SHELTON, Conn. — Hubbell Incorporated today reported operating results for the second quarter ended June 30, 2025.
“Hubbell delivered double digit adjusted earnings per share growth in the second quarter, driven by strong organic growth in Grid Infrastructure and Electrical Solutions, as well as year-over-year margin expansion,” said Gerben Bakker, Chairman, President and CEO.
Bakker continued, “In our Utility Solutions segment, Grid Infrastructure achieved 7% organic growth in the quarter. Demand for substation and transmission products remains robust as utility customers invest to accommodate load growth, and distribution markets returned to growth in the quarter. Grid Automation sales were down double digits in the quarter, driven by weak meters and AMI project activity, while protection and controls products continued to contribute solid growth. In Electrical Solutions, 4% organic growth was driven by strength in datacenter markets. Execution on our segment unification strategy continues to drive growth through innovation and commercial alignment, along with operating efficiencies and margin expansion. Operationally, price and productivity exceeded cost inflation across both segments in the quarter.”
Bakker concluded, “We are raising our 2025 adjusted earnings per share outlook, which anticipates mid single digit organic growth and continued adjusted operating margin expansion. Our outlook is consistent with our long-term financial framework which we are confident will deliver differentiated performance for our shareholders over time.”
CHANGE IN INVENTORY ACCOUNTING
During the second quarter of 2025, the Company elected to change its method of accounting for certain inventories in the United States from the last-in, first out (LIFO) method to the first-in, first out (FIFO) method. The change to FIFO method of accounting for these inventories is preferable because it provides better matching of costs and revenues, conforms the Company’s inventory to a single method of accounting and improves comparability with the Company’s peers. The impact of the change in inventory accounting as reported under the FIFO method compared with the amount if it continued to be reported under the LIFO method was a $29 million decrease in cost of goods sold during the three months ended June 30, 2025, and a $20 million decrease in cost of goods sold for the six months ended June 30, 2025. Amounts in this press release reflect the impact of the accounting change to FIFO. To provide historical information on a basis consistent with the change to FIFO, the Company has recast certain historical segment information to conform to the updated method of inventory accounting on page 21 of this press release. The recast financial information included below does not represent a restatement of previously issued financial statements.
SECOND QUARTER FINANCIAL HIGHLIGHTS
The comments and year-over-year comparisons in this segment review are based on second quarter results in 2025 and 2024.
Utility Solutions segment net sales in the second quarter of 2025 increased 1% to $936 million compared to $927 million reported in the second quarter of 2024. Organic net sales increased approximately 1% in the quarter. Grid Infrastructure net sales increased approximately 7% and Grid Automation net sales decreased approximately 13%. Segment operating income was $218 million, or 23.3% of net sales, in the second quarter of 2025 as compared to $197 million, or 21.3% of net sales in the same period of 2024. Segment adjusted operating income was $239 million, or 25.5% of net sales, in the second quarter of 2025 as compared to $223 million, or 24.1% of net sales in the prior year period. Changes in operating income and operating margin were primarily due to favorable price realization and productivity as well as strong volume growth in Grid Infrastructure, partially offset by volume declines in Grid Automation as well as higher cost inflation, raw material costs and tariffs.
Electrical Solutions segment net sales in the second quarter of 2025 increased 4% to $549 million compared to $526 million reported in the second quarter of 2024. Organic net sales increased 4% in the quarter, while an acquisition contributed 1%. Segment operating income was $118 million, or 21.5% of net sales in the second quarter of 2025, compared to $109 million, or 20.7% of net sales in the same period of 2024. Adjusted operating income was $124 million, or 22.5% of net sales, in the second quarter of 2025 as compared to $113 million, or 21.5% of net sales in the same period of the prior year. Changes in operating income and operating margin were driven primarily by volume growth and favorable price realization and productivity, partially offset by higher cost inflation, raw material costs and tariffs.
Adjusted diluted EPS in the second quarter 2025 excludes $0.36 of amortization of acquisition-related intangible assets and $0.01 of transaction, integration, and separation costs. Adjusted diluted EPS in the second quarter 2024 excluded $0.40 of amortization of acquisition-related intangible assets and $0.03 of transaction, integration, & separation costs.
Net cash provided by operating activities was $261 million in the second quarter of 2025 versus net cash provided by operating activities of $240 million in the 2024 period. Free cash flow was $221 million in the second quarter of 2025 versus $206 million in the comparable period of 2024.
SUMMARY & OUTLOOK
For the full year 2025, Hubbell anticipates diluted earnings per share (“EPS”) in the range of $16.25-$16.75 and anticipates adjusted diluted earnings per share (“Adjusted EPS”) in the range of $17.65-$18.15. Adjusted EPS excludes amortization of acquisition-related intangible assets, which the Company expects to be approximately $1.40 per share for the full year. The Company believes Adjusted EPS is a useful measure of underlying performance in light of our acquisition and divestiture strategy.
Hubbell anticipates full year 2025 total sales growth and organic net sales growth of 4-6%. The diluted EPS and Adjusted EPS ranges are based on an adjusted tax rate of 22.0% to 22.5% and include approximately $20 million of anticipated restructuring and related investment. The Company expects full year 2025 free cash flow conversion of approximately 90% on adjusted net income.
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