Rockwell Automation Inc. (NYSE:ROK) stock fell in Thursday’s premarket trading after the industrial automation company reported mixed fourth-quarter fiscal 2026 results.
Adjusted earnings rose 16% year over year to $3.88 per share, beating Wall Street’s estimate of $3.69.
However, revenue increased 1% to $2.332 billion, missing analysts’ estimate of $2.409 billion. Organic sales grew 3%, while divestitures reduced revenue by 2%.
A customer tariff refund program reduced reported and organic sales growth by approximately 4 percentage points.
Rockwell received $103 million in tariff refunds and $5 million in related interest. It also recorded an $85 million provision for customer refunds, reducing reported sales.
The combined after-tax impact of these items and related charges added 11 cents to adjusted earnings per share.
Rockwell Automation Reports Higher Margins and Cash Flow
Pretax margin jumped to 18.6% from 2.7%, helped by higher sales volume, favorable product mix and the absence of certain prior-year charges.
Enterprise operating profit rose 16% to $572 million. Operating margin improved to 24.5% from 21.3%.
Operating cash flow increased to $680 million from $454 million a year earlier. Free cash flow climbed to $602 million from $405 million.
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Software and Control Leads Segment Growth
Intelligent Devices sales rose 5% to $1.144 billion. Operating earnings increased to $247 million, while margins improved to 21.6% from 19.8%.
Software & Control sales jumped 15% to $754 million. Operating earnings climbed to $256 million, with margins expanding to 34% from 31.2%.
Lifecycle Services sales declined 9% to $519 million, despite 2% organic growth. Divestitures reduced sales by 11%.
Segment operating earnings fell to $85 million, while margins narrowed to 16.4% from 17.5%.
Rockwell Automation Issues Fiscal 2027 Outlook
Rockwell expects fiscal 2027 reported sales growth of 4.5% to 7.5%, with organic growth of 6% to 9%.
The company forecasts revenue of $9.394 billion to $9.663 billion, compared with Wall Street’s estimate of $9.591 billion.
Rockwell expects adjusted earnings of $14.50 to $15.50 per share, compared with analysts’ estimate of $14.88.
Divestitures are expected to reduce sales growth by approximately 1.5 percentage points, while currency translation is expected to have little impact.
ROK Price Action: Rockwell Automation shares were down 8.53% at $406.00 during premarket trading on Thursday, according to Benzinga Pro data.
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