Second Quarter 2025 Earnings Release

Forward-looking statements and non-GAAP financial information

This presentation and the accompanying comments contain forward-looking statements regarding full year and third quarter 2025 adjusted earnings per share, organic revenue growth, segment operating margins, cash flow, end markets, and anticipated share repurchases. These statements are subject to risks and uncertainties, including potential global pandemics, market changes, competitive pressures, supply chain disruptions, and geopolitical tensions. Eaton does not assume any obligation to update these statements. The presentation also includes non-GAAP measures, which are reconciled to their nearest GAAP equivalent in the Appendix.

Highlights

• Record adjusted earnings per share of $2.95 in Q2, an 8% increase versus 2Q24, with segment margins of 23.9%, a 20 basis points increase, marking a Q2 record.
• Organic growth of 8%, driven by 12% growth in Electrical Americas, 11% in Aerospace, and 7% in Electrical Global.
• On a rolling 12-month basis, order acceleration in Electrical Americas increased by 2%, and Aerospace saw strong growth of 10%. This resulted in a book-to-bill ratio of 1.1 for the combined segments, with backlog growth of 17% in Electrical Americas and 16% in Aerospace.
• In Q2, data center orders for the Electrical Sector and Electrical Americas increased by approximately 55%, with revenue up approximately 50% versus 2Q24, demonstrating strong momentum in this rapid growth market.
• Eaton is raising its 2025 guidance for organic growth, segment margin, and adjusted EPS at the midpoint.

Our Bold Strategy

Anchored by Three Pillars

Each pillar is designed to accelerate growth and create sustained value for shareholders.

Ultra PCS Acquisition

The Ultra PCS acquisition strengthens Eaton's position in fast-growing aerospace and defense markets. Ultra PCS's innovative solutions for safety and mission-critical aerospace systems will augment Eaton's portfolio in both military and civilian aircraft. The company has a strong pedigree on attractive aerospace platforms and is well-positioned for next-generation aerospace solutions, expecting double-digit growth and accretive margins to the Aerospace segment.

Acquisition of Resilient Power Systems

The acquisition of Resilient Power Systems will strengthen Eaton's power distribution offering for Data Centers and other direct current (DC) applications. Resilient's solid-state transformer technology replaces traditional copper windings with power electronics for medium voltage to low voltage power conversion, serving as a critical building block in future high-power AI data center designs. The technology also supports other direct current applications like EV charging and battery storage. Resilient's solution offers high-density electrical power in a smaller footprint than comparable solutions, simplifying system installation, reducing customer costs, and speeding time to revenue.

Partnerships Expand Capabilities

Eaton is expanding its capabilities and supporting customers in new ways through strategic partnerships.

Financial Summary

Key Financial Metrics:

• Record Quarterly Sales: $7,028M
• Record Quarterly Segment Operating Profit: $1,682M
• Q2 Record Segment Operating Margin: 23.9%

Sales Growth:

• Organic: 8%
• Acquisition: 2%
• Forex: 1%
• Total: 11%

Electrical Americas Segment

Segment Performance:

• Record sales and segment profit.
• Orders increased by 2% on a rolling 12-month basis, including a ~55% increase in data center orders in the quarter.
• Book-to-bill ratio of 1.1 on a rolling 12-month basis, with backlog up 17% year-over-year.
• Closed the acquisition of Fibrebond and signed an agreement to acquire Resilient Power Systems.

Sales Growth:

• Organic: 12%
• Acquisition: 5%
• Forex: (1)%
• Total: 16%

Electrical Global Segment

Segment Performance:

• Record sales and segment profit.
• Q2 record segment margin.
• Book-to-bill ratio of 1.0 on a rolling 12-month basis.

Sales Growth:

• Organic: 7%
• Forex: 2%
• Total: 9%

Aerospace Segment

Segment Performance:

• Record sales and operating profit.
• Orders increased by 10% on a rolling 12-month basis.
• Backlog increased by 16% year-over-year.
• Book-to-bill ratio of 1.1 on a rolling 12-month basis.
• Signed an agreement to acquire Ultra PCS.

Sales Growth:

• Organic: 11%
• Forex: 2%
• Total: 13%

Vehicle Segment

Solid operational performance was maintained despite market headwinds.

Sales Growth:

• Organic: (8)%
• Forex: --
• Total: (8)%

eMobility Segment

Sales Growth:

• Organic: (7)%
• Forex: 3%
• Total: (4)%

Eaton's End Market Growth – 2025 Assumptions

Eaton's assumptions for end market growth in 2025, indicating projected growth rates:

Growth indicators: Declining, Slight Growth, Modest Growth, Solid Growth, Strong/Double Digit Growth.

2025 Organic Growth and Operating Margin Guidance

2025 Guidance

Summary

• Record quarterly revenue and segment profit, along with Q2 record segment margins, reflect strong execution and commitment to Eaton's growth strategy.
• Order acceleration and growing backlogs, especially in data center markets, provide extended visibility and support Eaton's positioning to capitalize on megatrends.
• Eaton is investing for growth, doubling down in high-growth, high-margin markets to execute on organic and inorganic opportunities.
• The company is well-positioned to deliver on its 2030 financial commitments with differentiated performance.

Appendix

Additional modeling assumptions for 2025 guidance are provided in the appendix.

2025 Guidance – Additional Modeling Assumptions

The document also includes detailed reconciliations of non-GAAP financial information, including net income to adjusted earnings and operating cash flow to free cash flow.