Itron's Q3 Net Income Dips on Higher Taxes, YTD Profit Up 10%

TL;DR

**ITRI's Q3 net income took a hit from taxes, but strong cash flow and YTD profit growth suggest underlying resilience in a tough market.**

AI Summary

Itron, Inc. (ITRI) reported a mixed financial performance for the three and nine months ended September 30, 2025. For the three-month period, total revenues decreased by 5.5% to $581.6 million from $615.5 million in the prior year, primarily driven by a 8.2% decline in product revenues to $494.3 million. Despite this, gross profit increased by 4.7% to $219.5 million, up from $209.6 million in Q3 2024. Net income attributable to Itron, Inc. for the quarter fell by 15.9% to $65.6 million, compared to $78.0 million in Q3 2024, largely due to a significantly higher income tax provision of $24.5 million versus $3.5 million. Diluted EPS decreased to $1.41 from $1.70. For the nine-month period, total revenues saw a slight decrease of 1.8% to $1.796 billion from $1.828 billion. However, net income attributable to Itron, Inc. increased by 10.2% to $199.4 million from $181.0 million in the same period last year, with diluted EPS rising to $4.30 from $3.91. The company's cash and cash equivalents significantly increased to $1.332 billion as of September 30, 2025, from $1.051 billion at December 31, 2024, while total liabilities remained stable at approximately $2.0 billion.

Why It Matters

Itron's mixed results highlight the ongoing challenges in product revenue, which could impact investor confidence in its core offerings, despite service revenue growth. The substantial increase in cash and cash equivalents to $1.332 billion provides a strong liquidity position, potentially enabling strategic investments or debt reduction, which is crucial given the $458.9 million current portion of debt. For employees and customers, the company's focus on supply chain resiliency and managing inflation in raw materials is vital for stable operations and product availability in a competitive smart grid market. The significant income tax provision increase warrants investor scrutiny, as it directly impacts profitability and could signal future tax liabilities or changes in tax strategy, affecting overall market valuation compared to peers.

Risk Assessment

Risk Level: medium — The risk level is medium due to declining product revenues in Q3 2025 by 8.2% to $494.3 million, indicating potential demand or competitive pressures. However, this is partially offset by a strong cash position of $1.332 billion and a 10.2% increase in net income attributable to Itron, Inc. for the nine months ended September 30, 2025, reaching $199.4 million, demonstrating overall financial health despite quarterly fluctuations.

Analyst Insight

Investors should monitor Itron's product revenue trends closely for Q4 2025, as the Q3 decline of 8.2% is a concern. However, the substantial increase in cash to $1.332 billion and the positive year-to-date net income growth of 10.2% suggest financial stability; consider this a hold with an eye on future revenue diversification and tax efficiency.

Financial Highlights

revenue

$581.6M

operating Margin

14.1%

net Income

$65.6M

eps

$1.41

gross Margin

37.7%

cash Position

$1.332B

revenue Growth

-5.5%

Revenue Breakdown

Key Numbers

• $581.6M — Total Revenues (Q3 2025) (Decreased 5.5% from $615.5M in Q3 2024)
• $494.3M — Product Revenues (Q3 2025) (Decreased 8.2% from $538.2M in Q3 2024)
• $87.3M — Service Revenues (Q3 2025) (Increased 13.1% from $77.2M in Q3 2024)
• $65.6M — Net Income Attributable to Itron, Inc. (Q3 2025) (Decreased 15.9% from $78.0M in Q3 2024)
• $1.41 — Diluted EPS (Q3 2025) (Decreased from $1.70 in Q3 2024)
• $1.796B — Total Revenues (YTD Q3 2025) (Decreased 1.8% from $1.828B in YTD Q3 2024)
• $199.4M — Net Income Attributable to Itron, Inc. (YTD Q3 2025) (Increased 10.2% from $181.0M in YTD Q3 2024)
• $4.30 — Diluted EPS (YTD Q3 2025) (Increased from $3.91 in YTD Q3 2024)
• $1.332B — Cash and Cash Equivalents (Sept 30, 2025) (Increased from $1.051B at Dec 31, 2024)
• $458.9M — Current Portion of Debt (Sept 30, 2025) (Increased from $0 at Dec 31, 2024)

Key Players & Entities

• Itron, Inc. (company) — registrant
• NASDAQ Global Select Market (company) — exchange where ITRI is registered
• U.S. Securities and Exchange Commission (regulator) — filing oversight
• Financial Accounting Standards Board (regulator) — accounting standards setter
• $581.6 million (dollar_amount) — total revenues for Q3 2025
• $65.6 million (dollar_amount) — net income attributable to Itron, Inc. for Q3 2025
• $1.332 billion (dollar_amount) — cash and cash equivalents as of September 30, 2025
• $458.9 million (dollar_amount) — current portion of debt as of September 30, 2025
• $1.796 billion (dollar_amount) — total revenues for the nine months ended September 30, 2025
• $199.4 million (dollar_amount) — net income attributable to Itron, Inc. for the nine months ended September 30, 2025

FAQ

Risk Factors

• Global Economic Volatility [high — market]: Global economic impacts, such as pandemics and ongoing conflicts, create disruption in customer demand and global supply chains, resulting in market volatility. Temporary imbalances in supply and demand may create business uncertainties, including increased costs and lack of availability.
• Supply Chain Disruptions [medium — operational]: Disruptions in global supply chains, including labor, may struggle to keep pace with rapidly changing demand. Efforts continue with suppliers to improve supply resiliency, including the approval of alternative sources.
• Increased Income Tax Provision [medium — financial]: The income tax provision significantly increased to $24.5 million in Q3 2025 from $3.5 million in Q3 2024, negatively impacting net income.
• Compliance with Evolving Regulations [medium — regulatory]: The company operates in a regulated industry and must comply with evolving standards and regulations related to smart grid technology and data privacy, which could lead to increased compliance costs or operational changes.

Industry Context

Itron operates in the smart grid technology and utility solutions sector, facing a competitive landscape with companies offering similar hardware, software, and services for energy and water management. The industry is driven by the global transition towards cleaner energy, grid modernization initiatives, and increasing demand for data-driven operational efficiency by utilities.

Regulatory Implications

The company's operations are subject to various regulations concerning utility infrastructure, data security, and environmental standards. Changes in these regulations, particularly those related to smart metering mandates or data privacy, could impact demand for Itron's products and services or require significant compliance investments.

What Investors Should Do

1. Monitor service revenue growth
2. Analyze the drivers of increased tax provision
3. Evaluate the impact of product revenue decline
4. Assess the strength of the balance sheet

Key Dates

• 2025-09-30: End of Q3 2025 — Reporting period for the 10-Q, showing mixed revenue trends but improved year-to-date net income and a strong cash position.
• 2025-12-31: End of Fiscal Year 2024 — Reference point for year-end cash and cash equivalents ($1.051B) and debt levels.

Glossary

Noncontrolling interests

Represents the portion of equity in a subsidiary that is not attributable to the parent company. It is the portion of net income or loss that belongs to the owners of the subsidiary other than the parent. (Impacts the 'Net income attributable to Itron, Inc.' by showing the portion of earnings belonging to other shareholders in consolidated subsidiaries.)

Amortization of intangible assets

The systematic allocation of the cost of an intangible asset over its useful life. Similar to depreciation for tangible assets. (A non-cash operating expense that reduces operating income, reflecting the consumption of the economic benefits of intangible assets.)

Income tax provision

The amount of income tax expense recognized by a company for a given period, including current and deferred taxes. (A significant factor impacting net income, as seen by the substantial increase in Q3 2025 compared to Q3 2024.)

Foreign currency translation adjustments

Gains or losses resulting from translating the financial statements of foreign subsidiaries into the parent company's reporting currency. These are reported in Other Comprehensive Income. (Contributes to the volatility in 'Other comprehensive income (loss)' and impacts total comprehensive income attributable to Itron, Inc.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, Itron, Inc. reported a 5.5% decrease in total revenues for Q3 2025, primarily due to a decline in product revenues. However, gross profit saw a modest increase of 4.7%, and year-to-date net income attributable to Itron, Inc. grew by 10.2%. A key concern is the significant increase in the income tax provision, which led to a 15.9% drop in quarterly net income, despite improved year-to-date performance. The company's cash position strengthened considerably, while total liabilities remained stable, though a current portion of debt has emerged.

Filing Documents

• itri-20250930.htm (10-Q) — 2035KB
• itriex-31109302025.htm (EX-31.1) — 11KB
• itriex-31209302025.htm (EX-31.2) — 11KB
• itriex-32109302025.htm (EX-32.1) — 7KB
• itri-20250930_g1.jpg (GRAPHIC) — 96KB
• 0000780571-25-000074.txt ( ) — 11028KB
• itri-20250930.xsd (EX-101.SCH) — 61KB
• itri-20250930_cal.xml (EX-101.CAL) — 101KB
• itri-20250930_def.xml (EX-101.DEF) — 343KB
• itri-20250930_lab.xml (EX-101.LAB) — 830KB
• itri-20250930_pre.xml (EX-101.PRE) — 607KB
• itri-20250930_htm.xml (XML) — 1819KB

: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

: Financial Statements (Unaudited)

Item 1: Financial Statements (Unaudited) Consolidated Statements of Operations 1 Consolidated Statements of Comprehensive Income (Loss) 2 Consolidated Balance Sheets 3 Consolidated Statements of Equity 4 Consolidated Statements of Cash Flows 5

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 6

: Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations 28

: Quantitative and Qualitative Disclosures About Market Risk

Item 3: Quantitative and Qualitative Disclosures About Market Risk 48

: Controls and Procedures

Item 4: Controls and Procedures 49

: OTHER INFORMATION

PART II: OTHER INFORMATION

: Legal Proceedings

Item 1: Legal Proceedings 50

: Risk Factors

Item 1A: Risk Factors 50

: Unregistered Sales of Equity Securities and Use of Proceeds

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds 50

: Other Information

Item 5: Other Information 50

: Exhibits

Item 6: Exhibits 51 SIGNATURE 52 Table of Contents

: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

: Financial Statements (Unaudited)

Item 1: Financial Statements (Unaudited) ITRON, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended September 30, Nine Months Ended September 30, In thousands, except per share data 2025 2024 2025 2024 Revenues Product revenues $ 494,323 $ 538,249 $ 1,534,648 $ 1,598,978 Service revenues 87,302 77,213 260,889 228,995 Total revenues 581,625 615,462 1,795,537 1,827,973 Cost of revenues Product cost of revenues 319,238 362,579 1,003,074 1,076,033 Service cost of revenues 42,842 43,285 132,081 126,503 Total cost of revenues 362,080 405,864 1,135,155 1,202,536 Gross profit 219,545 209,598 660,382 625,437 Operating expenses Sales, general and administrative 83,139 79,639 257,665 254,023 Research and development 50,032 51,237 153,932 156,691 Amortization of intangible assets 4,403 4,814 13,425 13,311 Restructuring 188 ( 723 ) 872 ( 624 ) Loss on sale of business — 698 79 656 Total operating expenses 137,762 135,665 425,973 424,057 Operating income 81,783 73,933 234,409 201,380 Other income (expense) Interest income 13,569 13,420 37,582 22,394 Interest expense ( 5,647 ) ( 5,605 ) ( 16,888 ) ( 9,788 ) Other income (expense), net 996 677 1,359 695 Total other income (expense) 8,918 8,492 22,053 13,301 Income before income taxes 90,701 82,425 256,462 214,681 Income tax provision ( 24,478 ) ( 3,515 ) ( 56,137 ) ( 32,124 ) Net income 66,223 78,910 200,325 182,557 Net income attributable to noncontrolling interests 610 951 898 1,559 Net income attributable to Itron, Inc. $ 65,613 $ 77,959 $ 199,427 $ 180,998 Net income per common share - Basic $ 1.43 $ 1.73 $ 4.38 $ 3.98 Net income per common share - Diluted $ 1.41 $ 1.70 $ 4.30 $ 3.91 Weighted average common shares outstanding - Basic 45,746 44,982 45,574 45,458 Weighted average common shares outstanding - Diluted 46,660 45,839 46,405 46,239 The accompanying notes are an integral part of these consolidated financial statements. 1 Table of Contents ITRON, INC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2025 (UNAUDITED) In this Quarterly Report on Form 10-Q, the terms "we", "us", "our", "Itron", and the "Company" refer to Itron, Inc. and its subsidiaries. Note 1: Summary of Significant Accounting Policies Financial Statement Preparation The consolidated financial statements presented in this Quarterly Report on Form 10-Q are unaudited and reflect entries necessary for the fair presentation of the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2025 and 2024, Consolidated Statements of Equity for the three months ended September 30, 2025 and 2024, June 30, 2025 and 2024, and March 31, 2025 and 2024, the Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024, and the Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024, of Itron, Inc. and its subsidiaries. All entries required for the fair presentation of the financial statements are of a normal recurring nature, except as disclosed. The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results expected for the full year or for any other period. Certain information and notes normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been partially or completely omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) regarding interim results. These consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto for the fiscal year ended December 31, 2024 filed with the SEC in our Annual Report on Form 10-K on February 25, 2025 (2024 Annual Report). There have been no significant changes in financial statement preparation or significant accounting policies

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