Key Highlights

  • Third quarter Revenue rose 7% to USD 966.8 million, slightly above the USD 966.4 million estimate.
  • Non-GAAP EPS of USD 0.86 matched the estimate, up from USD 0.81, while GAAP EPS was USD 0.25.
  • Annualized Recurring Revenue reached a record USD 2.56 billion, up 11% year over year and 10% organically.
  • The company repurchased about 4.0 million shares for USD 231.7 million during the third quarter.

Trimble (NASDAQ:TRMB) reported third quarter revenue of USD 966.8 million, up 7% from USD 901.2 million and in line with organic growth. Non-GAAP diluted EPS was USD 0.86, in line with the estimate and above USD 0.81 a year earlier. GAAP diluted EPS was USD 0.25 against USD 0.46 in the prior-year quarter, as GAAP Net Income fell to USD 59.1 million from USD 111.5 million on a higher tax provision.

Recurring Revenue and Segment Trends

Annualized recurring revenue reached USD 2.56 billion. Subscription and services revenue rose to USD 642.5 million from USD 598.7 million, and product revenue rose to USD 324.3 million from USD 302.5 million. Chief executive Rob Painter said results came in ahead of plan on revenue and EPS and tied the strategy to a unified, connected industry data platform. Management also described an AI agent layer built on the Trimble Connect platform, with credits as a consumption currency.

AECO posted record ARR of USD 1.636 billion, up 13%, with revenue up 10% and Operating Margin up 170 basis points to 33.5%. Field Systems ARR rose 5% and revenue rose 7%, with an operating margin of 29.5%, led by civil construction and geospatial. Transportation and Logistics ARR grew 5%, revenue grew 2% and operating margin was 26.3%.

Margins, Cash and Capital Returns

GAAP gross margin was 68.2%, compared with 68.9% a year earlier, and management cited a higher hardware mix for the 70 basis point decline in non-GAAP gross margin to 70.5%. GAAP Operating Income was USD 142.0 million, a 14.7% margin, while non-GAAP operating income was USD 262.6 million, or 27.2%. Adjusted EBITDA was USD 278.5 million, a 28.8% margin. Restructuring charges rose to USD 24.9 million from USD 14.2 million.

Through the first three quarters, Operating Cash Flow was USD 664.7 million and free cash flow was USD 644 million. Cash stood at USD 214.5 million, long-term Debt was USD 1,443.3 million, and the Leverage Ratio was 1.2x. Trimble has USD 768 million left on its repurchase authorization and has bought back more than USD 1.4 billion of stock since the start of 2025. A Goodwill Impairment of USD 562.0 million recorded earlier in the year left the nine-month GAAP net loss at USD 313.7 million.

Updated Full Year and Fourth Quarter Guidance

Trimble guided full year revenue to USD 3,910 million to USD 3,940 million and non-GAAP EPS to USD 3.63 to USD 3.69, a midpoint of USD 3.66, about 17% growth. Management guides to a GAAP loss of USD 0.55 to USD 0.49 per share for the year. ARR growth is now projected near 10%, down from a prior range of 12% to 14%, because of market effects on positioning services and transportation, while adjusted EBITDA margin guidance holds near 30%.

For the fourth quarter, revenue is guided to USD 1,031 million to USD 1,061 million, with non-GAAP EPS of USD 1.13 to USD 1.19 and EBITDA margin of 34% to 35%. Management also noted that fiscal 2027 lacks a January 1 term license renewal date, creating a headwind of about USD 90 million to revenue and operating income, with ARR and free cash flow unaffected.

Benchmarks Ahead

Third quarter non-GAAP EPS of USD 0.86 compares with a fourth quarter guide of USD 1.13 to USD 1.19 and nine-month non-GAAP EPS of USD 2.51. Revenue of USD 966.8 million compares with a fourth quarter guide of USD 1,031 million to USD 1,061 million, and ARR of USD 2.56 billion compares with ARR growth guided near 10% for the year. Cash of USD 214.5 million compares with long-term debt of USD 1,443.3 million.