $X.X is million the of . revenue

update can And then your on the margins on give lower you [indiscernible]? an us PT, there

margins to change of No the for PT. expectation

of change Yes. and Jamie, reflection relative -- much here to certainly, as we I change think of -- to that's not a lot a real in no the said, not that. outlook

we half thought based saw into that the half, out. much exceptionally play like playing move we've or pretty able to on first out so been year me, second quarter the excuse the second a we've scenarios front margin seen would well we manage of but couple some business -- The

that we've we businesses. about PT talked utilities, in EMC, places of number beverage got at strength food a So and our

number we've And that's in got helpful good margin obviously, of a well. front some there the as places. So to strength

Your is the line next from Research. Melius question Davis Scott with of

of questions. couple A

wide start is range and little mark-to-market a a that mark-to-market or that trying kind properties, EA just type deal to and could valuation is first, looking the just that we M&A with pipeline sure -- 'XX? is stuff of how guys bit down of if on you And range that bit? to in -- want kind the So pipeline, I'm there little we just a type perhaps looks. assume your are of of narrow at but it's should of of we a

out there's of there now. valuations probably right would I say, is number sure. wide a variation Yes, one

things just there on been a have very haven't I also gone that -- but have going You've that that we're in have things things of occurred. in, the seen fully be interested things trades you relative various valued we'd Both certainly lot disciplined. stay would say marketplace. to some obviously trade, to but seen

we how has of but the M&A IOS I to we're created really with and really of really deck, think a tried to that what revenue that durable slide benefits strong look in going on those And of things. also kinds for highlight the the both from standpoint growth, was profitability. segment

looks served some we're continue well We be funnel to active, but some think disciplined remain around time, X the We relative right that wide we that but in businesses. The We some the valuation. software. be Those sort did did, an think quarter deals I did, but at the we And there's example. bolt-ons did we EA, we'll more way, the fourth things likely, spread now IOS, same are data. as hardware the than right? around did, did of I a to of to opportunities. selective

by the thought to is that as still -- I So EA I has the feel disciplined. But to for get for we we the relative really to token, same We the -- about And like down going our still some process. be same bit can deal. accretion think it original remain come We're think for revenue done things on good sure. to little to going a going the was that year. we're

deal accretive deal very into So 'XX. really a good it's be and a going to still

we'd for kinds So of active those certainly sure. -- things in the be are the

look go nothing or never as this side. in Or seems then just China perhaps being conservative. the about a to to if guide, maybe your the guide you that you you in ask And year, of I a I bit back being end bit is Helpful. the at and would at if not conservative look if the Okay. But just way. specific at, or you a honestly, think And that think said guys you'd guide commentary about a you've that, on and would where just last of changes, general then the characterize little am that, that it right think macro? the rest about at ASP for little ballpark if that year cautious is hour what the perhaps -- global -- just Is comps, probably just bit higher. over higher the this on I

Well, we beat just our quarter first guide.

the So look beat at then there the an $X.XX. FX we and they're And first cost. $X.XX $X.XX about was thing. And of that's offset when you really corporate of operational there

I it a a start good year. our a -- it's think good So I in said was that remarks. to start, very good the prepared

our if hey, of and points get XX%. to drive like would think I'd you And that's gate really the hey, gross good margin I a Jim, start. would say like say at basis of EPS out operating at XXX you margin said, year expansion, like full you I'd looks to a lot that, too.

forces I week with ago. were tried in first investments talking would much team call was them we would that we yes, with there was the were productive I tell a to time it, optimistic. feeling better ago some they're uncertainty. the about We talk to X weeks is some And you, the They the what the about. is they versus, is, guy. And I China like So quality when year. highlight where of more China

we sit investments to guide occur of that important down. opportunity So being our we some now still government active because guide, same have -- our are some us. the subsequent China places embedded But probably in is very the of time, there's are at those still Chinese right in in

our Interestingly mid-single growing. are markets than other growing China other there. are opportunity bigger are which high-growth digit, already markets, high-growth Our some enough, there probably

there's -- another got go every way, out there And make things better could well out work lot sure. about for a good early. of we'll to it but gate could really really still of that it's the we feel day certainly, So and And say it. really you well,

quarter. But the at Let's second see revenue energy in there's some where get to for through percent well. to places there's yes, continue is certainly certainly We us opportunities. where tried to we opportunity product like some the in do AI, highlight transition

Deane of line Dray with the Capital from is Markets. question next Your RBC

following reference, the I another heard references prepared there. of Just up in lot remarks. AI a yet

don't you to So all, You them real-time to rank leverage where near-term go are important the AI have have would through where most you exposures what the order? but build-out?

order Well, with later on that in that in go yes, [indiscernible] the high-performance I think Taiwan. generation. data where an got center we data and are chips will semiconductor We next centers expansion, in quarter example into ship year, the for as that the in showed to compute an as X-digit an going the in example, manufacturers slide from some

we're and I seeing grid the infrastructure would of certainly world. first Those certainly seeing foremost, again AI of it certainly direct would Qualitrol chip and it build-out. with preparation out infrastructure and investments to growth at the on relative say, We're So future Fluke. We're stand the seeing and utility that. the as

AI Dean. and -- launch we're the side, then So starting flip on to solutions,

for So Gordian, Provation, of when Sensing, we just platform, at we the integrate think about what announced together. we're solutions to allows us quarter the which doing Gordian data all and our

base as selling AI those see we'll well. solutions to in revenue of So is start our some

tech grid both those of play play the We'll to Keithley. maintain infrastructure -- going we'll that and start tools So -- needed to end, the to sort Qualitrol support then on see second them and with participate data out. needed with relative play And to we're as as start in front in the see certainly that those see well to in get build that that seeing the of PT, out investment. built, out as data that with starting and centers in as well. to that things electrical stages the of We're early primarily obviously, Fluke certainly half. And with centers we're to

so points, specific might your real are missed follow-up, then sharing. it weakness in you answer I referenced, question, to Those as the a appreciate And data and what to was in have your I customer the hesitation in Great. related? that's election Julian's Tektronix through the starting just anything cycle -- U.S.? delayed product Is there is Is worries in read the to orders? it about some R&D that related but

at play almost Yes. out how identically half the is to tech it would Dean, first play we well, to out. I think, thought exactly going

see start would They're I that delay funnel. say as in we is the -- I some of should government later want on the what customers that maybe call don't year. That's some both would now see to as first. in [indiscernible] well, up I I still primes. the showing want So -- I we certainly, -- investments the year. well They're typically direct to early in what

that's the of funnel in and movement news we're a them is So in on they're funnel. that. The good the growing seeing that

to over some So orders, is the -- we're starting and those hence, of X. see book-to-bill

revenue to we're little things But those maybe been a of the moved because little So certainly we sooner. have a them to able convert those because things and would generally, to funnel's starting those see for have of bit we come see think later the point, wouldn't that end the second canceled. And it those a of this half in second presents really quarter, more But then the tie opportunity. to don't I at election. we some

some started tie of more decisions probably just have that the to we'd investments. those uncertainty out delaying think with investment maybe some I year that as people made

leading a investments can our get invest think ultimately, the As in good not you those and or customer or do are companies test that. innovation, to technology think the But sometimes quarter I X. you to technology going a it's delayed said, world, well I they for base going we're as know, in

JPMorgan. question is Tusa next of the from Your Steve line with

backlog the of still where at expect the that's Can then book-to-bill total. the stage? guess, mentioned year guys you if Tektronix us and the then there? for you kind maybe but Book-to-bill, I rest an update on Tektronix of little where and I give there bit the just backlog, growth what into hardware you'd this just thing know a and excess maybe even the sits for delve book-to-bill in a excess more

in book-to-bill X.XX Tektronix was the quarter. Steve, Yes.

Sensing overall its and the products for combined X.X. X.X Tech revenue mid-single down quarter. being then in we For about and PT, was hardware digit And Tektronix talked

mid in always Our that outlook year would will single be that's the reflected be year. revenue digit, Tektronix the for but expectation our down been for

Okay.

change maybe And book-to-bill. sticking on no there. So then just

side, was. to hard EA like expected more bit quite on help what going on where not these gap the I guess, EA little they're of that just what's, a little the new a sure calibrate bridged we've than at something revenues, And had we like it's kind kind think it book-to-bill I'm run for I bit that the But us of to rate that. acquisition? guess, I understand business

Jim larger the is Yes. the that out for, That's of the We it, year I'll on and I'll Part XXX. probably for overall. of some is be, in quick and for XXX, expected the year. comment call numbers acquisition exchange foreign closer just part projects XXX. let EA had push on revenues It's of that really down. to come XXX to to

that. And we right, about certainly review for bit the acquisition. Jim, about of the component a more is the kind talked XXs the some color revenue, little want to the for million, XXX-day Specifically, and $XX There in to something QX, the on quarter. again, low give plan seasonal have a you talk in we maybe,

things number only of evident view world, Steve, have -- we prepared China, One, of see with I product of Yes. the things. say around a that in that's a other would the really this, we certainly a India, customers couple clearly said great like. of one really and as the U.S. not places remarks, we been but the

as out, technology really So really the product fact that start I and strong. think the really, we affirmed we is the

in quarter. I backlog As Elena that that. out couple in business bit of a mentioned this that been more getting quarter bit first than challenging less the little revenue the in has in little said, terms of a first the anticipated places in

same. a work factory first -- in the be X to over of we think on little sort revenue more little what the make the come FBS a the year. was think, our of for the I think bit to But continue We the bit and book-to-bill, doing. We've in the flexible certainly, So and will accretion still quarter. process on opportunity we're is down the

from an the earnings we're good still business. deliver very to going So about we perspective a and place good in feel

That in is a slower. mobility be this bit slow would anticipated that certainly little our view. was mobility year. We So

very is quite Tektronix funnel the with played data frankly, are the that's center out. opportunities good. And But so And building well.

thus their So start that about to that build in would we half, and the we said the half to first we build far. need -- we see funnel revenue of feel we're our opportunities now how we'll services linking that the good really sales here one synergy we the with order opportunity around feel with a in we on We prepared the second mentioned going funnel the good were shortly, well. as about large-scale remarks get

to business it simply So position a in now. move the the it And for things but about maybe a in really 'XX. started into feel good maybe taking to year finish longer because good stands get we're some of as that right the of marketplace, little and

is where excess my the one. And That's backlog today? last stand

I Yes, probably I'm but I'm it's something [indiscernible] like -- the range or number million-ish not in not what $XX guess, is, the, in that sure that.

Okay.

So a normalized.

is Kaplowitz of line question from Andy next Citigroup. Your the with

in AHS. about there. did in well I some potential and you you upside the just quarter, know Jim, talked maybe

anything did better You maybe all mention provision that performance understanding Is quite some even from still. still at headwinds holding there quarter. was the you in the back with that's it good

exceptionally year. number markets I we've transition out here, happy we high-growth quarters obviously, to The the strength But done of America playing you strategic do we of in well. is of really the what the if and at And quarter. the multiyear wanted nature we're about think really mean what had about Yes. well. if you look North last

about So quarter. software grow the We a good this we're half we license first work had segment. Relative at. business digit SaaS still in is well of we in business. we the last year, going business through is where good in to will feel That and growing ASP about broader double second year. that first the feel order [indiscernible], very the large-scale

good bit is. license work a the But of onetime convert next feel have about The going kind very opportunity. that to plays So we do to license of little where it's deal it's be that able more provision that over really we several news through that to large we're about fast large the customer out a years.

of So still opportunity to in there's opportunity, probation. great terms

So about we some the segments prepared hydrogen the We efficacy all we feel remarks, and of stands. things good about plasma of of peroxide do that. strategy the efficiency seeing and we're around in mentioned our how the where some and

biological indicators. about, So and talk wheel the EI ASP. to flywheel number we're innovation last we're of innovation that we're started trying the sterilization, steam get through of years, -- the we work to starting the A product started see at over couple things that to really

the the And is segment and good at year. through about to go so where feel we where it's going

pieces XXX a Great. for but moving amount I like And know I you about. nowadays, talked [indiscernible] there's next we when it, then year, reiterated as FX like the about fair of think

of to And So sort what Jim, you to what's point? your get level, at need this confidence do there? do

Well, we I had growth right, free to cash that growth rate think do, the number we drove quarter, strong and with I what still flow we're one, think strong in quarter affirms the first EPS growth. able the

Our guide demonstrates that.

setup -- the end So a we double-digit double-digit bit earnings growth free little a growth, operating cash the a strong margin not yet. and mid-single-digit to great really get of year, on for expansion, growth, flow

free growth, give So of think cash move record growth that growth into expansion, us those the are confidence. earnings track and as we things I our mid-single-digit flow margin and

of about at if it's But made We're of it here the day end 'XX. shortly. talking or again, XXXX, April Now the may. be we'll

a 'XX. we're about day, in talk I place of very obviously, at here. on focused So end the very think to 'XX we're the good But

So of I and good has what numbers also which demonstration multiyear very kinds think -- see the that through quarters support of think we'll our our the multiyear I is that the future. and really pass, been

Your line is the Coe from next Wolfe Nigel Research. of with question

in the I'm from day mid some So the -- digits. things why tech you mentioned a I mid-singles. hate high wouldn't but bit maybe just And mid-single just the my down PT question been maybe curious given in down quarter, -- that, sort down was in Elena, of better That to second has half plan Down of singles, [indiscernible] really comps? in the ground XQ. than singles already, X. like get rethread is, year therefore, tech worse is second so

through about thinking the way about how comes we Just year? the think should this

In than quarter. be to high Yes. down single-digit right, our to for tech That's in said slightly be PT in would to And that. mid-single range that Nigel. for in more we probably remarks prepared digit as that the we tax mid- QX. That include expected down

Okay.

is around inflecting continues a good then book-to-bill the indicator. to That's bit PMIs that better. say, Nigel, about are leading Keithley getting that good I talked So indicator. a that good point would get a The your little we leading

leading Our good funders indicator. are a sales

bit step And get a through the little so second we half. better through performance we'll as

other to thing I of all think the throughout revenues because consider, continue grow did year. the tax last to right,

Right.

pricing flatten for the negative X I PT, a a That's the that volumes? was run the so year in there rate. that, weakness could quarter, And of the -- Okay. out about the or given a completely, or go then versus X% think, Is for of clear. change, risk bit decel

the Chuck. this expect wouldn't Nigel, is that case. to be I

But PT, there's think little gradually I think, move bit we that we quarters. in of going X% timing as as up I the through the probably we here. through X% to and expect move year,

to Nigel, price is And add, just a place. cost in good

give through to the first little the not But It's stance margin up. not the get the less look bit really We a good. that quarter, So like that. the in PT line the when unnatural cost a when maybe top and is margin expansion at in did little probably you we bit price is expansion price anticipated maybe year.

So to a in be able position good that and still grow margins. do we're to

That's great.

year, and then full And in half that the of is a The sorry, XQ floating weak a kind quick the plan? XQ one on typically a has a EA. business seasonality back this for

new Yes. it. It's we're to --

don't you but sure business certainly the until have the So companies we've has history, the a push of so [indiscernible]. for don't multiyear end everything necessarily the back private sure. It's been make got some that have that sometimes -- year. numbers, you historically That's history. end

the we'll every through quarter not we integration. improved as cadence the get that's work unusual. And here So

with Joe Your question O'Dea Wells Fargo. line next from of is the

of wanted you talked start revenue on industrial and XX% slowdown about the the I through to PMI. the growing

around that And Fluke drew, Fluke. those more through that stable to play to grow to kind outgrowing ability PMI for post the through question headwinds? think I factors degree trends, attribute at some other But of related really markets the you primarily or were to to what of slowing? end

franchise And number in market. you look Well, we're just the does Fluke's a When presence on done the launches Team the Obviously, product great X quarter pretty outperforming in innovation much think new think had country -- definitely an job. things. a front. every of world. I I first job outstanding the of at We every alone. global a great

is eMaint doing business really well. Our

reliability growth Fluke up eMaint in our was So -- XX% the quarter.

that several we quarters, the business really just PMI make done has story. ability long-term our to last the really look as over the outgrow to an And So work we've durable. more end been is market

Our and XX%. grew over lines solar EV product

X development about really over towards been more the of of lean deals few drivers. those designating supported redirecting product in did So trying one which fall, to talked we last that secular -- around secular those a the portfolio example helped really years the they've been of process they management in our or slides what how really that it's and do prepared has about R&D in drivers. same good is investments we're and our Fluke terms certainly the and bolt-on

and countries. because playing the I our tough always think been share investments. And we're investments, So we've in intentional business been thing is about that's because position various their We've intentional good companies commercial about our in certainly, regional a innovation in the out. are really of competitors a most

channel chunk good know, you on look we of we're our channels. are our we have performing. and of we as usually what partnership about great So And sign our with can with That's how excited don't numbers a market But partners business is that certainly do -- together. share. as good a

wanted I also ASP. to on then ask And

drive up the you the and coming for just go-to-market, quarter consumables you're demand? think fourth transition sort other looking the together of in of what that's as how saw I consumables through the first some on side was quarter, America to North in in of the

Yes.

XX% up QX, pretty to right where just we much For be in were ASP think expected here. QX, specifically, I we in

going on well please to we happened growth through of over importantly, that's as because that But transition Now moderate and the delivering some as see track the we the that. year, as expansion. margin move right the year expected and

from is Giordano TD question line Joe with the Your Cowen. next of

just of remarkably things there business has On How like election that that policy trends mentioned by Or Is that data positive risk the like that election if there that? solar, kind you business, a an -- resilient. offset would if an Fluke, more on into is is risk be obviously, shift? that just could been handicap you changes? electrification, center within administration changes

maintenance to are is of we're to those one we number of think them. tied the the I than construction Well, more

it's respects, today. in there So many what's out

around number the global global have the too one. would that's Number X very solar I of and look is, so take a you think thing about opportunity. electrification. say view when good certainly same And I world, a you

those it's and those statements of systems the of the situations. really more -- those So -- of maintenance construction than

maintenance more maintenance of field much all that. of the to -- So tied the

term I So longer the to be good opportunity. And very if good. think bet would next pretty those we I feel about few over say think, continue the you years, probably on things

field yes, -- to tied is much -- tied I of more more we're much think the bottom the maintenance all we're to think that. line of So the of those the I maintenance

margins on with XX-plus the at lowering And a the EA EBITDA numbers top like just bit. then business line little Is rate? the still revenue curious, that lower Okay.

margin part story. we're That's at Came Yes. the Yes. of And actually, expansion very that out why strong. it's seeing PT. also

BNP the Buscaglia line Paribas. final come Andrew from Today's with question will of

implies AHS are incrementals rest good some gave -- through the within the a to that? your your contributors IOS, half. color but XXXX? your then a really normalized help some outstanding, in through what's like specifically margin get step-up other around have incremental What guidance year, in quite that talked getting back And might specifically you been -- margins So really we the of as PT

generally Andrew, of the around a in about. think couple think I things case. to XX% about -- incrementals at the base think We

probably So year, second talking of we you're move half the we've line that's XX% in up got about XX% with top a the first When to the start. through in as half. step and good place the the the revenue

XXX it that off Health drives that's And margins. When through second to biggest to seasonality half basis this the productivity always with QX, to upward in steps from there's we initiatives. year saw We points I key or and and year-over-year, basis the volume. the is you volume through that to the look points. with seasonality. normal for and up first expanding more of the more guided XX the half, start So of basis terms points the in year, because a XXX great think, trajectory

it's volume a way, got we've but things [indiscernible] falling So going in. right the lot the really of those

bit -- Okay. And the the staying transition as a on we talk about with Can think you way been business continues strong you the I as there? little more progress yes more touching incrementals a think sustainability guys. -- AHS, through definitely -- with little year? just distributor helping that you is there. that I that about Can your there bit talk have -- how

up full the that but for the seeing keep here benefit Yes. the dealer for points QX. health with transition but in We've you're show care, in got basis it's QX, the mind, year, in XXX in early year,

If the expansion, remember another be for margin expansion last growth move be also quarter bit that the stuff years. we the the you strong over the or but here, QX and margin going as saw expect pleased benefit. to margin year, we're million expect And through little that at year expansion we through full of Very quarter we with $XX through AHS. year, the and strong continue to tougher really into to it there's getting a

will the for back the Lico I now concludes over closing session. turn remarks. This call question-and-answer to Jim

-- everybody, guy today. about Obviously, holds quarter. is to year. from but good full Well, you We time everything, really takes and it us, good and about really feel the for first thanks, hear the raised. opportunity the some to We relative some puts spend feel the hopefully,

opportunities really feel excited here we in such expansion are about. of an perspective, that And the EPS fact executing a that position. on the operationally, got we've trajectory really good after out. free We so love we're a well. very several Health number And we're margin a playing flow now cash quarters well We're executing is from from

know on road So look available, forward be the a hopefully, the everyone. our I comes here see calls. we'll will and shortly. team to through you that follow-up Thanks,

Conference This concludes for you Corporation's XXXX Results Fortive First Call. joining. Earnings Thank Quarter

disconnect. may now You