ABB Prepares to Report Second Quarter Results

ABB, the Swiss technology company, is set to release its second-quarter results on Thursday. Analysts provide key insights into what to expect:

Revenue Forecast

According to a company-provided consensus of analyst views, ABB is anticipated to report second-quarter revenue of $8.13 billion. This is an increase from the $7.25 billion revenue reported in the same quarter of 2022.

Net Income

Analysts predict that ABB will achieve quarterly net income of $873 million. This figure significantly surpasses the $379 million earned in the corresponding period last year.

Key Aspects to Monitor

Orders

Based on trends observed in the first quarter, Jefferies analysts believe that base orders will be slightly below the prior-year level. Deutsche Bank analyst Gael de-Bray notes a projected decline of 1% in electrification orders, 2% in organic motion orders, and 24% in organic robotics orders. However, de-Bray predicts a 20% organic order growth at ABB’s process automation unit. Overall, organic group orders are expected to remain flat, reaching $8.5 billion in the second quarter. This marks a 10% decrease compared to the strong order intake in the first quarter, which benefited from several significant orders. In the second quarter of 2022, ABB reported $8.81 billion in orders, while the first quarter of this year saw $9.45 billion. Additionally, UBS analysts suggest that China destocking, short cycle end markets, and residential exposures may impact ABB’s second-quarter order intake.

Growth

Deutsche Bank highlights that ABB’s execution on its backlog will drive revenue growth in the second quarter. The company’s pricing strategy is also expected to contribute to improved margins. Deutsche Bank forecasts a rise in ABB’s adjusted earnings before interest, taxes, and amortization margin to 16.9%, up from 15.7% in the same period last year.