Business Context and Reporting Period
Company: Itron, Inc.
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended December 31, 2025
Business Overview: Itron is a global leader in grid edge intelligence, energy and water management, smart city applications, and the Industrial Internet of Things (IIoT). The company provides intelligent infrastructure solutions to utilities and cities to improve efficiency, resilience, and service delivery.
Segments: The company operates under four reportable segments: Device Solutions, Networked Solutions, Outcomes, and Resiliency Solutions (a new segment established in Q4 2025 following the acquisition of Urbint, Inc.).
Key Financial Metrics
| Metric | 2025 | 2024 |
|---|---|---|
| Total Revenues | $2,367.2 million | $2,440.8 million |
| Gross Profit | $892.1 million | $839.3 million |
| Gross Margin | 37.7% | 34.4% |
| Operating Income | $313.1 million | $264.1 million |
| Net Income (GAAP) | $301.1 million | $239.1 million |
| Diluted EPS (GAAP) | $6.50 | $5.18 |
| Adjusted EBITDA | $373.8 million | $323.6 million |
| Free Cash Flow | $383.1 million | $207.6 million |
| Cash and Equivalents (Year End) | $1,020.4 million | $1,051.2 million |
| Total Debt | $1,265.0 million | $1,265.0 million |
| Total Backlog | $4,501 million | $4,734 million |
Material Changes vs. Prior Period
- Revenue Decline: Total revenues decreased 3% ($73.6 million) year-over-year. Product revenues declined 6% ($122.4 million), while service revenues increased 16% ($48.8 million). The decline was driven by lower volumes in Device Solutions and Networked Solutions, partially offset by growth in Outcomes.
- Margin Expansion: Gross margin improved by 330 basis points to 37.7%, driven by favorable product mix and manufacturing efficiencies. Operating income increased 19% to $313.1 million despite lower revenues, due to margin expansion and controlled operating expenses.
- Profitability Growth: Net income attributable to Itron, Inc. increased 26% to $301.1 million. Non-GAAP diluted EPS rose 27% to $7.13.
- Segment Performance:
- Device Solutions: Revenues down 6%; Adjusted Operating Income up 16%.
- Networked Solutions: Revenues down 6%; Adjusted Operating Income up 3%.
- Outcomes: Revenues up 15%; Adjusted Operating Income up 49%.
- Resiliency Solutions: New segment with $3.0 million in revenue for the period ended Dec 31, 2025.
- Acquisitions: Completed the acquisition of Urbint, Inc. for $330.7 million in November 2025. Entered into an agreement to acquire Locusview, Ltd. for $525 million (closed Jan 2026).
Guidance, Outlook, Risks, and Unusual Items
- Capital Allocation: The company fully utilized its $100 million 2024 stock repurchase program in November 2025. A new $250 million repurchase program was authorized in November 2025. No shares were repurchased under the new program as of year-end.
- Liquidity: The company entered into a new $750 million credit facility in September 2025. As of December 31, 2025, there were no outstanding borrowings under this facility, with $706.2 million available.
- Debt Structure: Total indebtedness remains at $1.265 billion, consisting of $460 million in 2021 Convertible Notes (maturing March 2026) and $805 million in 2024 Convertible Notes (maturing July 2030).
- Tax Legislation: The "One Big Beautiful Bill Act" signed in July 2025 allowed for the current deductibility of certain property additions and R&D costs, impacting the 2025 tax provision.
- Risks: Key risks include supply chain constraints for raw materials and components, foreign currency exchange rate fluctuations (particularly the Euro), regulatory changes in the utility sector, and cybersecurity threats. The company notes that sales cycles in the utility industry are lengthy and irregular.
Investor Verification Checklist
- Convertible Note Maturity: Verify the company's plan to settle or refinance the $460 million 2021 Convertible Notes maturing in March 2026.
- Acquisition Integration: Monitor the integration progress and financial contribution of the Urbint acquisition (Resiliency Solutions) and the pending Locusview acquisition.
- Backlog Conversion: Track the conversion rate of the $4.5 billion total backlog into revenue, noting the impact of project rescheduling and foreign currency.
- Stock Repurchase Activity: Observe execution under the new $250 million stock repurchase program authorized in late 2025.
- Regulatory Environment: Assess the impact of new tax laws and potential changes in utility regulations on future capital spending by customers.