Eaton (NYSE:ETN) posted stronger-than-expected second-quarter earnings and record revenue but saw shares fall over 5% intra-day following soft third-quarter guidance.

The company reported adjusted earnings of $2.95 per share, narrowly beating the $2.93 consensus. Revenue reached a record $7.03 billion, topping analyst expectations of $6.91 billion. Organic sales grew 8%, at the high end of the guidance range.

Segment margins hit a second-quarter high of 23.9%. Revenue rose 11% year-over-year, including 8% organic growth, 2% from acquisitions, and 1% from favorable currency exchange.

However, Eaton’s third-quarter EPS forecast of $3.01–$3.07 came in below analyst expectations of $3.10, sparking investor concern.

For full-year 2025, Eaton guided adjusted EPS between $11.97 and $12.17, representing 12% growth at the midpoint and aligning with the $12.04 consensus.

The Electrical Americas segment delivered record sales of $3.4 billion, up 16% year-over-year, while Aerospace reached $1.1 billion, up 13%. Backlogs in both segments expanded by double digits.

The company maintained its full-year organic sales growth forecast of 8.5–9.5% and expects segment margins between 24.1% and 24.5%.