Itron’s third quarter results were met positively by the market, reflecting the company’s focus on recurring software-based revenue and operational efficiencies. Management attributed year-over-year growth to expanded adoption of Outcomes and Resiliency Solutions, as well as strong execution in utility modernization projects. CEO Thomas Deitrich emphasized, “Our applications software, analytics, and services portfolio drove annual recurring revenue growth to approximately 25% year over year,” underscoring the shift toward higher-margin, services-driven business. Operational discipline and favorable mix further contributed to margin improvement, while supply chain stability supported delivery against customer demand.
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Itron (ITRI) Q3 2026 highlights:
- Revenue $599.3 million vs S&P analysts’ estimates of $595.8 million (3% year-on-year growth, 0.6% beat)
- Adjusted EPS $1.94 vs S&P analysts’ estimates of $1.56 (24.7% beat)
- Adjusted EBITDA $114.5 million vs analyst estimates of $93.85 million (19.1% margin, 22% beat)
- Revenue guidance $628.5 million at the midpoint for Q4 2026, below analyst estimates of $640.8 million
- Adjusted EPS guidance Management raised its full-year adjusted EPS guidance to $6.77 at the midpoint, a 5.8% increase
- Operating margin 15.9%, up from 14.1% in the same quarter last year
- Market capitalization $4.06 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our top 5 analyst questions from Itron’s Q3 earnings call
- Noah Kaye (Oppenheimer): Asked about the sustainability of lower operating expenses and expectations for bookings in the fourth quarter. CFO Joan Hooper clarified that Q4 expenses are typically higher due to customer events and sales compensation, and management did not provide explicit bookings guidance but expressed confidence in the pipeline.
- Ben Kallo (Baird): Inquired about the Open Way Forward program and how it affects competitive positioning and booking patterns. CEO Thomas Deitrich explained that forward-backward compatibility helps retain incumbency and smooths bookings over time, reducing the need for disruptive asset replacements.
- Alfred Moore (ROTH Capital Partners): Asked about growth opportunities and timing in the gas segment. Deitrich described the gas opportunity as “multiples higher” than historical norms, citing lifecycle upgrades and integrated safety, though benefits are expected to materialize over several years.
- Scott Graham (Seaport Research Partners): Questioned the impact of inflation on customer budgets and noted competitive changes. Deitrich highlighted that inflation is driving higher capital spending but also greater demand for advanced use cases, with supply chain management and pricing helping to mitigate cost pressures.
- Joseph Osha (Guggenheim Securities): Sought insight into artificial intelligence deployment in resiliency and grid edge. Deitrich detailed AI’s role in hazard identification, anomaly detection, and wildfire prevention, with future plans to expand capabilities deeper into the grid.
Catalysts in upcoming quarters
Looking ahead, the StockStory team will be monitoring (1) the pace of new deployments and their impact on sequential revenue growth, (2) expansion of recurring software and analytics revenue as utilities adopt distributed intelligence, and (3) the timing of large customer awards and regulatory-driven project launches. The evolution of AI-based products and the ability to sustain margin improvements will also be key signposts for evaluating progress.
Itron currently trades at $92.13, up from $87.73 just before the earnings. Is there an opportunity in the stock? See for yourself in our full research report (it’s free).
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