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Itron's Q1 Earnings and Sales Surpass Estimates, Down Y/Y
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Key Takeaways
ITRI reported Q1 EPS of $1.49, beating estimates and falling year over year due to lower interest income.
ITRI posted $587M revenue, down 3% YoY, adversely impacted by project timing and portfolio optimization.
ITRI expects Q2 revenue of $560M-$570M and EPS of $1.25-$1.35, indicating a YoY decline.
Itron Inc. (ITRI - Free Report) reported non-GAAP earnings per share (EPS) of $1.49 for first-quarter 2026, which beat the Zacks Consensus Estimate by 18.3%. The company reported earnings of $1.52 per share in the prior-year quarter. The year-over-year decline was due to lower interest income, partially offset by higher operating income.
Itron reported quarterly revenues of $587 million, which declined 3% year over year but exceeded the upper end of guidance ($565-$575 million). The top line surpassed the Zacks Consensus Estimate by 2.8%. The revenue decline was largely due to portfolio optimization efforts and the timing of project deployments.
Management stated that first-quarter results exceeded expectations, driven by strong execution and some projects progressing ahead of schedule, which led to a record gross profit. The company highlighted that utility customers remain focused on resiliency and affordability, with a structural, multi-year investment trend toward adding intelligence to the grid, an area well aligned with Itron’s strengths in networks, analytics and operational intelligence.
Product revenues were $477.8 million (81.4% of total revenues), down 8.7% year over year. Service revenues totaled $109.2 million (18.6%), up 30%. Itron’s bookings were $476 million in the first quarter of 2026, and its backlog amounted to $4.4 billion at the end of the quarter. The first quarter included several key wins, including progress on a strategic grid visibility program with Duquesne Light Company. The engagement underscores rising demand for distributed intelligence and Grid Edge Computing as utilities modernize networks, while highlighting Itron’s ability to deliver an integrated solution combining smart devices, software and communications for next-generation grid operations.
Device Solutions (21.2% of total revenues): Revenues fell 1% (9% in constant currency or cc) to $124.4 million primarily due to lower sales of legacy EMEA electricity products and reduced project deployments in North America.
Networked Solutions (59.7%): Revenues dipped 13% (14% in cc) to $350.7 million, primarily due to the timing of project deployments.
Outcomes (16.4%): Revenues rose 22% (or 20% in cc) to $95.9 million, driven by growth in recurring and services revenue.
Resiliency Solutions (2.7%): The company reported revenues of $16 million. Starting with the first-quarter 2026 report, the combined results of Locusview and Urbint will be included in this segment.
Operating Details
Itron’s gross margin for the quarter rose significantly to 40.7%, a 490-basis point (bp) improvement year over year. This increase was attributed to a favorable mix and improved operational efficiencies.
Non-GAAP operating expenses were $154.4 million, up $17 million from the prior year, primarily due to higher sales and increased general and administrative expenses driven by the additions of Urbint and Locusview.
Non-GAAP operating income was $84.5 million compared with $80.3 million in the year-ago quarter. The upside was driven by higher gross profit. Non-GAAP operating margins expanded 120 bps to 14.4%.
Adjusted EBITDA jumped 4.7% year over year to $92 million. Adjusted EBITDA margins gained 120 bps to 15.7%.
Balance Sheet & Cash Flows
As of March 31, 2026, cash and cash equivalents totaled $712.9 million compared with $1.1 billion as of Dec. 31, 2025. The company’s cash balance declined by about $300 million from year-end 2025, primarily due to the January acquisition of Locusview, the February issuance of $805 million in zero-interest convertible senior notes, the March repayment of $460 million in 2021 convertible notes, a $100 million share repurchase and $79 million in free cash flow generated during the first quarter.
As of March 31, 2026, net long-term debt was $1.6 billion compared with $788.8 million as of Dec. 31, 2025.
Itron generated $85.5 million of cash from operations in the reported quarter compared with $72.1 million in the prior-year quarter. In the first quarter, the free cash flow reached $79 million, up from $67 million in the previous year's quarter. Free cash flow increased mainly due to a reduction in tax payments.
Financial Guidance
For the second quarter, the company expects revenue to range from $560 million to $570 million, with the midpoint implying a 7% year-over-year decline.
The anticipated fall reflects a pull-forward of first-half projects into the first quarter, while the broader first-half 2026 outlook remains consistent with the company’s previous guidance in February.
Non-GAAP EPS is projected between $1.25 and $1.35, with the midpoint suggesting an approximately 8% decline year over year after adjusting for tax rate and interest income.
Badger Meter, Inc. (BMI - Free Report) reported EPS of 93 cents for first-quarter 2026, which missed the Zacks Consensus Estimate by 22.5%. The bottom line compared unfavorably with the year-ago quarter’s EPS of $1.30.
Quarterly net sales were $202.3 million, down 9% from $222.2 million in the year-ago quarter due to delayed project deployments and weaker-than-expected short-cycle order activity. The Zacks Consensus Estimate was pegged at $230.1 million.
SAP SE (SAP - Free Report) reported first-quarter 2026 non-IFRS EPS of €1.72 ($2.01), which increased 20% from the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.92.
Driven by momentum in the cloud business, SAP reported total revenues on a non-IFRS basis of €9.56 billion ($11.2 billion), which increased 6% year over year (up 12% at constant currency or cc). The Zacks Consensus Estimate was pegged at $11.3 billion.
BlackBerry Limited (BB - Free Report) reported fourth-quarter fiscal 2026 non-GAAP EPS of 6 cents. The figure beat the company’s estimate of 3-5 cents. In the year-ago quarter, it reported a non-GAAP EPS of 3 cents. The Zacks Consensus Estimate was pegged at 5 cents per share.
BlackBerry reported quarterly revenue of $156 million, surpassing the top end of its guidance ($138-$148 million), driven by stronger-than-expected sales across both its QNX and Secure Communications divisions. Revenue also increased 10% year over year.
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Itron's Q1 Earnings and Sales Surpass Estimates, Down Y/Y
Key Takeaways
Itron Inc. (ITRI - Free Report) reported non-GAAP earnings per share (EPS) of $1.49 for first-quarter 2026, which beat the Zacks Consensus Estimate by 18.3%. The company reported earnings of $1.52 per share in the prior-year quarter. The year-over-year decline was due to lower interest income, partially offset by higher operating income.
Itron reported quarterly revenues of $587 million, which declined 3% year over year but exceeded the upper end of guidance ($565-$575 million). The top line surpassed the Zacks Consensus Estimate by 2.8%. The revenue decline was largely due to portfolio optimization efforts and the timing of project deployments.
Management stated that first-quarter results exceeded expectations, driven by strong execution and some projects progressing ahead of schedule, which led to a record gross profit. The company highlighted that utility customers remain focused on resiliency and affordability, with a structural, multi-year investment trend toward adding intelligence to the grid, an area well aligned with Itron’s strengths in networks, analytics and operational intelligence.
Product revenues were $477.8 million (81.4% of total revenues), down 8.7% year over year. Service revenues totaled $109.2 million (18.6%), up 30%.
Itron’s bookings were $476 million in the first quarter of 2026, and its backlog amounted to $4.4 billion at the end of the quarter. The first quarter included several key wins, including progress on a strategic grid visibility program with Duquesne Light Company. The engagement underscores rising demand for distributed intelligence and Grid Edge Computing as utilities modernize networks, while highlighting Itron’s ability to deliver an integrated solution combining smart devices, software and communications for next-generation grid operations.
The stock has declined 21.8% in the past year against the Zacks Electronics-Testing Equipment industry’s rise of 32.9%.
Image Source: Zacks Investment Research
Segments in Detail
Device Solutions (21.2% of total revenues): Revenues fell 1% (9% in constant currency or cc) to $124.4 million primarily due to lower sales of legacy EMEA electricity products and reduced project deployments in North America.
Networked Solutions (59.7%): Revenues dipped 13% (14% in cc) to $350.7 million, primarily due to the timing of project deployments.
Outcomes (16.4%): Revenues rose 22% (or 20% in cc) to $95.9 million, driven by growth in recurring and services revenue.
Resiliency Solutions (2.7%): The company reported revenues of $16 million. Starting with the first-quarter 2026 report, the combined results of Locusview and Urbint will be included in this segment.
Operating Details
Itron’s gross margin for the quarter rose significantly to 40.7%, a 490-basis point (bp) improvement year over year. This increase was attributed to a favorable mix and improved operational efficiencies.
Non-GAAP operating expenses were $154.4 million, up $17 million from the prior year, primarily due to higher sales and increased general and administrative expenses driven by the additions of Urbint and Locusview.
Itron, Inc. Price, Consensus and EPS Surprise
Itron, Inc. price-consensus-eps-surprise-chart | Itron, Inc. Quote
Non-GAAP operating income was $84.5 million compared with $80.3 million in the year-ago quarter. The upside was driven by higher gross profit. Non-GAAP operating margins expanded 120 bps to 14.4%.
Adjusted EBITDA jumped 4.7% year over year to $92 million. Adjusted EBITDA margins gained 120 bps to 15.7%.
Balance Sheet & Cash Flows
As of March 31, 2026, cash and cash equivalents totaled $712.9 million compared with $1.1 billion as of Dec. 31, 2025. The company’s cash balance declined by about $300 million from year-end 2025, primarily due to the January acquisition of Locusview, the February issuance of $805 million in zero-interest convertible senior notes, the March repayment of $460 million in 2021 convertible notes, a $100 million share repurchase and $79 million in free cash flow generated during the first quarter.
As of March 31, 2026, net long-term debt was $1.6 billion compared with $788.8 million as of Dec. 31, 2025.
Itron generated $85.5 million of cash from operations in the reported quarter compared with $72.1 million in the prior-year quarter.
In the first quarter, the free cash flow reached $79 million, up from $67 million in the previous year's quarter. Free cash flow increased mainly due to a reduction in tax payments.
Financial Guidance
For the second quarter, the company expects revenue to range from $560 million to $570 million, with the midpoint implying a 7% year-over-year decline.
The anticipated fall reflects a pull-forward of first-half projects into the first quarter, while the broader first-half 2026 outlook remains consistent with the company’s previous guidance in February.
Non-GAAP EPS is projected between $1.25 and $1.35, with the midpoint suggesting an approximately 8% decline year over year after adjusting for tax rate and interest income.
ITRI’s Zacks Rank
Currently, Itron carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Performance of Other Firms
Badger Meter, Inc. (BMI - Free Report) reported EPS of 93 cents for first-quarter 2026, which missed the Zacks Consensus Estimate by 22.5%. The bottom line compared unfavorably with the year-ago quarter’s EPS of $1.30.
Quarterly net sales were $202.3 million, down 9% from $222.2 million in the year-ago quarter due to delayed project deployments and weaker-than-expected short-cycle order activity. The Zacks Consensus Estimate was pegged at $230.1 million.
SAP SE (SAP - Free Report) reported first-quarter 2026 non-IFRS EPS of €1.72 ($2.01), which increased 20% from the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.92.
Driven by momentum in the cloud business, SAP reported total revenues on a non-IFRS basis of €9.56 billion ($11.2 billion), which increased 6% year over year (up 12% at constant currency or cc). The Zacks Consensus Estimate was pegged at $11.3 billion.
BlackBerry Limited (BB - Free Report) reported fourth-quarter fiscal 2026 non-GAAP EPS of 6 cents. The figure beat the company’s estimate of 3-5 cents. In the year-ago quarter, it reported a non-GAAP EPS of 3 cents. The Zacks Consensus Estimate was pegged at 5 cents per share.
BlackBerry reported quarterly revenue of $156 million, surpassing the top end of its guidance ($138-$148 million), driven by stronger-than-expected sales across both its QNX and Secure Communications divisions. Revenue also increased 10% year over year.