ABB expects tough quarters ahead marked by the COVID-19 crisis after the Swiss engineering company performed better than expected during its second quarter.
The maker of factory robots and drives said its operational EBITA fell 21% to $651 million, beating the $446 million expectation in a company-gathered poll. Revenue fell 14% to $6.15 billion, but still stronger than the $5.61 billion consensus.
Net profit jumped to $319 million from $69 million a year earlier, when ABB was hit by a $470 million charge it took to ditch its struggling solar inverter business.
Chief Executive Bjorn Rosengren said ABB's second quarter had been heavily impacted by the COVID-19 epidemic, which the company had tried to tackle by reducing costs.
As a result, the operating profit margin of 10.6% - down from 11.5% in the year-earlier quarter - turned out better than expected, he said. Analysts had expected margins of 8%.
Still, the problems associated with COVID-19, with industrial shutdowns affecting demand, would remain, said Rosengren, who joined ABB in March from Sandvik.
"A lot of uncertainty remains and we still see some challenging quarters ahead," he said as ABB launched its previously announced share buyback program.