Johnson Controls International said on Wednesday that it has raised its full-year adjusted profit forecast, pointing to heightened demand for its data center cooling and thermal management solutions. The company, which also provides IT cooling, security and fire systems, attributed improved results to growth tied to AI-driven data center expansion that is increasing demand for infrastructure supporting compute workloads.
Management increased the company's annual adjusted earnings estimate to $4.85 per share, up from a prior forecast of $4.70 per share. That revised range exceeded the average analyst expectation of $4.76 per share, based on data compiled by LSEG.
For the third quarter, Johnson Controls projected adjusted profit of $1.28 per share, a figure that matched analysts' consensus.
Results for the second quarter showed adjusted earnings of $1.19 per share, compared with $0.82 per share in the year-ago period. Net sales for the quarter rose to $6.14 billion, up from $5.68 billion a year earlier.
Despite the stronger guidance and higher quarterly sales and earnings, the company's U.S.-listed shares traded lower in premarket activity, falling about 1% following the results. The company is headquartered in Cork, Ireland.
Analysts and investors will be watching how sustained demand for energy-efficient thermal management continues to influence Johnson Controls' top-line and margin trends. The company highlighted that growing AI compute capacity has driven a sharp rise in cooling needs, prompting customers to prioritize energy-efficient solutions for data centers. That focus has been a key factor in the company's recent performance.
Johnson Controls' mix of offerings - including IT cooling alongside security and fire systems - positions it within the industrial and infrastructure segments that supply the data center ecosystem. The company’s updated guidance and quarterly results reflect current strength in those end markets as described by management.
While the firm reported sequential and year-over-year gains in its latest quarter and lifted its outlook, the market reaction in premarket trading indicates some investor caution despite the beat on guidance versus analyst estimates.
Summary of reported figures
- Annual adjusted profit estimate raised to $4.85 per share (prior: $4.70).
- Analyst average expectation: $4.76 per share (LSEG).
- Third-quarter adjusted profit forecast: $1.28 per share (in line with estimates).
- Second-quarter adjusted profit: $1.19 per share versus $0.82 a year ago.
- Second-quarter net sales: $6.14 billion versus $5.68 billion a year earlier.
- U.S.-listed shares fell about 1% in premarket trading following the results.