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ROCKWELL AUTOMATION, INC

ROK
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Business Summary

Rockwell Automation, Inc. is the world's largest company dedicated to industrial automation and digital transformation. The company operates in the industrial automation industry, serving discrete end markets (e.g., Automotive including Electric Vehicle and Battery, Semiconductor, and e-Commerce & Warehouse Automation), hybrid end markets (e.g., Food & Beverage, Life Sciences, and Tire), and process end markets (e.g., Energy, Mining, and Chemicals). The filing does not disclose a specific market size or growth rate for the industry, but management states that over the past decade, investments in technology and globalization have enabled the company to expand its addressed market to approximately $120 billion . Key structural forces shaping competition include the need for customers to optimize production, build resilience, empower people, become more sustainable, and accelerate transformation, as well as converging megatrends including digitization and AI, energy transition and sustainability, shifting demographics, and an increased need for resiliency.

Major competitors named in the filing include Siemens AG, ABB Ltd, Schneider Electric SA, Emerson Electric Co., Mitsubishi Electric Corp., Honeywell International Inc., and Dassault Systemes. The company's stated competitive advantages include being the only automation provider that can support many production disciplines, including discrete, process, batch, safety, security, motion, robotics, and power control, in a single hardware and software environment, helping customers increase the speed of deployment and reduce their total cost of ownership. Other advantages include an open architecture and strong partner ecosystem, industry and application domain expertise, and an integrated control and information architecture with Logix at its core. The filing does not disclose specific market share percentages.

The company generates revenue through three operating segments: Intelligent Devices, Software & Control, and Lifecycle Services. Revenue is derived from sales of products and solutions (hardware, software, and configured-to-order products) and services (customer technical support and repair, asset management and optimization consulting, and training). In most countries, the company sells primarily through independent distributors in conjunction with its direct sales force. Approximately 65 percent of global sales are transacted through independent distributors. Sales to the two largest distributors in 2025, 2024, and 2023, which are attributable to all three segments, were approximately 20 percent of total sales. The company also has a recurring revenue stream, with a strategic goal to continue double-digit growth in annual recurring revenue.

The Intelligent Devices segment includes drives, motion, advanced material handling, safety, sensing, industrial components, and configured-to-order products. For fiscal 2025, Intelligent Devices reported sales of $3,756 million and segment operating earnings of $676 million , with a segment operating margin of 18.0% . The Software & Control segment includes control and visualization software and hardware, digital twin, simulation and information software, and network and security infrastructure. For fiscal 2025, Software & Control reported sales of $2,383 million and segment operating earnings of $708 million , with a segment operating margin of 29.7% . The Lifecycle Services segment includes digital consulting, professional services including engineered-to-order solutions, recurring services including cybersecurity, safety, remote monitoring, and asset management, and the Sensia joint venture. For fiscal 2025, Lifecycle Services reported sales of $2,203 million and segment operating earnings of $319 million , with a segment operating margin of 14.5% .

In fiscal 2025, the company reversed $5 million of restructuring accruals primarily due to attrition without payment of severance. In fiscal 2024, the company recorded restructuring charges of $97 million related to actions in conjunction with an enterprise-wide comprehensive program to optimize cost structure and expand margins. During fiscal 2025, the company repurchased approximately 1.5 million shares of its common stock under its share repurchase program at a total cost of $419 million and an average cost of $279.43 per share. In fiscal 2024, the company repurchased approximately 2.2 million shares at a total cost of $594 million and an average cost of $272.97 per share. In May 2025, the company entered into a $500 million senior unsecured 364-day term loan credit agreement and was advanced the full loan amount, which was repaid in August and September 2025. The company also made a voluntary pre-tax contribution of $70 million to its U.S. pension plan in fiscal 2025. In the fourth quarter of fiscal 2025, the company recorded a pre-tax expense of $136 million ($103 million after tax or $0.91 per share) related to a change in accounting method for net legacy asbestos-related defense costs and an indemnity accrual increase. The company also recorded a $224 million non-cash impairment charge related to the Sensia joint venture, or $110 million including the impact of non-controlling interest and tax effects.

Total sales for fiscal 2025 were $8,342 million , compared to $8,264 million in fiscal 2024, representing a 1 percent increase. Net income attributable to Rockwell Automation was $869 million in fiscal 2025, compared to $953 million in fiscal 2024. Diluted EPS was $7.67 in fiscal 2025, compared to $8.28 in fiscal 2024. Total segment operating earnings increased to $1,703 million from $1,595 million in 2024, and total segment operating margin was 20.4% in 2025 compared to 19.3% in 2024. Pre-tax margin was 11.0% in 2025 compared to 13.3% in 2024. Cash provided by operating activities was $1,544 million for fiscal 2025, compared to $864 million for fiscal 2024. Free cash flow was $1,358 million for fiscal 2025, compared to $639 million for fiscal 2024.

Business Outlook

The company's long-term profitable growth framework outlines several growth vectors. The company aims to achieve faster secular growth in traditional markets due to customer needs for resiliency (including cybersecurity), agility, sustainability, and mitigating impacts of labor shortages. Another vector is to grow share and create new ways to win through technology differentiation, industry focus, go to market acceleration, expanded offerings, and new markets. The company also targets continued double-digit growth in annual recurring revenue and expects to add 1% average annual growth from acquisitions. The company plans to invest over $2 billion over the next five years in manufacturing facilities, digital infrastructure, and talent to support market share growth, operational resilience, and margin expansion. The company's key priorities for inorganic investments include industrial AI applications, market access in Europe and Asia, and product portfolio expansion.

The company's margin and cost outlook is framed around its long-term profitable growth framework, which aims to deliver profitable growth within a disciplined financial framework. The company continuously pursues alignment of costs with business and economic conditions through productivity projects including savings in product cost, indirect cost, administrative costs, purchased services, logistics, manufacturing workflows, make or buy decisions in manufacturing, product portfolio, and price optimization. The company's ongoing productivity initiatives target both cost reduction and improved asset utilization. The filing does not provide specific margin targets for future periods.

The company expects capital expenditures in 2026 to be approximately $270 million . The company plans to invest over $2 billion over the next five years in manufacturing facilities, digital infrastructure, and talent. At September 30, 2025, the company had approximately 26,000 employees globally. The company's supply chain strategy includes resiliency actions taken in recent years that enable it to build certain high value product lines in more than one geographic location. The company continues to manage the impact of tariffs through actions including pricing and the use of alternative sources of materials and redundant manufacturing locations.

Research and development expenses were $482 million in fiscal 2025. The company expects capital expenditures in 2026 to be approximately $270 million . At September 30, 2025, the company had approximately $927 million remaining for share repurchases under its existing board authorizations. Cash dividends declared to shareowners were $593 million in 2025 ($5.24 per common share). The quarterly dividend rate as of September 30, 2025, is $1.31 per common share ($5.24 per common share annually).

Management identified several headwinds and constraints. The company faces risks from adverse changes in macroeconomic or industry conditions, which may result in decreases in sales and profitability. Changes in trade policies, including the imposition of new tariffs or increases in existing tariffs, could adversely affect the company's cost structure and profitability. The company also faces risks from foreign currency exchange rate fluctuations, with a strengthening U.S. Dollar potentially adversely impacting sales and profitability related to business done outside the U.S. The company noted that the Manufacturing PMI results remained below 50 for each of the months in the fourth quarter of fiscal 2025, indicating contraction in the U.S. manufacturing economy. Additionally, the company faces risks related to the availability and price of components and materials, including single-source supplier relationships.

Management identified several structural headwinds and constraints. The company faces risks from the potential harms of natural disasters, including those as a result of climate change, pandemics, acts of war, terrorism, international conflicts, or other disruptions to operations. The company also faces risks related to the successful execution of cost productivity and margin expansion initiatives, and the ability to attract, develop, and retain qualified employees. The company noted that the adoption of AI has resulted in more sophisticated cyber attacks, increasing its risk exposure. The company also faces risks related to the successful integration and management of strategic transactions and the successful development of advanced technologies.

Risk Factors

The company faces material risks from adverse changes in macroeconomic and industry conditions, as demand for its products is sensitive to levels of capital spending by customers in industries such as Oil & Gas, Automotive, and Semiconductor, and a recession could result in reduced, canceled, or delayed orders. Changes in trade policies, including tariffs between the U.S., Mexico, Canada, and China, could adversely affect the company's cost structure and profitability; the company notes that tariff costs are expected to be neutral to EPS in fiscal 2026 after mitigating actions. The company relies on suppliers, including single-source relationships, and shortages of components or materials could adversely affect manufacturing efficiencies and the ability to make timely deliveries. The company's Sensia joint venture, which is concentrated in the Oil & Gas industry, has experienced impairment charges of $224 million in fiscal 2025 and $158 million in fiscal 2023, and the joint venture parents have decided to pursue an orderly dissolution, with the transaction expected to close in the first half of fiscal 2026. The company faces risks from cybersecurity threats, noting that the adoption of AI has resulted in more sophisticated attacks, increasing risk exposure, and that its commercial product offerings can be used in critical infrastructure, which could indicate increased risk.

Management Priorities

Management's message emphasizes the company's position as the world's largest company dedicated to industrial automation and digital transformation, with a strategy to bring the Connected Enterprise to life. The tone is forward-looking, focusing on long-term profitable growth through secular trends in digitization, AI, energy transition, sustainability, shifting demographics, and increased need for resiliency. Key strategic priorities emphasized for the period ahead include achieving faster secular growth in traditional markets, growing share through technology differentiation and industry focus, continuing double-digit growth in annual recurring revenue, adding 1% average annual growth from acquisitions, and delivering profitable growth within a disciplined financial framework. Management also highlights the company's plan to invest over $2 billion over the next five years in manufacturing facilities, digital infrastructure, and talent.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 7, MD&A — Market Access and Expansion
  2. [2] Item 7, MD&A — Market Access and Expansion
  3. [3] Item 7, MD&A — Market Access and Expansion
  4. [4] Item 7, MD&A — Summary of Results of Operations
  5. [5] Item 7, MD&A — Summary of Results of Operations
  6. [6] Item 7, MD&A — Summary of Results of Operations
  7. [7] Item 7, MD&A — Summary of Results of Operations
  8. [8] Item 7, MD&A — Summary of Results of Operations
  9. [9] Item 7, MD&A — Summary of Results of Operations
  10. [10] Item 7, MD&A — Summary of Results of Operations
  11. [11] Item 7, MD&A — Summary of Results of Operations
  12. [12] Item 7, MD&A — Summary of Results of Operations
  13. [13] Item 7, MD&A — Restructuring Charges
  14. [14] Item 7, MD&A — Restructuring Charges
  15. [15] Item 7, MD&A — Financial Condition
  16. [16] Item 7, MD&A — Financial Condition
  17. [17] Item 7, MD&A — Financial Condition
  18. [18] Item 7, MD&A — Financial Condition
  19. [19] Item 7, MD&A — Financial Condition
  20. [20] Item 7, MD&A — Financial Condition
  21. [21] Item 7, MD&A — Financial Condition
  22. [22] Item 7, MD&A — Financial Condition
  23. [23] Item 7, MD&A — Legacy Asbestos and Environmental Charges
  24. [24] Item 7, MD&A — Legacy Asbestos and Environmental Charges
  25. [25] Item 7, MD&A — Legacy Asbestos and Environmental Charges
  26. [26] Item 7, MD&A — Purchase Accounting Depreciation and Amortization, and Impairment
  27. [27] Item 7, MD&A — Adjusted Income, Adjusted EPS, and Adjusted Effective Tax Rate Reconciliation
  28. [28] Item 8, Consolidated Statement of Operations
  29. [29] Item 8, Consolidated Statement of Operations
  30. [30] Item 7, MD&A — 2025 Compared to 2024
  31. [31] Item 8, Consolidated Statement of Operations
  32. [32] Item 8, Consolidated Statement of Operations
  33. [33] Item 8, Consolidated Statement of Operations
  34. [34] Item 8, Consolidated Statement of Operations
  35. [35] Item 7, MD&A — Summary of Results of Operations
  36. [36] Item 7, MD&A — Summary of Results of Operations
  37. [37] Item 7, MD&A — Summary of Results of Operations
  38. [38] Item 7, MD&A — Summary of Results of Operations
  39. [39] Item 7, MD&A — Summary of Results of Operations
  40. [40] Item 7, MD&A — Summary of Results of Operations
  41. [41] Item 7, MD&A — Financial Condition
  42. [42] Item 7, MD&A — Financial Condition
  43. [43] Item 7, MD&A — Financial Condition
  44. [44] Item 7, MD&A — Financial Condition
  45. [45] Item 7, MD&A — Long-term Strategy
  46. [46] Item 1A, Risk Factors — Strategic Transactions and Investments Risks
  47. [47] Item 7, MD&A — Financial Condition
  48. [48] Item 1A, Risk Factors — Strategic Transactions and Investments Risks
  49. [49] Item 7, MD&A — Attracting, Developing, and Retaining Highly Qualified Employees
  50. [50] Item 8, Note 1 — Research and Development Expenses
  51. [51] Item 7, MD&A — Financial Condition
  52. [52] Item 7, MD&A — Financial Condition
  53. [53] Item 7, MD&A — Financial Condition
  54. [54] Item 8, Consolidated Statement of Shareowners' Equity
  55. [55] Item 7, MD&A — Financial Condition
  56. [56] Item 7, MD&A — Financial Condition
  57. [57] Item 8, Consolidated Statement of Operations
  58. [58] Item 8, Consolidated Statement of Operations
  59. [59] Item 7, MD&A — Long-term Strategy
  60. [60] Item 1A, Risk Factors — Strategic Transactions and Investments Risks
  61. [61] Item 8, Consolidated Statement of Operations
  62. [62] Item 8, Consolidated Statement of Operations
  63. [63] Item 8, Consolidated Statement of Operations
  64. [64] Item 8, Consolidated Statement of Operations
  65. [65] Item 8, Consolidated Statement of Operations
  66. [66] Item 8, Consolidated Statement of Operations
  67. [67] Item 8, Consolidated Statement of Operations
  68. [68] Item 8, Consolidated Statement of Operations
  69. [69] Item 7, MD&A — Summary of Results of Operations
  70. [70] Item 7, MD&A — Summary of Results of Operations
  71. [71] Item 7, MD&A — Financial Condition
  72. [72] Item 7, MD&A — Financial Condition
  73. [73] Item 8, Consolidated Balance Sheet
  74. [74] Item 8, Consolidated Balance Sheet
  75. [75] Item 8, Consolidated Balance Sheet
  76. [76] Item 8, Consolidated Balance Sheet
  77. [77] Item 8, Consolidated Statement of Operations
  78. [78] Item 7, MD&A — Legacy Asbestos and Environmental Charges
  79. [79] Item 8, Note 1 — Legacy Asbestos and Environmental Matters
  80. [80] Item 8, Note 1 — Legacy Asbestos and Environmental Matters
  81. [81] Item 7, MD&A — Restructuring Charges
  82. [82] Item 7, MD&A — Summary of Results of Operations
  83. [83] Item 7, MD&A — Summary of Results of Operations
  84. [84] Item 7, MD&A — Summary of Results of Operations

Analysis on 6/8/2026