UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended December 31, ~~2021~~2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from ____________________ to __________________

Commission file number 1-278

EMERSON ELECTRIC CO.

(Exact name of registrant as specified in its charter)


Missouri		43-0259330
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

8000 W. Florissant Ave.
P.O. Box 4100
St. Louis,	Missouri	63136
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: (314) 553-2000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock of $0.50 par value per share	EMR	New York Stock Exchange
		NYSE Chicago
0.375% Notes due 2024	EMR 24	New York Stock Exchange
1.250% Notes due 2025	EMR 25A	New York Stock Exchange
2.000% Notes due 2029	EMR 29	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Common stock of $0.50 par value per share outstanding at December 31, ~~2021:~~2022: ~~594.0~~571.4 million shares.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Consolidated Statements of Earnings

EMERSON ELECTRIC CO. & SUBSIDIARIES

Three months ended December 31, ~~2020~~2021 and ~~2021~~2022

(Dollars in millions, except per share amounts; unaudited)


		Three Months Ended December 31,				Three Months Ended December 31,
		2020		2021			2021		2022
Net sales	Net sales	$	4,161	4,473	Net sales		$	3,156	3,373

Cost of sales	Cost of sales	2,438		2,651	Cost of sales		1,741		1,753
Selling, general and administrative expenses	Selling, general and administrative expenses	998		1,011	Selling, general and administrative expenses		849		1,030
Gain on subordinated interest	Gain on subordinated interest	—		(453)	Gain on subordinated interest		(453)		—

Other deductions, net	Other deductions, net	122		51	Other deductions, net		38		120
Interest expense (net of interest income of $2 and $3, respectively)		40		38
Interest expense (net of interest income of $3 and $20, respectively)					Interest expense (net of interest income of $3 and $20, respectively)		39		48

Earnings before income taxes		563		1,175
Earnings from continuing operations before income taxes					Earnings from continuing operations before income taxes		942		422

Income taxes	Income taxes	111		280	Income taxes		196		98

Earnings from continuing operations					Earnings from continuing operations		746		324

Discontinued operations, net of tax: $84 and $966, respectively					Discontinued operations, net of tax: $84 and $966, respectively		149		2,002

Net earnings	Net earnings	452		895	Net earnings		895		2,326

Less: Noncontrolling interests in subsidiaries	Less: Noncontrolling interests in subsidiaries	7		(1)	Less: Noncontrolling interests in subsidiaries		(1)		(5)

Net earnings common stockholders	Net earnings common stockholders	$	445	896	Net earnings common stockholders		$	896	2,331

Earnings common stockholders:					Earnings common stockholders:
Earnings from continuing operations					Earnings from continuing operations		746		329
Discontinued operations					Discontinued operations		150		2,002
Net earnings common stockholders					Net earnings common stockholders		$	896	2,331

Basic earnings per share common stockholders:					Basic earnings per share common stockholders:
Earnings from continuing operations					Earnings from continuing operations		$	1.25	0.56
Discontinued operations					Discontinued operations		0.26		3.43
Basic earnings per common share					Basic earnings per common share		$	1.51	3.99

Earnings per share:
Basic		$	0.74	1.51
Diluted		$	0.74	1.50
Diluted earnings per share common stockholders:					Diluted earnings per share common stockholders:
Earnings from continuing operations					Earnings from continuing operations		$	1.25	0.56
Discontinued operations					Discontinued operations		0.25		3.41
Diluted earnings per common share					Diluted earnings per common share		$	1.50	3.97

Weighted average outstanding shares:	Weighted average outstanding shares:				Weighted average outstanding shares:
Basic	Basic	598.5		594.6	Basic		594.6		583.6
Diluted	Diluted	601.9		598.1	Diluted		598.1		586.7

See accompanying Notes to Consolidated Financial Statements.

Consolidated Statements of Comprehensive Income

EMERSON ELECTRIC CO. & SUBSIDIARIES

Three months ended December 31, ~~2020~~2021 and ~~2021~~2022

(Dollars in millions; unaudited)


		Three Months Ended December 31,			Three Months Ended December 31,
		2020		2021			2021		2022
Net earnings	Net earnings	$	452	895		Net earnings	$	895	2,326

Other comprehensive income (loss), net of tax:	Other comprehensive income (loss), net of tax:					Other comprehensive income (loss), net of tax:
Foreign currency translation	Foreign currency translation	189		(72)		Foreign currency translation	(72)		241
Pension and postretirement	Pension and postretirement	27		18		Pension and postretirement	18		(16)
Cash flow hedges	Cash flow hedges	31		4		Cash flow hedges	4		10
Total other comprehensive income (loss)	Total other comprehensive income (loss)	247		(50)		Total other comprehensive income (loss)	(50)		235

Comprehensive income	Comprehensive income	699		845		Comprehensive income	845		2,561

Less: Noncontrolling interests in subsidiaries	Less: Noncontrolling interests in subsidiaries	7		(1)		Less: Noncontrolling interests in subsidiaries	(1)		—
Comprehensive income common stockholders	Comprehensive income common stockholders	$	692	846		Comprehensive income common stockholders	$	846	2,561

See accompanying Notes to Consolidated Financial Statements.

Consolidated Balance Sheets

EMERSON ELECTRIC CO. & SUBSIDIARIES

(Dollars and shares in millions, except per share amounts; unaudited)
Sept 30, 2021 Dec 31, 2021
ASSETS
Current assets
Cash and equivalents $ 2,354 4,726
Receivables, less allowances of $116 and $112, respectively 2,971 2,745
Inventories 2,050 2,335
Other current assets 1,057 1,054
Total current assets 8,432 10,860
Property, plant and equipment, net 3,738 3,685
Other assets
Goodwill 7,723 7,695
Other intangible assets 2,877 2,791
Other 1,945 1,928
Total other assets 12,545 12,414
Total assets $ 24,715 26,959
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings and current maturities of long-term debt $ 872 37
Accounts payable 2,108 2,100
Accrued expenses 3,266 3,194
Total current liabilities 6,246 5,331
Long-term debt 5,793 8,722
Other liabilities 2,753 2,618
Equity
Common stock, $0.50 par value; authorized, 1,200.0 shares; issued, 953.4 shares; outstanding, 595.8 shares and 594.0 shares, respectively 477 477
Additional paid-in-capital 522 564
Retained earnings 26,047 26,636
Accumulated other comprehensive income (loss) (872) (922)
Cost of common stock in treasury, 357.6 shares and 359.4 shares, respectively (16,291) (16,506)
Common stockholders’ equity 9,883 10,249
Noncontrolling interests in subsidiaries 40 39
Total equity 9,923 10,288
Total liabilities and equity $ 24,715 26,959


	Sept 30, 2022		Dec 31, 2022
ASSETS
Current assets
Cash and equivalents	$	1,804	2,271
Receivables, less allowances of $100 and $101, respectively	2,261		2,231
Inventories	1,742		1,999
Other current assets	1,301		1,290
Current assets held-for-sale	1,398		1,209
Total current assets	8,506		9,000

Property, plant and equipment, net	2,239		2,263
Other assets
Goodwill	13,946		14,087
Other intangible assets	6,572		6,460
Other	2,151		2,268
Noncurrent assets held-for-sale	2,258		2,163
Total other assets	24,927		24,978
Total assets	$	35,672	36,241

LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings and current maturities of long-term debt	$	2,115	1,792
Accounts payable	1,276		1,219
Accrued expenses	3,038		3,949

Current liabilities held-for-sale	1,348		1,200
Total current liabilities	7,777		8,160

Long-term debt	8,259		8,159

Other liabilities	3,153		3,057

Noncurrent liabilities held-for-sale	167		151

Equity
Common stock, $0.50 par value; authorized, 1,200.0 shares; issued, 953.4 shares; outstanding, 591.4 shares and 571.4 shares, respectively	477		477
Additional paid-in-capital	57		112
Retained earnings	28,053		30,076
Accumulated other comprehensive income (loss)	(1,485)		(1,255)
Cost of common stock in treasury, 362.0 shares and 382.0 shares, respectively	(16,738)		(18,683)
Common stockholders’ equity	10,364		10,727
Noncontrolling interests in subsidiaries	5,952		5,987
Total equity	16,316		16,714
Total liabilities and equity	$	35,672	36,241

See accompanying Notes to Consolidated Financial Statements.

Consolidated Statements of Equity

EMERSON ELECTRIC CO. & SUBSIDIARIES

Three months ended December 31, ~~2020~~2021 and ~~2021~~2022

(Dollars in millions; unaudited)


		Three Months Ended December 31,				Three Months Ended December 31,
		2020		2021			2021		2022

Common stock	Common stock	$	477	477	Common stock		$	477	477

Additional paid-in-capital	Additional paid-in-capital				Additional paid-in-capital
Beginning balance	Beginning balance	470		522	Beginning balance		522		57
Stock plans	Stock plans	29		42	Stock plans		42		55

Ending balance	Ending balance	499		564	Ending balance		564		112

Retained earnings	Retained earnings				Retained earnings
Beginning balance	Beginning balance	24,955		26,047	Beginning balance		26,047		28,053
Net earnings common stockholders	Net earnings common stockholders	445		896	Net earnings common stockholders		896		2,331
Dividends paid (per share: $0.505 and $0.515, respectively)		(303)		(307)
Adoption of accounting standard		(1)		—
Dividends paid (per share: $0.515 and $0.52, respectively)					Dividends paid (per share: $0.515 and $0.52, respectively)		(307)		(308)

Ending balance	Ending balance	25,096		26,636	Ending balance		26,636		30,076

Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)				Accumulated other comprehensive income (loss)
Beginning balance	Beginning balance	(1,577)		(872)	Beginning balance		(872)		(1,485)
Foreign currency translation	Foreign currency translation	189		(72)	Foreign currency translation		(72)		236
Pension and postretirement	Pension and postretirement	27		18	Pension and postretirement		18		(16)
Cash flow hedges	Cash flow hedges	31		4	Cash flow hedges		4		10
Ending balance	Ending balance	(1,330)		(922)	Ending balance		(922)		(1,255)

Treasury stock	Treasury stock				Treasury stock
Beginning balance	Beginning balance	(15,920)		(16,291)	Beginning balance		(16,291)		(16,738)
Purchases	Purchases	(13)		(258)	Purchases		(258)		(2,000)
Issued under stock plans	Issued under stock plans	86		43	Issued under stock plans		43		55
Ending balance	Ending balance	(15,847)		(16,506)	Ending balance		(16,506)		(18,683)

Common stockholders' equity	Common stockholders' equity	8,895		10,249	Common stockholders' equity		10,249		10,727

Noncontrolling interests in subsidiaries	Noncontrolling interests in subsidiaries				Noncontrolling interests in subsidiaries
Beginning balance	Beginning balance	42		40	Beginning balance		40		5,952
Net earnings	Net earnings	7		(1)	Net earnings		(1)		(5)
Stock plans					Stock plans		—		35
Other comprehensive income					Other comprehensive income		—		5

Dividends paid		(5)		—

Ending balance	Ending balance	44		39	Ending balance		39		5,987

Total equity	Total equity	$	8,939	10,288	Total equity		$	10,288	16,714

See accompanying Notes to Consolidated Financial Statements.

Consolidated Statements of Cash Flows

EMERSON ELECTRIC CO. & SUBSIDIARIES

Three Months Ended December 31, ~~2020~~2021 and ~~2021~~2022

(Dollars in millions; unaudited)


		Three Months Ended				Three Months Ended
		December 31,				December 31,
		2020		2021		2021		2022
Operating activities	Operating activities				Operating activities
Net earnings	Net earnings	$	452	895	Net earnings	$	895	2,326

Earnings from discontinued operations, net of tax					Earnings from discontinued operations, net of tax	(149)		(2,002)
Adjustments to reconcile net earnings to net cash provided by operating activities:	Adjustments to reconcile net earnings to net cash provided by operating activities:				Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	Depreciation and amortization	244		231	Depreciation and amortization	178		260
Stock compensation	Stock compensation	64		41	Stock compensation	34		102
Pension expense		8		1

Changes in operating working capital	Changes in operating working capital	71		(185)	Changes in operating working capital	(125)		(289)
Gain on subordinated interest	Gain on subordinated interest	—		(453)	Gain on subordinated interest	(453)		—

Other, net	Other, net	(31)		(7)	Other, net	(3)		(95)

Cash from continuing operations					Cash from continuing operations	377		302
Cash from discontinued operations					Cash from discontinued operations	146		116
Cash provided by operating activities	Cash provided by operating activities	808		523	Cash provided by operating activities	523		418

Investing activities	Investing activities				Investing activities
Capital expenditures	Capital expenditures	(122)		(116)	Capital expenditures	(73)		(59)
Purchases of businesses, net of cash and equivalents acquired	Purchases of businesses, net of cash and equivalents acquired	(1,611)		(39)	Purchases of businesses, net of cash and equivalents acquired	(39)		—

Proceeds from subordinated interest	Proceeds from subordinated interest	—		438	Proceeds from subordinated interest	438		15
Other, net	Other, net	13		2	Other, net	3		(23)

Cash provided by (used in) investing activities		(1,720)		285
Cash from continuing operations					Cash from continuing operations	329		(67)
Cash from discontinued operations					Cash from discontinued operations	(44)		2,953
Cash provided by investing activities					Cash provided by investing activities	285		2,886

Financing activities	Financing activities				Financing activities
Net increase (decrease) in short-term borrowings		340		(335)
Net increase in short-term borrowings					Net increase in short-term borrowings	(335)		(539)

Proceeds from long-term debt	Proceeds from long-term debt	—		2,975	Proceeds from long-term debt	2,975		—
Payments of long-term debt	Payments of long-term debt	(301)		(501)	Payments of long-term debt	(501)		(9)
Dividends paid	Dividends paid	(303)		(307)	Dividends paid	(307)		(306)
Purchases of common stock	Purchases of common stock	(13)		(253)	Purchases of common stock	(253)		(2,000)
Other, net	Other, net	42		22	Other, net	22		(41)
Cash provided by (used in) financing activities	Cash provided by (used in) financing activities	(235)		1,601	Cash provided by (used in) financing activities	1,601		(2,895)

Effect of exchange rate changes on cash and equivalents	Effect of exchange rate changes on cash and equivalents	29		(37)	Effect of exchange rate changes on cash and equivalents	(37)		58
Increase (Decrease) in cash and equivalents		(1,118)		2,372
Increase in cash and equivalents					Increase in cash and equivalents	2,372		467
Beginning cash and equivalents	Beginning cash and equivalents	3,315		2,354	Beginning cash and equivalents	2,354		1,804
Ending cash and equivalents	Ending cash and equivalents	$	2,197	4,726	Ending cash and equivalents	$	4,726	2,271

Changes in operating working capital	Changes in operating working capital				Changes in operating working capital
Receivables	Receivables	$	232	217	Receivables	$	172	78
Inventories	Inventories	(37)		(302)	Inventories	(177)		(193)
Other current assets	Other current assets	18		(10)	Other current assets	7		14
Accounts payable	Accounts payable	(37)		10	Accounts payable	(15)		(58)
Accrued expenses	Accrued expenses	(105)		(100)	Accrued expenses	(112)		(130)

Total changes in operating working capital	Total changes in operating working capital	$	71	(185)	Total changes in operating working capital	$	(125)	(289)

See accompanying Notes to Consolidated Financial Statements.

Notes to Consolidated Financial Statements

EMERSON ELECTRIC CO. & SUBSIDIARIES

(Dollars and shares in millions, except per share amounts or where noted)

(1) BASIS OF PRESENTATION

In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary for a fair presentation of operating results for the interim periods presented. Adjustments consist of normal and recurring accruals. The consolidated financial statements are presented in accordance with the requirements of Form 10-Q and consequently do not include all disclosures required for annual financial statements presented in conformity with U.S. generally accepted accounting principles (GAAP). For further information, refer to the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended September 30, ~~2021.~~2022.

~~Effective October 1, 2021,~~Over the past 18 months, Emerson Electric Co. ("Emerson" or the "Company") has taken significant actions to accelerate the transformation of its portfolio through the completion of strategic acquisitions and divestitures of non-core businesses. The Company's recent portfolio actions include the combination of its industrial software businesses with Aspen Technology, Inc., with the Company ~~adopted three accounting standard updates~~owning 55 percent of the outstanding shares of the combined entity on a fully diluted basis upon closing of the transaction on May 16, 2022, the sale of its Therm-O-Disc business, which ~~had no impact or an immaterial impact~~was completed on May 31, 2022, the ~~Company's financial statements as~~sale of its InSinkErator business, which was completed on October 31, 2022, and ~~for~~ the ~~three months ended December~~sale of a majority stake in its Climate Technologies business, which was announced on October 31, ~~2021. These included:~~2022, and is expected to close in the first half of calendar year 2023, subject to regulatory approvals and customary closing conditions.

•~~Updates~~Certain prior year amounts have been reclassified to ~~ASC 805,~~ ~~Business Combinations, which clarify~~conform to the ~~accounting~~current year presentation. This includes reporting financial results for ~~contract~~Climate Technologies, InSinkErator and Therm-O-Disc as discontinued operations for all periods presented, and the assets and liabilities ~~assumed in a business combination.~~of Climate Technologies and InSinkErator (prior to completion of the divestiture) as held-for-sale (see Note 5). In ~~general, this will result in contract liabilities being recognized at their historical amounts under ASC 606, rather than at fair value in accordance with the general requirements of ASC 805.~~

•~~Updates to ASC 740,~~ ~~Income Taxes, which require the recognition of a franchise tax that is partially based on income as an income-based tax with any incremental amount~~addition, as a ~~non-income based tax. These updates also make certain changes to intra-period tax allocation principles~~result of its portfolio transformation, the Company now reports six segments and ~~interim tax calculations.~~

•~~Updates to ASC 321,~~ ~~Equity Securities, ASC 323~~ ~~Investments - Equity Method and Joint Ventures, and ASC 815,~~ ~~Derivatives and Hedging, which clarify how to account for the transition into and out of the equity method of accounting when evaluating observable transactions.~~two business groups (see Note 13).

(2) REVENUE RECOGNITION

Emerson is a global manufacturer that combines technology and engineering to provide innovative solutions to its customers, largely in the form of tangible products. The vast majority of the Company's revenues relate to a broad offering of manufactured products which are recognized at the point in time when control transfers, while a smaller portion is recognized over time or relates to sales arrangements with multiple performance obligations. See Note 13 for additional information about the Company's revenues.

The following table summarizes the balances of the Company's unbilled receivables (contract assets), which are reported in Other ~~current~~ assets (current and noncurrent), and its customer advances (contract liabilities), which are reported in Accrued ~~expenses.~~expenses and Other liabilities.


		Sept 30, 2021			Dec 31, 2021			Sept 30, 2022			Dec 31, 2022
Unbilled receivables (contract assets)	Unbilled receivables (contract assets)		$	528		527	Unbilled receivables (contract assets)		$	1,390		1,412
Customer advances (contract liabilities)	Customer advances (contract liabilities)		(730)			(851)	Customer advances (contract liabilities)		(776)			(938)
Net contract liabilities			$	(202)		(324)
Net contract assets (liabilities)							Net contract assets (liabilities)		$	614		474

The majority of the Company's contract balances relate to (1) arrangements where revenue is recognized over time and payments from customers are made according to a contractual billing ~~schedule.~~schedule, and (2) revenue from term software license arrangements sold by AspenTech where the license revenue is recognized upfront upon delivery. The ~~increase~~decrease in net contract ~~liabilities~~assets was due to customer billings ~~which exceeded~~exceeding revenue recognized for performance completed during the period. Revenue recognized for the three months ended December 31, ~~2021~~2022 included ~~$348~~$335 that was included in the beginning contract liability balance. Other factors that impacted the change in net contract ~~liabilities~~assets were immaterial. Revenue recognized for the three months ended December 31, ~~2021~~2022 for performance obligations that were satisfied in previous periods, including cumulative catchup adjustments on the Company's long-term contracts, was not material.

As of December 31, ~~2021,~~2022, the Company's backlog relating to unsatisfied (or partially unsatisfied) performance obligations in contracts with its customers was approximately ~~$7.2 billion.~~$7.8 billion. The Company expects to recognize ~~approximately 85~~approximately 80 percent of its remaining performance obligations as revenue over the next 12 months, with the remainder substantially over the ~~subsequent~~following two ~~years thereafter.~~ years.

(3) COMMON SHARES AND SHARE-BASED COMPENSATION

Reconciliations of weighted-average shares for basic and diluted earnings per common share follow. Earnings allocated to participating securities were inconsequential.


		Three Months Ended December 31,			Three Months Ended December 31,
		2020	2021			2021	2022

Basic shares outstanding	Basic shares outstanding	598.5	594.6	Basic shares outstanding		594.6	583.6
Dilutive shares	Dilutive shares	3.4	3.5	Dilutive shares		3.5	3.1
Diluted shares outstanding	Diluted shares outstanding	601.9	598.1	Diluted shares outstanding		598.1	586.7

~~The Company changed the terms of its annual performance share awards issued in the first quarter of fiscal 2022. The new terms meet the criteria for equity classification in accordance with ASC 718,~~ ~~Compensation - Stock Compensation~~, and therefore expense will be recognized on a fixed basis over the three-year performance period. The terms of the performance share awards issued in fiscal 2020 and 2021 are unchanged and will therefore continue to be accounted for as liability awards and marked-to-market each period based on changes in the stock price.

(4) ACQUISITIONS AND DIVESTITURES

Aspen Technology

On ~~October 11, 2021,~~May 16, 2022, the Company ~~announced that it entered into a~~completed the transactions contemplated by its definitive agreement with Aspen Technology, Inc. ("Heritage AspenTech") to contribute two of Emerson's stand-alone industrial software businesses, Open Systems International, Inc. and the Geological Simulation Software business (collectively, the “Emerson Industrial Software Business”), along with approximately $6.0 billion in cash to Heritage AspenTech stockholders, to create ~~"new~~"New AspenTech", a diversified, high-performance industrial software leader with greater scale, capabilities and ~~technologies.~~technologies (hereinafter referred to as "AspenTech"). Upon closing of the transaction, ~~the Company will own~~Emerson owned 55 percent of ~~new~~the outstanding shares of New AspenTech common stock (on a fully diluted basis) and former Heritage AspenTech stockholders owned the remaining outstanding shares of AspenTech common stock. AspenTech and its subsidiaries now operate under Heritage AspenTech’s previous name “Aspen Technology, Inc.” and AspenTech common stock is traded on NASDAQ under AspenTech’s previous stock ticker symbol “AZPN.”

The business combination has been accounted for using the acquisition method of accounting with Emerson considered the accounting acquirer of Heritage AspenTech. The net assets of Heritage AspenTech were recorded at their estimated fair value and for the Emerson Industrial Software Business continue at their historical basis. The Company recorded a noncontrolling interest of $5.9 billion for the 45 percent ownership interest of former Heritage AspenTech stockholders in AspenTech. The noncontrolling interest associated with the Heritage AspenTech acquired net assets was recorded at fair value determined using the closing market price per share of Heritage AspenTech as of May 16, 2022, while the portion attributable to the Emerson Industrial Software business was recorded at its historical carrying amount. The impact of recognizing the noncontrolling interest in the Emerson Industrial Software Business resulted in a decrease to additional paid-in-capital of $550.

The following table summarizes the components of the purchase consideration reflected in the acquisition accounting using Heritage AspenTech's shares outstanding and closing market price per share as of May 16, 2022 (in millions except share and per share data):


Heritage AspenTech shares outstanding	66,662,482
Heritage AspenTech share price	$	166.30
Purchase price	$	11,086
Value of stock-based compensation awards attributable to pre-combination service	102
Total purchase consideration	$	11,188

The total purchase consideration for Heritage AspenTech was allocated to assets and liabilities as follows.


Cash and equivalents	$	274
Receivables	43
Other current assets	280
Property, plant equipment	4
Goodwill ($34 expected to be tax-deductible)	7,225
Other intangible assets	4,390
Other assets	513
Total assets	12,729

Short-term borrowings	27
Accounts payable	8
Accrued expenses	113
Long-term debt	255
Deferred taxes and other liabilities	1,138
Total purchase consideration	$	11,188

Emerson's cash contribution of approximately $6.0 billion was paid out at approximately $87.69 per share (on a fully diluted basis) to holders of issued and outstanding shares of Heritage AspenTech common stock as of the closing of the transactions, with $168 of cash remaining on AspenTech's balance sheet as of the closing which is not included in the allocation of purchase consideration above.

The estimated intangible assets attributable to the transaction are comprised of the following (in millions):


	Amount		Estimated Weighted Average Life (Years)
Developed technology	$	1,350	10
Customer relationships	2,300		15
Trade names	430		Indefinite-lived
Backlog	310		3
Total	$	4,390

Results of operations for the first quarter of 2023 attributable to the Heritage AspenTech acquisition include sales of $168 while the impact to GAAP net earnings was not material.

Pro Forma Financial Information

The following unaudited proforma consolidated condensed financial results of operations are presented as if the acquisition of Heritage AspenTech occurred on October 1, 2020. The pro forma information is presented for informational purposes only and ~~financial position will~~is not indicative of the results of operations that would have been achieved had the acquisition occurred as of that time ($ in millions, except per share amounts).


	Three Months Ended December 31,
		2021
Net Sales		$	3,327
Net earnings from continuing operations common stockholders		$	734
Diluted earnings per share from continuing operations		$	1.23

The pro forma results for the three months ended December 31, 2021 include $32 of transaction costs which were assumed to be ~~consolidated~~incurred in the first fiscal quarter of 2021.Of these transaction costs, $22 were included in the Company's reported results for the three months ended December 31, 2021, but have been excluded from the fiscal 2022 pro forma results above. In addition, Heritage AspenTech incurred $68 of transaction costs prior to the completion of the acquisition that were not included in Emerson's ~~financial statements~~reported results. .The pro forma results for the three months ended December 31, 2021 include estimated interest expense of $37 related to the issuance of $3 billion of term debt and increased commercial paper borrowings to fund the acquisition.

Other Transactions

On ~~October 1, 2020,~~July 27, 2022, AspenTech entered into an agreement to acquire Micromine, a global leader in design and operational solutions for the ~~Company completed the acquisition of Open Systems International, Inc. ("OSI"), a leading operations technology software provider in the global power~~mining industry, for ~~approximately $1.6 billion, net of cash acquired. This business, which had net sales of $191 in fiscal 2021 and is reported in~~AU$900 (approximately $623 USD based on exchange rates when the ~~Automation Solutions segment, expands the Company's offerings in the power industry to include the digitization and modernization of the electric grid.~~transaction was announced). The ~~Company recognized goodwill of $967 (none of which~~transaction is expected to be tax deductible), identifiable intangible assets of $783, primarily intellectual property and customer relationships with a weighted-average useful life of approximately 11 years, and deferred tax liabilities of approximately $193.close as soon as the remaining regulatory approval is obtained.

~~As previously disclosed,~~On May 4, 2022, Emerson announced its intention to exit business operations in Russia and divest Metran, its Russia-based manufacturing subsidiary, and on September 27, 2022, announced an agreement to sell the business to the local management group. In the first quarter of fiscal 2023, the Company ~~sold~~recognized a pretax loss of $47 in Other deductions ($47 after-tax, in total $0.08 per share) related to its ~~network power systems~~exit of business ~~(rebranded as Vertiv, now~~operations in Russia. The transaction will be subject to regulatory and government approvals, and other customary closing conditions. Emerson will work closely with the local Russia management group to help ensure a ~~publicly traded company, symbol VRT) in 2017 and retained a subordinated interest contingent upon~~smooth transition for employees through the ~~equity holders first receiving a threshold cash return on their initial investment.~~ sale process.

In the first quarter of fiscal 2022, the ~~equity holders' cumulative cash return exceeded the threshold and as a result, the~~ Company received a distribution of $438 related to its subordinated interest in ~~November 2021~~Vertiv (in total, a pretax gain of $453 was recognized in the first ~~quarter)~~quarter, $358 after-tax, $0.60 per share). Based on the terms of the agreement and the current calculation, the Company could receive additional distributions of approximately ~~$100~~$75 which are expected to be received over the next two-to-three years. However, the distributions are contingent on the timing and price at which Vertiv shares are sold by the equity holders and therefore, there can be no assurance as to the amount or timing of the remaining distributions to the Company.

(5) DISCONTINUED OPERATIONS

In October 2022, the Board of Directors approved the Company's announced agreement to sell a majority stake in its Climate Technologies business (which constitutes the former Climate Technologies segment, excluding Therm-O-Disc which was divested earlier in fiscal 2022) to private equity funds managed by Blackstone in a $14.0 billion transaction. Emerson will receive upfront, pre-tax cash proceeds of approximately $9.5 billion and a note of $2.25 billion at close (which will accrue 5 percent interest payable in kind by capitalizing interest), while retaining a 45 percent non-controlling interest in a new standalone joint venture between Emerson and Blackstone. The Climate Technologies business, which includes the Copeland compressor business and the entire portfolio of products and services across all residential and commercial HVAC and refrigeration end-markets, had fiscal 2022 net sales of approximately $5.0 billion and pretax earnings of $1.0 billion. The transaction is expected to close in the first half of calendar year 2023, subject to regulatory approvals and customary closing conditions.

On October 31, 2022, the Company completed the divestiture of its InSinkErator business, which manufactures food waste disposers, to Whirlpool Corporation for $3.0 billion. This business had net sales of $630 and pretax earnings of $152 in fiscal 2022. The Company recognized a pretax gain of $2.8 billion (approximately $2.1 billion after-tax) in the first quarter of fiscal 2023.

On May 31, 2022 the Company completed the divestiture of its Therm-O-Disc sensing and protection technologies business to an affiliate of One Rock Capital Partners, LLC. The Company recognized a pretax gain of $486 ($429 after-tax) in the third fiscal quarter of 2022.

The financial results of Climate Technologies, InSinkErator ("ISE") and Therm-O-Disc ("TOD") (through the completion of the divestitures), are reported as discontinued operations for the three months ended December 31, 2022 and 2021 and were as follows:


	Climate Technologies				ISE and TOD				Total
	Three Months Ended December 31,				Three Months Ended December 31,			Three Months Ended December 31,
		2021		2022		2021	2022		2021	2022
Net sales		$	1,079	1,064		238	49		1,317	1,113
Cost of sales		762		702		148	29		910	731
SG&A		127		142		35	8		162	150
Gain on sale of business		—		—		—	(2,780)		—	(2,780)
Other deductions, net		6		32		6	12		12	44
Earnings (Loss) before income taxes		184		188		49	2,780		233	2,968
Income taxes		39		313		45	653		84	966
Earnings (Loss), net of tax		$	145	(125)		4	2,127		149	2,002

Climate Technologies' results for the three months ended December 31, 2022 include lower expense of $27 due to ceasing depreciation and amortization upon the held-for-sale classification. Other deductions, net for Climate Technologies included $27 of transaction-related costs for the three months ended December 31, 2022. Income taxes for the three months ended December 31, 2022 included approximately $275 for Climate Technologies subsidiary restructurings and approximately $660 related to the gain on the InSinkErator divestiture.

The aggregate carrying amounts of the major classes of assets and liabilities classified as held-for-sale as of December 31, 2022 and September 30, 2022 are summarized as follows:


	Climate Technologies				ISE			Total
		Sept. 30,		Dec. 31,		Sept. 30,	Dec. 31,		Sept. 30,	Dec. 31,
Assets		2022		2022		2022	2022		2022	2022
Receivables		$	747	608		68	—		815	608
Inventories		449		541		81	—		530	541
Other current assets		49		60		4	—		53	60
Property, plant & equipment, net		1,122		1,093		141	—		1,263	1,093
Goodwill		716		720		2	—		718	720
Other noncurrent assets		265		350		12	—		277	350
Total assets held-for-sale		$	3,348	3,372		308	—		3,656	3,372

Liabilities
Accounts payable		$	752	733		60	—		812	733
Other current liabilities		475		467		61	—		536	467
Deferred taxes and other noncurrent liabilities		154		151		13	—		167	151
Total liabilities held-for-sale		$	1,381	1,351		134	—		1,515	1,351

~~(5)~~Net cash from operating and investing activities for Climate Technologies, InSinkErator and Therm-O-Disc for the three months ended December 31, 2022 and 2021 were as follows:


	Climate Technologies				ISE and TOD				Total
	Three Months Ended December 31,				Three Months Ended December 31,			Three Months Ended December 31,
		2021		2022		2021	2022		2021	2022
Cash from operating activities		$	132	205		14	(89)		146	116
Cash from investing activities		$	(35)	(43)		(9)	2,996		(44)	2,953

Cash from operating activities reflects the payment of ISE transaction fees and unfavorable working capital. Cash from investing activities for the three months ended December 31, 2022 reflects the proceeds of $3.0 billion related to the InSinkErator divestiture.

(6) PENSION & POSTRETIREMENT PLANS

Total periodic pension and postretirement (income) expense is summarized below:


		Three Months Ended December 31,				Three Months Ended December 31,
			2020		2021			2021		2022
Service cost	Service cost		$	21	19		Service cost	$	19	12
Interest cost	Interest cost		32		34		Interest cost	34		54
Expected return on plan assets	Expected return on plan assets		(84)		(78)		Expected return on plan assets	(78)		(71)
Net amortization	Net amortization		35		23		Net amortization	23		(20)
Total	Total		$	4	(2)		Total	$	(2)	(25)

~~(6)~~(7) OTHER DEDUCTIONS, NET

Other deductions, net are summarized below:


		Three Months Ended December 31,				Three Months Ended December 31,
		2020			2021			2021			2022

Amortization of intangibles (intellectual property and customer relationships)	Amortization of intangibles (intellectual property and customer relationships)		$	78	63		Amortization of intangibles (intellectual property and customer relationships)		$	57		118
Restructuring costs	Restructuring costs		66		9		Restructuring costs		6			10

Acquisition/divestiture costs							Acquisition/divestiture costs		23			—
Foreign currency transaction (gains) losses							Foreign currency transaction (gains) losses		(7)			(7)
Investment-related gains & gains from sales of capital assets							Investment-related gains & gains from sales of capital assets		(15)			(4)
Russia business exit							Russia business exit		—			47
Other	Other		(22)		(21)		Other		(26)			(44)
Total	Total		$	122	51		Total		$	38		120

In the first quarter of fiscal ~~2022, the decrease in~~2023, intangibles amortization ~~was largely due to~~for the ~~backlog amortization of $11 in the prior year~~three months ended December 31, 2022 included $64 related to the ~~OSI acquisition.~~Heritage AspenTech acquisition and foreign currency transaction gains included a mark-to-market gain of $35 related to foreign currency forward contracts entered into by AspenTech to mitigate the impact of foreign currency exchange associated with the Micromine purchase price. Other is composed of several items, including ~~acquisition/divestiture costs, foreign currency transaction gains and losses,~~ pension expense, litigation costs, provision for bad debt and other ~~items. In the first quarter~~items, none of ~~fiscal 2022, other included transaction costs related to the AspenTech transaction of $23,~~ ~~a favorable impact from foreign currency transactions of $25 due to losses in the prior year and gains in the current year, and~~ gains from the sales of capital assets of $15. Comparisons were also impacted by prior year investment-related gains, including $21 from an investment sale and $17 from the acquisition of full ownership of an equity investment.which is individually significant.

~~(7)~~

(8) RESTRUCTURING COSTS

Restructuring expense reflects costs associated with the Company’s ongoing efforts to improve operational efficiency and deploy assets globally in order to remain competitive on a worldwide basis. Costs incurred in the first three months of fiscal 2022 relate to the Company's initiatives that began in the third quarter of fiscal 2019 to improve operating margins and were subsequently increased in response to the effects of the COVID-19 pandemic on demand for the Company's products. Expenses incurred in the ~~first three months of fiscal 2022 included costs related to workforce reductions of approximately 150 employees.~~ The Company expects fiscal ~~2022~~2023 restructuring expense and related costs to be approximately ~~$150,~~$90, including costs to complete actions initiated in the first three months of the year.

Restructuring expense by business segment follows:
Three Months Ended
December 31,
2020 2021
Automation Solutions $ 64 5
Climate Technologies 1 2
Tools & Home Products 1 1
Commercial & Residential Solutions 2 3
Corporate — 1
Total $ 66 9


	Three Months Ended December 31,
		2021	2022

Final Control			$	—	(1)
Measurement & Analytical			2		1
Discrete Automation			2		1
Safety & Productivity			—		—
Intelligent Devices			4		1

Control Systems & Software			1		1
AspenTech			—		—
Software and Control			1		1

Corporate			1		8

Total			$	6	10

Details of the change in the liability for restructuring costs during the three months ended December 31, ~~2021~~2022 follow:

Sept 30, 2021 Expense Utilized/Paid Dec 31, 2021
Severance and benefits $ 172 2 20 154
Other 4 7 9 2
Total $ 176 9 29 156


	Sept 30, 2022			Expense		Utilized/Paid		Dec 31, 2022

Severance and benefits		$	117		(2)		1		114




Other		5			12		11		6
Total		$	122		10		12		120

The tables above do not include $3$8 and $9$5 of costs related to restructuring actions incurred for the three months ended December 31, ~~2020~~2021 and ~~2021,~~2022, respectively, that are required to be reported in cost of sales and selling, general and administrative expenses.

~~(8)~~(9) TAXES

Income taxes were ~~$280~~$98 in the first quarter of fiscal ~~2022~~2023 and ~~$111~~$196 in ~~2021,~~2022, resulting in effective tax rates of 2423 percent and 2021 percent, respectively. ~~Income taxes in the first quarter~~The current year rate included ~~expense of $95~~a 2 percentage point unfavorable impact related to the ~~Vertiv subordinated interest gain,~~Russia charge, which ~~benefited the~~had no related tax rate by approximately 2 percentage points. This was offset by portfolio restructuring activities which negatively impacted the rate by 4 percentage points, while the prior year rate included discrete benefits which decreased the rate 2 ~~percentage points.~~benefit.

On March 27, 2020, the CARES Act was enacted in response to the COVID-19 pandemic, and among other things, provides tax relief to businesses. Tax provisions of the CARES Act include the deferral of certain payroll taxes, relief for retaining employees, and other provisions. The Company deferred $73 of certain payroll taxes through the end of calendar year 2020, of which approximately $37 was paid in December 2021 ~~with~~ andthe ~~remaining amount due~~remainder was paid in December 2022.

~~(9) OTHER FINANCIAL INFORMATION~~

Sept 30, 2021 Dec 31, 2021
Inventories
Finished products $ 616 744
Raw materials and work in process 1,434 1,591
Total $ 2,050 2,335

Property, plant and equipment, net
Property, plant and equipment, at cost $ 9,427 9,442
Less: Accumulated depreciation 5,689 5,757
Total $ 3,738 3,685

912

Goodwill by business segment
Automation Solutions $ 6,552 6,534
Climate Technologies 753 751
Tools & Home Products 418 410
Commercial & Residential Solutions 1,171 1,161
Total $ 7,723 7,695
(10) OTHER FINANCIAL INFORMATION


	Sept 30, 2022			Dec 31, 2022
Inventories
Finished products		$	417		456
Raw materials and work in process		1,325			1,543
Total		$	1,742		1,999

Other intangible assets
Gross carrying amount $ 5,911 5,910
Less: Accumulated amortization 3,034 3,119
Net carrying amount $ 2,877 2,791




Property, plant and equipment, net
Property, plant and equipment, at cost	$	5,390	5,373
Less: Accumulated depreciation	3,151		3,110
Total	$	2,239	2,263




Goodwill by business segment
Final Control	$	2,605	2,659
Measurement & Analytical	1,112		1,131
Discrete Automation	807		839
Safety & Productivity	364		389
Intelligent Devices	4,888		5,018


Control Systems & Software	732		740
AspenTech	8,326		8,329
Software and Control	9,058		9,069

Total	$	13,946	14,087



Other intangible assets
Gross carrying amount	$	9,671	9,767
Less: Accumulated amortization	3,099		3,307
Net carrying amount	$	6,572	6,460

Other intangible assets include customer relationships, net, of ~~$1,495~~$3,436 and ~~$1,449~~$3,399 and intellectual property, net, of $2,934 and $2,860 as of September 30, ~~2021~~2022 and December 31, ~~2021,~~2022, respectively.


		Three Months Ended				Three Months Ended December 31,
		Dec 31, 2020		Dec 31, 2021			2021		2022
Depreciation and amortization expense include the following:	Depreciation and amortization expense include the following:				Depreciation and amortization expense include the following:
Depreciation expense	Depreciation expense	$	124	128	Depreciation expense		$	84	74
Amortization of intangibles (includes $14 and $14 reported in Cost of Sales for the three months ended December 31, 2020 and 2021, respectively)		92		77
Amortization of intangibles (includes $14 and $49 reported in Cost of Sales, respectively)					Amortization of intangibles (includes $14 and $49 reported in Cost of Sales, respectively)		71		167
Amortization of capitalized software	Amortization of capitalized software	28		26	Amortization of capitalized software		23		19
Total	Total	$	244	231	Total		$	178	260

Amortization of intangibles included ~~backlog amortization of $11~~$99 related to the ~~OSI~~Heritage AspenTech acquisition for the three months ended December 31, ~~2020.~~

Sept 30, 2021 Dec 31, 2021
Other assets include the following:
Pension assets $ 1,015 1,042
Operating lease right-of-use assets 558 536
Deferred income taxes 115 101
Asbestos-related insurance receivables 95 91

Accrued expenses include the following:
Customer advances (contract liabilities) $ 730 851
Employee compensation 690 428
Operating lease liabilities (current) 155 152
Product warranty 146 136

Other liabilities include the following:
Deferred income taxes $ 711 736
Pension and postretirement liabilities 676 674
Operating lease liabilities (noncurrent) 413 395
Asbestos litigation 256 251
2022.

1013

~~(10) DEBT~~


	Sept 30, 2022			Dec 31, 2022
Other assets include the following:
Pension assets		$	865		912
Unbilled receivables (contract assets)		428			516
Operating lease right-of-use assets		439			434
Deferred income taxes		85			73
Asbestos-related insurance receivables		68			68

~~In December 2021, the Company issued $1 billion of 2.0% notes~~



Accrued expenses include the following:
Income taxes	$	125	1,080
Customer advances (contract liabilities)	751		901
Employee compensation	523		372
Operating lease liabilities (current)	128		131
Product warranty	84		89

The increase in Income taxes was due ~~December 2028, $1 billion of 2.2% notes due December 2031, and $1 billion of 2.8% notes due December 2051. The Company expects~~ to ~~use the net proceeds from the sale of the notes to pay a portion of its contribution~~taxes of approximately ~~$6.0 billion~~$660 related to ~~existing stockholders~~the gain on divestiture of ~~AspenTech as part of the transaction discussed further in~~InSinkErator and approximately $275 related to subsidiary restructurings at Climate Technologies. See Note 4. If the transaction with AspenTech is not completed or is terminated, the Company will be required to redeem the notes at a redemption price equal to 101% of the principal amount plus accrued and unpaid interest.5.



Other liabilities include the following:
Deferred income taxes	$	1,714	1,694
Pension and postretirement liabilities	427		441
Operating lease liabilities (noncurrent)	312		306
Asbestos litigation	205		200

Debt:

On January 17, 2023, AspenTech paid off the ~~first quarter~~outstanding balance of ~~fiscal 2022,~~its existing term loan facility of $264, plus accrued interest, which resulted in the ~~Company repaid $500~~long-term portion being reclassified and reported as short-term borrowings as of ~~2.625% notes that matured.~~December 31, 2022.

(11) FINANCIAL INSTRUMENTS

Hedging Activities – As of December 31, ~~2021,~~2022, the notional amount of foreign currency hedge positions was approximately ~~$2.4~~$5.2 billion, and commodity hedge contracts totaled approximately ~~$143~~$115 (primarily 4033 million pounds of copper and aluminum). All derivatives receiving hedge accounting are cash flow hedges. The majority of hedging gains and losses deferred as of December 31, ~~2021~~2022 are expected to be recognized over the next 12 months as the underlying forecasted transactions occur. Gains and losses on foreign currency derivatives reported in Other deductions, net reflect hedges of balance sheet exposures that do not receive hedge accounting.

Net Investment Hedge – In fiscal 2019, the Company issued euro-denominated debt of €1.5 billion. The euro notes reduce foreign currency risk associated with the Company's international subsidiaries that use the euro as their functional currency and have been designated as a hedge of a portion of the investment in these operations. Foreign currency gains or losses associated with the euro-denominated debt are deferred in accumulated other comprehensive income (loss) and will remain until the hedged investment is sold or substantially liquidated.

The following gains and losses are included in earnings and other comprehensive income (OCI) for the three months ended December 31, ~~2020~~2021 and ~~2021:~~2022:


			Into Earnings			Into OCI				Into Earnings				Into OCI
			1st Quarter				1st Quarter				1st Quarter					1st Quarter
Gains (Losses)	Gains (Losses)	Location	2020		2021			2020	2021			Gains (Losses)	Location	2021		2022	2021	2022
Commodity	Commodity	Cost of sales	$	3	7			13	13			Commodity	Cost of sales	$	7	(8)	13	11
Foreign currency	Foreign currency	Sales	1		1			5	—			Foreign currency	Sales	1		(1)	—	4
Foreign currency	Foreign currency	Cost of sales	—		2			27	3			Foreign currency	Cost of sales	2		8	3	(3)
Foreign currency	Foreign currency	Other deductions, net	(4)		44							Foreign currency	Other deductions, net	44		5

Net Investment Hedges	Net Investment Hedges											Net Investment Hedges
Euro denominated debt	Euro denominated debt							(80)	44			Euro denominated debt					44	(123)
Total	Total		$	—	54			(35)	60			Total		$	54	4	60	(111)

Regardless of whether derivatives and non-derivative financial instruments receive hedge accounting, the Company expects hedging gains or losses to be offset by losses or gains on the related underlying exposures. The amounts ultimately recognized will differ from those presented above for open positions, which remain subject to ongoing market price fluctuations until settlement. Derivatives receiving hedge accounting are highly effective and no amounts were excluded from the ~~assessment~~assessment of hedge effectiveness.

Equity Investment– The Company has an equity investment in National Instruments, valued at $82 as of December 31, 2022, and reported in Other current assets. On January 17, 2023, the Company announced a proposal to acquire National Instruments for $53 per share in cash at an implied enterprise value of $7.6 billion. National Instruments, which had fiscal 2021 sales of approximately $1.5 billion, announced on January 13, 2023 it was undertaking a strategic review which could include the solicitation of interest from other potential acquirors.

Fair Value Measurement – Valuations for all derivatives and the Company's long-term debt fall within Level 2 of the GAAP valuation ~~hierarch~~y.hierarchy. As of December 31, ~~2021,~~2022, the fair value of long-term debt was ~~$9.2~~$7.7 billion, which ~~exceeded~~was lower than the carrying value by ~~$411.~~$1,169. The fair values of commodity and foreign currency contracts did not materially change since September 30, 2022. Foreign currency contracts were reported in Other current assets and Accrued expenses, while commodity contracts, which primarily relate to discontinued operations, were reported in Current assets and ~~did not materially change since September 30, 2021.~~liabilities held-for-sale. The fair value of the Company's equity investment in National Instruments falls within Level 1 and was based on the most recent quoted closing market price from its principal exchange.

Counterparties to derivatives arrangements are companies with investment-grade credit ratings. The Company has bilateral collateral arrangements with counterparties with credit rating-based posting thresholds that vary depending on the arrangement. If credit ratings on the Company's debt fall below pre-established levels, counterparties can require immediate full collateralization of all derivatives in net liability positions. The maximum amount that could potentially have been required was immaterial. The Company also can demand full collateralization of derivatives in net asset positions should any counterparty credit ratings fall below certain thresholds. No collateral was posted with counterparties and none was held by the Company as of December 31, ~~2021.~~2022.

~~(12) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)~~

Activity in Accumulated other comprehensive income (loss) for the three months ended December 31, 2020 and 2021 is shown below, net of income taxes:
Three Months Ended December 31,
2020 2021
Foreign currency translation
   Beginning balance $ (711) (629)
   Other comprehensive income (loss), net of tax of $19 and $(10), respectively 189 (72)
   Ending balance (522) (701)
Pension and postretirement
   Beginning balance (864) (259)
Amortization of deferred actuarial losses into earnings, net of tax of $(8) and $(5),
  respectively
27 18
   Ending balance (837) (241)
Cash flow hedges
   Beginning balance (2) 16
Gains deferred during the period, net of taxes of $(11) and $(4), respectively 34 12
   Reclassification of realized (gains) losses to sales and cost of sales, net of tax of $1 and
     $2, respectively
(3) (8)
   Ending balance 29 20
Accumulated other comprehensive income (loss) $ (1,330) (922)

~~(13) BUSINESS SEGMENTS~~

~~Summarized information about the Company's results of operations by business segment follows:~~
Three Months Ended December 31,
Sales Earnings
2020 2021 2020 2021
Automation Solutions $ 2,692 2,805 361 526
Climate Technologies 1,031 1,163 212 192
Tools & Home Products 445 508 98 107
Commercial & Residential Solutions 1,476 1,671 310 299
Stock compensation (64) (41)
Unallocated pension and postretirement costs 24 26
Corporate and other (28) (50)
Gain on subordinated interest — 453
Eliminations/Interest (7) (3) (40) (38)
Total $ 4,161 4,473 563 1,175

1215

(12) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)


Activity in Accumulated other comprehensive income (loss) for the three months ended December 31, 2021 and 2022 is shown below, net of income taxes:
	Three Months Ended December 31,
		2021		2022
Foreign currency translation
Beginning balance		$	(629)	(1,265)
Other comprehensive income (loss), net of tax of $(10) and $28, respectively		(72)		236


Ending balance		(701)		(1,029)

Pension and postretirement
Beginning balance		(259)		(222)
Amortization of deferred actuarial losses into earnings, net of tax of $(5) and $4, respectively		18		(16)

Ending balance		(241)		(238)

Cash flow hedges
Beginning balance		16		2
Gains deferred during the period, net of taxes of $(4) and $(3), respectively		12		9
Reclassification of realized (gains) losses to sales and cost of sales, net of tax of $2 and $—, respectively		(8)		1
Ending balance		20		12

Accumulated other comprehensive income (loss)		$	(922)	(1,255)

(13) BUSINESS SEGMENTS

As disclosed in Note 5, the financial results of Climate Technologies, InSinkErator and Therm-O-Disc are reported as discontinued operations for all periods presented. As a result of these portfolio actions, the Company has realigned its business segments and now reports six segments and two business groups, which are highlighted in the table below. The Company also reclassified certain product sales that were previously reported in Control Systems & Software to Discrete Automation.

INTELLIGENT DEVICES

SOFTWARE AND CONTROL

•Final Control

•Control Systems & Software

•Measurement & Analytical

•AspenTech

•Discrete Automation

•Safety & Productivity

The new segments were previously described as follows: Final Control was the Valves, Actuators & Regulators product offering; Measurement & Analytical was the Measurement & Analytical instrumentation product offering; Discrete Automation was the Industrial Solutions product offering; Safety & Productivity was the Tools & Home Products segment, excluding the divested InSinkErator business; Control Systems & Software was the Systems & Software product offering; and, AspenTech remains unchanged. The AspenTech segment was identified in the third quarter of fiscal 2022 as a result of the Heritage AspenTech acquisition and reflects the combined results of Heritage AspenTech and the Emerson Industrial Software Business (see Note 4 for further details). The results for this new segment include the historical results of the Emerson Industrial Software Business (which were previously reported in the Control Systems & Software segment), while results related to the Heritage AspenTech business only include periods subsequent to the close of the transaction. Prior year amounts have been reclassified to conform to the current year presentation.


	Three Months Ended December 31,
		Sales	Earnings
			2021		2022	2021	2022

Final Control			$	817	862	122	158
Measurement & Analytical			737		749	170	175
Discrete Automation			617		618	120	121
Safety & Productivity			351		310	65	63
Intelligent Devices			2,522		2,539	477	517

Control Systems & Software			570		606	116	107
AspenTech			82		243	(2)	(33)
Software and Control			652		849	114	74

Stock compensation						(34)	(102)
Unallocated pension and postretirement costs						26	45
Corporate and other						(55)	(64)
Gain on subordinated interest						453	—

Eliminations/Interest			(18)		(15)	(39)	(48)
Total			$	3,156	3,373	942	422

~~Automation Solutions~~Corporate and other for the three months ended December 31, 2022 included a ~~sales~~loss of $47 related to the Company's exit of business operations in Russia and a mark-to-market gain of $35 related to foreign currency forward contracts entered into by ~~major product offering are summarized below.~~AspenTec
Three Months Ended December 31,
2020 2021
Measurement & Analytical Instrumentation $ 698 735
Valves, Actuators & Regulators 806 816
Industrial Solutions 508 566
Systems & Software 680 688
Automation Solutions $ 2,692 2,805
h to mitigate the impact of foreign currency exchange associated with the Micromine purchase price, while the three months ended December 31, 2021 included acquisition/divestiture costs of $23.

Depreciation and amortization (includes intellectual property, customer relationships and capitalized software) by business segment are summarized below:
Three Months Ended December 31,
2020 2021
Automation Solutions $ 156 155
Climate Technologies 49 47
Tools & Home Products 19 20
Commercial & Residential Solutions 68 67
Corporate and other 20 9
Total $ 244 231

~~Sales by geographic destination are summarized below:~~
Three Months Ended December 31,
2020 2021
Automation Solutions Commercial & Residential Solutions Total Automation Solutions Commercial & Residential Solutions Total
Americas $ 1,168 981 2,149 1,241 1,144 2,385
Asia, Middle East & Africa 942 308 1,250 1,005 322 1,327
Europe 582 187 769 559 205 764
Total $ 2,692 1,476 4,168 2,805 1,671 4,476


	Three Months Ended December 31,
		2021		2022
Final Control		$	53	45
Measurement & Analytical		31		30
Discrete Automation		23		21
Safety & Productivity		15		14
Intelligent Devices		122		110

Control Systems & Software		25		21
AspenTech		23		123
Software and Control		48		144

Corporate and other		8		6
Total		$	178	260

1317

Sales by geographic destination, Americas, Asia, Middle East & Africa ("AMEA") and Europe, are summarized below:


	Three Months Ended December 31,						Three Months Ended December 31,
		2021					2022
		Americas		AMEA	Europe	Total	Americas	AMEA	Europe	Total
Final Control		$	352	336	129	817	446	308	108	862
Measurement & Analytical		311		296	130	737	396	246	107	749
Discrete Automation		274		183	160	617	291	175	152	618
Safety & Productivity		270		16	65	351	236	17	57	310
Intelligent Devices		1,207		831	484	2,522	1,369	746	424	2,539

Control Systems & Software		268		173	129	570	294	185	127	606
AspenTech		54		16	12	82	112	63	68	243
Software and Control		322		189	141	652	406	248	195	849


Total		$	1,529	1,020	625	3,174	1,775	994	619	3,388

Items 2 and 3.

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

(Dollars are in millions, except per share amounts or where noted)

OVERVIEW

As previously disclosed, in October 2022, the Board of Directors approved the Company's announced agreement to sell a majority stake in its Climate Technologies business (which constitutes the historical Climate Technologies segment, excluding Therm-O-Disc which was divested in fiscal 2022) to private equity funds managed by Blackstone in a $14.0 billion transaction. The transaction is expected to close in the first half of calendar year 2023, subject to regulatory approvals and customary closing conditions.

Additionally, on October 31, 2022, the Company completed the divestiture of its InSinkErator business, which manufactures food waste disposers, to Whirlpool Corporation for $3.0 billion, and the Company recognized a pretax gain of $2.8 billion (approximately $2.1 billion after-tax) in the first quarter of fiscal 2023.

Climate Technologies, Therm-O-Disc and InSinkErator are reported within discontinued operations for all periods presented. See Note 5.

On May 16, 2022, the Company completed the transactions contemplated by its definitive agreement with Aspen Technology, Inc. ("Heritage AspenTech") to contribute two of Emerson's stand-alone industrial software businesses, Open Systems International, Inc. and the Geological Simulation Software business, along with approximately $6.0 billion in cash to Heritage AspenTech stockholders, to create "New AspenTech" (hereinafter referred to as "AspenTech"). Upon closing of the transaction, Emerson owned 55 percent of the outstanding shares of New AspenTech common stock (on a fully diluted basis). See Note 4. Due to the timing of the acquisition in the prior year, the results for the first quarter of fiscal 2022 do not include the results of Heritage AspenTech.

For the first quarter of fiscal ~~2022,~~2023, net sales from continuing operations were ~~$4.5~~$3.4 billion, up 87 percent compared with the prior year. Underlying sales, which exclude foreign currency translation, acquisitions and divestitures, were ~~also~~ up 86 percent. The AspenTech acquisition added 5 percent, while foreign currency translation had a 4 percent unfavorable impact. Sales growth ~~reflected~~continued to be strong in North America, while Asia, Middle East & Africa was essentially flat and Europe was down modestly due to the ~~continuation~~negative impact of the ~~Company's strong rebound which began in the prior year, with favorable results across both~~ business ~~platforms and all geographies.~~exit from Russia.

~~Net earnings~~Earnings from continuing operations attributable to common stockholders were ~~$896, up 101~~$329, down 56 percent, and diluted earnings per share from continuing operations were ~~$1.50, up 103~~$0.56, down 55 percent compared with ~~$0.74~~$1.25 in the prior year. ~~Results reflected strong operating results and~~The prior year included a ~~pretax~~$0.60 gain ~~of $453 ($358 after-tax, $0.60 per share)~~ related to the Company's subordinated interest in Vertiv. Adjusted diluted earnings per share from continuing operations were $0.78 compared with $0.79 in the prior year, reflecting strong operating results offset by higher stock compensation expense due to an increasing stock price in the current year.

The table below presents the Company's diluted earnings per share from continuing operations on an adjusted basis to facilitate period-to-period comparisons and provide additional insight into the underlying, ongoing operating performance of the Company. Adjusted diluted earnings per share from continuing operations excludes intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction-related costs, and certain gains, losses or impairments.


Three Months Ended Dec 31	2021		2022

Diluted earnings from continuing operations per share	$	1.25	0.56

Amortization of intangibles	0.09		0.15
Restructuring and related costs	0.02		0.02
Gain on subordinated interest	(0.60)		—

Acquisition/divestiture costs	0.03		—
Russia business exit	—		0.08
AspenTech Micromine purchase price hedge	—		(0.03)


Adjusted diluted earnings from continuing operations per share	$	0.79	0.78

The table below summarizes the changes in adjusted diluted earnings per share from continuing operations. The items identified below are discussed throughout MD&A, see further discussion above and in the Business Segments and Financial Position sections below.


	Three Months Ended
Adjusted diluted earnings from continuing operations per share - Dec 31, 2021	$	0.79

Operations excluding impact of acquisitions	0.10
Heritage AspenTech acquisition	0.05
Stock compensation	(0.09)
Foreign currency	(0.09)
Pensions	0.02




Interest expense, net	(0.01)
Share repurchases	0.01

Adjusted diluted earnings from continuing operations per share - Dec 31, 2022	$	0.78

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31

Following is an analysis of the Company’s operating results for the first quarter ended December 31, ~~2020,~~2021, compared with the first quarter ended December 31, ~~2021.~~2022.


		2020			2021		Change			2021			2022		Change

(dollars in millions, except per share amounts)									(dollars in millions, except per share amounts)

Net sales	Net sales	$	4,161		4,473		8	%	Net sales	$	3,156		3,373		7	%
Gross profit	Gross profit	$	1,723		1,822		6	%	Gross profit	$	1,415		1,620		14	%
Percent of sales	Percent of sales	41.4		%	40.7	%			Percent of sales	44.9		%	48.0	%	3.1 pts

SG&A	SG&A	$	998		1,011		1	%	SG&A	$	849		1,030		21	%
Percent of sales	Percent of sales	24.0		%	22.6	%			Percent of sales	27.0		%	30.5	%	3.5 pts

Gain on subordinated interest	Gain on subordinated interest	$	—		(453)				Gain on subordinated interest	$	(453)		—
Other deductions, net	Other deductions, net	$	122		51				Other deductions, net	$	38		120
Amortization of intangibles	Amortization of intangibles	$	78		63				Amortization of intangibles	$	57		118
Restructuring costs	Restructuring costs	$	66		9				Restructuring costs	$	6		10

Interest expense, net	Interest expense, net	$	40		38				Interest expense, net	$	39		48

Earnings before income taxes		$	563		1,175		109	%
Earnings from continuing operations before income taxes									Earnings from continuing operations before income taxes	$	942		422		(55)	%
Percent of sales	Percent of sales	13.5		%	26.3	%			Percent of sales	29.8		%	12.5	%	(17.3) pts

Earnings from continuing operations common stockholders									Earnings from continuing operations common stockholders	$	746		329		(56)	%
Percent of sales									Percent of sales	23.6		%	9.8	%	(13.8) pts
Net earnings common stockholders	Net earnings common stockholders	$	445		896		101	%	Net earnings common stockholders	$	896		2,331		160	%
Percent of sales		10.7		%	20.0	%

Diluted earnings per share		$	0.74		1.50		103	%
Diluted EPS - Earnings from continuing operations									Diluted EPS - Earnings from continuing operations	$	1.25		0.56		(55)	%
Diluted EPS - Net Earnings									Diluted EPS - Net Earnings	$	1.50		3.97		165	%

Net sales for the first quarter of fiscal ~~2022~~2023 were ~~$4.5~~$3.4 billion, up 87 percent compared with ~~2021. Automation Solutions~~2022. Intelligent Devices sales were up 41 percent, while Software and ~~Commercial & Residential Solutions~~Control sales were up ~~13 percent.~~30 percent, which included the impact of the Heritage AspenTech acquisition. Underlying sales were ~~also~~ up 86 percent on 52 percent higher volume and 34 percent higher price, while foreign currency translation had a ~~slightly~~ 4 percent negative impact. The Heritage AspenTech acquisition added 5 percent. Underlying sales were up 1012 percent in the U.S. and up 72 percent internationally. The Americas was up 1113 percent, ~~Europe was up 3 percent and~~while Asia, Middle East & Africa was flat (China down 7 percent). Europe decreased 2 percent, but was up 67 percent ~~(China up 12 percent).~~excluding the negative impact of the business exit from Russia.

Cost of sales for the first quarter of fiscal 2022 were $2,651, an increase of $213 compared with 2021, due to higher sales volume and higher materials costs. Gross margin of 40.7 percent decreased 0.7 percentage points compared with the prior year reflecting unfavorable price-cost in Commercial & Residential Solutions, partially offset by leverage on higher sales volume and favorable mix.

~~Selling, general and administrative (SG&A) expenses of $1,011 increased $13 compared with the prior year on increased sales volume, partially offset by lower stock compensation expense of $23~~. ~~SG&A as a~~ ~~percent of sales~~

1420

~~decreased 1.4~~Cost of sales for the first quarter of fiscal 2023 were $1,753, an increase of $12 compared with 2022. Gross margin of 48.0 percent increased 3.1 percentage points due to favorable price less net material inflation, the impact of the Heritage AspenTech acquisition which benefited margins by 1.3 percentage points, and favorable mix.

Selling, general and administrative (SG&A) expenses of $1,030 increased $181 and SG&A as a percent of sales increased 3.5 percentage points to ~~22.6~~30.5 percent compared with the prior year, reflecting ~~leverage on~~the Heritage AspenTech acquisition and higher ~~sales volume~~stock compensation expense of $68, of which $45 related to Emerson stock plans due to an increasing stock price in the current year and ~~savings from the Company's restructuring and cost reset actions.~~$23 was attributable to AspenTech stock plans.

As previously disclosed, the Company sold its network power systems business (rebranded as Vertiv, now a publicly traded company, symbol VRT) in 2017 and retained a subordinated interest contingent upon the equity holders first receiving a threshold cash return on their initial investment. In the first quarter of fiscal 2022, the ~~equity holders' cumulative cash return exceeded the threshold and as a result, the~~ Company received a distribution of $438 related to its subordinated interest in ~~November 2021~~Vertiv (in total, a gain of $453 was recognized in the first ~~quarter)~~quarter, $358 after-tax, $0.60 per share). Based on the terms of the agreement and the current calculation, the Company could receive additional distributions of approximately ~~$100~~$75 which are expected to be received over the next ~~two~~two-to-three years. However, the distributions are contingent on the timing and price at which Vertiv shares are sold by the equity holders and therefore, there can be no assurance as to the amount or timing of the remaining distributions to the Company.

Other deductions, net were ~~$51~~$120 in ~~2022, a decrease~~2023, an increase of ~~$71~~$82 compared with the prior year, reflecting higher intangibles amortization of $61 primarily related to the Heritage AspenTech acquisition and a ~~decline~~charge of $47 related to the Company exiting its business in ~~restructuring~~Russia, partially offset by lower acquisition/divestiture costs of ~~$57,~~ $23. The current year also included a ~~favorable impact from~~mark-to-market gain of $35 related to foreign currency ~~transactions~~forward contracts entered into by AspenTech to mitigate the impact of ~~$25 due~~foreign currency exchange associated with the Micromine purchase price, which was largely offset by unfavorable foreign currency transaction losses compared to ~~losses~~gains in the prior ~~year and gains in the current year, and~~ ~~gains from the sales of capital assets of $15,~~ partially offset by transaction costs of $23 related to the AspenTech transaction. Intangibles amortization was lower by $11 due to backlog amortization in the prior year related to the OSI acquisition. The prior year also included investment-related gains, including a gain of $21 from an investment sale and a $17 gain from the acquisition of full ownership of an equity investment also impacted comparisons.year. See ~~Notes 6 and~~Note 7.

Pretax ~~earnings~~earnings from continuing operations of ~~$1,175 increased $612, up 109~~$422 decreased $520, down 55 percent compared with the prior year ~~reflecting~~largely due to the Vertiv ~~subordinated interest~~ gain ~~of $453~~ discussed above. Earnings increased ~~$165~~$40 in ~~Automation Solutions~~Intelligent Devices and decreased ~~$11~~$40 in ~~Commercial & Residential Solutions,~~Software and Control, while costs reported at Corporate ~~decreased $3.~~ increased $58 largely due to higher stock compensation expense of $68 and the $47 Russia business exit loss, partially offset by the $35 gain on the Micromine foreign currency forward contracts. See the Business Segments discussion that follows and Note 13.

Earnings from continuing operations attributable to common stockholders were $329, down 56 percent, and diluted earnings per share from continuing operations were $0.56, down 55 percent compared with $1.25 in the prior year. The prior year included a $0.60 gain related to the Company's subordinated interest ~~gain, which benefited the tax rate by approximately 2 percentage points. This was offset by portfolio restructuring activities which negatively impacted the rate by 4 percentage points, while~~in Vertiv. Adjusted diluted earnings per share from continuing operations were $0.78 compared with $0.79 in the prior year, ~~rate~~reflecting strong operating results offset by higher stock compensation expense due to an increasing stock price in the current year. See the analysis above of adjusted earnings per share for further details.

Earnings from discontinued operations were $2,002 ($3.41 per share) which included ~~discrete benefits which decreased~~ the ~~rate~~ 2 ~~percentage points.~~$2.1 billion after-tax gain on the divestiture of InSinkErator, compared to $149 ($0.25 per share) in the prior year. Earnings from discontinued operations were negatively impacted in the current year by approximately $275 of income taxes within Climate Technologies related to subsidiary restructurings and $27 of transaction-related costs. See Note 5.

Net earnings common stockholders in the first quarter of fiscal ~~2022~~2023 were ~~$896,~~$2,331, up ~~101~~160 percent, compared with ~~$445~~$896 in the prior year, and earnings per share were ~~$1.50,~~$3.97, up ~~103~~165 percent, compared with ~~$0.74~~$1.50 in the prior year. ~~See discussion in the Overview above and the analysis below of adjusted earnings per share for further details.~~

The table below, which shows results from continuing operations on an adjusted EBITA basis, is intended to supplement the Company's discussion of its results of operations herein. The Company defines adjusted EBITA as earnings from continuing operations excluding interest expense, net, income taxes, intangibles amortization expense, restructuring expense, first year purchase accounting related items and ~~transaction fees,~~transaction-related costs, and certain gains, losses or impairments. Adjusted EBITA and adjusted EBITA margin are measures used by management and may be useful for investors to evaluate the Company's operational performance.

2020 2021 Change
Earnings before income taxes $ 563 1,175 109 %
      Percent of sales 13.5 % 26.3 %
    Interest expense, net 40 38
    Restructuring and related costs 69 18
    Amortization of intangibles 81 77
    Gain on subordinated interest — (453)
    AspenTech transaction costs — 23
    Gain on acquisition of full ownership of equity investment (17) —
    OSI first year acquisition accounting charges and fees 21 —
Adjusted EBITA $ 757 878 16 %
      Percent of sales 18.2 % 19.6 %

1521

The tables below presents the Company's diluted earnings per share on an adjusted basis to facilitate period-to-period comparisons and provide additional insight into the underlying, ongoing operating performance of the Company. Adjusted earnings per share excludes intangibles amortization expense, restructuring expense, first year purchase accounting related items and transaction fees, and certain gains, losses or impairments.


Three Months Ended Dec 31	2021			2022		Change

Earnings from continuing operations before income taxes	$	942		422		(55)	%
Percent of sales	29.8		%	12.5	%	(17.3) pts
Interest expense, net	39			48
Amortization of intangibles	71			167
Restructuring and related costs	14			15

Gain on subordinated interest	(453)			—
Acquisition/divestiture costs	23			—
Russia business exit	—			47

AspenTech Micromine purchase price hedge	—			(35)
Adjusted EBITA from continuing operations	$	636		664		5	%
Percent of sales	20.1		%	19.7	%	(0.4) pts

Three Months Ended Dec 31
2020 2021
Diluted earnings per share $ 0.74 1.50
    Restructuring and related costs 0.09 0.02
    Amortization of intangibles 0.10 0.10
    Gain on subordinated interest — (0.60)
    AspenTech transaction costs — 0.03
    Gain on acquisition of full ownership of equity investment (0.03) —
    OSI first year acquisition accounting charges and fees 0.03 —
Adjusted diluted earnings per share $ 0.93 1.05
Other Items

The ~~table below summarizes~~Company has an equity investment in National Instruments, valued at $82 as of December 31, 2022. On January 17, 2023, the ~~changes~~Company announced a proposal to acquire National Instruments for $53 per share in ~~adjusted diluted earnings per share. The items identified below are discussed throughout MD&A, see further discussion above and in~~cash at an implied enterprise value of $7.6 billion. National Instruments, which had fiscal 2021 sales of approximately $1.5 billion, announced on January 13, 2023 it was undertaking a strategic review which could include the ~~Business Segments and Financial Position sections below.~~solicitation of interest from other potential acquirors.


	~~Three Months Ended~~
~~Adjusted diluted earnings per share - Dec 31, 2020~~	$	~~0.93~~

~~Operations~~	~~0.10~~
~~Stock compensation~~	~~0.03~~
~~Pensions~~	~~0.01~~
~~Gains on sales of investments - prior year~~	~~(0.03)~~
~~Gains on sales of capital assets - current year~~	~~0.02~~
~~Foreign currency~~	~~0.03~~
~~Income tax rate~~	~~(0.06)~~
~~Share repurchases~~	~~0.02~~

~~Adjusted diluted earnings per share - Dec 31, 2021~~	$	~~1.05~~

Business Segments

Following is an analysis of operating results for the Company’s business segments for the ~~first quarter~~three months ended December 31, ~~2020,~~2021, compared with the ~~first quarter~~three months ended December 31, ~~2021.~~2022. The Company defines segment earnings as earnings before interest and taxes. ~~See Note 13 for~~As a ~~discussion~~result of the Company's portfolio transformation, the Company has realigned its business ~~segments.~~segments and now reports six segments and two business groups. See Note 13.

~~AUTOMATION SOLUTIONS~~

Three Months Ended Dec 31 2020 2021 Change
Sales $ 2,692 2,805 4 %
Earnings $ 361 526 45 %
     Margin 13.4 % 18.7 %
   Restructuring and related costs $ 64 12
   Amortization of intangibles $ 68 65
Adjusted EBITA $ 493 603 22 %
   Adjusted EBITA Margin 18.3 % 21.5 %

Sales by Major Product Offering
Measurement & Analytical Instrumentation $ 698 735 5 %
Valves, Actuators & Regulators 806 816 1 %
Industrial Solutions 508 566 12 %
Systems & Software 680 688 1 %
Total $ 2,692 2,805 4 %

Automation Solutions sales were $2.8 billion in the first quarter, an increase of $113 or 4 percent. Underlying sales increased 5 percent on 4 percent higher volume and 1 percent higher price, reflecting continued recovery in most end markets and world areas. However, sales continued to be unfavorably impacted by supply chain and logistics constraints in the quarter. Foreign currency translation had a 1 percent unfavorable impact. Underlying sales increased 7 percent in the Americas (U.S. up 4 percent), as process end markets continue to recover, while Europe was flat, and Asia, Middle East & Africa increased 7 percent (China up 17 percent). Sales for Measurement & Analytical Instrumentation increased $37, or 5 percent as market conditions continued to improve for North American process industries. Measurement & Analytical sales were strong in Asia, Middle East & Africa, with China up over 20 percent, up moderately in North America, and soft in Europe. Valves, Actuators & Regulators increased $10, or 1 percent as favorable demand in the Americas and China was offset by softness in the rest of Asia, Middle East & Africa. Industrial Solutions sales were up $58, or 12 percent, reflecting strong global demand in discrete end markets. Systems & Software increased $8, or 1 percent, as strength in process end markets in North America was offset by declines in Europe and Asia, Middle East & Africa, while power end markets were strong in Asia, Middle East & Africa. Earnings were $526, an increase of $165, or 45 percent, and margin increased 5.3 percentage points to 18.7 percent, reflecting leverage on higher volume, lower restructuring expenses which benefited margins 2.0 percentage points, savings from cost reduction actions and favorable mix, partially offset by slightly unfavorable comparisons due to higher COVID-related savings in the prior year.

~~COMMERCIAL & RESIDENTIAL SOLUTIONS~~

Three Months Ended Dec 31 2020 2021 Change
Sales:
  Climate Technologies $ 1,031 1,163 13 %
  Tools & Home Products 445 508 14 %
     Total $ 1,476 1,671 13 %
Earnings:
  Climate Technologies $ 212 192 (9) %
  Tools & Home Products 98 107 9 %
     Total $ 310 299 (3) %
     Margin 21.0 % 17.9 %
   Restructuring and related costs $ 3 4
   Amortization of intangibles $ 13 12
Adjusted EBITA $ 326 315 (3) %
   Adjusted EBITA Margin 22.1 % 18.9 %

Commercial & Residential Solutions sales were $1.7 billion in the first quarter, up $195, or 13 percent compared to the prior year. Underlying sales increased 13 percent on 8 percent higher volume and 5 percent higher price, reflecting strong growth

across all businesses and geographies, especially in commercial and industrial end markets while residential end markets were solid. Overall, underlying sales increased 17 percent in the Americas (U.S. up 16 percent), 13 percent in Europe and 4 percent in Asia, Middle East & Africa (China was flat). Climate Technologies sales were $1.2 billion in the first quarter, an increase of $132, or 13 percent. Air conditioning, heating and refrigeration sales were up, reflecting strong global demand across all end markets, especially food service, food retail and aftermarket.

Tools & Home Products sales were $508 in the first quarter, an increase of $63, or 14 percent. Sales of professional tools were up nearly 20 percent, while wet/dry vacuums and food waste disposers sales increased over 10 percent. Earnings were $299, down 3 percent compared with the prior year, and margin decreased 3.1 percentage points to 17.9 percent due to unfavorable price-cost reflecting steel price increases, partially offset by leverage on higher sales volume and savings from cost reduction actions. Unfavorable price-cost is expected to improve and become favorable during the second half of fiscal 2022 as price increases are realized.

1822

INTELLIGENT DEVICES


	2021			2022		Change		FX		Acq/Div		U/L


Sales:
Final Control	$	817		862		6	%	4	%	—	%	10	%
Measurement & Analytical	737			749		2	%	4	%	—	%	6	%
Discrete Automation	617			618		—	%	6	%	—	%	6	%
Safety & Productivity	351			310		(12)	%	2	%	—	%	(10)	%
Total	$	2,522		2,539		1	%	4	%	—	%	5	%

Earnings:
Final Control	$	122		158		30	%
Measurement & Analytical	170			175		3	%
Discrete Automation	120			121		1	%
Safety & Productivity	65			63		(3)	%
Total	$	477		517		9	%
Margin	18.9		%	20.4	%	1.5 pts

Amortization of intangibles:
Final Control	$	24		22
Measurement & Analytical	6			5
Discrete Automation	8			7
Safety & Productivity	6			6
Total	$	44		40

Restructuring and related costs:
Final Control	$	7		4
Measurement & Analytical	2			1
Discrete Automation	2			1
Safety & Productivity	1			—
Total	$	12		6


Adjusted EBITA	$	533		563		6	%
Adjusted EBITA Margin	21.1		%	22.2	%	1.1 pts

Intelligent Devices sales were $2.5 billion in the first three months of 2023, an increase of $17, or 1 percent. Underlying sales increased 5 percent on higher price, while volume was flat overall reflecting lagging performance in Safety & Productivity. Underlying sales increased 14 percent in the Americas, while Asia, Middle East & Africa was down 3 percent (China down 12 percent). Europe decreased 5 percent, but was up moderately excluding the negative impact of the business exit from Russia. Final Control sales increased $45, or 6 percent. Underlying sales were up 10 percent, reflecting strength in chemical, energy and power end markets, particularly in the Americas. Europe was up slightly excluding the impact from Russia and Asia was down slightly. Sales for Measurement & Analytical increased $12, or 2 percent. Underlying sales were up 6 percent, reflecting strength in North America and solid growth in Europe excluding the impact from Russia. Sales were down 16 percent in Asia reflecting the negative impact from continued supply chain constraints. Discrete Automation sales were flat while underlying sales increased 6 percent, reflecting broad-based demand across most end markets and all geographies despite continued supply chain constraints. Safety & Productivity sales decreased $41, or 12 percent, reflecting weakness across all end markets, particularly in the Americas. Earnings were $517, an increase of $40, or 9 percent, and margin increased 1.5 percentage points to 20.4 percent, reflecting favorable price less net material inflation and favorable mix, partially offset by higher wage and other inflation and unfavorable foreign currency transactions which negatively impacted margins 0.6 percentage points. Adjusted EBITA margin was 22.2 percent, an increase of 1.1 percentage points.

SOFTWARE AND CONTROL


	2021			2022		Change		FX		Acq/Div		U/L


Sales:
Control Systems & Software	$	570		606		6	%	4	%	—	%	10	%
AspenTech	82			243		197	%	—	%	(197)	%	—	%
Total	$	652		849		30	%	4	%	(24)	%	10	%

Earnings:
Control Systems & Software	$	116		107		(8)	%
AspenTech	(2)			(33)		(1668)	%
Total	$	114		74		(36)	%
Margin	17.6		%	8.7	%	(8.9) pts

Amortization of intangibles:
Control Systems & Software	$	5		6
AspenTech	22			121
Total	$	27		127

Restructuring and related costs:
Control Systems & Software	$	1		1
AspenTech	—			—
Total	$	1		1

Adjusted EBITA	$	142		202		42	%
Adjusted EBITA Margin	21.8		%	23.8	%	2.0 pts

Software and Control sales were $849 in the first three months of 2023, an increase of $197, or 30 percent compared to the prior year, reflecting the impact of the Heritage AspenTech acquisition. Underlying sales were up 10 percent on 8 percent higher volume and 2 percent higher price. Overall, underlying sales increased 11 percent in the Americas, 6 percent in Europe and 15 percent in Asia, Middle East & Africa (China up 26 percent). Control Systems & Software sales increased $36, or 6 percent. Underlying sales increased 10 percent, reflecting strength in process end markets in North America, Europe (excluding the impact of the business exit from Russia) and Asia, which benefited from improved electronic component availability, while power end markets were up modestly. AspenTech sales increased $161, or 197 percent, due to the acquisition of Heritage AspenTech. Earnings decreased $40, down 36 percent, and margin decreased 8.9 percentage points, reflecting the impact from $99 of incremental intangibles amortization ($35 of which was reported in Cost of Sales) related to the Heritage AspenTech acquisition. Adjusted EBITA margin increased 2.0 percentage points, reflecting the impact of the Heritage AspenTech acquisition, partially offset by lower margins within Control Systems & Software due to higher inflation and unfavorable foreign currency transactions.

FINANCIAL CONDITION

Key elements of the Company's financial condition for the three months ended December 31, ~~2021~~2022 as compared to the year ended September 30, ~~2021~~2022 and the three months ended December 31, ~~2020~~2021 follow.
Dec 31, 2020 Sept 30, 2021 Dec 31, 2021
Operating working capital $ 825 $ 704 $ 840
Current ratio 1.2 1.3 2.0
Total debt-to-total capital 46.1 % 40.3 % 46.1 %
Net debt-to-net capital 37.8 % 30.4 % 28.2 %
Interest coverage ratio 14.2 X 18.6 X 29.6 X


	Dec 31, 2021			Sept 30, 2022			Dec 31, 2022
Operating working capital	$	780		$	990		$	351
Current ratio	2.4			1.1			1.1
Total debt-to-total capital	46.1		%	50.0		%	48.1		%
Net debt-to-net capital	28.2		%	45.3		%	41.7		%
Interest coverage ratio	23.9		X	11.7		X	7.3		X

The Company's operating working ~~capital increased compared~~capital as of December 31, 2022 includes income taxes payable of approximately $660 related to the gain on the InSinkErator divestiture, which is expected to be paid over the next three quarters, and approximately $275 related to subsidiary restructurings at Climate Technologies, approximately $230 of which was paid in January 2023 with the remainder expected to be paid by the end of fiscal 2023. Excluding these income taxes payable related to discontinued operations, operating working capital increased compared to the same quarter last year and compared to September 30, ~~2021~~2022 due to higher inventory levels to support sales growth and reflecting ongoing supply chain and logistics constraints. As of December 31, 2022, Emerson's cash and equivalents totaled $2,271, which included approximately $450 attributable to AspenTech. Subsequent to the end of the quarter, in January 2023 AspenTech paid off the outstanding balance of its existing term loan facility of $264, plus accrued interest. The ~~increase in the~~cash held by AspenTech is intended to be used for its own purposes and is not a readily available source of liquidity for other Emerson general business purposes or to return to Emerson shareholders.

The current ratio ~~reflects increased cash from the Company's $3 billion of debt issued in the first quarter of fiscal 2022~~was unchanged compared to ~~support the AspenTech transaction and cash received related to the Vertiv subordinated interest of $438.~~September 30, 2022. The interest coverage ratio (earnings before income taxes plus interest expense, divided by interest expense) of ~~29.6X~~7.3X for the first three months of fiscal ~~2022~~2023 compares to ~~14.2X~~23.9X for the three months ended December 31, ~~2020. The increase reflects~~2021, reflecting lower pretax earnings and higher ~~pretax~~interest expense. Pretax earnings in the ~~current quarter, including~~prior year included the Vertiv subordinated interest gain of $~~453~~.453. Excluding the gain, the interest coverage ratio was ~~18.6X.~~

~~In December 2021,~~12.9X in the Company issued $1 billion of 2.00% notes due 2028, $1 billion of 2.20% notes due 2031 and $1 billion of 2.80% notes due 2051. The net proceeds from the sale of the notes will be used to pay a portion of the Company's contribution of approximately $6.0 billion to existing stockholders of Aspen Technology, Inc. (“AspenTech”) as part of the AspenTech transaction. The Company expects to finance the remainder of the contribution through existing sources, including cash on hand, short-term debt capacity, and cash from operations. See Note 4 and Note 10.prior year.

Operating cash flow from continuing operations for the first three months of fiscal ~~2022~~2023 was ~~$523,~~$302, a decrease of ~~$285~~$75 compared with ~~$808~~$377 in the prior year, reflecting higher working capital due to ~~higher inventory levels to support sales growth~~ ~~and reflecting~~ ongoing supply chain ~~and logistics constraints. Free~~constraints. Operating cash flow included approximately $50 generated by AspenTech. Free cash flow from continuing operations of ~~$407~~$243 in the first three months of fiscal ~~2022~~2023 (operating cash flow of ~~$523~~$302 less capital expenditures of ~~$116)~~$59) decreased ~~$279~~$61 compared to free cash flow of ~~$686~~$304 in ~~2021~~2022 (operating cash flow of ~~$808~~$377 less capital expenditures of ~~$122)~~$73), reflecting the decrease in operating cash flow. Cash used in investing activities from continuing operations was $67. Cash used in financing activities from continuing operations was $2,895, reflecting share repurchases of $2.0 billion, net repayments of short-term borrowings of $539, and dividend payments.

Total cash provided by ~~investing~~operating activities was ~~$285,~~$418 including the impact of discontinued operations, and decreased $105 compared with $523 in the prior year. Investing cash flow from discontinued operations was $3.0 billion, reflecting ~~cash received related to the Vertiv subordinated interest of $438. Cash provided by financing activities was $1,601, primarily due to~~ proceeds ~~of nearly $3 billion~~ from the ~~December 2021 debt issuance, partially offset by the repayment of $500 of long-term debt, dividend payments, and share repurchases.~~InSinkErator divestiture.

On March 27, 2020, the CARES Act was enacted in response to the COVID-19 pandemic, and among other things, provides tax relief to businesses. Tax provisions of the CARES Act include the deferral of certain payroll taxes, relief for retaining employees, and other provisions. The Company deferred $73 of certain payroll taxes through the end of calendar year 2020, of which approximately $37 was paid in December 2021 ~~with~~and the ~~remaining amount due~~remainder paid in December 2022.

Emerson maintains a conservative financial structure to provide the strength and flexibility necessary to achieve our strategic objectives and has been successful in efficiently deploying cash where needed worldwide to fund operations, complete acquisitions and sustain long-term growth. Emerson is in a strong financial position, with total assets of ~~$27~~$36 billion and common stockholders' equity of ~~$10~~$11 billion, and has the resources available for reinvestment in existing businesses, strategic acquisitions and managing its capital structure on a short- and long-term basis.

1925

FISCAL ~~2022~~2023 OUTLOOK

Emerson continues to see strong demand in both the Automation Solutions and Commercial & Residential Solutions platforms and to manage ongoing supply chain constraints and challenges related to the COVID-19 pandemic.

For the full year, consolidated net sales ~~are expected to be up 6 to 8 percent, with underlying sales up 7 to 9 percent excluding a 1 percent unfavorable impact~~ from foreign currency translation. Automation Solutions net sales are expected to be up 5 to 7 percent, with underlying sales up 7 to 9 percent excluding a 2 percent unfavorable impact from foreign currency translation. Commercial & Residential Solutions net salescontinuing operations are expected to be up 8 to 10 percent, with underlying sales up 96.5 to 118.5 percent excluding a 12 percent unfavorable impact from foreign currency ~~translation.~~ translation and an approximately 3.5 percent favorable impact from acquisitions net of divestitures.

Earnings per share from continuing operations are expected to be ~~$4.71~~$3.55 to ~~$4.86,~~$3.70 (which excludes any potential impact from the 45 percent common equity ownership in Climate Technologies' income or loss post-close), while adjusted earnings per share are expected to be ~~$4.90~~$4.00 to ~~$5.05. Adjusted earnings~~$4.15, excluding a $0.60 per share ~~exclude a $0.20 impact from restructuring actions, a $0.39~~ impact from amortization of intangibles, ~~a $0.60 gain~~$0.12 per share from restructuring actions, $0.08 per share from the ~~Vertiv subordinated~~Russia business exit, a $0.03 per share benefit from the AspenTech Micromine purchase price hedge, $0.09 per share from interest ~~(see Note 4),~~income on the Climate Technologies note receivable, and $0.23 per share of interest income on undeployed proceeds from the Climate Technologies and InSinkErator divestitures. Earnings from discontinued operations are expected to be $10.5 billion to $11.5 billion, or $18 to $20 per share, including the net gains on 2023 divestitures. The fiscal 2023 outlook includes $2 billion returned to shareholders through share repurchases completed in the first quarter and approximately $1.2 billion of dividend payments.

The Company's fiscal 2023 results from continuing operations after the Climate Technologies divestiture (assumed to close March 31, 2023 for the purposes of guidance) will reflect a ~~$0.20 impact from Aspen Tech transaction costs~~45 percent common equity ownership in the income, or loss, of Climate Technologies. Emerson will not control Climate Technologies post-closing and ~~interest expense. Operating cash flow~~is therefore unable to estimate the amount of its 45 percent share of Climate Technologies' post-close results. The effect of Emerson's 45 percent share of Climate Technologies is expected to be ~~approximately $3.8 billion and free~~immaterial to post-closing cash ~~flow, which excludes projected capital spending of $650 million, is expected to be approximately $3.1 billion. Share repurchases are expected to be approximately $250 to $500 million in fiscal 2022.~~

The guidance above does not include the operational impact of the pending transaction with AspenTech, but does include estimated transaction fees and interest expense on $3 billion of debt already incurred to fund the transaction. Emerson will contribute approximately $6.0 billion in cash related to its definitive agreement with AspenTech, and the transaction is expected to close in the second calendar quarter of 2022, subject to approval by AspenTech shareholders, regulatory approvals and other customary closing conditions. The Company issued $3 billion of long-term debt in the first quarter of fiscal 2022 and expects to finance the remainder of the contribution through existing sources, including cash on hand, short-term debt capacity, and cash from operations. While the transaction will initially increase the Company's financial leverage and debt ratios, Emerson's debt rating agencies reaffirmed the Company's investment-grade long-term debt ratings on the new debt issuances. Further, the Company expects its leverage and debt ratios to improve through strong combined cash flow of the companies and disciplined capital allocation. See Item 1A - "Risk Factors" in our Annual Report on Form 10-K.flows.

Statements in this report that are not strictly historical may be "forward-looking" statements, which involve risks and uncertainties, and Emerson undertakes no obligation to update any such statements to reflect later developments. These risks and uncertainties include the the Company's ability to successfully complete on the terms and conditions contemplated, and the financial impact of, the proposed ~~AspenTech~~Climate Technologies transaction, the potential National Instruments transaction, the scope, duration and ultimate ~~impact~~impacts of the COVID-19 pandemic and the Russia-Ukraine conflict, as well as economic and currency conditions, market demand, including related to the pandemic and oil and gas price declines and volatility, pricing, protection of intellectual property, cybersecurity, tariffs, competitive and technological factors, inflation, among others, which are set forth in the “Risk Factors” of Part I, Item 1A, and the "Safe Harbor Statement" of Part II, Item 7, to the Company's Annual Report on Form 10-K for the year ended September 30, ~~2021~~2022 and in subsequent reports filed with the SEC, which are hereby incorporated by reference.

Item 4. Controls and Procedures

The Company maintains a system of disclosure controls and procedures designed to ensure that information required to be disclosed in its reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported in a timely manner. This system also is designed to ensure information is accumulated and communicated to management, including the Company's certifying officers, to allow timely decisions regarding required disclosure. Based on an evaluation performed, the certifying officers have concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report.

Notwithstanding the foregoing, there can be no assurance that the Company's disclosure controls and procedures will detect or uncover all failures of persons within the Company and its consolidated subsidiaries to report material information otherwise required to be set forth in the Company's reports.

There was no change in the Company's internal control over financial reporting during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

2026

PART II. OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) Issuer Purchases of Equity Securities (shares in 000s).
Period Total Number of Shares
Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
October 2021 870 $95.51 870 59,375
November 2021 382 $94.70 382 58,993
December 2021 1,524 $91.08 1,524 57,469
Total 2,776 $92.97 2,776 57,469


Period	Total Number of Shares Purchased		Average Price Paid Per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
October 2022		—	$—		—	54,540
November 2022		11,957	$92.85		11,957	42,583
December 2022		9,299	$95.69		9,299	33,284
Total		21,256	$94.09		21,256	33,284

~~In November 2015, the Board of Directors authorized the purchase of up to 70 million shares.~~ In March 2020, the Board of Directors authorized the purchase of an additional 60 million shares and a total of approximately ~~57.5 million~~33.3 shares remain available for purchase under the ~~authorizations.~~authorization.

Item 6. Exhibits

(a) Exhibits (Listed by numbers corresponding to the Exhibit Table of Item 601 in Regulation S-K).


~~2.1~~















2(a)**	Transaction Agreement, ~~and Plan of Merger,~~ dated as of October ~~10, 2021~~,30, 2022, among Emerson Electric Co., ~~Aspen Technology, Inc.~~BCP Emerald Aggregator L.P., ~~EMR Worldwide, Inc., Emersub CX, Inc.~~Emerald Debt Merger Sub L.L.C and ~~Emersub CXI, Inc.,~~Emerald JV Holdings L.P, incorporated by reference to the Company’s Form 8-K, filed on October ~~12, 2021,~~31, 2022, File No. 1-278, Exhibit 2.1. *

~~4.1~~ 10(a)		Amended and Restated Deferred Compensation Plan for Non-Employee Directors and Forms of Payment Election Forms

10(b)	Amended and Restated Restricted Stock Plan for Non-Management Directors and Form of ~~2.000% Notes due 2028~~Restricted Stock Unit Award Letter under the Emerson Electric Co. Restricted Stock Plan for Non-Management Directors

,10(c)	Emerson Electric Co. Annual Cash Incentive Plan and Form of Acceptance of Award

10(d)	Letter Agreement dated November 16, 2022 between Emerson Electric Co. and Mark J. Bulanda, signed November 22, 2022, incorporated by reference to the Company’s Form 8-K, filed on ~~December 21, 2021,~~November 28, 2022, File No. 1-278, Exhibit 4.2. **

~~4.2~~	~~Form of 2.200% Notes due 2031~~10.1., incorporated by reference to the Company’s Form 8-K, filed on December 21, 2021, File No. 1-278, Exhibit 4.3. **

~~4.3~~	~~Form of 2.800% Notes due 2051~~, incorporated by reference to the Company’s Form 8-K, filed on December 21, 2021, File No. 1-278, Exhibit 4.4. **

~~10.1~~	~~Suspension of Rights Agreement dated October 12, 2021~~ ~~between Emerson Electric Co. and JPMorgan Chase Bank, N.A., as Agent, under the Credit Agreement dated as of May 23, 2018 (as amended or otherwise modified from time to time).~~

~~10.2~~	~~Form of Emerson Electric Co. Performance Shares Program Award Agreement~~ ~~(used after November 1, 2021).~~

31	Certifications pursuant to Exchange Act Rule 13a-14(a).

32	Certifications pursuant to Exchange Act Rule 13a-14(b) and 18 U.S.C. Section 1350.

101	Attached as Exhibit 101 to this report are the following documents formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Statements of Earnings for the three months ended December 31, ~~2021~~2022 and ~~2020,~~2021, (ii) Consolidated Statements of Comprehensive Income for the three months ended December 31, ~~2021~~2022 and ~~2020,~~2021, (iii) Consolidated Balance Sheets as of September 30, ~~2021~~2022 and December 31, ~~2021,~~2022, (iv) Consolidated Statements of Equity for the three months ended December 31, ~~2021~~2022 and ~~2020,~~2021, (v) Consolidated Statements of Cash Flows for the three months ended December 31, ~~2021~~2022 and ~~2020,~~2021, and (vi) Notes to Consolidated Financial Statements for the three months ended ~~ended~~ December 31, ~~2021~~2022 and ~~2020.~~2021.

104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

**	Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. Emerson agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. Portions of ~~this exhibit~~these exhibits have been redacted in compliance with Regulation S-K Item 601(b)(10).

**	~~The Company entered into two global notes for each series of notes (Notes A-1 and A-2), which are identical other than with respect to the note number.~~

2227

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EMERSON ELECTRIC CO.

/s/ F. J. Dellaquila

Frank J. Dellaquila

Senior Executive Vice President and Chief Financial Officer

(on behalf of the registrant and as Chief Financial Officer)

February ~~2, 2022~~8, 2023

2328



Property, plant and equipment, net
Property, plant and equipment, at cost	$	9,427	9,442
Less: Accumulated depreciation	5,689		5,757
Total	$	3,738	3,685




Goodwill by business segment
Automation Solutions	$	6,552	6,534

Climate Technologies	753		751
Tools & Home Products	418		410
Commercial & Residential Solutions	1,171		1,161

Total	$	7,723	7,695



Other intangible assets
Gross carrying amount	$	5,911	5,910
Less: Accumulated amortization	3,034		3,119
Net carrying amount	$	2,877	2,791





Sales by Major Product Offering
Measurement & Analytical Instrumentation	$	698	735	5	%
Valves, Actuators & Regulators	806		816	1	%
Industrial Solutions	508		566	12	%
Systems & Software	680		688	1	%
Total	$	2,692	2,805	4	%