Shares of Eaton Corporation (NYSE: ETN) fell more than 3% intraday after the power management company reported fourth-quarter results that largely matched expectations and issued a weaker-than-anticipated outlook for early 2026.
Eaton posted adjusted earnings per share of $3.33 for the quarter, narrowly beating the consensus estimate of $3.32. Revenue reached a quarterly record of $7.1 billion, in line with analyst expectations.
Sales increased 13% year over year, driven by 9% organic growth, a 2% contribution from acquisitions, and a 2% benefit from foreign exchange. Segment margins reached a fourth-quarter record of 24.9%, improving 20 basis points from the prior year.
Operating cash flow totaled $2.0 billion during the quarter, while free cash flow reached $1.6 billion, representing increases of 23% and 17%, respectively, from a year earlier.
For full-year 2025, Eaton reported record revenue of $27.4 billion, up 10% year over year, reflecting 8% organic growth and 2% from acquisitions. Adjusted earnings per share rose to a record $12.07.
Looking ahead, Eaton forecast first-quarter 2026 adjusted EPS of $2.65 to $2.85, below the $3.01 consensus estimate. The company expects organic growth of 5% to 7% and segment margins of 22.2% to 22.6% for the quarter.
