Emerson Electric (EMR)

Industrial automation + software (Emerson) — process automation + (Aspen) industrial software

AI exposure 10% — derived from reported segment revenue, not asserted.

Where it sits

Physical Infrastructure → Industrial & Factory Automation · figures rebased to Q3 FY2026, reported 2026-08-04

Final Control (valves/actuators) + Measurement & Analytical leads 2 businesses in this sub-tier that together are 64% of revenue and the largest business on the map, which is what Industrial & Factory Automation holds. The rest is tagged separately: Industrial & Automation Software at 26%; Test & Measurement Instruments at 10%.

Also tagged: secondary in Software Stack → Industrial & Automation Software; emerging in Connectivity → Test & Measurement Instruments.

Reported segments

• Intelligent Devices group — 66.2% of revenue
• Software and Control group — 33.8% of revenue

Emerson ($4.87B Q3 FY2026, +7% YoY; 2026 outlook raised). Intelligent Devices 66.2% = primary B2 Industrial & Factory Automation — final control, measurement, analytical instrumentation and discrete automation; Software and Control 33.8% ($1,644M, +11% reported with expanded margins) = B5 Industrial & Automation Software secondary, including AspenTech and the NI test business. Software is the faster half and the margin story.

How the 10% is built

• Intelligent Devices group — 66.2% of revenue × 7% AI-driven (disclosed). Process instrumentation and control hardware for refineries, chemicals and power — data centres are a small end market
• Software and Control group — 33.8% of revenue × 16% AI-driven (disclosed). Industrial software and NI test reach semiconductor and electronics manufacturing alongside process industries

Investment read

Moat. Process-automation installed base (DeltaV, Ovation) where control systems run 20-30 years and re-platforming is rarely worth the risk, now paired with AspenTech owned outright rather than held as a stake — software ACV $1.68B (+9% YoY) across roughly 2,000 enterprise customers, with the AVA agentic-AI layer launched May 2026.

Bottleneck / pricing power. Genuinely strong in the power vertical and unremarkable elsewhere. Ovation lead times now extend into late 2027 and 2028 — the control layer for behind-the-meter data-center generation is sold out more than a year forward — with power orders +37% and semiconductor orders +53% in fiscal Q3 2026. The chemicals and traditional oil-and-gas core is barely growing and China is still -3%, which is what holds the blended rate at ~3.5% underlying.

Role in the AI stack. The process-automation + industrial-software layer.

Connected companies

• ON Semiconductor (ON) — EMR is supplied by: power semis + sensors into automation devices
• Caterpillar (CAT) — EMR supplies: process automation + flow control for heavy industry
• Texas Instruments (TXN) — EMR is supplied by: analog + control ICs for instrumentation/automation
• Rockwell Automation (ROK) — EMR competes with: industrial automation — Rockwell (discrete/factory) vs Emerson (process)
• Mitsubishi Electric (MIELY) — EMR competes with: partial automation overlap — Emerson (process) vs Mitsubishi Electric (discrete/factory automation)
• Siemens (SIEGY) — EMR competes with: automation/process control rivalry
• Schneider Electric (SU) — EMR competes with: process automation / DCS rivalry — Schneider (Foxboro/Triconex) vs Emerson (DeltaV/Ovation)
• Keysight Technologies (KEYS) — EMR competes with: test & measurement — Emerson/NI (National Instruments) vs Keysight
• Teledyne Technologies (TDY) — EMR competes with: partial T&M overlap — NI (modular/PXI/DAQ) vs Teledyne LeCroy (oscilloscopes/protocol analyzers); different niches
• Microsoft (MSFT) — EMR supplies: industrial automation, control valves and Ovation-based microgrid/energy-management controls for hyperscale data centers
• Digital Realty Trust (DLR) — EMR supplies: data-center automation/controls for Digital Realty
• Meta Platforms (META) — EMR supplies: Ovation automation/energy-management controls for hyperscale data centers; Meta not publicly named
• Alphabet (GOOGL) — EMR supplies: Ovation microgrid/energy controls for hyperscale campuses; Google not named (DC power/cooling was divested to Vertiv in 2016)
• Amazon (AMZN) — EMR supplies: automation/controls for AMZN AI data centers

Others in Industrial & Factory Automation

• Mitsubishi Electric (MIELY)
• Rockwell Automation (ROK)

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