Why Did ROK Beat Analysts’ Fiscal 1Q17 Revenue Estimates?
Rockwell Automation’s regional sales
Rockwell Automation (ROK) continues to derive a major portion of its revenues from the US. For fiscal 1Q17, ROK reported $820 million in sales from the US compared to $787 million during fiscal 1Q16. Notably, the company posted a 1.8% increase in its organic sales growth in the US market compared to a 5.9% decline in fiscal 1Q16.
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Sales from EMEA (Europe, Middle East, and Africa) were down to $271 million compared to $274 million in fiscal 1Q16. According to the company’s earnings call, its orders were up year-over-year and ROK expects sales growth for the balance of the year in this region.
During fiscal 1Q17, Rockwell Automation (ROK) witnessed strong growth in the transportation and consumer verticals in the Asia-Pacific region, with solid organic sales growth of 19.8%. ROK reported $205 million in its fiscal 1Q17 sales from the Asia-Pacific region compared to $173 million in fiscal 1Q16. Also, the company witnessed a strong revival in its organic growth in Canada with $83 million in sales compared to $79 million in fiscal 1Q16. Rockwell’s growth in Latin America was driven by Mexico and Brazil.
For fiscal 1Q17, Rockwell Automation (ROK) reported ~$1.5 billion in consolidated sales compared to analysts’ expectations of ~$1.4 billion. The deviation from analysts’ expectations was primarily due to the company’s better-than-expected performance in the Asia-Pacific region, accompanied by a strong YoY rebound in organic growth across its major markets.
Rockwell Automation reported overall organic sales growth of 3.8% in fiscal 1Q17 compared to declines of 3.3% and 4.0% during fiscal 1Q16 and fiscal 4Q16, respectively. Also, the company’s recent acquisitions contributed to ~2% in sales growth in fiscal 1Q17.
Next, we’ll look into Rockwell Automation’s fiscal 1Q17 operating performance.