===== SIDA 1 ===== — ZURICH, SWITZERLAND, OCTOBER 17, 2024 Q3 2024 results Order growth and record level margin • Orders $8,193 million, +2%; comparable1 +2% • Revenues $8,151 million, +2%; comparable1 +2% • Income from operations $1,309 million; margin 16.1% • Operational EBITA1 $1,553 million; margin1 19.0% • Basic EPS $0.51; +8%2 • Cash flow from operating activities $1,345 million; 0% — “ABB is on a good path, and long-term I am confident we can optimize the ABB Way further. Our strong performance in the third quarter triggers an upgrade of full year margin guidance, while the weaker than expected discrete automation market and a slightly slower pace of backlog execution impacted revenue growth.” Morten Wierod, CEO KEY FIGURES CHANGE CHANGE ($ millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable1 9M 2024 9M 2023 US$ Comparable1 Orders 8,193 8,052 2% 2% 25,602 26,169 -2% -1% Revenues 8,151 7,968 2% 2% 24,260 23,990 1% 3% Gross Profit 3,116 2,762 13% 9,225 8,366 10% as % of revenues 38.2% 34.7% +3.5 pts 38.0% 34.9% +3.1 pts Income from operations 1,309 1,259 4% 3,902 3,755 4% Operational EBITA1 1,553 1,392 12% 11% 3 4,534 4,094 11% 11% 3 as % of operational revenues1 19.0% 17.4% +1.6 pts 18.6% 17.0% +1.6 pts Income from continuing operations, net of tax 937 905 4% 2,955 2,902 2% Net income attributable to ABB 947 882 7% 2,948 2,824 4% Basic earnings per share ($) 0.51 0.48 8%2 1.60 1.52 5%2 Cash flow from operating activities 1,345 1,351 0% 3,138 2,393 31% Free cash flow 1,173 1,186 -1% 2,642 1,954 35% 1 For a reconciliation of alternative performance measures, see “supplemental reconciliations and definitions” in the attached Q3 2024 Financial Information. 2 EPS growth rates are computed using unrounded amounts. 3 Constant currency (not adjusted for portfolio changes). Ad hoc Announcement pursuant to Art. 53 Listing Rules of SIX Swiss Exchange — Q3 2024 First nine months Press Release ===== SIDA 2 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 2 In the third quarter, we had a positive year-on-year development on virtually all lines in our income statement. On a high level, I would summarize it by saying that the very strong development in our Electrification business more than offset weakness in the areas of Robotics & Discrete Automation and E-mobility. Despite some businesses not running at their optimal performance, we repeated the record level Operational EBITA margin of 19.0%. Cash flow from operating activities remained virtually stable at $1.3 billion. With an accumulated free cash flow of $2.6 billion so far this year we are in a good position to achieve our ambition of at least $3.7 billion this year. In total, the book-to-bill was positive at 1.01, supported by the Electrification and Process Automation business areas. Order intake increased by 2% (2% comparable), with the short-cycle orders improving, while large order bookings declined from last year's peak level. Looking at the different customer segments, the areas of data centers, utilities and infrastructure stood out as strong positives, while the most challenging area was machine builders linked to discrete automation. The revenue growth of 2% (2% comparable) was lower than anticipated, and this mainly related to our business in discrete automation, but to some extent also to the Motion business area. From an Operational EBITA margin perspective, the 19.0% was better than expected coming into the quarter. It mirrors solid year-on-year increases in three business areas offsetting a weak performance in Robotics & Discrete Automation and the E-mobility business. We also had some additional support from the lower than originally expected Corporate-related costs. We have recently closed two acquisitions. One being Födisch Group in the Measurement & Analytics division in the Process Automation business area. Albeit modest in size, it expands our offering in advanced industrial emission measurement and analytical solutions, adding approximately $55 million of annual revenues. The other being in the Electrification business area where the Service division has acquired the SEAM Group, a US-based provider of asset management and advisory services across industrial and commercial building markets. The deal complements our already existing service offering and adds approximately $90 million of annual revenues. As of August 1, we have new business area Presidents in Electrification – Giampiero Frisio and in Motion – Brandon Spencer. Being internal appointments, they are both off to a running start and I know they will bring high energy to their respective teams. Also I have completed the first couple of months in my new role, as CEO. ABB is at the center of the secular trends of electricity becoming the key source of energy, and resource efficiency through automation. We have made significant operational improvements through the ABB Way operating model, and I believe we can fine- tune and benefit even further from it. Like we have said before, we are increasing our R&D and capex investments to support profitable growth. We also have some way to go in making M&A fully integrated in our performance culture, while continuing to deliver on our targets. In my view, ABB is not yet firing on all cylinders. Morten Wierod CEO In the fourth quarter of 2024, we anticipate a low to mid- single-digit comparable revenue growth and the historical pattern to repeat for a negative book-to-bill and a sequentially lower Operational EBITA margin. In full-year 2024, we expect a positive book-to-bill, comparable revenue growth to be below 5% and the Operational EBITA margin to be slightly above 18%. Outlook CEO summary ===== SIDA 3 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 3 In the third quarter, order intake amounted to $8,193 million and book-to-bill was 1.01. The year-on- year increase of 2% (2% comparable) signals a solid underlying market environment in three out of four business areas. Electrification recorded a double-digit order growth, with the strongest momentum in offerings linked to data centers and utilities. Process Automation benefited from buoyant markets although order intake declined from last year’s comparable which included the booking of a very large order of $285 million. Orders in the Motion business area declined mainly linked to timing impacts of project and systems orders in the rail-related business. Orders in Robotics & Discrete Automation declined from an already low comparable. While Robotics orders improved slightly, demand in the Machine Automation division was weak as customers focused on reducing inventories after having pre-ordered during the period of stressed supply chains. The underlying market environment in the Americas was strong, however the growth rate was impacted by the timing of large order bookings and dropped by 6% (6% comparable). Europe improved by 8% (6% comparable) and Asia, Middle East and Africa improved year-on-year by 7% (8% comparable) on strong comparable development in countries like Australia and parts of the Middle East, offsetting a small decline of 1% (2% comparable) in China. In transport & infrastructure, there was high customer activity in marine, ports and upgrades of electrical equipment related to land transport. In the industrial areas a particularly strong development was seen in data centers. Utilities was strong. Orders in the buildings segment improved on the combined impact from a positive development in the commercial area, most pronounced in the United States, while the overall residential segment stabilized at a low level. In the robotics-related segments, orders declined in automotive but improved in general industry and consumer- related segments. The machine builder segment declined materially. In the process-related areas, orders improved in power generation, mining & metals and in low carbon segments of solar and wind. Customer activity remained broadly stable in oil & gas, with a negative order development in chemicals. Revenues of $8,151 million improved by 2% (2% comparable) year-on-year with broadly equal support from volumes and price. The positive development in three business areas, led by a double-digit growth in Electrification, was partially offset by sharp declines in Robotics & Discrete Automation and the E-mobility business where the markets are weak and order backlogs have normalized. Growth Q3 Q3 Change year-on-year Orders Revenues Comparable 2% 2% FX 0% -1% Portfolio changes 0% 1% Total 2% 2% Orders by region ($ in millions, unless otherwise indicated) CHANGE Q3 2024 Q3 2023 US$ Comparable Europe 2,572 2,391 8% 6% The Americas 3,048 3,258 -6% -6% Asia, Middle East and Africa 2,573 2,403 7% 8% ABB Group 8,193 8,052 2% 2% Revenues by region ($ in millions, unless otherwise indicated) CHANGE Q3 2024 Q3 2023 US$ Comparable Europe 2,659 2,810 -5% -6% The Americas 3,006 2,775 8% 9% Asia, Middle East and Africa 2,486 2,383 4% 5% ABB Group 8,151 7,968 2% 2% Orders and revenues ===== SIDA 4 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 4 Gross profit Gross profit increased by 13% (13% constant currency) year- on-year to $3,116 million, reflecting a gross margin improvement of 350 basis points to 38.2%. Gross margin improved in three out of four business areas. Income from operations Income from operations amounted to $1,309 million and improved by 4% year-on-year. This was driven by a stronger operational performance, although the year-on-year improvement was dampened by the impacts of a charge of approximately $90 million relating to the E-mobility business’ planned reduction in ownership of a current subsidiary to a minority level, as well as a divestment gain recorded in the previous year. The Income from operations margin was 16.1%, up by 30 basis points. Operational EBITA Operational EBITA improved by 12% year-on-year to $1,553 million and the margin increased by 160 basis points to the record level of 19.0%. The positive impacts from higher pricing and volumes more than offset some inflation related to commodities and labor, and the impacts from operational efficiency measures clearly outweighed some additional expenses related to Research & Development (R&D) and Selling, General and Administrative (SG&A). Earnings improved in three business areas reflecting the higher margin run rate compared with last year. This more than offset significant declines in Robotics and Discrete Automation and in the E-mobility business which both were impacted by a weak market environment and customers focusing on inventory management. Operational EBITA in Corporate and Other amounted to -$108 million, of which -$48 million related to the unusually low underlying Corporate costs. The remaining -$60 million relate to the E-mobility business, where the operational performance was hampered by the ongoing reorganization to ensure a more focused portfolio. Finance net Net finance income contributed to results with a positive $2 million, an improvement from last year’s expense of $36 million. The year-on-year improvement is due to a combination of a lower net debt position and favorable mix of interest rates between borrowings and cash deposits. Income tax Income tax expense was $387 million with an effective tax rate of 29.2%, impacted to the higher rate by about 200 basis points due to the non-realized tax benefit related to the charge linked to the planned change of ownership position in the E- mobility subsidiary. Net income and earnings per share Net income attributable to ABB was $947 million, representing an increase of 7% from last year, helped by the improved operational performance and the contribution from net finance income more than offsetting the adverse impact from the higher tax rate. This resulted in basic earnings per share of $0.51, up from $0.48 in the last year period. Earnings Corporate and Other Operational EBITA ($ in millions) Q3 2024 Q3 2023 Corporate and Other E-mobility (60) (39) Corporate costs, intersegment eliminations and other1 (48) (70) Total (108) (109) 1 Majority of which relates to underlying corporate ===== SIDA 5 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 5 Net working capital Net working capital amounted to $3,603 million, decreasing year-on-year from $4,041 million as the impact from higher inventories was more than offset by higher payables and advances from customers. Net working capital as a percentage of revenues1 was 11.1%, a decline from 12.8% one year ago. Capital expenditures Purchases of property, plant and equipment and intangible assets amounted to $196 million. Net debt Net debt1 amounted to $2,158 million at the end of the quarter and decreased from $2,872 million year-on-year. The decrease was mainly driven by strong free cash flow offset partly by the dividend, acquisitions and share buyback activity. The sequential decrease from $2,480 million was due mainly to the strong free cash flow that was partly offset by the share buyback activity, the acquisition of SEAM that closed during the quarter as well as a negative foreign currency impacts on the long-term debt as the US dollar depreciated. Cash flows Cash flow from operating activities was $1,345 million and remained stable year-on-year. The impact of stronger earnings was offset by a lower reduction in net working capital compared to the prior year. Share buyback program A new share buyback program of up to $1 billion was launched on April 1, 2024, and will run to January 31, 2025. During the third quarter, ABB repurchased a total of 5,686,275 shares for a total amount of approximately $315 million. ABB’s total number of issued shares, including shares held in treasury, amounts to 1,860,614,888. Balance sheet & Cash flow ($ in millions, unless otherwise indicated) Sep. 30 2024 Sep. 30 2023 Dec. 31 2023 Short term debt and current maturities of long-term debt 109 2,951 2,607 Long-term debt 6,666 4,899 5,221 Total debt 6,775 7,850 7,828 Cash & equivalents 3,264 3,869 3,891 Restricted cash - current 19 18 18 Marketable securities and short-term investments 1,334 1,091 1,928 Cash and marketable securities 4,617 4,978 5,837 Net debt (cash)* 2,158 2,872 1,991 Net debt (cash)* to EBITDA ratio 0.4 0.5 0.4 Net debt (cash)* to Equity ratio 0.15 0.21 0.14 * At Sep. 30, 2024, Sep. 30, 2023 and Dec. 31, 2023, net debt(cash) excludes net pension (assets)/liabilities of $(302) million, $(414) million and $(191) million, respectively. ===== SIDA 6 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 6 Orders and revenues 10% order growth year-on-year is testimony to high customer activity as electricity is becoming the key source of energy. All divisions recorded a stable to positive development, reflecting improved customer activity in both medium voltage and short-cycle businesses. Total order intake amounted to $4,049 million, and book-to-bill was positive at 1.03. • While there are regional differences, the overall year- on-year order development was positive in most of the customer segments. Particular strength was recorded in data centers, utilities and infrastructure. The buildings segment also improved, supported by a positive development in the commercial area and the residential market stabilizing at a low level. • From a geographical perspective order intake improved in all three regions. Europe was up by 8% (7% comparable) with growth in all the larger markets. The Americas increased by 2% (3% comparable) supported by the United States at 3% (2% comparable). A very strong growth of 24% (26% comparable) was recorded in Asia, Middle East and Africa with strong development in countries like India, and only a small year-on-year change in China of 1% (down 1% comparable). • Revenues reached the new record-high level of $3,913 million and increased by 10% (10% comparable) year-on-year, supported both by backlog deliveries and by recent strong development in short-cycle orders converting to revenues. Higher volumes were the primary source for growth, with additional support from positive price impacts. Profit At 24.1%, a milestone was reached with Operational EBITA margin for the first time reaching the 24% level, up 330 basis points year-on-year. Absolute earnings increased by 26% with Operational EBITA at the all- time-high of $944 million. • Operational leverage on higher volumes and impact from continuous improvement measures were the key drivers to the higher margin, year-on-year. • Additional support was derived from a positive price impact. • All divisions contributed with material margin improvements year-on-year. — Electrification CHANGE CHANGE ($ millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable 9M 2024 9M 2023 US$ Comparable Orders 4,049 3,693 10% 10% 12,514 11,794 6% 8% Order backlog 7,945 6,994 14% 12% 7,945 6,994 14% 12% Revenues 3,913 3,561 10% 10% 11,402 10,886 5% 8% Operational EBITA 944 748 26% 2,657 2,212 20% as % of operational revenues 24.1% 20.8% +3.3 pts 23.2% 20.3% +2.9 pts Cash flow from operating activities 1,041 1,051 -1% 2,438 2,143 14% No. of employees (FTE equiv.) 51,700 50,500 2% Growth Q3 Q3 Change year-on-year Orders Revenues Comparable 10% 10% FX 0% 0% Portfolio changes 0% 0% Total 10% 10% ===== SIDA 7 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 7 Orders and revenues Order intake amounted to $1.8 billion, representing a drop of 4% (4% comparable) year-on-year, mainly due to timing impacts of project and systems orders and particularly so in the rail business. Overall, the short- cycle orders remained broadly stable, despite pressure in the China market. A strong development in the service business was also recorded. • Higher customer activity was noted in the segments of HVAC linked to commercial buildings, but also in metals and to the low carbon power areas such as hydro and waste-to-energy where grid stability is a focus area. Somewhat softer customer activity was noted in oil & gas, chemicals and pulp & paper; and rail-related orders declined from a high level. • Orders increased in the Americas by 1% (2% comparable), supported by a positive development in the United States. Asia, Middle East and Africa declined by 10% (10% comparable) including a drop of 6% (7% comparable) in China. Europe declined by 3% (4% comparable). • Revenues amounted to $1,969 million, up by 1% (1% comparable) from last year and in line with recent quarterly revenue levels. Pricing had a positive impact, but the pace of converting the backlog to revenues was slower than expected, due mainly to changed delivery schedules from customers. Profit Despite slow revenue growth, the Operational EBITA increased by 4% and the margin was up by 90 basis points to 20.7%; both reaching new record highs. • Impacts from positive pricing and a stringent cost control in the quarter, more than offset slight negative impact from volumes, and higher expenses related to R&D and SG&A, year-on-year. • Margins improved in most of the divisions. — Motion CHANGE CHANGE ($ millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable 9M 2024 9M 2023 US$ Comparable Orders 1,806 1,886 -4% -4% 6,123 6,285 -3% -2% Order backlog 5,750 5,108 13% 8% 5,750 5,108 13% 8% Revenues 1,969 1,947 1% 1% 5,749 5,868 -2% -2% Operational EBITA 404 390 4% 1,135 1,157 -2% as % of operational revenues 20.7% 19.8% +0.9 pts 19.7% 19.7% 0 pts Cash flow from operating activities 397 466 -15% 1,258 935 35% No. of employees (FTE equiv.) 22,600 22,100 2% Growth Q3 Q3 Change year-on-year Orders Revenues Comparable -4% 1% FX 0% 0% Portfolio changes 0% 0% Total -4% 1% ===== SIDA 8 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 8 Orders and revenues Book-to-bill of 1.09 was positive for the 16th consecutive quarter, a token of the robust market environment and strength in the business area offering towards electrification, automation and digitalization of heavy industries. Orders remained on par with recent quarterly levels at $1.8 billion, although declining by 5% (5% comparable) from last year's level which included one specific order of $285 million. • Customer activity remained very strong in the marine and ports segment, although order intake declined on the back of timing of large orders in the prior year period. Positive developments were recorded in the areas of low carbon segments of solar and wind, and in mining and metals and conventional power generation. Activity was broadly stable in oil & gas, and with a negative order development in chemicals. • Revenues improved by 6% (6% comparable) to $1,643 million, supported by a stable to positive development in all divisions as the order backlog was executed, including a slight positive price impact. A positive development in the service business also contributed to revenues in the quarter. Profit Operational EBITA improved by 11% to $251 million on a margin of 15.2% - the third consecutive quarter with a +15% margin proving that the focused gross margin efforts continue to support operational performance as the backlog is converted to revenues. • Higher volumes were the main driver for the year-on- year earnings increase. • A positive price impact in the product business as well as the impact from generally improved operational efficiency also contributed to the increase in Operational EBITA year-on-year, and more than offset the impacts from higher R&D and SG&A expenses. — Process Automation CHANGE CHANGE ($ millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable 9M 2024 9M 2023 US$ Comparable Orders 1,784 1,883 -5% -5% 5,283 5,665 -7% -6% Order backlog 7,782 7,135 9% 6% 7,782 7,135 9% 6% Revenues 1,643 1,554 6% 6% 4,961 4,543 9% 10% Operational EBITA 251 226 11% 767 670 14% as % of operational revenues 15.2% 14.6% +0.6 pts 15.4% 14.7% +0.7 pts Cash flow from operating activities 323 258 25% 809 558 45% No. of employees (FTE equiv.) 22,100 20,900 5% Growth Q3 Q3 Change year-on-year Orders Revenues Comparable -5% 6% FX 0% 0% Portfolio changes 0% 0% Total -5% 6% ===== SIDA 9 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 9 Orders and revenues Order intake decreased by 4% (4% comparable) year- on-year to $640 million with strongly diverging market environments between the two divisions. • The Robotics division recorded a slight positive order growth, supported by improvements in the segments of general industry and warehouse logistics linked to consumer industries. This was however partially offset by the negative development in electronics and in automotive where a slower pace in the EV-related market more than offset somewhat increasing activities linked to hybrids. Orders increased strongly in both Americas and Europe, but declined at a double- digit rate in Asia, Middle East and Africa. • Machine Automation orders declined sharply as the current slow industrial automation demand extended machine builders' ongoing inventory adjustment activities; re-aligning after the period of significant pre- ordering when supply chains were disrupted. These inventory adjustments are expected to ease at the latest during the second quarter 2025. The division is primarily exposed to the European market. • Revenues of $747 million represented a decline of 20% (20% comparable) from last year, driven primarily by a sharp volume drop in Machine Automation. In Robotics the decline was limited to a single-digit rate. Profit Operational leverage on significantly lower volumes in the Machine Automation division put pressure on the Operational EBITA which broadly halved from last year to $62 million. The Operational EBITA margin dropped by 640 basis points year- on-year to 8.3%, which is expected to be the quarterly margin trough level. • Lower production volumes triggered significant underabsorption of fixed costs in the Machine Automation division. Extensive cost saving actions have commenced, including the workforce reduction of approximately 25%, which should start generating savings towards the end of 2024. • The Operational EBITA margin in the Robotics division softened year-on-year, although it remained in double-digit territory, supported by earlier implemented cost saving measures. — Robotics & Discrete Automation CHANGE CHANGE ($ millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable 9M 2024 9M 2023 US$ Comparable Orders 640 665 -4% -4% 2,029 2,516 -19% -19% Order backlog 1,734 2,363 -27% -29% 1,734 2,363 -27% -29% Revenues 747 929 -20% -20% 2,444 2,788 -12% -12% Operational EBITA 62 137 -55% 268 418 -36% as % of operational revenues 8.3% 14.7% -6.4 pts 11.0% 15.0% -4 pts Cash flow from operating activities 83 92 -10% 276 266 4% No. of employees (FTE equiv.) 10,900 11,000 -1% Growth Q3 Q3 Change year-on-year Orders Revenues Comparable -4% -20% FX 0% 0% Portfolio changes 0% 0% Total -4% -20% ===== SIDA 10 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 10 Events from the Quarter • ABB has automated the world’s largest single-site solar plant, Al Dhafra PV2, in Abu Dhabi. This 2 GW plant, covering 20 square km, uses four million solar modules to power 200,000 homes annually and will help to decarbonize the UAE’s energy system. ABB’s technology, including the ABB Ability™ Symphony Plus system, enhances efficiency and reliability by integrating data insights for real-time optimization. This project supports the UAE’s Energy Strategy 2050, aiming to triple renewable energy share by 2030 and achieve net zero emissions by 2050. • GoFa™ collaborative robots (cobots) are helping Belgian social enterprise AMAB to improve productivity while maintaining a safe and ergonomic work environment for people with difficulty accessing the labor market. Replacing technology on their packaging lines which was too fast and too noisy, the GoFa™ cobots proved ideal for the job improving working conditions for AMAB’s teams. With the help of ABB's cobots, AMAB can now quickly adapt to handle new products and take on new projects that generate extra job opportunities. • GSK’s vaccine plant in Hungary converted to ABB’s ultra-efficient IE5 SynRM motor and drive packages to modernize its pump applications. This upgrade significantly boosts energy efficiency, helping GSK progress towards its net-zero climate goal in its European operations by 2030. The new motors, which do not use rare earth elements, replaced older IE1 and IE2 models, offer high reliability and lower energy consumption, with the investment expected to pay off in about two years. • ABB’s Mission to Zero ™ program celebrated its fifth anniversary during the quarter and now has 20 sites on four continents. The scalable blueprint targets net-zero emissions and more sustainable operations at ABB’s own sites. To achieve Mission to Zero status, sites must achieve certain minimum requirements, applying ABB technology and integrating third-party solutions to enable greater electrification, efficiency and use of renewable energy. By creating real-life case studies of low-carbon manufacturing facilities, ABB is showing others how to meet their sustainability targets as these sites are now becoming smart showcases to educate customers, suppliers, governments and partners on sustainable operations. — Sustainability Q3 outcome • 17% reduction year-on-year of CO₂e emissions due to a lower use of fossil fuels and a shift to green electricity in our operations. • LTIFR stable year-on-year at 0.15 remaining at a low level • 0.9%-points increase year-on-year in the proportion of women in senior management roles, demonstrating progress towards our target. Q3 2024 Q3 2023 CHANGE 12M ROLLING CO₂e own operations emissions, Ktons scope 1 and 21 30 36 -17% 135 Lost Time Injury Frequency Rate (LTIFR), frequency / 200,000 working hours 2 0.15 0.15 0% 0.13 Proportion of women in senior management roles in % 21.3 20.4 +0.9 pts 21.4 1 CO₂ equivalent emissions from site, energy use, SF₆ and fleet, previous quarter 2 Current quarter Includes all incidents reported until October 8, 2024 ===== SIDA 11 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 11 During Q3 2024 • On August 1, Morten Wierod took over as new CEO of ABB. Giampiero Frisio stepped into his role as new President of Electrification Business Area and Brandon Spencer as the new President of the Motion Business Area, and both joined ABB’s Executive Committee. • On August 27, ABB announced the acquisition of Födisch Group in the Process Automation business area. The deal will strengthen ABB’s global leadership position in continuous emission monitoring. The acquisition which closed on October 1, 2024, adds 250 employees and approximately $55 million in revenues. • ABB filed a Form 15F to voluntarily deregister and suspend SEC reporting on June 10, 2024. The SEC did not oppose during the 90 days evaluation period, and consequently the deregistration became effective during September. The Company will continue to comply with its financial reporting and other obligations pursuant to applicable stock exchange listing rules – in particular the Listing Rules of SIX Swiss Exchange and the Nasdaq Stockholm Rulebook. In the first nine months of 2024, the overall order intake declined slightly on a high comparable. Short cycle order development was positive, despite weakness primarily linked to discrete automation. In the project- and systems-related businesses, the market environment remained robust, albeit order growth was adversely impacted by the timing of large orders booked which benefited the prior year period. Orders increased in the Electrification business area, while the declines in Robotics and Discrete Automation as well as the E- mobility business were most pronounced. Order intake amounted to $25,602 million and was down slightly by 2% versus the prior year (1% comparable). Revenues were supported by execution of the large order backlog and amounted to $24,260 million, up by 1% (3% comparable), overall implying a book-to-bill of 1.06. Growth was driven by the Electrification and Process Automation business areas with declines elsewhere. Income from operations increased by 4% year-on-year to 3,902 million. This increase was driven by an improved operational performance which more than offset the significant movements in the impacts from business divestments and higher expenses related to the ABB Way transformation activities. Operational EBITA amounted to $4,534 million, up 11% year-on-year. The Operational EBITA margin improved by 160 basis points to 18.6%. The increase was driven by improvements in the Electrification and Process Automation business areas, which more than offset declines elsewhere. The expansion was driven by operating leverage on higher volumes and additional impacts from implemented price increases as well as lower underlying Corporate costs. Combined these impacts more than offset some higher expenses related to Sales and R&D. Corporate and Other Operational EBITA amounted to -$293 million. This includes a loss of $201 million that can be attributed to the E-mobility business, which was negatively affected by the ongoing reorganization to ensure a more focused portfolio, and impairments mainly linked to inventories. Net financial income supported results by $55 million, representing an improvement from last year’s expense of $82 million. The year-on-year improvement is mainly driven by a combination of a lower net debt position and favorable mix of interest rates between borrowings and cash deposits. Income tax expense was $1,041 million reflecting a tax rate of 26.1%, compared to a tax rate of 21.5% in the first nine months last year. Last year’s tax rate was positively impacted by a favourable resolution of a prior year tax matter relating to the Power Grids business. Net income attributable to ABB was $2,948 million, up from $2,824 million year-on-year. Basic earnings per share was $1.60, representing an increase by 5% compared with the prior year. Significant events First nine months of 2024 ===== SIDA 12 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 12 Acquisitions Company/unit Closing date Revenues, $ in millions1 No. of employees 2024 Electrification SEAM Group 31-Jul ∼90 250 Process Automation DTN Europe 3-Jun ∼14 84 Process Automation Real Tech Water 1-Feb ∼6 38 Robotics & Discrete Automation Meshmind 1-Feb <5 50 2023 Robotics & Discrete Automation Sevensense 21-Dec <5 35 E-mobility Imagen Energy Inc 13-Nov <5 4 Motion Spring Point Solutions Llc 1-Nov <5 13 E-mobility Vourity AB 25-Oct <5 9 Acquisitions and divestments, last twelve months ABB Group Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2024 Q2 2024 Q3 2024 EBITDA, $ in million 1,389 1,494 1,453 1,315 5,651 1,418 1,578 1,503 Return on Capital Employed, % n.a. n.a. n.a. n.a. 21.10 n.a. n.a. n.a. Net debt/Equity 0.30 0.31 0.21 0.14 0.14 0.16 0.18 0.15 Net debt/ EBITDA 12M rolling 0.9 0.8 0.5 0.4 0.4 0.4 0.4 0.4 Net working capital, % of 12M rolling revenues 13.9% 14.7% 12.8% 10.2% 10.2% 11.2% 11.2% 11.1% Earnings per share, basic, $ 0.56 0.49 0.48 0.50 2.02 0.49 0.59 0.51 Earnings per share, diluted, $ 0.55 0.48 0.47 0.50 2.01 0.49 0.59 0.51 Dividend per share, CHF n.a. n.a. n.a. n.a. 0.87 n.a. n.a. n.a. Share price at the end of period, CHF 31.37 35.18 32.80 37.30 37.30 41.89 49.92 48.99 Number of employees (FTE equivalents) 106,170 108,320 107,430 107,870 107,870 108,700 109,390 109,970 No. of shares outstanding at end of period (in millions) 1,862 1,860 1,849 1,842 1,842 1,851 1,849 1,843 Additional figures Divestments Company/unit Closing date Revenues, $ in millions1 No. of employees 2024 Electrification Service repair shops in US/CA 30-Aug ∼35 115 E-mobility Numocity 30-Jun <5 56 2023 Electrification Power Conversion division 3-Jul ∼440 1,500 Electrification Industrial Plugs & Sockets business 3-Jul ∼12 2 Note: comparable growth calculation includes acquisitions and divestments with revenues of greater than $50 million. 1 Represents the estimated revenues for the last fiscal year prior to the announcement of the respective acquisition/divestment unless otherwise stated. Additional 2024 guidance ($ in millions, unless otherwise stated) FY 20241 Q4 2024 Corporate and Other Operational EBITA2 ~(170) ~(75) from ~(200) Non-operating items Acquisition-related amortization ~(200) ~(45) from ~(210) Restructuring and related3 ~(250) ~(100) ABB Way transformation ~(200) ~(55) ($ in millions, unless otherwise stated) FY 2024 Finance net ~75 Effective tax rate ~24% 4 Capital Expenditures ~(850) from ~(900) 1 Excludes one project estimated to a total of ~$100 million, that is ongoing in the non-core business. Exact exit timing is difficult to assess due to legal proceedings etc. 2 Excludes Operational EBITA from E-mobility business. 3 Includes restructuring and restructuring-related as well as separation and integration costs. 4 Excludes the impact of acquisitions or divestments or any significant non-operational items. ===== SIDA 13 ===== AB B IN TE RIM RE P ORT I Q3 2 02 4 13 This press release includes forward-looking information and statements as well as other statements concerning the outlook for our business, including those in the sections of this release titled “CEO summary,” “Outlook,” and “Sustainability”. These statements are based on current expectations, estimates and projections about the factors that may affect our future performance, including global economic conditions, the economic conditions of the regions and industries that are major markets for ABB. These expectations, estimates and projections are generally identifiable by statements containing words such as “anticipates,” “expects,” “estimates,” “plans,” “targets,” “guidance,” or similar expressions. However, there are many risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking information and statements made in this press release and which could affect our ability to achieve any or all of our stated targets. These include, among others, business risks associated with the volatile global economic environment and political conditions, costs associated with compliance activities, market acceptance of new products and services, changes in governmental regulations and currency exchange rates. Although ABB Ltd believes that its expectations reflected in any such forward looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. The Q3 2024 results press release and presentation slides are available on the ABB News Center at www.abb.com/news and on the Investor Relations homepage at www.abb.com/investorrelations. A conference call and webcast for analysts and investors is scheduled to begin at 10:00 a.m. CET, this time extended to include the new CEO’s perspectives. To pre- register for the conference call or to join the webcast, please refer to the ABB website: www.abb.com/investorrelations. The recorded session will be available after the event on ABB’s website. Important notice about forward-looking information For additional information please contact: Media Relations Phone: +41 43 317 71 11 Email: media.relations@ch.abb.com Investor Relations Phone: +41 43 317 71 11 Email: investor.relations@ch.abb.com ABB Ltd Affolternstrasse 44 8050 Zurich Switzerland Q3 results presentation on October 17, 2024 ABB is a technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. The company’s solutions connect engineering know-how and software to optimize how things are manufactured, moved, powered and operated. Building on over 140 years of excellence, ABB’s more than 105,000 employees are committed to driving innovations that accelerate industrial transformation. Financial calendar 2025 January 30 Q4 2024 results February 28 Publication of Annual Reporting Suite March 27 Annual General Meeting April 17 Q1 2025 results July 17 Q2 2025 results October 16 Q3 2025 results ===== SIDA 14 ===== 1 Q3 2024 FINANCIAL INFORMATION October 17, 2024 Q3 2024 Financial information ===== SIDA 15 ===== 2 Q3 2024 FINANCIAL INFORMATION — Financial Information Contents 03 ─ 07 Key Figures 08 ─ 31 Consolidated Financial Information (unaudited) 32 ─ 48 Supplemental Reconciliations and Definitions ===== SIDA 16 ===== 3 Q3 2024 FINANCIAL INFORMATION — Key Figures CHANGE ($ in millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Comparable(1) Orders 8,193 8,052 2% 2% Order backlog (end September) 22,881 21,445 7% 4% Revenues 8,151 7,968 2% 2% Gross Profit 3,116 2,762 13% as % of revenues 38.2% 34.7% +3.5 pts Income from operations 1,309 1,259 4% Operational EBITA(1) 1,553 1,392 12% 11%(2) as % of operational revenues(1) 19.0% 17.4% +1.6 pts Income from continuing operations, net of tax 937 905 4% Net income attributable to ABB 947 882 7% Basic earnings per share ($) 0.51 0.48 8%(3) Cash flow from operating activities 1,345 1,351 0% Free cash flow(1) 1,173 1,186 -1% CHANGE ($ in millions, unless otherwise indicated) 9M 2024 9M 2023 US$ Comparable(1) Orders 25,602 26,169 -2% -1% Revenues 24,260 23,990 1% 3% Gross Profit 9,225 8,366 10% as % of revenues 38.0% 34.9% +3.1 pts Income from operations 3,902 3,755 4% Operational EBITA(1) 4,534 4,094 11% 11%(2) as % of operational revenues(1) 18.6% 17.0% +1.6 pts Income from continuing operations, net of tax 2,955 2,902 2% Net income attributable to ABB 2,948 2,824 4% Basic earnings per share ($) 1.60 1.52 5%(3) Cash flow from operating activities 3,138 2,393 31% Free cash flow(1) 2,642 1,954 35% (1) For a reconciliation of alternative performance measures see “ Supplemental Reconciliations and Definitions ” on page 32. (2) Constant currency (not adjusted for portfolio changes). (3) EPS growth rates are computed using unrounded amounts. ===== SIDA 17 ===== 4 Q3 2024 FINANCIAL INFORMATION CHANGE ($ in millions, unless otherwise indicated) Q3 2024 Q3 2023 US$ Local Comparable Orders ABB Group 8,193 8,052 2% 2% 2% Electrification 4,049 3,693 10% 10% 10% Motion 1,806 1,886 -4% -4% -4% Process Automation 1,784 1,883 -5% -5% -5% Robotics & Discrete Automation 640 665 -4% -4% -4% Corporate and Other 132 135 Intersegment eliminations (218) (210) Order backlog (end September) ABB Group 22,881 21,445 7% 4% 4% Electrification 7,945 6,994 14% 12% 12% Motion 5,750 5,108 13% 8% 8% Process Automation 7,782 7,135 9% 6% 6% Robotics & Discrete Automation 1,734 2,363 -27% -29% -29% Corporate and Other (incl. intersegment eliminations) (330) (155) Revenues ABB Group 8,151 7,968 2% 3% 2% Electrification 3,913 3,561 10% 10% 10% Motion 1,969 1,947 1% 1% 1% Process Automation 1,643 1,554 6% 6% 6% Robotics & Discrete Automation 747 929 -20% -20% -20% Corporate and Other 107 194 Intersegment eliminations (228) (217) Income from operations ABB Group 1,309 1,259 Electrification 893 762 Motion 397 365 Process Automation 242 218 Robotics & Discrete Automation 31 113 Corporate and Other (incl. intersegment eliminations) (254) (199) Income from operations % ABB Group 16.1% 15.8% Electrification 22.8% 21.4% Motion 20.2% 18.7% Process Automation 14.7% 14.0% Robotics & Discrete Automation 4.1% 12.2% Operational EBITA ABB Group 1,553 1,392 12% 11% Electrification 944 748 26% 27% Motion 404 390 4% 3% Process Automation 251 226 11% 11% Robotics & Discrete Automation 62 137 -55% -55% Corporate and Other (incl. intersegment eliminations) (108) (109) Operational EBITA % ABB Group 19.0% 17.4% Electrification 24.1% 20.8% Motion 20.7% 19.8% Process Automation 15.2% 14.6% Robotics & Discrete Automation 8.3% 14.7% Cash flow from operating activities ABB Group 1,345 1,351 Electrification 1,041 1,051 Motion 397 466 Process Automation 323 258 Robotics & Discrete Automation 83 92 Corporate and Other (incl. intersegment eliminations) (499) (516) ===== SIDA 18 ===== 5 Q3 2024 FINANCIAL INFORMATION CHANGE ($ in millions, unless otherwise indicated) 9M 2024 9M 2023 US$ Local Comparable Orders ABB Group 25,602 26,169 -2% -1% -1% Electrification 12,514 11,794 6% 7% 8% Motion 6,123 6,285 -3% -2% -2% Process Automation 5,283 5,665 -7% -6% -6% Robotics & Discrete Automation 2,029 2,516 -19% -19% -19% Corporate and Other 386 595 Intersegment eliminations (733) (686) Order backlog (end September) ABB Group 22,881 21,445 7% 4% 4% Electrification 7,945 6,994 14% 12% 12% Motion 5,750 5,108 13% 8% 8% Process Automation 7,782 7,135 9% 6% 6% Robotics & Discrete Automation 1,734 2,363 -27% -29% -29% Corporate and Other (incl. intersegment eliminations) (330) (155) Revenues ABB Group 24,260 23,990 1% 2% 3% Electrification 11,402 10,886 5% 6% 8% Motion 5,749 5,868 -2% -1% -2% Process Automation 4,961 4,543 9% 10% 10% Robotics & Discrete Automation 2,444 2,788 -12% -12% -12% Corporate and Other 377 540 Intersegment eliminations (673) (635) Income from operations ABB Group 3,902 3,755 Electrification 2,499 2,130 Motion 1,067 1,098 Process Automation 750 688 Robotics & Discrete Automation 168 347 Corporate and Other (incl. intersegment eliminations) (582) (508) Income from operations % ABB Group 16.1% 15.7% Electrification 21.9% 19.6% Motion 18.6% 18.7% Process Automation 15.1% 15.1% Robotics & Discrete Automation 6.9% 12.4% Operational EBITA ABB Group 4,534 4,094 11% 11% Electrification 2,657 2,212 20% 21% Motion 1,135 1,157 -2% -1% Process Automation 767 670 14% 15% Robotics & Discrete Automation 268 418 -36% -35% Corporate and Other (incl. intersegment eliminations) (293) (363) Operational EBITA % ABB Group 18.6% 17.0% Electrification 23.2% 20.3% Motion 19.7% 19.7% Process Automation 15.4% 14.7% Robotics & Discrete Automation 11.0% 15.0% Cash flow from operating activities ABB Group 3,138 2,393 Electrification 2,438 2,143 Motion 1,258 935 Process Automation 809 558 Robotics & Discrete Automation 276 266 Corporate and Other (incl. intersegment eliminations) (1,643) (1,509) ===== SIDA 19 ===== 6 Q3 2024 FINANCIAL INFORMATION Operational EBITA Process Robotics & Discrete ABB Electrification Motion Automation Automation ($ in millions, unless otherwise indicated) Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Revenues 8,151 7,968 3,913 3,561 1,969 1,947 1,643 1,554 747 929 Foreign exchange/commodity timing differences in total revenues 6 51 9 32 (13) 23 10 (7) – 2 Operational revenues 8,157 8,019 3,922 3,593 1,956 1,970 1,653 1,547 747 931 Income from operations 1,309 1,259 893 762 397 365 242 218 31 113 Acquisition-related amortization 44 55 23 22 9 9 2 1 7 20 Restructuring, related and implementation costs(1) 21 51 2 14 2 3 – 3 20 – Changes in obligations related to divested businesses – – – – – – – – – – Gains and losses from sale of businesses (1) (71) (1) (71) – – – – – – Fair value adjustment on assets and liabilities held for sale 89 – – – – – – – – – Acquisition- and divestment-related expenses and integration costs 17 10 4 4 1 3 2 (4) 5 3 Certain other non-operational items 55 49 1 2 2 1 3 – 1 1 Foreign exchange/commodity timing differences in income from operations 19 39 22 15 (7) 9 2 8 (2) – Operational EBITA 1,553 1,392 944 748 404 390 251 226 62 137 Operational EBITA margin (%) 19.0% 17.4% 24.1% 20.8% 20.7% 19.8% 15.2% 14.6% 8.3% 14.7% Process Robotics & Discrete ABB Electrification Motion Automation Automation ($ in millions, unless otherwise indicated) 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 Revenues 24,260 23,990 11,402 10,886 5,749 5,868 4,961 4,543 2,444 2,788 Foreign exchange/commodity timing differences in total revenues 67 25 32 12 16 12 16 3 (2) 2 Operational revenues 24,327 24,015 11,434 10,898 5,765 5,880 4,977 4,546 2,442 2,790 Income from operations 3,902 3,755 2,499 2,130 1,067 1,098 750 688 168 347 Acquisition-related amortization 157 164 69 66 26 26 5 4 48 59 Restructuring, related and implementation costs(1) 97 92 20 26 24 5 7 7 40 – Changes in obligations related to divested businesses (11) (5) – 1 – – – – – – Gains and losses from sale of businesses 13 (97) (2) (71) – – – (26) – – Fair value adjustment on assets and liabilities held for sale 132 – 25 – – – – – – – Acquisition- and divestment-related expenses and integration costs 54 55 33 23 3 15 3 (3) 12 7 Certain other non-operational items 168 89 3 11 5 4 (2) – – 4 Foreign exchange/commodity timing differences in income from operations 22 41 10 26 10 9 4 – – 1 Operational EBITA 4,534 4,094 2,657 2,212 1,135 1,157 767 670 268 418 Operational EBITA margin (%) 18.6% 17.0% 23.2% 20.3% 19.7% 19.7% 15.4% 14.7% 11.0% 15.0% (1) Includes impairment of certain assets. ===== SIDA 20 ===== 7 Q3 2024 FINANCIAL INFORMATION Depreciation and Amortization Process Robotics & Discrete ABB Electrification Motion Automation Automation ($ in millions) Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Depreciation 138 130 69 64 30 27 13 12 15 14 Amortization 56 64 29 27 11 11 3 2 8 21 including total acquisition-related amortization of: 44 55 23 22 9 9 2 1 7 20 Process Robotics & Discrete ABB Electrification Motion Automation Automation ($ in millions) 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 9M 24 9M 23 Depreciation 406 384 201 190 88 80 36 35 44 43 Amortization 191 197 85 81 31 31 8 7 51 61 including total acquisition-related amortization of: 157 164 69 66 26 26 5 4 48 59 Orders received and revenues by region ($ in millions, unless otherwise indicated) Orders received CHANGE Revenues CHANGE Com- Com- Q3 24 Q3 23 US$ Local parable Q3 24 Q3 23 US$ Local parable Europe 2,572 2,391 8% 6% 6% 2,659 2,810 -5% -6% -6% The Americas 3,048 3,258 -6% -5% -6% 3,006 2,775 8% 10% 9% of which United States 2,307 2,479 -7% -7% -7% 2,259 2,067 9% 9% 9% Asia, Middle East and Africa 2,573 2,403 7% 8% 8% 2,486 2,383 4% 5% 5% of which China 1,035 1,044 -1% -2% -2% 1,094 1,075 2% 0% 0% ABB Group 8,193 8,052 2% 2% 2% 8,151 7,968 2% 3% 2% ($ in millions, unless otherwise indicated) Orders received CHANGE Revenues CHANGE Com- Com- 9M 24 9M 23 US$ Local parable 9M 24 9M 23 US$ Local parable Europe 8,656 8,904 -3% -3% -3% 8,238 8,617 -4% -5% -5% The Americas 8,983 9,452 -5% -5% -4% 8,755 8,243 6% 7% 8% of which United States 6,687 6,928 -3% -3% -3% 6,590 6,143 7% 7% 9% Asia, Middle East and Africa 7,963 7,813 2% 5% 6% 7,267 7,130 2% 5% 5% of which China 3,152 3,593 -12% -10% -10% 3,226 3,404 -5% -3% -3% ABB Group 25,602 26,169 -2% -1% -1% 24,260 23,990 1% 2% 3% ===== SIDA 21 ===== 8 Q3 2024 FINANCIAL INFORMATION — Consolidated Financial Information ABB Ltd Consolidated Income Statements (unaudited) Nine months ended Three months ended ($ in millions, except per share data in $) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023 Sales of products 20,132 20,210 6,777 6,680 Sales of services and other 4,128 3,780 1,374 1,288 Total revenues 24,260 23,990 8,151 7,968 Cost of sales of products (12,686) (13,393) (4,271) (4,447) Cost of services and other (2,349) (2,231) (764) (759) Total cost of sales (15,035) (15,624) (5,035) (5,206) Gross profit 9,225 8,366 3,116 2,762 Selling, general and administrative expenses (4,205) (4,058) (1,399) (1,331) Non-order related research and development expenses (1,060) (951) (333) (314) Other income (expense), net (58) 398 (75) 142 Income from operations 3,902 3,755 1,309 1,259 Interest and dividend income 146 115 43 37 Interest and other finance expense (91) (197) (41) (73) Non-operational pension (cost) credit 39 23 13 8 Income from continuing operations before taxes 3,996 3,696 1,324 1,231 Income tax expense (1,041) (794) (387) (326) Income from continuing operations, net of tax 2,955 2,902 937 905 Income (loss) from discontinued operations, net of tax 2 (16) 5 (7) Net income 2,957 2,886 942 898 Net loss (income) attributable to noncontrolling interests and redeemable noncontrolling interests (9) (62) 5 (16) Net income attributable to ABB 2,948 2,824 947 882 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 2,945 2,840 941 889 Income (loss) from discontinued operations, net of tax 3 (16) 6 (7) Net income 2,948 2,824 947 882 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 1.60 1.53 0.51 0.48 Income (loss) from discontinued operations, net of tax 0.00 (0.01) 0.00 0.00 Net income 1.60 1.52 0.51 0.48 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 1.59 1.52 0.51 0.48 Income (loss) from discontinued operations, net of tax 0.00 (0.01) 0.00 0.00 Net income 1.59 1.51 0.51 0.47 Weighted-average number of shares outstanding (in millions) used to compute: Basic earnings per share attributable to ABB shareholders 1,845 1,859 1,846 1,854 Diluted earnings per share attributable to ABB shareholders 1,853 1,871 1,851 1,865 Due to rounding, numbers presented may not add to the totals provided. See Notes to the Consolidated Financial Information ===== SIDA 22 ===== 9 Q3 2024 FINANCIAL INFORMATION — ABB Ltd Condensed Consolidated Statements of Comprehensive Income (unaudited) Nine months ended Three months ended ($ in millions) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023 Total comprehensive income, net of tax 2,952 2,729 899 815 Total comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interests, net of tax (6) (54) (8) (11) Total comprehensive income attributable to ABB shareholders, net of tax 2,946 2,675 891 804 Due to rounding, numbers presented may not add to the totals provided. See Notes to the Consolidated Financial Information ===== SIDA 23 ===== 10 Q3 2024 FINANCIAL INFORMATION — ABB Ltd Consolidated Balance Sheets (unaudited) ($ in millions) Sep. 30, 2024 Dec. 31, 2023 Cash and equivalents 3,264 3,891 Restricted cash 19 18 Marketable securities and short-term investments 1,334 1,928 Receivables, net 7,448 7,446 Contract assets 1,236 1,090 Inventories, net 6,556 6,149 Prepaid expenses 306 235 Other current assets 434 520 Current assets held for sale 235 – Total current assets 20,832 21,277 Property, plant and equipment, net 4,248 4,142 Operating lease right-of-use assets 873 893 Investments in equity-accounted companies 185 187 Prepaid pension and other employee benefits 871 780 Intangible assets, net 1,036 1,223 Goodwill 10,582 10,561 Deferred taxes 1,536 1,381 Other non-current assets 521 496 Total assets 40,684 40,940 Accounts payable, trade 5,167 4,847 Contract liabilities 3,081 2,844 Short-term debt and current maturities of long-term debt 109 2,607 Current operating leases 260 249 Provisions for warranties 1,289 1,210 Other provisions 907 1,201 Other current liabilities 4,617 5,046 Current liabilities held for sale 47 – Total current liabilities 15,477 18,004 Long-term debt 6,666 5,221 Non-current operating leases 635 666 Pension and other employee benefits 677 686 Deferred taxes 747 669 Other non-current liabilities 1,722 1,548 Total liabilities 25,924 26,794 Commitments and contingencies Redeemable noncontrolling interest 80 89 Stockholders’ equity: Common stock, CHF 0.12 par value (1,861 million and 1,882 million shares issued at September 30, 2024, and December 31, 2023, respectively) 162 163 Additional paid-in capital 32 7 Retained earnings 19,730 19,724 Accumulated other comprehensive loss (5,072) (5,070) Treasury stock, at cost (17 million and 40 million shares at September 30, 2024, and December 31, 2023, respectively) (770) (1,414) Total ABB stockholders’ equity 14,082 13,410 Noncontrolling interests 598 647 Total stockholders’ equity 14,680 14,057 Total liabilities and stockholders’ equity 40,684 40,940 Due to rounding, numbers presented may not add to the totals provided. See Notes to the Consolidated Financial Information ===== SIDA 24 ===== 11 Q3 2024 FINANCIAL INFORMATION — ABB Ltd Consolidated Statements of Cash Flows (unaudited) Nine months ended Three months ended ($ in millions) Sep. 30, 2024 Sep. 30, 2023 Sep. 30, 2024 Sep. 30, 2023 Operating activities: Net income 2,957 2,886 942 898 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 597 581 194 194 Changes in fair values of investments (18) (28) 2 (4) Pension and other employee benefits (52) (67) (17) (55) Deferred taxes (93) (44) (115) (80) Loss from equity-accounted companies 14 11 5 4 Net loss (gain) from derivatives and foreign exchange (68) (43) (29) 10 Net gain from sale of property, plant and equipment (42) (39) (16) (6) Net loss (gain) from sale of businesses 4 (97) (10) (71) Fair value adjustment on assets and liabilities held for sale 132 – 89 – Other 99 115 35 23 Changes in operating assets and liabilities: Trade receivables, net 50 (797) 229 (138) Contract assets and liabilities 121 243 (41) 164 Inventories, net (424) (438) (113) 12 Accounts payable, trade 79 (56) (119) (48) Accrued liabilities (191) 138 233 342 Provisions, net (44) 99 (30) 48 Income taxes payable and receivable 193 (9) 199 77 Other assets and liabilities, net (176) (62) (93) (19) Net cash provided by operating activities 3,138 2,393 1,345 1,351 Investing activities: Purchases of investments (1,202) (1,103) (286) (343) Purchases of property, plant and equipment and intangible assets (562) (506) (196) (175) Acquisition of businesses (net of cash acquired) and increases in cost- and equity-accounted companies (297) (160) (163) (25) Proceeds from sales of investments 1,838 598 254 422 Proceeds from maturity of investments – 138 – – Proceeds from sales of property, plant and equipment 66 67 24 10 Proceeds from sales of businesses (net of transaction costs and cash disposed) and cost- and equity-accounted companies (13) 531 (5) 509 Net cash from settlement of foreign currency derivatives (9) (76) (133) (58) Changes in loans receivable, net (10) 7 (4) 6 Other investing activities (2) 9 (2) – Net cash provided by (used in) investing activities (191) (495) (511) 346 Financing activities: Net changes in debt with original maturities of 90 days or less (7) (997) – (962) Increase in debt 1,364 2,584 – 936 Repayment of debt (2,487) (1,437) (336) (309) Delivery of shares 404 118 14 22 Purchase of treasury stock (843) (909) (280) (433) Dividends paid (1,769) (1,713) – – Dividends paid to noncontrolling shareholders (103) (89) (9) (6) Proceeds from issuance of subsidiary shares – 328 – – Other financing activities (26) 4 29 4 Net cash used in financing activities (3,467) (2,111) (582) (748) Effects of exchange rate changes on cash and equivalents and restricted cash (106) (74) 52 (32) Adjustment for the net change in cash and equivalents and restricted cash in Assets held for sale – – – 28 Net change in cash and equivalents and restricted cash (626) (287) 304 945 Cash and equivalents and restricted cash, beginning of period 3,909 4,174 2,979 2,942 Cash and equivalents and restricted cash, end of period 3,283 3,887 3,283 3,887 Supplementary disclosure of cash flow information: Interest paid 201 151 53 43 Income taxes paid 952 865 309 338 Due to rounding, numbers presented may not add to the totals provided. See Notes to the Consolidated Financial Information ===== SIDA 25 ===== 12 Q3 2024 FINANCIAL INFORMATION — ABB Ltd Consolidated Statements of Changes in Stockholders’ Equity (unaudited) ($ in millions) Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock Total ABB stockholders’ equity Non- controlling interests Total stockholders’ equity Balance at January 1, 2023 171 141 20,082 (4,556) (3,061) 12,777 410 13,187 Net income(1) 2,824 2,824 65 2,889 Foreign currency translation adjustments, net of tax of $0 (177) (177) (8) (185) Effect of change in fair value of available-for-sale securities, net of tax of $1 6 6 6 Unrecognized income (expense) related to pensions and other postretirement plans, net of tax of $8 19 19 19 Change in derivative instruments and hedges, net of tax of $0 3 3 3 Issuance of subsidiary shares 170 170 168 338 Other changes in noncontrolling interests (7) (7) 5 (2) Dividends to noncontrolling shareholders – (93) (93) Dividends to shareholders (1,706) (1,706) (1,706) Cancellation of treasury shares (7) (201) (2,359) 2,567 – – Share-based payment arrangements 82 82 1 83 Purchase of treasury stock (898) (898) (898) Delivery of shares (163) 281 118 118 Other (4) (4) (4) Balance at September 30, 2023 163 19 18,840 (4,705) (1,111) 13,206 548 13,754 Balance at January 1, 2024 163 7 19,724 (5,070) (1,414) 13,410 647 14,057 Net income(1) 2,948 2,948 11 2,959 Foreign currency translation adjustments, net of tax of $0 (22) (22) (3) (25) Effect of change in fair value of available-for-sale securities, net of tax of $1 4 4 4 Unrecognized income (expense) related to pensions and other postretirement plans, net of tax of $11 13 13 13 Change in derivative instruments and hedges, net of tax of $(1) 3 3 3 Changes in noncontrolling interests (12) (62) (74) 43 (31) Dividends to noncontrolling shareholders – (103) (103) Dividends to shareholders (1,804) (1,804) (1,804) Cancellation of treasury shares (2) (2) (828) 832 – – Share-based payment arrangements 69 69 4 73 Purchase of treasury stock (867) (867) (867) Delivery of shares (25) (249) 678 404 404 Other (4) (4) (4) Balance at September 30, 2024 162 32 19,730 (5,072) (770) 14,082 598 14,680 (1) Amounts attributable to noncontrolling interests for the nine months ended September 30, 2024 and 2023, exclude net losses of $2 million and $3 million, respectively, related to redeemable noncontrolling interests, which are reported in the mezzanine equity section on the Consolidated Balance Sheets. Due to rounding, numbers presented may not add to the totals provided. See Notes to the Consolidated Financial Information ===== SIDA 26 ===== 13 Q3 2024 FINANCIAL INFORMATION — Notes to the Consolidated Financial Information (unaudited) ─ Note 1 The Company and basis of presentation ABB Ltd and its subsidiaries (collectively, the Company) together form a technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. The Company’s solutions connect engineering know -how and software to optimize how things are manufactured, moved, powered, and operated. The Company’s Consolidated Financial Information is prepared in accordance with United States of America generally accepted a ccounting principles (U.S. GAAP) for interim financial reporting. As such, the Consolidated Financial Information does not include all the informa tion and notes required under U.S. GAAP for annual consolidated financial statements. Therefore, such financial information should be read in conjunction w ith the audited consolidated financial statements in the Company’s Annual Report for the year ended December 31, 2023. The preparation of financial information in conformity with U.S. GAAP requires management to make assumptions and estimates t hat directly affect the amounts reported in the Consolidated Financial Information. These accounting assumptions and estimates include: • estimates to determine valuation allowances for deferred tax assets and amounts recorded for unrecognized tax benefits, • estimates related to credit losses expected to occur over the remaining life of financial assets such as trade and other rece ivables, loans and other instruments, • estimates of loss contingencies associated with litigation or threatened litigation and other claims and inquiries, environme ntal damages, product warranties, self-insurance reserves, regulatory and other proceedings, • assumptions and projections, principally related to future material, labor and project -related overhead costs, used in determining the percentage-of-completion on projects where revenue is recognized over time , as well as the amount of variable consideration the Company expects to be entitled to, • assumptions used in the calculation of pension and postretirement benefits and the fair value of pension plan assets, • estimates used to record expected costs for employee severance in connection with restructuring programs, • assumptions used in determining inventory obsolescence and net realizable value, • growth rates, discount rates and other assumptions used to determine impairment of long -lived assets and in testing goodwill for impairment, • estimates and assumptions used in determining the fair values of assets and liabilities assumed in business combinations, and • estimates and assumptions used in determining the initial fair value of retained noncontrolling interest s and certain obligations in connection with divestments. The actual results and outcomes may differ from the Company’s estimates and assumptions. A portion of the Company’s activities (primarily long-term construction activities) has an operating cycle that exceeds one year. For classification of current assets and liabilities related to such activities, the Company elected to use the duration of the individual contract s as its operating cycle. Accordingly, there are accounts receivable, contract assets, inventories and provisions related to these contracts which will not be realized within one year that have been classified as current. Basis of presentation In the opinion of management, the unaudited Consolidated Financial Information contains all necessary adjustments to present fairly the financial position, results of operations and cash flows for the reported periods. Management considers all such adjustments to be of a normal recurring nature. The Consolidated Financial Information is presented in United States dollars ($) unless otherwise stated. Due to rounding, nu mbers presented in the Consolidated Financial Information may not add to the totals provided. Certain amounts reported in the Consolidated Financial Information for prior periods have been reclassified to conform to the current year’s presentation. Change in accounting policy Effective January 1, 2024, the Company changed the presentation of discontinued operations in its statement of cash flows to an alternate allowable policy. As a result, the total cash flows for operating, investing and financing activities from discontinued operations are no longer show n separately but instead all cash flows in discontinued operations are present ed within each line item as appropriate in the statement of cash flow s. As this presentation c hange represents a chang e in accounting policy, all prior periods presented have been rec lassified to conform to the current period presentation and there was no material impact for the nine and three months ended September 30, 2023 . ===== SIDA 27 ===== 14 Q3 2024 FINANCIAL INFORMATION ─ Note 2 Recent accounting pronouncements Applicable for current periods Improvements to reportable segment disclosures In January 2024, the Company adopted an accounting standard update which requires the Company to disclose additional reportable segment information primarily through enhanced disclosures about significant segment expenses and extending certain annual disclosure requirements to a quarterly frequency. The update will be applied retrospectively for all periods presented in the Company’s 2024 annual consolidated financial statements and then commencing from the first quarter of 2025, in its interim consolidated financial information. Other than these additional disclosures, this update does not have a significant impact on the Company’s consolidated financial statements . Applicable for future periods Improvements to Income tax disclosures In December 2023, an accounting standard update was issued which requires the Company to disclose additional information rela ted to income taxes. Under the update, the Company is required to annually disclose by jurisdiction (i) additional disaggregated information within the tax rate reconciliation and (ii) income taxes paid. This update is effective for the Company prospectively, with retrospective adoption permitted, for annual periods beginning January 1, 2025. The Company is currently evaluating the impact of adopting this update on its consolidated financial statements. ─ Note 3 Acquisitions and divestments Acquisition of controlling interests Acquisitions of controlling interests were as follows: Nine months ended September 30, Three months ended September 30, ($ in millions, except number of acquired businesses) 2024 2023 2024 2023 Purchase price for acquisitions (net of cash acquired) (1) 266 115 162 1 Aggregate excess of purchase price over fair value of net assets acquired(2) 220 55 131 1 Number of acquired businesses 4 3 1 1 (1) Excluding changes in cost - and equity -accounted companies. (2) Recorded as goodwill. In the table above, the “Purchase price for acquisitions” and “Aggregate excess of purchase price over fair value of net assets acquired” amounts in the nine months ended September 30, 2024, relate primarily to the acquisitions of the SEAM Group and DTN Europe B.V. Acquisitions of controlling interests have been accounted for under the acquisition method and have been included in the Comp any’s consolidated financial statements since the date of acquisition. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to value assets ac quired and liabilities assumed at the acquisition date, the purchase price allocation for acquisitions is preliminary for up to 12 months after the acquisition date and is subject to refinement as more detailed analyses are completed and additional information about the fair values of the assets and liabilities becomes available. Business divestments There were no significant divestments in the nine and three months ended September 30, 2024. In the nine and three months ended September 30, 2023, the Company received proceeds (net of transaction costs and cash disposed) of $55 2 million and $509 million, respectively, relating to divestments of consolidated businesses and recorded gains of $ 97 million and $71 million, respectively, in Other income (expense), net, on the sale of such businesses. These are primarily due the divestment of the Company’s Power Conversion Division to AcBel Polytech Inc ., which prior to its sale was part of the Company’s Electrification operating segment. Planned business divestments classified as held for sale The Company classifies its long-lived assets or disposal groups to be sold as held for sale in the period in which all of the held for sale criteria are met. The Company initially measures a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any resulting loss is recognized in the period in which the held for sale criteria are met , while gains are not recognized on the sale of a long-lived asset or disposal group until the date of sale. The Company assesses the fair value of a long -lived asset or disposal group less any costs to sell at each reporting period and until the asset or disposal group is no longer classified as held for sale. In January 2022, the Company’s E-mobility Division obtained control of a company by increasing its ownership to a 60 percent controlling interest. At that time, the Company had entered into an agreement with the remaining noncontrolling shareholders allowing either party to put or call the remaining 40 percent of the shares of that company until 2027. The amount for which either party could exercise their option was dependent on a formula based on revenues. In September 2024, the parties came to a definitive agreement to terminate their respective put and call options by settling the contracts on a net basis. This settlement is expected to be completed in the fourth quarter of 2024 and will lead to ABB returning a portion of its shares to this company, resulting in a reduction of ABB’s direct ownership to approximately 46 percent and thus losing control. This transaction will be treated similar to a business divestment and a separate re-acquisition at fair value of the 46 percent equity-method investment. ===== SIDA 28 ===== 15 Q3 2024 FINANCIAL INFORMATION As a result, as of September 30, 2024, the assets and liabilities of this company have been presented as held for sale and a loss of $ 89 million was recorded in Other income (expense), net, in connection with the expected loss of control. The fair value adjustment on this business was determined using Level 3 inputs and based on a discounted cash flow model considering the expected future results of this business. The loss is based on the net assets of the business; any changes to these factors through to the closing date of the transaction will result in adjustments to the loss recognized on the planned sale. The major classes of assets and liabilities held for sale relating to this planned divestment relate to inventory and intangible assets (including goodwill). Subsequent event On October 1, 2024, the Company acquired all the shares of the Födisch Group. The Födisch Group is a worldwide provider of advanced measurement and analytical solutions for the energy and industrial sectors . The initial cash outflow to complete the transaction was approximately $300 million. This acquisition enhances the Company’s Process Automation segment offering in continuous emission monitoring systems (CEMS) and bolsters its competitiveness in technology and innovation in this segment. ─ Note 4 Cash and equivalents, marketable securities and short-term investments Cash and equivalents, marketable securities and short -term investments consisted of the following: September 30, 2024 Cash and Marketable Gross Gross equivalents securities unrealized unrealized and restricted and short-term ($ in millions) Cost basis gains losses Fair value cash investments Changes in fair value recorded in net income Cash 1,480 1,480 1,480 Time deposits 2,313 2,313 1,803 510 Equity securities 593 32 625 625 4,386 32 – 4,418 3,283 1,135 Changes in fair value recorded in other comprehensive income Debt securities available-for-sale: U.S. government obligations 193 4 (6) 191 191 European government obligations 8 8 8 201 4 (6) 199 – 199 Total 4,587 36 (6) 4,617 3,283 1,334 Of which: Restricted cash, current 19 December 31, 2023 Cash and Marketable Gross Gross equivalents securities unrealized unrealized and restricted and short-term ($ in millions) Cost basis gains losses Fair value cash investments Changes in fair value recorded in net income Cash 1,449 1,449 1,449 Time deposits 2,923 2,923 2,460 463 Equity securities 1,250 32 1,282 1,282 5,622 32 – 5,654 3,909 1,745 Changes in fair value recorded in other comprehensive income Debt securities available-for-sale: U.S. government obligations 189 2 (8) 183 183 189 2 (8) 183 – 183 Total 5,811 34 (8) 5,837 3,909 1,928 Of which: Restricted cash, current 18 ===== SIDA 29 ===== 16 Q3 2024 FINANCIAL INFORMATION ─ Note 5 Derivative financial instruments The Company is exposed to certain currency, commodity and interest rate risks arising from its global operating, financing and investing activities. The Company uses derivative instruments to reduce and manage the economic impact of these exposures. Currency risk Due to the global nature of the Company’s operations, many of its subsidiaries are exposed to currency risk in their operatin g activities from entering into transactions in currencies other than their functional currency. To manage such currency risks, the Company’s policies r equire its subsidiaries to hedge their foreign currency exposures from binding sales and purchase contracts denominated in foreign currencies. For forec asted foreign currency denominated sales of standard products and the related foreign currency denominated purchases, the Company’s policy is to hed ge up to a maximum of 100 percent of the forecasted foreign currency denominated exposures, depending on the length of the forecasted exposures. Foreca sted exposures greater than 12 months are not hedged. Forward foreign exchange contracts are the main instrument used to protect the Company against the vol atility of future cash flows (caused by changes in exchange rates) of contracted and forecasted sales and purchases denominated in fo reign currencies. In addition, within its treasury operations, the Company primarily uses foreign exchange swaps and forward foreign exchange cont racts to manage the currency and timing mismatches arising in its liquidity management activities. Commodity risk Various commodity products are used in the Company’s manufacturing activities. Consequently it is exposed to volatility in future cas h flows arising from changes in commodity prices. To manage the price risk of commodities, the Com pany’s policies require that its subsidiaries hedge the commodity price risk exposures from binding contracts, as well as at least 50 percent (up to a maximum of 100 percent) of the forecasted commodity exposure over the next 12 months or longer (up to a maximum of 18 months). Primarily swap contracts are used to manage the associated price risks of commodities. Interest rate risk The Company has issued bonds at fixed rates. Interest rate swaps and cross-currency interest rate swaps are used to manage the interest rate and foreign currency risk associated with certain debt and generally such swaps are designated as fair value hedges. In addition, from time to tim e, the Company uses instruments such as interest rate swaps, interest rate futures, bond futures or forward rate agreements to manag e interest rate risk arising from the Company’s balance sheet structure but does not designate such instruments as hedges. Volume of derivative activity In general, while the Company’s primary objective in its use of derivatives is to minimize exposures arising from its business, certain derivatives are designated and qualify for hedge accounting treatment while others either are not designated or do not qualify for hedge acco unting. Foreign exchange and interest rate derivatives The gross notional amounts of outstanding foreign exchange and interest rate derivatives (whether designated as hedges or not ) were as follows: Type of derivative Total notional amounts at ($ in millions) September 30, 2024 December 31, 2023 September 30, 2023 Foreign exchange contracts 14,160 12,335 13,090 Embedded foreign exchange derivatives 1,210 1,137 1,291 Cross-currency interest rate swaps 895 886 849 Interest rate contracts 1,345 1,606 1,751 Derivative commodity contracts The Company uses derivatives to hedge its direct or indirect exposure to the movement in the prices of commodities which are primarily copper, silver, steel and aluminum. The following table shows the notional amounts of outstanding derivatives (whether designated as hedges or not), on a net bas is, to reflect the Company’s requirements for these commodities: Type of derivative Unit Total notional amounts at September 30, 2024 December 31, 2023 September 30, 2023 Copper swaps metric tonnes 38,292 35,015 32,223 Silver swaps ounces 2,708,095 2,359,363 1,702,359 Steel swaps metric tonnes 25,175 10,206 11,476 Aluminum swaps metric tonnes 5,250 5,900 5,800 Cash flow hedges As noted above, the Company mainly uses forward foreign exchange contracts to manage the foreign exchange risk of its operati ons and commodity swaps to manage its commodity risks. The Company applies cash flow hedge accounting in only limited cases. In these cases, th e effective portion of the changes in their fair value is recorded in Accumulated other comprehensive loss and subsequently reclassified into earnin gs in the same line item and in the same period as the underlying hedged transaction affects earnings. For the nine and three months ended September 30, 2024 and 2023, there were no significant amounts recorded for cash flow hedge accounting activities. Fair value hedges To reduce its interest rate exposure arising primarily from its debt issuance activities, the Company uses interest rate swap s and cross-currency interest rate swaps. Where such instruments are designated as fair value hedges, the changes in the fair value of these instruments, as well as the changes in the fair value of the risk component of the underlying debt being hedged, are recorded as offsetting gains and losses in Interest and other finance expense. ===== SIDA 30 ===== 17 Q3 2024 FINANCIAL INFORMATION The effect of derivative instruments, designated and qualifying as fair value hedges, on the Consolidated Income Statements w as as follows: Nine months ended September 30, Three months ended September 30, ($ in millions) 2024 2023 2024 2023 Gains (losses) recognized in Interest and other finance expense: Interest rate contracts Designated as fair value hedges 28 30 18 12 Hedged item (29) (31) (19) (13) Cross-currency interest rate swaps Designated as fair value hedges 20 (13) 25 (3) Hedged item (18) 2 (24) 2 Derivatives not designated in hedge relationships Derivative instruments that are not designated as hedges or do not qualify as either cash flow or fair value hedges are economic hedges used for risk management purposes. Gains and losses from changes in the fair values of such derivatives are recognized in the same line in the income statement as the economically hedged transaction. Furthermore, under certain circumstances, the Company is required to split and account separately for foreign currency deriva tives that are embedded within certain binding sales or purchase contracts denominated in a currency other than the functional currency of the subsid iary and the counterparty. The gains (losses) recognized in the Consolidated Income Statements on derivatives not designated in hedging relationships were a s follows: Type of derivative not Gains (losses) recognized in income designated as a hedge Nine months ended September 30, Three months ended September 30, ($ in millions) Location 2024 2023 2024 2023 Foreign exchange contracts Total revenues (119) (13) 67 (18) Total cost of sales 35 (20) (17) (8) SG&A expenses(1) 24 24 3 10 Non-order related research and development – (4) 1 (3) Interest and other finance expense 90 (16) (104) 46 Embedded foreign exchange Total revenues (7) 39 (23) (6) contracts Total cost of sales – – 4 1 Commodity contracts Total cost of sales 49 (7) 4 8 Other Interest and other finance expense (1) 1 1 – Total 71 4 (64) 30 (1) SG&A expenses represent “Selling, general and administrative expenses”. The fair values of derivatives included in the Consolidated Balance Sheets were as follows: September 30, 2024 Derivative assets Derivative liabilities Current in Non-current in Current in Non-current in “Other current “Other non-current “Other current “Other non-current ($ in millions) assets” assets” liabilities” liabilities” Derivatives designated as hedging instruments: Foreign exchange contracts – – 2 – Interest rate contracts – 7 – – Cross-currency interest rate swaps – – – 202 Other 5 – – – Total 5 7 2 202 Derivatives not designated as hedging instruments: Foreign exchange contracts 89 21 89 5 Commodity contracts 31 – 4 – Interest rate contracts – – – – Embedded foreign exchange derivatives 13 4 20 5 Other – 3 – – Total 133 28 113 10 Total fair value 138 35 115 212 ===== SIDA 31 ===== 18 Q3 2024 FINANCIAL INFORMATION December 31, 2023 Derivative assets Derivative liabilities Current in Non-current in Current in Non-current in “Other current “Other non-current “Other current “Other non-current ($ in millions) assets” assets” liabilities” liabilities” Derivatives designated as hedging instruments: Foreign exchange contracts – – 5 2 Interest rate contracts – – 18 – Cross-currency interest rate swaps – – – 230 Other 10 – – – Total 10 – 23 232 Derivatives not designated as hedging instruments: Foreign exchange contracts 123 30 177 9 Commodity contracts 8 – 3 – Interest rate contracts 1 – 1 – Other equity contracts 4 – – – Embedded foreign exchange derivatives 23 5 26 5 Total 159 35 207 14 Total fair value 169 35 230 246 Close-out netting agreements provide for the termination, valuation and net settlement of some or all outstanding transactions between two counterparties on the occurrence of one or more pre-defined trigger events. Although the Company is party to close-out netting agreements with most derivative counterparties, the fair values in the tables above and in the Consolidated Balance Sheets at September 30, 2024, and December 31, 2023, have been presented on a gross basis. The Company’s netting agreements and other similar arrangements allow net settlements under certain conditions. At September 30, 2024, and December 31, 2023, information related to these offsetting arrangements was as follows: ($ in millions) September 30, 2024 Gross amount Derivative liabilities Cash Non-cash Type of agreement or of recognized eligible for set-off collateral collateral Net asset similar arrangement assets in case of default received received exposure Derivatives 156 (71) – – 85 Total 156 (71) – – 85 ($ in millions) September 30, 2024 Gross amount Derivative liabilities Cash Non-cash Type of agreement or of recognized eligible for set-off collateral collateral Net liability similar arrangement liabilities in case of default pledged pledged exposure Derivatives 302 (71) – – 231 Total 302 (71) – – 231 ($ in millions) December 31, 2023 Gross amount Derivative liabilities Cash Non-cash Type of agreement or of recognized eligible for set-off collateral collateral Net asset similar arrangement assets in case of default received received exposure Derivatives 176 (111) – – 65 Total 176 (111) – – 65 ($ in millions) December 31, 2023 Gross amount Derivative liabilities Cash Non-cash Type of agreement or of recognized eligible for set-off collateral collateral Net liability similar arrangement liabilities in case of default pledged pledged exposure Derivatives 445 (111) – – 334 Total 445 (111) – – 334 ===== SIDA 32 ===== 19 Q3 2024 FINANCIAL INFORMATION ─ Note 6 Fair values The Company uses fair value measurement principles to record certain financial assets and liabilities on a recurring basis an d, when necessary, to record certain non-financial assets at fair value on a non -recurring basis, as well as to determine fair value disclosures for certain financial instruments carried at amortized cost in the financial statements. Financial assets and liabilities recorded at fair value on a recurring basis i nclude foreign currency, commodity and interest rate derivatives, as well as available -for-sale securities. Non-financial assets recorded at fair value on a non -recurring basis include long-lived assets that are reduced to their estimated fair value due to impairments. Fair value is the price that would be received when selling an asset or paid to transfer a liability in an orderly transactio n between market participants at the measurement date. In determining fair value, the Company uses various valuation techniques including the market approach (using observable market data for identical or similar assets and liabilities), the income approach (discounted cash flow models) and the cost approach (using costs a market participant would incur to develop a comparable asset). Inputs used to determine the fair value of assets and liabilit ies are defined by a three-level hierarchy, depending on the nature of those inputs. The Company has categorized its financial assets and liabilities and non -financial assets measured at fair value within this hierarchy based on whether the inputs to the valuation technique are observable or unobser vable. An observable input is based on market data obtained from independent sources, while an unobservable input reflects the Company’s assumptions abo ut market data. The levels of the fair value hierarchy are as follows: Level 1: Valuation inputs consist of quoted prices in an active market for identical assets or liabilities (observable quoted prices). Assets and liabilities valued using Level 1 inputs include exchange‑traded equity securities, listed derivatives which are actively traded such as commodity futures, interest rate futures and certain actively traded debt securities . Level 2: Valuation inputs consist of observable inputs (other than Level 1 inputs) such as actively quoted prices for similar assets, quoted prices in inactive markets and inputs other than quoted prices such as interest rate yield curves, credit spreads, or inputs derived fr om other observable data by interpolation, correlation, regression or other means. The adjustments applied to quoted prices or the inputs used in valuation models may be both observable and unobservable. In these cases, the fair value measurement is classified as Level 2 unless the unobs ervable portion of the adjustment or the unobservable input to the valuation model is significant, in which case the fair value measurement woul d be classified as Level 3. Assets and liabilities valued or disclosed using Level 2 inputs include investments in certain funds, certain debt s ecurities that are not actively traded, interest rate swaps, cross-currency interest rate swaps, commodity swaps, forward foreign exchange contracts, foreign exchange swaps and forward rate agreements, time deposits, as well as financing receivables and debt. Level 3: Valuation inputs are based on the Company’s assumptions of relevant market data (unobservable input). Whenever quoted prices involve bid-ask spreads, the Company ordinarily determines fair values based on mid -market quotes. When determining fair values based on quoted prices in an active market, the Company considers if the level of transaction activity for the financi al instrument has significantly decreased or would not be considered orderly. In such cases, the resulting changes in valuation techniques would be disclosed . If the market is considered disorderly or if quoted prices are not available, the Company is required to use another valuation technique, such as an income approach. Recurring fair value measures The fair values of financial assets and liabilities measured at fair value on a recurring basis were as follows: September 30, 2024 ($ in millions) Level 1 Level 2 Level 3 Total fair value Assets Securities in “Marketable securities and short-term investments”: Equity securities – 625 – 625 Debt securities—U.S. government obligations 191 – – 191 Debt securities—European government obligations 8 – – 8 Derivative assets—current in “Other current assets” – 138 – 138 Derivative assets—non-current in “Other non-current assets” – 35 – 35 Total 199 798 – 997 Liabilities Derivative liabilities—current in “Other current liabilities” – 115 – 115 Derivative liabilities—non-current in “Other non-current liabilities” – 212 – 212 Total – 327 – 327 ===== SIDA 33 ===== 20 Q3 2024 FINANCIAL INFORMATION December 31, 2023 ($ in millions) Level 1 Level 2 Level 3 Total fair value Assets Securities in “Marketable securities and short-term investments”: Equity securities – 1,282 – 1,282 Debt securities—U.S. government obligations 183 – – 183 Debt securities—European government obligations – – – – Derivative assets—current in “Other current assets” – 169 – 169 Derivative assets—non-current in “Other non-current assets” – 35 – 35 Total 183 1,486 – 1,669 Liabilities Derivative liabilities—current in “Other current liabilities” – 230 – 230 Derivative liabilities—non-current in “Other non-current liabilities” – 246 – 246 Total – 476 – 476 The Company uses the following methods and assumptions in estimating fair values of financial assets and liabilities measured at fair value on a recurring basis: • Securities in “Marketable securities and short-term investments”: If quoted market prices in active markets for identical assets are available, these are considered Level 1 inputs; however, when markets are not active, these inputs are considered Level 2. If such quoted market prices are not available, fair value is determined using market prices for similar assets or present value techniques, applying an a ppropriate risk-free interest rate adjusted for non-performance risk. The inputs used in present value techniques are observable and fall into the Level 2 category. • Derivatives: The fair values of derivative instruments are determined using quoted prices of identical instruments from an active market, if available (Level 1 inputs). If quoted prices are not available, price quotes for similar instruments, appropriately adjusted, or present value techniques, based on available market data, or option pricing models are used. The fair values obtained using price quotes fo r similar instruments or valuation techniques represent a Level 2 input unless significant unobservable inputs are used. Non-recurring fair value measures In the nine months ended September 30, 2024, the Company recognized $132 million of fair value adjustments on assets and liabilities held for sale. These primarily relate to a fair value adjustment within the E-mobility Division of $89 million recorded in the three months ended September 30, 2024 (See Note 3). There were no other significant non-recurring fair value measurements during the nine and three months ended September 30, 2024 and 2023. Disclosure about financial instruments carried on a cost basis The fair values of financial instruments carried on a cost basis were as follows: September 30, 2024 ($ in millions) Carrying value Level 1 Level 2 Level 3 Total fair value Assets Cash and equivalents (excluding securities with original maturities up to 3 months): Cash 1,461 1,461 – – 1,461 Time deposits 1,803 – 1,803 – 1,803 Restricted cash 19 19 – – 19 Marketable securities and short-term investments (excluding securities): Time deposits 510 – 510 – 510 Liabilities Short-term debt and current maturities of long-term debt (excluding finance lease obligations) 78 25 53 – 78 Long-term debt (excluding finance lease obligations) 6,488 6,586 9 – 6,595 ===== SIDA 34 ===== 21 Q3 2024 FINANCIAL INFORMATION December 31, 2023 ($ in millions) Carrying value Level 1 Level 2 Level 3 Total fair value Assets Cash and equivalents (excluding securities with original maturities up to 3 months): Cash 1,431 1,431 – – 1,431 Time deposits 2,460 – 2,460 – 2,460 Restricted cash 18 18 – – 18 Marketable securities and short-term investments (excluding securities): Time deposits 463 – 463 – 463 Liabilities Short-term debt and current maturities of long-term debt (excluding finance lease obligations) 2,576 2,521 55 – 2,576 Long-term debt (excluding finance lease obligations) 5,060 5,096 5 – 5,101 The Company uses the following methods and assumptions in estimating fair values of financial instruments carried on a cost b asis: • Cash and equivalents (excluding securities with original maturities up to 3 months), Restricted cash, and Marketable securities and short -term investments (excluding securities): The carrying amounts approximate the fair values as the items are short -term in nature or, for cash held in banks, are equal to the deposit amount. • Short-term debt and current maturities of long-term debt (excluding finance lease obligations): Short-term debt includes commercial paper, bank borrowings and overdrafts. The carrying amounts of short -term debt and current maturities of long-term debt, excluding finance lease obligations, approximate their fair values. • Long-term debt (excluding finance lease obligations): Fair values of bonds are determined using quoted market prices (Level 1 inputs), if available. For bonds without available quoted market prices and other long -term debt, the fair values are determined using a discounted cash flow methodology based upon borrowing rates of similar debt instruments and reflecting appropriate adjustments for non -performance risk (Level 2 inputs). ─ Note 7 Contract assets and liabilities The following table provides information about Contract assets and Contract liabilities: ($ in millions) September 30, 2024 December 31, 2023 September 30, 2023 Contract assets 1,236 1,090 1,073 Contract liabilities 3,081 2,844 2,610 Contract assets primarily relate to the Company’s right to receive consideration for work completed but for which no invoice has been issued at the reporting date. Contract assets are transferred to receivables when rights to receive payment become unconditional. Management expects that the majority of the amounts will be collected within one year of the respective balance sheet date. Contract liabilities primarily relate to up-front advances received on orders from customers as well as amounts invoiced to customers in excess of revenues recognized predominantly on long-term projects. Contract liabilities are reduced as work is performed and as revenues are recognized . The significant changes in the Contract assets and Contract liabilities balances were as follows: Nine months ended September 30, 2024 2023 Contract Contract Contract Contract ($ in millions) assets liabilities assets liabilities Revenue recognized, which was included in the Contract liabilities balance at Jan 1, 2024/2023 (1,381) (1,230) Additions to Contract liabilities - excluding amounts recognized as revenue during the period 1,625 1,602 Receivables recognized that were included in the Contract assets balance at Jan 1, 2024/2023 (589) (553) The Company considers its order backlog to represent its unsatisfied performance obligations. At September 30, 2024, the Company had unsatisfied performance obligations totaling $22,881 million and, of this amount, the Company expects to fulfill approximately 29 percent of the obligations in 202 4, approximately 47 percent of the obligations in 2025 and the balance thereafter. ===== SIDA 35 ===== 22 Q3 2024 FINANCIAL INFORMATION ─ Note 8 Supplier finance programs The Company has several supplier finance programs, all with similar characteristics, with various financial institutions acti ng as paying agent. These programs allow qualifying suppliers access to bank facilities which permit earlier payment at a cost to the supplier. The Company’s payment terms related to suppliers’ finance programs are not impacted by the suppliers’ decisions to sell amounts under the arrangements an d are typically consistent with local market practices. Outstanding supplier finance obligations are included in “Accounts payable, trade” in the Consol idated Balance Sheets and are reported as operating or investing (if capitalized) activities in the Consolidated Statement of Cash Flows when paid. At September 30, 2024, and December 31, 2023, the total obligation outstanding under supplier finance programs amounted to $443 million and $415 million, respectively. ─ Note 9 Debt The Company’s total debt at September 30, 2024, and December 31, 2023, amounted to $6,775 million and $7,828 million, respectively. Short-term debt and current maturities of long-term debt The Company’s “Short-term debt and current maturities of long-term debt” consisted of the following: ($ in millions) September 30, 2024 December 31, 2023 Short-term debt 72 87 Current maturities of long-term debt 37 2,520 Total 109 2,607 Short-term debt primarily represented short-term bank borrowings from various banks. In August 2024, the Company repaid at maturity its CHF 280 million 0.3% Bonds, equivalent to $328 million on date of repayment. In May 2024, the Company repaid at maturity its EUR 750 million 0.75% EUR Instruments, equivalent to $ 816 million on date of repayment. In April 2024, the Company repaid at maturity its EUR 700 million 0.625% EUR Instruments, equivalent to $752 million on date of repayment and in March 2024, the Company repaid at maturity its EUR 500 million Floating Rate Instruments, equivalent to $539 million on date of repayment. Long-term debt The Company’s long-term debt at September 30, 2024, and December 31, 2023, amounted to $6,666 million and $5,221 million, respectively. Outstanding bonds (including maturities within the next 12 months) were as follows: September 30, 2024 December 31, 2023 (in millions) Nominal outstanding Carrying value(1) Nominal outstanding Carrying value(1) Bonds: Floating Rate EUR Instruments, due 2024 EUR 500 $ 554 0.625% EUR Instruments, due 2024 EUR 700 $ 768 0.75% EUR Instruments, due 2024 EUR 750 $ 819 0.3% CHF Bonds, due 2024 CHF 280 $ 335 2.1% CHF Bonds, due 2025 CHF 150 $ 178 CHF 150 $ 179 1.965% CHF Bonds, due 2026 CHF 325 $ 384 CHF 325 $ 387 3.25% EUR Instruments, due 2027 EUR 500 $ 557 EUR 500 $ 551 0.75% CHF Bonds, due 2027 CHF 425 $ 503 CHF 425 $ 507 3.8% USD Notes, due 2028(2) USD 383 $ 382 USD 383 $ 382 1.9775% CHF Bonds, due 2028 CHF 150 $ 177 CHF 150 $ 179 3.125% EUR Instruments, due 2029 EUR 500 $ 562 1.0% CHF Bonds, due 2029 CHF 170 $ 201 CHF 170 $ 203 0% EUR Instruments, due 2030 EUR 800 $ 777 EUR 800 $ 749 2.375% CHF Bonds, due 2030 CHF 150 $ 177 CHF 150 $ 178 3.375% EUR Instruments, due 2031 EUR 750 $ 828 EUR 750 $ 818 2.1125% CHF Bonds, due 2033 CHF 275 $ 324 CHF 275 $ 327 3.375% EUR Instruments, due 2034 EUR 750 $ 839 4.375% USD Notes, due 2042(2) USD 609 $ 591 USD 609 $ 591 Total $ 6,480 $ 7,527 (1) USD carrying values include unamortized debt issuance costs, bond discounts or premiums, as well as adjustments for fair value hedge accounting, where appropriate. (2) Prior to completing a cash tender offer in November 2020, the original principal amount outstanding, on each of the 3.8% USD Notes, due 2028, and the 4.375% USD Notes, due 2042, was USD 750 million. In January 2024, the Company issued the following EUR Instruments: (i) EUR 500 million of 3.125 percent Instruments, due 2029, and (ii) EUR 750 million of 3.375 percent Instruments, due 2034, both paying interest annually in arrears. The aggregate net proceeds of these EUR Instruments, after discount and fees, amounted to EUR 1,243 million (equivalent to approximately $1,360 million on date of issuance). ===== SIDA 36 ===== 23 Q3 2024 FINANCIAL INFORMATION ─ Note 10 Commitments and contingencies Contingencies—Regulatory, Compliance and Legal Regulatory Based on findings during an internal investigation, the Company self -reported to the Securities and Exchange Commission (SEC) and the Department of Justice (DoJ), in the United States, to the Special Investigating Unit (SIU) and the National Prosecuting Authority (NPA) in South Africa as well as to various authorities in other countries potential suspect payments and other compliance concerns in connection with some of th e Company’s dealings with Eskom and related persons. Many of those parties have expressed an interest in, or commenced an investigation into, thes e matters and the Company is cooperating fully with them. The Company paid $104 million to Eskom in December 2020 as part of a full and final settlement with Eskom and the SIU relating to improper payments and other compliance issues associated with the Controls and Instrumentation Contra ct, and its Variation Orders for Units 1 and 2 at Kusile. The Company made a provision of approximately $325 million which was recorded in Other income (expense), net, during the third quarter of 2022. In December 2022, the Company settled with the SEC and D oJ as well as the authorities in South Africa and Switzerland. In March 2024, the Company settled its final pending matter with the authorities in Germany. The Company does not believe tha t it will need to record any additional provisions for this matter, and has paid all amounts in full. General The Company is aware of proceedings, or the threat of proceedings, against it and others in respect of private claims by cust omers and other third parties with regard to certain actual or alleged anticompetitive practices. Also, the Company is subject to other claims and legal proceedings, as well as investigations carried out by various law enforcement authorities. With respect to the above -mentioned claims, regulatory matters, and any related proceedings, the Company will bear the related costs, including costs necessary to resolve them. Liabilities recognized At September 30, 2024, and December 31, 2023, the Company had aggregate liabilities of $79 million and $101 million, respectively, included in Other provisions and Other non‑current liabilities, for the above regulatory, compliance and legal contingencies, and none of the individual liabilities recognized was significant. As it is not possible to make an informed judgment on, or reasonably predict, the outcome of cert ain matters and as it is not possible, based on information currently available to management, to estimate the maximum potential liability on other matter s, there could be adverse outcomes beyond the amounts accrued. Guarantees General The following table provides quantitative data regarding the Company’s third -party guarantees. The maximum potential payments represent a “worst-case scenario”, and do not reflect management’s expected outcomes. Maximum potential payments ($ in millions) September 30, 2024 December 31, 2023 Performance guarantees 2,532 3,451 Financial guarantees 22 94 Total(1) 2,554 3,545 (1) Maximum potential payments include amounts in both continuing and discontinued operations. The carrying amount of liabilities recorded in the Consolidated Balance Sheets reflects the Company’s best estimate of future payments, which it may incur as part of fulfilling its guarantee obligations. In respect of the above guarantees, the carrying amounts of liabilities at September 30, 2024, and December 31, 2023, were not significant. The Company is party to various guarantees providing financial or performance assurances to certain third parties. These guar antees, which have various maturities up to 2034, mainly consist of performance guarantees whereby (i) the Company guarantees the performance of a third party’s product or service according to the terms of a contract and (ii) as member of a consortium/joint-venture that includes third parties, the Company guarantees not only its own performance but also the work of third parties. Such guarantees may include guarantees that a pro ject will be completed within a specified time. If the third party does not fulfill the obligation, the Company will compensate the guaranteed party in cash or in kind. The original maturity dates for the majority of these performance guarantees range from one to ten years. In conjunction with the divestment of the high-voltage cable and cables accessories businesses, the Company has entered into various performance guarantees with other parties with respect to certain liabilities of the divested business. At September 30, 2024, and December 31, 2023, the maximum potential payable under these guarantees amounts to $879 million and $874 million, respectively, and these guarantees have various original maturities up to ten years. The Company retained obligations for financial and performance guarantees related to its former Power Grids business (reporte d as discontinued operations prior to its sale to Hitachi Ltd in 2020), which at both September 30, 2024, and December 31, 2023, have been fully indemnified by Hitachi Ltd. These guarantees, having various maturities up to 203 4, primarily consist of bank guarantees, standby letters of credit, business performance guarantees and other trade-related guarantees, the majority of which have original maturity dates ranging from one to ten years. The maximum amount payable under these guarantees at September 30, 2024, and December 31, 2023, is approximately $1.2 billion and $2.2 billion, respectively. Commercial commitments In addition, in the normal course of bidding for and executing certain projects, the Company has entered into standby letters of credit, bid/performance bonds and surety bonds (collectively “performance bonds”) with various financial institutions. Customers can draw on such per formance bonds in the event that the Company does not fulfill its contractual obligations. The Company would then have an obligation to reimburse t he financial institution for amounts paid under the performance bonds. At September 30, 2024, and December 31, 2023, the total outstanding performance bonds aggregated to $3.4 billion and $3.1 billion, respectively. There have been no significant amounts reimbursed to financial institutions under these types of arran gements in the nine and three months ended September 30, 2024 and 2023. ===== SIDA 37 ===== 24 Q3 2024 FINANCIAL INFORMATION Product and order-related contingencies The Company calculates its provision for product warranties based on historical claims experience and specific review of cert ain contracts. The reconciliation of the Provisions for warranties, including guarantees of product performance, was as follows: ($ in millions) 2024 2023 Balance at January 1, 1,210 1,028 Claims paid in cash or in kind (116) (132) Net increase in provision for changes in estimates, warranties issued and warranties expired 192 228 Exchange rate differences 3 (16) Balance at September 30, 1,289 1,108 ─ Note 11 Income taxes In calculating income tax expense, the Company uses an estimate of the annual effective tax rate based upon the facts and circumstances known at each interim period. On a quarterly basis, the actual effective tax rate is adjusted, as appropriate, based upon changed facts and circumstances, if any, as compared to those forecasted at the beginning of the year and each interim period thereafter. The effective tax rate of 26.1 percent in the nine months ended September 30, 2024, was higher than the effective tax rate of 21.5 percent in the nine months ended September 30, 2023, primarily due to a net benefit of $206 million realized on a favorable resolution of an uncertain tax position in the nine months ended September 30, 2023, partially offset by a net benefit of $72 million from a partial reversal of an uncertain tax position related to the reassessment of certain tax risks in the nine months ended September 30, 2024. The former resulted in an increase of $0.11 in earnings per share (basic and diluted) for the nine months ended September 30, 2023, while the latter resulted in an increase of $0.04 in earnings per share (basic and diluted) for the nine months ended September 30, 2024. ─ Note 12 Employee benefits The Company operates defined benefit pension plans, defined contribution pension plans, and termination indemnity plans, in a ccordance with local regulations and practices. At September 30, 2024, the Company’s most significant defined benefit pension plans are in Switzerland as well as in Germany, the United Kingdom, and the United States. These plans cover a large portion of the Company’s employees and provide benefits to employees in the event of death, disability, retirement, or termination of employment. Certain of these plans are multi -employer plans. The Company also operates other postretirement benefit plans including postretirement health care benefits and other employee -related benefits for active employees including long-service award plans. The postretirement benefit plans are not significant. The measurement date used for the Company’s employ ee benefit plans is December 31. The funding policies of the Company’s plans are consistent with the local government and tax requirements. Net periodic benefit cost of the Company’s defined benefit pension plans consist s of the following: ($ in millions) Defined pension benefits Switzerland International Nine months ended September 30, 2024 2023 2024 2023 Operational pension cost: Service cost 35 29 20 21 Operational pension cost 35 29 20 21 Non-operational pension cost (credit): Interest cost 27 35 118 122 Expected return on plan assets (98) (94) (128) (116) Amortization of prior service cost (credit) (5) (6) (1) (2) Amortization of net actuarial loss – – 40 39 Curtailments, settlements and special termination benefits 3 – 4 18 Non-operational pension cost (credit)(1) (73) (65) 33 61 Net periodic benefit cost (credit) (38) (36) 53 82 ===== SIDA 38 ===== 25 Q3 2024 FINANCIAL INFORMATION ($ in millions) Defined pension benefits Switzerland International Three months ended September 30, 2024 2023 2024 2023 Operational pension cost: Service cost 12 10 7 7 Operational pension cost 12 10 7 7 Non-operational pension cost (credit): Interest cost 10 11 40 40 Expected return on plan assets (36) (31) (43) (42) Amortization of prior service cost (credit) (1) (2) – (1) Amortization of net actuarial loss – – 14 16 Curtailments, settlements and special termination benefits 1 – – 18 Non-operational pension cost (credit)(1) (26) (22) 11 31 Net periodic benefit cost (credit) (14) (12) 18 38 (1) Total Non-operational pension cost (credit) includes additional credits of $(2) million and $(19) million for the nine months ended September 30, 2024 and 2023, respectively, and additional credits of $(1) million and $(17) million for the three months ended September 30, 2024 and 2023, respectively, related to other postretirement benefits. The components of net periodic benefit cost other than the service cost component are included in the line Non -operational pension cost (credit) in the Consolidated Income Statements. Employer contributions were as follows: ($ in millions) Defined pension benefits Switzerland International Nine months ended September 30, 2024 2023 2024 2023 Total contributions to defined benefit pension plans 44 8 30 85 ($ in millions) Defined pension benefits Switzerland International Three months ended September 30, 2024 2023 2024 2023 Total contributions to defined benefit pension plans 16 3 4 64 The Company expects to make contributions totaling approximately $88 million to its defined benefit pension plans for the full year 202 4. ─ Note 13 Stockholder's equity At the Annual General Meeting of Shareholders (AGM) on March 21, 2024, shareholders approved the proposal of the Board of Directors to distribute 0.87 Swiss francs per share to shareholders. The declared dividend amounted to $ 1,804 million, with the Company disbursing a portion in March and the remaining amounts in April. In March 2024, the Company completed the share buyback program that was launched in April 2023. This program was executed on a second trading line on the SIX Swiss Exchange. Through this program, the Company purchased a total of 21 million shares for approximately $0.8 billion, of which 4 million shares were purchased in the first quarter of 2024 (resulting in an increase in Treasury stock of $187 million). Also in March 2024, the Company announced a new share buyback program of up to $1 billion. This program, which was launched in April 2024, is being executed on a second trading line on the SIX Swiss Exchange and is planned to run until January 2025. Through this program, the Company purchased, from the program’s launch in April 2024 to September 30, 2024, 9 million shares, resulting in an increase in Treasury stock of $505 million. In the second quarter of 2024, the Company cancelled 21 million shares which had been purchased under its share buyback program. This resulted in a decrease in Treasury stock of $832 million and a corresponding total decrease in Capital stock, Additional paid -in capital and Retained earnings. In addition to the share buyback programs, the Company purchased 4 million of its own shares on the open market in the nine months ended September 30, 2024, mainly for use in connection with its employee share plans, resulting in an increase in Treasury stock of $ 175 million. In the nine months ended September 30, 2024, the Company delivered, out of treasury stock, approximately 17 million shares in connection with its Management Incentive Plan. ===== SIDA 39 ===== 26 Q3 2024 FINANCIAL INFORMATION ─ Note 14 Earnings per share Basic earnings per share is calculated by dividing income by the weighted -average number of shares outstanding during the period. Diluted earnings per share is calculated by dividing income by the weighted -average number of shares outstanding during the period, assuming that all potentially dilutive securities were exercised, if dilutive. Potentially dilutive securities comprise outstanding written call options, and outsta nding options and shares granted subject to certain conditions under the Company’s share -based payment arrangements. Basic earnings per share Nine months ended September 30, Three months ended September 30, ($ in millions, except per share data in $) 2024 2023 2024 2023 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 2,945 2,840 941 889 Income (loss) from discontinued operations, net of tax 3 (16) 6 (7) Net income 2,948 2,824 947 882 Weighted-average number of shares outstanding (in millions) 1,845 1,859 1,846 1,854 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 1.60 1.53 0.51 0.48 Income (loss) from discontinued operations, net of tax 0.00 (0.01) 0.00 0.00 Net income 1.60 1.52 0.51 0.48 Diluted earnings per share Nine months ended September 30, Three months ended September 30, ($ in millions, except per share data in $) 2024 2023 2024 2023 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 2,945 2,840 941 889 Income (loss) from discontinued operations, net of tax 3 (16) 6 (7) Net income 2,948 2,824 947 882 Weighted-average number of shares outstanding (in millions) 1,845 1,859 1,846 1,854 Effect of dilutive securities: Call options and shares 8 12 5 11 Adjusted weighted-average number of shares outstanding (in millions) 1,853 1,871 1,851 1,865 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 1.59 1.52 0.51 0.48 Income (loss) from discontinued operations, net of tax 0.00 (0.01) 0.00 0.00 Net income 1.59 1.51 0.51 0.47 ===== SIDA 40 ===== 27 Q3 2024 FINANCIAL INFORMATION ─ Note 15 Reclassifications out of accumulated other comprehensive loss The following table shows changes in “Accumulated other comprehensive loss” (OCI) attributable to ABB, by component, net of t ax: Unrealized gains Pension and Foreign currency (losses) on other Derivative translation available-for-sale postretirement instruments ($ in millions) adjustments securities plan adjustments and hedges Total OCI Balance at January 1, 2023 (3,691) (19) (838) (8) (4,556) Other comprehensive (loss) income: Other comprehensive (loss) income before reclassifications (194) – (9) (5) (208) Amounts reclassified from OCI 9 6 28 8 51 Total other comprehensive (loss) income (185) 6 19 3 (157) Less: Amounts attributable to noncontrolling interests and redeemable noncontrolling interests (8) – – – (8) Balance at September 30, 2023 (3,868) (13) (819) (5) (4,705) Unrealized gains Pension and Foreign currency (losses) on other Derivative translation available-for-sale postretirement instruments ($ in millions) adjustments securities plan adjustments and hedges Total OCI Balance at January 1, 2024 (3,977) (8) (1,075) (10) (5,070) Other comprehensive (loss) income: Other comprehensive (loss) income before reclassifications (26) 4 (14) (5) (41) Amounts reclassified from OCI 1 – 27 8 36 Total other comprehensive (loss) income (25) 4 13 3 (5) Less: Amounts attributable to noncontrolling interests and redeemable noncontrolling interests (3) – – – (3) Balance at September 30, 2024 (3,999) (4) (1,062) (7) (5,072) The amounts reclassified out of OCI were not significant for the nine and three months ended September 30, 2024 and 2023. ─ Note 16 Operating segment data The Chief Operating Decision Maker (CODM) is the Chief Executive Officer. The CODM allocates resources to and assesses the pe rformance of each operating segment using the information outlined below. The Company is organized into the following segments, based on products and services: Electrification, Motion, Process Automation and Robotics & Discrete Automation. The remaining operations of the Company are i ncluded in Corporate and Other. A description of the types of products and services provided by each reportable segment is as follows: • Electrification: manufactures and sells electrical products and solutions which are designed to provide safe, smart and sustainable electrical flow from the substation to the socket. The portfolio of increasingly digital and connected solutions includes renewable power solutions, modular substation packages, distribution automation products, switchboard s and panelboards, switchgear, UPS solutions, circuit breakers, measuring and sensing devices, control products, wiring accessories, enclosures and cabling systems and intelligent home and building solutions, designed to integrate and automate lighting, heating, ventilation, security and data communication networ ks. The products and services are currently delivered through five operating Divisions: Distribution Solutions, Smart Power, Smart Buildings, Installation Products and Service, as well as, prior to its sale in July 2023, the Power Conversion Division. • Motion: designs, manufactures, and sells drives, motors, generators and traction converters that are driving the low -carbon future for industries, cities, infrastructure and transportation. These products, digital technology and related services enable industr ial customers to increase energy efficiency, improve safety and reliability, and achieve precise control of their processes. Building on over 140 years of cumulative experience in electric powertrains, Motion combines domain expertise and technology to deliver the optimum solution for a wide range of applications in all industrial segments. In addition, Motion, along with its partners, has a leading global service presence. These products and services are delivered through seven operating Divisions: Large Motors and Generators, IEC LV Motors, NEMA Motors, Drive Products, System Drives, Service and Traction. ===== SIDA 41 ===== 28 Q3 2024 FINANCIAL INFORMATION • Process Automation: offers a broad range of industry-specific, integrated automation, electrification and digital solutions, as well as lifecycle services for the process, hybrid and marine industries. The product portfolio includes control technologies, industrial software, advanced analytics, sensing and measurement technology, and marine propulsion systems. In addition, Process Automation offers a comprehensive range of services, from repair to advanced digital capabilities such as remote monitoring, preventive maintenance, asset performance management, emission monitoring and cybersecurity . The products, systems and services are delivered through four operating Divisions: Energy Industries, Process Industries, Marine & Ports and Measurement & Analytics. • Robotics & Discrete Automation: delivers its products, solutions and services through two operating Divisions. Robotics provides industrial and collaborative robots, autonomous mobile robotics, mapping and navigation solutions, robotic solutions, field services, spare parts and digital services. Machine Automation specializes in automation solutions based on its programmable logic controllers (PLC), i ndustrial PCs (IPC), servo motion, transport systems and machine vision. Both divisions offer software across the entire life cycle, includ ing engineering and simulation software as well as a comprehensive range of digital solutions. Corporate and Other: Corporate includes headquarter costs, the Company’s corporate real estate activities and Corporate Treasury while Other inclu des the E-mobility operating segment, other non-core operating activities as well as the operating activities of certain divested businesses. The primary measure of profitability on which the operating segments are evaluated is Operational EBITA, which represents inc ome from operations excluding: • amortization expense on intangibles arising upon acquisition ( acquisition-related amortization), • restructuring, related and implementation costs , • changes in the amount recorded for obligations related to divested businesses occurring after the divestment date (changes in obligations related to divested businesses), • gains and losses from sale of businesses (including fair value adjustment on assets and liabilities held for sale , if any), • acquisition- and divestment-related expenses and integration costs, • certain other non-operational items, as well as • foreign exchange/commodity timing differences in income from operations consisting of: (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (c) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities). Certain other non-operational items generally includes certain regulatory, compliance and legal costs, certain asset write downs/impairments and certain other fair value changes, as well as other items which are determined by management on a case -by-case basis. The CODM primarily reviews the results of each segment on a basis that is before the elimination of profits made on inventory sales between segments. Segment results below are presented before these eliminations, with a total deduction for intersegment profits to arrive at t he Company’s consolidated Operational EBITA. Intersegment sales and transfers are accounted for as if the sales and transfers were to third parties, at current market prices. The following tables present disaggregated segment revenues from contracts with customers , Operational EBITA, and the reconciliations of consolidated Operational EBITA to Income from continuing operations before taxes for the nine and three months ended Septembe r 30, 2024 and 2023, as well as total assets at September 30, 2024, and December 31, 2023. Nine months ended September 30, 2024 Robotics & Process Discrete Corporate ($ in millions) Electrification Motion Automation Automation and Other Total Geographical markets Europe 3,391 1,621 1,786 1,282 158 8,238 The Americas 4,886 1,948 1,384 399 138 8,755 of which: United States 3,803 1,580 857 248 102 6,590 Asia, Middle East and Africa 2,930 1,749 1,770 756 62 7,267 of which: China 1,337 827 522 524 16 3,226 11,207 5,318 4,940 2,437 358 24,260 Product type Products 10,444 4,455 2,913 1,999 321 20,132 Services and other 763 863 2,027 438 37 4,128 11,207 5,318 4,940 2,437 358 24,260 Third-party revenues 11,207 5,318 4,940 2,437 358 24,260 Intersegment revenues 195 431 21 7 (654) – Total revenues(1) 11,402 5,749 4,961 2,444 (296) 24,260 ===== SIDA 42 ===== 29 Q3 2024 FINANCIAL INFORMATION Nine months ended September 30, 2023 Robotics & Process Discrete Corporate ($ in millions) Electrification Motion Automation Automation and Other Total Geographical markets Europe 3,411 1,858 1,663 1,456 229 8,617 The Americas 4,393 1,924 1,279 431 216 8,243 of which: United States 3,292 1,602 798 269 182 6,143 Asia, Middle East and Africa 2,912 1,699 1,580 886 53 7,130 of which: China 1,356 866 502 657 23 3,404 10,716 5,481 4,522 2,773 498 23,990 Product type Products 10,050 4,695 2,667 2,353 445 20,210 Services and other 666 786 1,855 420 53 3,780 10,716 5,481 4,522 2,773 498 23,990 Third-party revenues 10,716 5,481 4,522 2,773 498 23,990 Intersegment revenues 170 387 21 15 (593) – Total revenues(1) 10,886 5,868 4,543 2,788 (95) 23,990 Three months ended September 30, 2024 Robotics & Process Discrete Corporate ($ in millions) Electrification Motion Automation Automation and Other Total Geographical markets Europe 1,095 559 605 358 42 2,659 The Americas 1,714 655 464 126 47 3,006 of which: United States 1,346 524 278 78 33 2,259 Asia, Middle East and Africa 1,037 607 570 261 11 2,486 of which: China 466 281 161 181 5 1,094 3,846 1,821 1,639 745 100 8,151 Product type Products 3,582 1,529 975 601 90 6,777 Services and other 264 292 664 144 10 1,374 3,846 1,821 1,639 745 100 8,151 Third-party revenues 3,846 1,821 1,639 745 100 8,151 Intersegment revenues 67 148 4 2 (221) – Total revenues(1) 3,913 1,969 1,643 747 (121) 8,151 Three months ended September 30, 2023 Robotics & Process Discrete Corporate ($ in millions) Electrification Motion Automation Automation and Other Total Geographical markets Europe 1,083 569 582 500 76 2,810 The Americas 1,461 657 411 159 87 2,775 of which: United States 1,113 541 248 94 71 2,067 Asia, Middle East and Africa 964 582 553 263 21 2,383 of which: China 439 285 163 182 6 1,075 3,508 1,808 1,546 922 184 7,968 Product type Products 3,288 1,526 924 777 165 6,680 Services and other 220 282 622 145 19 1,288 3,508 1,808 1,546 922 184 7,968 Third-party revenues 3,508 1,808 1,546 922 184 7,968 Intersegment revenues 53 139 8 7 (207) – Total revenues(1) 3,561 1,947 1,554 929 (23) 7,968 (1) Due to rounding, numbers presented may not add to the totals provided. ===== SIDA 43 ===== 30 Q3 2024 FINANCIAL INFORMATION Nine months ended Three months ended September 30, September 30, ($ in millions) 2024 2023 2024 2023 Operational EBITA: Electrification 2,657 2,212 944 748 Motion 1,135 1,157 404 390 Process Automation 767 670 251 226 Robotics & Discrete Automation 268 418 62 137 Corporate and Other ‒ E-mobility (201) (134) (60) (39) ‒ Corporate costs, Intersegment elimination and other (92) (229) (48) (70) Total 4,534 4,094 1,553 1,392 Acquisition-related amortization (157) (164) (44) (55) Restructuring, related and implementation costs (1) (97) (92) (21) (51) Changes in obligations related to divested businesses 11 5 – – Gains and losses from sale of businesses (13) 97 1 71 Fair value adjustment on assets and liabilities held for sale (132) – (89) – Acquisition- and divestment-related expenses and integration costs (54) (55) (17) (10) Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) (38) (58) 6 (48) Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized 6 (8) 7 (2) Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) 10 25 (32) 11 Certain other non-operational items: Other income/expense relating to the Power Grids joint venture 14 27 3 7 Regulatory, compliance and legal costs 1 – 5 – Business transformation costs(2) (148) (139) (47) (57) Certain other fair value changes, including asset impairments (31) 3 (12) (3) Other non-operational items (4) 20 (4) 4 Income from operations 3,902 3,755 1,309 1,259 Interest and dividend income 146 115 43 37 Interest and other finance expense (91) (197) (41) (73) Non-operational pension (cost) credit 39 23 13 8 Income from continuing operations before taxes 3,996 3,696 1,324 1,231 (1) Includes impairment of certain assets. (2) Amount includes ABB Way process transformation costs of $145 million and $ 122 million for the nine months ended September 30, 2024 and 2023 , respectively , and $46 million and $ 51 million for the three months ended September 30, 2024 and 2023 , respectively. Total assets(1) ($ in millions) September 30, 2024 December 31, 2023 Electrification 13,544 12,668 Motion 7,164 7,016 Process Automation 5,126 4,971 Robotics & Discrete Automation 4,988 5,047 Corporate and Other 9,862 11,238 Consolidated 40,684 40,940 (1) Total assets are after intersegment eliminations and therefore reflect third -party assets only. ===== SIDA 44 ===== 31 Q3 2024 FINANCIAL INFORMATION ===== SIDA 45 ===== 32 Q3 2024 FINANCIAL INFORMATION — Supplemental Reconciliations and Definitions The following reconciliations and definitions include alternative performance measures which ABB uses to supplement its Consolidated Financial Information (unaudited) which is prepared in accordance with United States generally accepted accounting principles (U.S. GAAP). Certain of these financial measures are not defined under U.S. GAAP. While ABB’s management believes that the measures herein are useful in evaluating ABB’s operating results, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance wit h U.S. GAAP. Therefore these measures should not be viewed in isolation but considered together with the Consolidated Financial Informatio n (unaudited) prepared in accordance with U.S. GAAP as of and for the nine and three months ended September 30, 2024. Comparable growth rates Growth rates for certain key figures may be presented and discussed on a “comparable” basis. The comparable growth rate measu res growth on a constant currency basis. Since we are a global company, the comparability of our operating results reported in U.S. dollars i s affected by foreign currency exchange rate fluctuations. We calculate the impacts from foreign currency fluctuations by translating the current -year periods’ reported key figures into U.S. dollar amounts using the exchange rates in effect for the comparable periods in the previous year. Comparable growth rates are also adjusted for changes in our business portfolio. Adjustments to our business portfolio occur due to acquisitions, divestments, or by exiting specific business activities or customer markets. The adjustment for portfolio changes is calculat ed as follows: where the results of any business acquired or divested have not been consolidated and reported for the entire duration of both the curr ent and comparable periods, the reported key figures of such business are adjusted to exclude the relevant key figures of any corresponding quar ters which are not comparable when computing the comparable growth rate. Certain portfolio changes which do not qualify as divestments under U.S . GAAP have been treated in a similar manner to divestments. Changes in our portfolio where we have exited certain business activities or cust omer markets are adjusted as if the relevant business was divested in the period when the decision to cease business activities was taken. We do not ad just for portfolio changes where the relevant business has annualized revenues of less than $50 million. The following tables provide reconciliations of reported growth rates of certain key figures to their respective comparable g rowth rate. Comparable growth rate reconciliation by Business Area Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Business Area reported) impact changes Comparable reported) impact changes Comparable Electrification 10% 0% 0% 10% 10% 0% 0% 10% Motion -4% 0% 0% -4% 1% 0% 0% 1% Process Automation -5% 0% 0% -5% 6% 0% 0% 6% Robotics & Discrete Automation -4% 0% 0% -4% -20% 0% 0% -20% ABB Group 2% 0% 0% 2% 2% 1% -1% 2% 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Business Area reported) impact changes Comparable reported) impact changes Comparable Electrification 6% 1% 1% 8% 5% 1% 2% 8% Motion -3% 1% 0% -2% -2% 1% -1% -2% Process Automation -7% 1% 0% -6% 9% 1% 0% 10% Robotics & Discrete Automation -19% 0% 0% -19% -12% 0% 0% -12% ABB Group -2% 1% 0% -1% 1% 1% 1% 3% ===== SIDA 46 ===== 33 Q3 2024 FINANCIAL INFORMATION Regional comparable growth rate reconciliation Regional comparable growth rate reconciliation for ABB Group - Quarter Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 8% -2% 0% 6% -5% -1% 0% -6% The Americas -6% 1% -1% -6% 8% 2% -1% 9% of which: United States -7% 0% 0% -7% 9% 0% 0% 9% Asia, Middle East and Africa 7% 1% 0% 8% 4% 1% 0% 5% of which: China -1% -1% 0% -2% 2% -2% 0% 0% ABB Group 2% 0% 0% 2% 2% 1% -1% 2% Regional comparable growth rate reconciliation by Business Area - Quarter Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 8% -1% 0% 7% 2% -2% 0% 0% The Americas 2% 1% 0% 3% 17% 1% 0% 18% of which: United States 3% 0% -1% 2% 21% 0% -1% 20% Asia, Middle East and Africa 24% 2% 0% 26% 8% 2% 0% 10% of which: China 1% -2% 0% -1% 5% -1% 0% 4% Electrification 10% 0% 0% 10% 10% 0% 0% 10% Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe -3% -1% 0% -4% 1% -2% 0% -1% The Americas 1% 1% 0% 2% -1% 1% 0% 0% of which: United States 2% 0% 0% 2% -3% -1% 0% -4% Asia, Middle East and Africa -10% 0% 0% -10% 3% 1% 0% 4% of which: China -6% -1% 0% -7% 1% -1% 0% 0% Motion -4% 0% 0% -4% 1% 0% 0% 1% Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 15% 0% 0% 15% 3% -1% 0% 2% The Americas -32% 1% 0% -31% 13% 2% 0% 15% of which: United States -39% 0% 0% -39% 13% -1% 0% 12% Asia, Middle East and Africa 11% 1% 0% 12% 3% 0% 0% 3% of which: China 52% -2% 0% 50% -2% 0% 0% -2% Process Automation -5% 0% 0% -5% 6% 0% 0% 6% Q3 2024 compared to Q3 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 1% -1% 0% 0% -29% -1% 0% -30% The Americas 14% 2% 0% 16% -21% 2% 0% -19% of which: United States 6% 0% 0% 6% -16% 0% 0% -16% Asia, Middle East and Africa -20% 0% 0% -20% -2% 0% 0% -2% of which: China -22% 0% 0% -22% -1% -1% 0% -2% Robotics & Discrete Automation -4% 0% 0% -4% -20% 0% 0% -20% ===== SIDA 47 ===== 34 Q3 2024 FINANCIAL INFORMATION Regional comparable growth rate reconciliation for ABB Group – Year to date 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe -3% 0% 0% -3% -4% -1% 0% -5% The Americas -5% 0% 1% -4% 6% 1% 1% 8% of which: United States -3% 0% 0% -3% 7% 0% 2% 9% Asia, Middle East and Africa 2% 3% 1% 6% 2% 3% 0% 5% of which: China -12% 2% 0% -10% -5% 2% 0% -3% ABB Group -2% 1% 0% -1% 1% 1% 1% 3% Regional comparable growth rate reconciliation by Business Area – Year to date 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 5% 0% 0% 5% -1% 0% 1% 0% The Americas 4% 0% 2% 6% 11% 0% 4% 15% of which: United States 6% 0% 3% 9% 15% 0% 6% 21% Asia, Middle East and Africa 11% 4% 1% 16% 2% 3% 1% 6% of which: China -4% 2% 0% -2% -2% 3% 0% 1% Electrification 6% 1% 1% 8% 5% 1% 2% 8% 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe -6% -1% 0% -7% -11% 0% 0% -11% The Americas -5% 1% -2% -6% 1% 0% -2% -1% of which: United States -7% 0% -1% -8% -2% 0% -1% -3% Asia, Middle East and Africa 3% 3% 0% 6% 4% 4% 0% 8% of which: China -7% 2% 0% -5% -2% 2% 0% 0% Motion -3% 1% 0% -2% -2% 1% -1% -2% 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe 7% 0% 0% 7% 7% 0% 0% 7% The Americas -24% 0% 0% -24% 8% 1% 0% 9% of which: United States -23% -1% 0% -24% 7% 0% 0% 7% Asia, Middle East and Africa -4% 3% 0% -1% 12% 2% 0% 14% of which: China -13% 2% 0% -11% 4% 2% 0% 6% Process Automation -7% 1% 0% -6% 9% 1% 0% 10% 9M 2024 compared to 9M 2023 Order growth rate Revenue growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Region reported) impact changes Comparable reported) impact changes Comparable Europe -23% -1% 0% -24% -12% 0% 0% -12% The Americas 1% 0% 0% 1% -8% 1% 0% -7% of which: United States 1% 0% 0% 1% -8% 0% 0% -8% Asia, Middle East and Africa -24% 2% 0% -22% -15% 3% 0% -12% of which: China -32% 2% 0% -30% -20% 2% 0% -18% Robotics & Discrete Automation -19% 0% 0% -19% -12% 0% 0% -12% ===== SIDA 48 ===== 35 Q3 2024 FINANCIAL INFORMATION Order backlog growth rate reconciliation September 30, 2024 compared to September 30, 2023 US$ Foreign (as exchange Portfolio Business Area reported) impact changes Comparable Electrification 14% -2% 0% 12% Motion 13% -5% 0% 8% Process Automation 9% -3% 0% 6% Robotics & Discrete Automation -27% -2% 0% -29% ABB Group 7% -3% 0% 4% Other growth rate reconciliations Q3 2024 compared to Q3 2023 Service orders growth rate Services revenues growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Business Area reported) impact changes Comparable reported) impact changes Comparable Electrification 17% 1% -3% 15% 20% 1% -5% 16% Motion 13% 1% 0% 14% 3% 2% 0% 5% Process Automation -26% 0% 0% -26% 7% 0% 0% 7% Robotics & Discrete Automation 13% 0% 0% 13% 0% 0% 0% 0% ABB Group -10% 1% -1% -10% 7% 1% -1% 7% 9M 2024 compared to 9M 2023 Service orders growth rate Services revenues growth rate US$ Foreign US$ Foreign (as exchange Portfolio (as exchange Portfolio Business Area reported) impact changes Comparable reported) impact changes Comparable Electrification 16% 2% -1% 17% 15% 1% -2% 14% Motion 3% 2% 0% 5% 10% 3% 0% 13% Process Automation -6% 0% 0% -6% 9% 1% 0% 10% Robotics & Discrete Automation 5% 1% 0% 6% 4% 1% 0% 5% ABB Group 0% 1% 0% 1% 9% 1% 0% 10% ===== SIDA 49 ===== 36 Q3 2024 FINANCIAL INFORMATION Operational EBITA as % of operational revenues (Operational EBITA margin) Definition Operational EBITA margin Operational EBITA margin is Operational EBITA as a percentage of operational revenues. Operational EBITA Operational earnings before interest, taxes and acquisition -related amortization (Operational EBITA) represents Income from operations excluding: • acquisition-related amortization (as defined below), • restructuring, related and implementation costs, • changes in the amount recorded for obligations related to divested businesses occurring after the divestment date (changes in obligations related to divested businesses), • gains and losses from sale of businesses (including fair value adjustment on assets and liabilities held for sale , if any), • acquisition- and divestment-related expenses and integration costs, • certain other non-operational items, as well as • foreign exchange/commodity timing differences in income from operations consisting of: (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (c) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities). Certain other non-operational items generally includes certain regulatory, compliance and legal costs, certain asset write downs/impairments and certain other fair value changes, as well as other items which are determined by management on a case -by-case basis. Operational EBITA is our measure of segment profit but is also used by management to evaluate the profitability of the Compan y as a whole. Acquisition-related amortization Amortization expense on intangibles arising upon acquisitions. Restructuring, related and implementation costs Restructuring, related and implementation costs consists of restructuring and other related expenses, as well as internal and external costs relating to the implementation of group-wide restructuring programs. Operational revenues The Company presents operational revenues solely for the purpose of allowing the computation of Operational EBITA margin. Operational revenues are Total revenues adjusted for foreign exchange/commodity timing differences in total revenues of: (i) unrealized gains and losses on derivatives, (ii) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (iii) unrealized foreign exchange movements on receivables (and related assets). Operational revenues are not intended to be an alternative measure to Total revenues, which represent our revenues measured in accordance with U.S. GAAP. Reconciliation The following tables provide reconciliations of consolidated Operational EBITA to Net Income and Operational EBITA margin by business. Reconciliation of consolidated Operational EBITA to Net Income Nine months ended September 30, Three months ended September 30, ($ in millions) 2024 2023 2024 2023 Operational EBITA 4,534 4,094 1,553 1,392 Acquisition-related amortization (157) (164) (44) (55) Restructuring, related and implementation costs (1) (97) (92) (21) (51) Changes in obligations related to divested businesses 11 5 – – Gains and losses from sale of businesses (13) 97 1 71 Fair value adjustment on assets and liabilities held for sale (132) – (89) – Acquisition- and divestment-related expenses and integration costs (54) (55) (17) (10) Certain other non-operational items (168) (89) (55) (49) Foreign exchange/commodity timing differences in income from operations (22) (41) (19) (39) Income from operations 3,902 3,755 1,309 1,259 Interest and dividend income 146 115 43 37 Interest and other finance expense (91) (197) (41) (73) Non-operational pension (cost) credit 39 23 13 8 Income from continuing operations before taxes 3,996 3,696 1,324 1,231 Income tax expense (1,041) (794) (387) (326) Income from continuing operations, net of tax 2,955 2,902 937 905 Loss from discontinued operations, net of tax 2 (16) 5 (7) Net income 2,957 2,886 942 898 (1) Includes impairment of certain assets. ===== SIDA 50 ===== 37 Q3 2024 FINANCIAL INFORMATION Reconciliation of Operational EBITA margin by business Three months ended September 30, 2024 Corporate and Robotics & Other and Process Discrete Intersegment ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation elimination Consolidated Total revenues 3,913 1,969 1,643 747 (121) 8,151 Foreign exchange/commodity timing differences in total revenues: Unrealized gains and losses on derivatives (6) (14) (3) (3) (6) (32) Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized – (2) 3 – (4) (3) Unrealized foreign exchange movements on receivables (and related assets) 15 3 10 3 10 41 Operational revenues 3,922 1,956 1,653 747 (121) 8,157 Income (loss) from operations 893 397 242 31 (254) 1,309 Acquisition-related amortization 23 9 2 7 3 44 Restructuring, related and implementation costs(1) 2 2 – 20 (3) 21 Gains and losses from sale of businesses (1) – – – – (1) Fair value adjustment on assets and liabilities held for sale – – – – 89 89 Acquisition- and divestment-related expenses and integration costs 4 1 2 5 5 17 Certain other non-operational items 1 2 3 1 48 55 Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) 13 (12) (6) (4) 3 (6) Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized (4) (1) 3 – (5) (7) Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) 13 6 5 2 6 32 Operational EBITA 944 404 251 62 (108) 1,553 Operational EBITA margin (%) 24.1% 20.7% 15.2% 8.3% n.a. 19.0% (1) Includes impairment of certain assets. In the three months ended September 30, 2024, Certain other non-operational items in the table above includes the following: Three months ended September 30, 2024 Robotics & Process Discrete Corporate ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation and Other Consolidated Certain other non-operational items: Other income/expense relating to the Power Grids joint venture – – – – (3) (3) Regulatory, compliance and legal costs – – – – (5) (5) Business transformation costs(1) 2 – – – 45 47 Certain other fair values changes, including asset impairments 1 2 2 – 7 12 Other non-operational items (2) – 1 1 4 4 Total 1 2 3 1 48 55 (1) Amounts include ABB Way process transformation costs of $46 million for the three months ended September 30, 2024. ===== SIDA 51 ===== 38 Q3 2024 FINANCIAL INFORMATION Three months ended September 30, 2023 Corporate and Robotics & Other and Process Discrete Intersegment ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation elimination Consolidated Total revenues 3,561 1,947 1,554 929 (23) 7,968 Foreign exchange/commodity timing differences in total revenues: Unrealized gains and losses on derivatives 45 20 (13) (4) 2 50 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized – (1) 2 1 1 3 Unrealized foreign exchange movements on receivables (and related assets) (13) 4 4 5 (2) (2) Operational revenues 3,593 1,970 1,547 931 (22) 8,019 Income (loss) from operations 762 365 218 113 (199) 1,259 Acquisition-related amortization 22 9 1 20 3 55 Restructuring, related and implementation costs(1) 14 3 3 – 31 51 Changes in obligations related to divested businesses – – – – – – Gains and losses from sale of businesses (71) – – – – (71) Acquisition- and divestment-related expenses and integration costs 4 3 (4) 3 4 10 Certain other non-operational items 2 1 – 1 45 49 Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) 26 10 9 (5) 8 48 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized 1 (1) – 2 – 2 Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) (12) – (1) 3 (1) (11) Operational EBITA 748 390 226 137 (109) 1,392 Operational EBITA margin (%) 20.8% 19.8% 14.6% 14.7% n.a. 17.4% (1) Includes impairment of certain assets. In the three months ended September 30, 2023, Certain other non-operational items in the table above includes the following: Three months ended September 30, 2023 Robotics & Process Discrete Corporate ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation and Other Consolidated Certain other non-operational items: Other income/expense relating to the Power Grids joint venture – – – – (7) (7) Business transformation costs(1) 3 1 – 1 52 57 Certain other fair values changes, including asset impairments – 1 – – 2 3 Other non-operational items (1) (1) – – (2) (4) Total 2 1 – 1 45 49 (1) Amounts include ABB Way process transformation costs of $51 million for the three months ended September 30, 2023. ===== SIDA 52 ===== 39 Q3 2024 FINANCIAL INFORMATION Nine months ended September 30, 2024 Corporate and Robotics & Other and Process Discrete Intersegment ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation elimination Consolidated Total revenues 11,402 5,749 4,961 2,444 (296) 24,260 Foreign exchange/commodity timing differences in total revenues: Unrealized gains and losses on derivatives 45 29 20 3 2 99 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized (2) – 4 – (2) – Unrealized foreign exchange movements on receivables (and related assets) (11) (13) (8) (5) 5 (32) Operational revenues 11,434 5,765 4,977 2,442 (291) 24,327 Income (loss) from operations 2,499 1,067 750 168 (582) 3,902 Acquisition-related amortization 69 26 5 48 9 157 Restructuring, related and implementation costs(1) 20 24 7 40 6 97 Changes in obligations related to divested businesses – – – – (11) (11) Gains and losses from sale of businesses (2) – – – 15 13 Fair value adjustment on assets and liabilities held for sale 25 – – – 107 132 Acquisition- and divestment-related expenses and integration costs 33 3 3 12 3 54 Certain other non-operational items 3 5 (2) – 162 168 Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) 12 15 4 2 5 38 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized (7) – 4 – (3) (6) Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) 5 (5) (4) (2) (4) (10) Operational EBITA 2,657 1,135 767 268 (293) 4,534 Operational EBITA margin (%) 23.2% 19.7% 15.4% 11.0% n.a. 18.6% (1) Includes impairment of certain assets. In the nine months ended September 30, 2024, Certain other non-operational items in the table above includes the following: Nine months ended September 30, 2024 Robotics & Process Discrete Corporate ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation and Other Consolidated Certain other non-operational items: Other income/expense relating to the Power Grids joint venture – – – – (14) (14) Regulatory, compliance and legal costs – – – – (1) (1) Business transformation costs(1) 3 1 – – 144 148 Certain other fair values changes, including asset impairments 1 4 (2) – 28 31 Other non-operational items (1) – – – 5 4 Total 3 5 (2) – 162 168 (1) Amounts include ABB Way process transformation costs of $145 million for the nine months ended September 30, 2024. ===== SIDA 53 ===== 40 Q3 2024 FINANCIAL INFORMATION Nine months ended September 30, 2023 Corporate and Robotics & Other and Process Discrete Intersegment ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation elimination Consolidated Total revenues 10,886 5,868 4,543 2,788 (95) 23,990 Foreign exchange/commodity timing differences in total revenues: Unrealized gains and losses on derivatives 37 15 3 4 6 65 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized (5) (1) 8 1 1 4 Unrealized foreign exchange movements on receivables (and related assets) (20) (2) (8) (3) (11) (44) Operational revenues 10,898 5,880 4,546 2,790 (99) 24,015 Income (loss) from operations 2,130 1,098 688 347 (508) 3,755 Acquisition-related amortization 66 26 4 59 9 164 Restructuring, related and implementation costs(1) 26 5 7 – 54 92 Changes in obligations related to divested businesses 1 – – – (6) (5) Gains and losses from sale of businesses (71) – (26) – – (97) Acquisition- and divestment-related expenses and integration costs 23 15 (3) 7 13 55 Certain other non-operational items 11 4 – 4 70 89 Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) 42 15 (1) 1 1 58 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized (1) (1) 7 2 1 8 Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) (15) (5) (6) (2) 3 (25) Operational EBITA 2,212 1,157 670 418 (363) 4,094 Operational EBITA margin (%) 20.3% 19.7% 14.7% 15.0% n.a. 17.0% (1) Includes impairment of certain assets. In the nine months ended September 30, 2023, certain other non-operational items in the table above includes the following: Nine months ended September 30, 2023 Robotics & Process Discrete Corporate ($ in millions, unless otherwise indicated) Electrification Motion Automation Automation and Other Consolidated Certain other non-operational items: Other income/expense related to the Power Grids joint venture – – – – (27) (27) Business transformation costs 12 1 – 3 123 139 Certain other fair values changes, including asset impairments 1 2 – 1 (7) (3) Other non-operational items (2) 1 – – (19) (20) Total 11 4 – 4 70 89 (1) Amounts include ABB Way process transformation costs of $122 million for the nine months ended September 30, 2023. ===== SIDA 54 ===== 41 Q3 2024 FINANCIAL INFORMATION Net debt Definition Net debt Net debt is defined as Total debt less Cash and marketable securities. Total debt Total debt is the sum of Short-term debt and current maturities of long-term debt, and Long-term debt. Cash and marketable securities Cash and marketable securities is the sum of Cash and equivalents, Restricted cash and Marketable securities and short -term investments. Reconciliation ($ in millions) September 30, 2024 December 31, 2023 Short-term debt and current maturities of long-term debt 109 2,607 Long-term debt 6,666 5,221 Total debt 6,775 7,828 Cash and equivalents 3,264 3,891 Restricted cash 19 18 Marketable securities and short-term investments 1,334 1,928 Cash and marketable securities 4,617 5,837 Net debt 2,158 1,991 Net debt/Equity ratio Definition Net debt/Equity ratio Net debt/Equity ratio is defined as Net debt divided by Equity. Equity Equity is defined as Total stockholders’ equity. Reconciliation ($ in millions, unless otherwise indicated) September 30, 2024 December 31, 2023 Total stockholders' equity 14,680 14,057 Net debt (as defined above) 2,158 1,991 Net debt / Equity ratio 0.15 0.14 Net debt/EBITDA ratio Definition Net debt/EBITDA ratio Net debt/EBITDA ratio is defined as Net debt divided by EBITDA. EBITDA EBITDA is defined as Income from operations for the trailing twelve months preceding the balance sheet date before depreciati on and amortization for the same trailing twelve-month period. Reconciliation ($ in millions, unless otherwise indicated) September 30, 2024 September 30, 2023 Income from operations for the three months ended: December 31, 2023 / 2022 1,116 1,185 March 31, 2024 / 2023 1,217 1,198 June 30, 2024 / 2023 1,376 1,298 September 30, 2024 / 2023 1,309 1,259 Depreciation and Amortization for the three months ended: December 31, 2023 / 2022 199 199 March 31, 2024 / 2023 201 191 June 30, 2024 / 2023 202 196 September 30, 2024 / 2023 194 194 EBITDA 5,814 5,720 Net debt (as defined above) 2,158 2,872 Net debt / EBITDA 0.4 0.5 ===== SIDA 55 ===== 42 Q3 2024 FINANCIAL INFORMATION Net working capital as a percentage of revenues Definition Net working capital as a percentage of revenues Net working capital as a percentage of revenues is calculated as Net working capital divided by Adjusted revenues for the tra iling twelve months. Net working capital Net working capital is the sum of (i) receivables, net, (ii) contract assets, (iii) inventories, net, and (iv) prepaid expenses; less (v ) accounts payable, trade, (vi) contract liabilities and (vii) other current liabilities (excluding primarily: (a) income taxes payable, (b) current derivative liabilities, (c) pens ion and other employee benefits, (d) payables under the share buyback program and (e) liabilities related to certain other restructuring-related activities); and including the amounts related to these accounts which have been presented as either assets or liabilities held for sale. Adjusted revenues for the trailing twelve months Adjusted revenues for the trailing twelve months includes total revenues recorded by ABB in the twelve months preceding the r elevant balance sheet date adjusted to eliminate revenues of divested businesses and the estimated impact of annualizing revenues of certain acquis itions which were completed in the same trailing twelve-month period. Reconciliation ($ in millions, unless otherwise indicated) September 30, 2024 September 30, 2023 Net working capital: Receivables, net 7,448 7,586 Contract assets 1,236 1,073 Inventories, net 6,556 6,332 Prepaid expenses 306 280 Accounts payable, trade (5,167) (4,777) Contract liabilities (3,081) (2,610) Other current liabilities(1) (3,714) (3,843) Net working capital in assets and liabilities held for sale 19 – Net working capital 3,603 4,041 Total revenues for the three months ended: December 31, 2023 / 2022 8,245 7,824 March 31, 2024 / 2023 7,870 7,859 June 30, 2024 / 2023 8,239 8,163 September 30, 2024 / 2023 8,151 7,968 Adjustment to annualize/eliminate revenues of certain acquisitions/divestments 83 (267) Adjusted revenues for the trailing twelve months 32,588 31,547 Net working capital as a percentage of revenues (%) 11.1% 12.8% (1) Amounts exclude $903 million and $754 million at September 30, 2024 and 2023, respectively, related primarily to (a) income taxes payable, (b) current derivative liabilities, (c) pension and other employee benefits, (d) payables under the share buyback program and (e) liabilities related to certain restructuring -related activitie s. ===== SIDA 56 ===== 43 Q3 2024 FINANCIAL INFORMATION Free cash flow Definition Free cash flow Free cash flow is calculated as net cash provided by operating activities adjusted for: (i) purchases of property, plant and equipment and intangible assets, and (ii) proceeds from sales of property, plant and equipment . Reconciliation Nine months ended September 30, Three months ended September 30, ($ in millions, unless otherwise indicated) 2024 2023 2024 2023 Net cash provided by operating activities 3,138 2,393 1,345 1,351 Adjusted for the effects of operations: Purchases of property, plant and equipment and intangible assets (562) (506) (196) (175) Proceeds from sale of property, plant and equipment 66 67 24 10 Free cash flow 2,642 1,954 1,173 1,186 Free cash flow conversion to net income Definition Free cash flow conversion to net income Free cash flow conversion to net income is calculated as free cash flow divided by Adjusted net income attributable to ABB. Adjusted net income attributable to ABB Adjusted net income attributable to ABB is calculated as net income attributable to ABB adjusted for gains or losses arising on sale of certain businesses and certain other significant items within net income which are also excluded / adjusted for when calculating operating cashflows. Free cash flow for the trailing twelve months Free cash flow for the trailing twelve months includes free cash flow recorded by ABB in the twelve months preceding the rele vant balance sheet date. Net income for the trailing twelve months Net income for the trailing twelve months includes net income recorded by ABB (as adjusted) in the twelve months preceding th e relevant balance sheet date. Reconciliation Trailing twelve months to ($ in millions, unless otherwise indicated) September 30, 2024 December 31, 2023 Net cash provided by operating activities 5,035 4,290 Adjusted for the effects of operations: Purchases of property, plant and equipment and intangible assets (826) (770) Proceeds from sale of property, plant and equipment 146 147 Free cash flow 4,355 3,667 Adjusted net income attributable to ABB (1) 3,952 3,686 Free cash flow conversion to net income 110% 99% (1) Adjusted net income attributable to ABB for the year ended December 31, 2023, is adjusted to exclude the gain on sale of the Power Conversion Division of $59 million. Reconciliation of the trailing twelve months to September 30, 2024 ($ in millions) Net cash provided by operating activities Purchases of property, plant and equipment and intangible assets Proceeds from sale of property, plant and equipment Adjusted net income attributable to ABB(1) Q4 2023 1,897 (264) 80 915 Q1 2024 726 (181) 6 905 Q2 2024 1,067 (185) 36 1,096 Q3 2024 1,345 (196) 24 1,036 Total for the trailing twelve months to September 30, 2024 5,035 (826) 146 3,952 (1) Adjusted net income attributable to ABB for Q4 2023 is adjusted to exclude an increase in the gain on sale of the Power Conversion Division of $6 million and Q3 2024 is adjusted to exclude the fair value adjustment on assets and liabilities held for sale of $89 million within the E -mobility Division. ===== SIDA 57 ===== 44 Q3 2024 FINANCIAL INFORMATION Free cash flow margin Effective January 1, 2024, ABB changed the presentation of discontinued operations in its statement of cash flows to an alternate allowable policy. As a result, the total cash flows from discontinued operations are no longer shown separately but instead all cash flows in discon tinued operations are presented within each line item as appropriate in the statement of cash flows. For the purposes of the table below, these cha nges have not been reflected in all periods up to and including December 31, 2023. Definition Free cash flow margin Free cash flow margin is calculated as Free cash flow from continuing operations divided by total revenues. Free cash flow from continuing operations Free cash flow from continuing operations is calculated as net cash provided by operating activities from continuing operations adjusted for continuing operations: (i) purchases of property, plant and equipment and intangible assets, and (ii) proceeds from sales of property, p lant and equipment. Reconciliation Nine months ended, Twelve months ended December 31, ($ in millions, unless otherwise indicated) September 30, 2024 2023 2022 2021 2020 2019 Free cash flow from continuing operations: Net cash provided by operating activities - continuing activities 3,138 4,301 1,334 3,338 1,875 1,899 Adjusted for the effects of continuing operations: Purchases of property, plant and equipment and intangible assets (562) (770) (762) (820) (694) (762) Proceeds from sale of property, plant and equipment 66 147 127 93 114 82 Free cash flow from continuing operations 2,642 3,678 699 2,611 1,295 1,219 Total revenues 24,260 32,235 29,446 28,945 26,134 27,978 Free cash flow margin 10.9% 11.4% 2.4% 9.0% 5.0% 4.4% (1) In the nine months ended September 30, 2024, Free cash flow from discontinued operations is not material and as such has not been excluded from the amounts presented. ===== SIDA 58 ===== 45 Q3 2024 FINANCIAL INFORMATION Net finance income (expense) Definition Net finance income (expense) is calculated as Interest and dividend income less Interest and other finance expense. Reconciliation Nine months ended September 30, Three months ended September 30, ($ in millions) 2024 2023 2024 2023 Interest and dividend income 146 115 43 37 Interest and other finance expense (91) (197) (41) (73) Net finance income (expense) 55 (82) 2 (36) Book-to-bill ratio Definition Book-to-bill ratio is calculated as Orders received divided by Total revenues. Reconciliation Nine months ended September 30, 2024 2023 ($ in millions, except Book-to-bill presented as a ratio) Orders Revenues Book-to-bill Orders Revenues Book-to-bill Electrification 12,514 11,402 1.10 11,794 10,886 1.08 Motion 6,123 5,749 1.07 6,285 5,868 1.07 Process Automation 5,283 4,961 1.06 5,665 4,543 1.25 Robotics & Discrete Automation 2,029 2,444 0.83 2,516 2,788 0.90 Corporate and Other (incl. intersegment eliminations) (347) (296) n.a. (91) (95) n.a. ABB Group 25,602 24,260 1.06 26,169 23,990 1.09 Three months ended September 30, 2024 2023 ($ in millions, except Book-to-bill presented as a ratio) Orders Revenues Book-to-bill Orders Revenues Book-to-bill Electrification 4,049 3,913 1.03 3,693 3,561 1.04 Motion 1,806 1,969 0.92 1,886 1,947 0.97 Process Automation 1,784 1,643 1.09 1,883 1,554 1.21 Robotics & Discrete Automation 640 747 0.86 665 929 0.72 Corporate and Other (incl. intersegment eliminations) (86) (121) n.a. (75) (23) n.a. ABB Group 8,193 8,151 1.01 8,052 7,968 1.01 ===== SIDA 59 ===== 46 Q3 2024 FINANCIAL INFORMATION R&D and related spend Definition R&D and related spend R&D and related spend is calculated as the sum of Non-order related R&D excluding completed divisional exits but including Venture Investments. Non-order related R&D excluding completed divisional exits Non-order related R&D excluding completed divisional exits is calculated as Non -order related research and development expenses adjusted for the impacts from the divestment of the Power Conversion Division, the Mechanical Power Transmission Division (Dodge) and the Solar invertors business as well as the spin-off of the Turbocharging Division (Impact of divisional exits). Venture Investments Venture Investments are defined as investments in and funding provided directly to start-up companies. Reconciliation Trailing 12 mths December 31, ($ in millions, unless otherwise indicated) to Sept. 30, 2024 2023 2022 2021 2020 2019 2018 Non-order related research and development expenses 1,426 1,317 1,166 1,219 1,127 1,198 1,147 Impact of divisional exits – (14) (64) (89) (86) (107) (101) Non-order related R&D excluding completed divisional exits 1,426 1,303 1,102 1,130 1,041 1,091 1,046 Venture Investments 48 78 84 35 20 15 18 R&D and related spend 1,474 1,381 1,186 1,165 1,061 1,106 1,064 Reconciliation of the trailing twelve months to September 30, 2024 R&D and related spend Revenues excluding divisional exits ($ in millions) Non-order related research and development expenses Impact of divisional exits Non-order related R&D excluding completed divisional exits Venture Investments R&D and related spend Total revenues Impact of divisional exits Revenues excluding divisional exits Q4 2023 366 – 366 10 376 8,245 – 8,245 Q1 2024 363 – 363 – 363 7,870 – 7,870 Q2 2024 364 – 364 34 398 8,239 – 8,239 Q3 2024 333 – 333 4 337 8,151 – 8,151 Total for the trailing 12 mths to Sept. 30, 2024 1,426 – 1,426 48 1,474 32,505 – 32,505 R&D and related spend as a percentage of revenues Definition R&D and related spend as a percentage of Revenues R&D and related spend as a percentage of Revenues is calculated as R&D and related spend divided by Revenues excluding divisional exits, for the trailing twelve months. Revenues excluding divisional exits Revenues excluding divisional exits includes Total revenues recorded by ABB in the twelve months preceding the relevant reporting date, adjusted to eliminate revenues of certain divested businesses (i.e. Power Conversion Division, Mechanical Power Transmission Division , the Solar invertors business and the Turbocharging Division) in the same trailing twelve-month period. Reconciliation Trailing 12 mths December 31, ($ in millions, unless otherwise indicated) to Sept. 30, 2024 2023 2022 2021 2020 2019 2018 Total revenues 32,505 32,235 29,446 28,945 26,134 27,978 27,662 Impact of divisional exits – (220) (1,012) (1,625) (1,604) (2,032) (1,915) Revenues excluding divisional exits 32,505 32,015 28,434 27,320 24,530 25,946 25,747 R&D and related spend (as defined above) 1,474 1,381 1,186 1,165 1,061 1,106 1,064 R&D and related spend as a % of revenues 4.5% 4.3% 4.2% 4.3% 4.3% 4.3% 4.1% Non-order related R&D as a percentage of revenues Definition Non-order related R&D as a percentage of Revenues Non-order related R&D as a percentage of Revenues is calculated as Non-order related R&D excluding completed divisional exits divided by Revenues excluding divisional exits (defined above). Reconciliation Trailing 12 mths December 31, ($ in millions, unless otherwise indicated) to Sept. 30, 2024 2023 2022 2021 2020 2019 2018 Non-order related R&D excluding completed divisional exits (as defined above) 1,426 1,303 1,102 1,130 1,041 1,091 1,046 Revenues excluding divisional exits (as defined above) 32,505 32,015 28,434 27,320 24,530 25,946 25,747 Non-order related R&D as a % of revenues 4.4% 4.1% 3.9% 4.1% 4.2% 4.2% 4.1% ===== SIDA 60 ===== 47 Q3 2024 FINANCIAL INFORMATION Return on Capital employed (ROCE) – Trailing twelve months Definition Return on Capital employed (ROCE) – Trailing twelve months Return on Capital employed (ROCE) – Trailing twelve months is calculated as Operational EBITA after tax for the trailing twelve months, divided by the average of the opening and closing Capital employed for each of the four quarters during the trailing twelve-month period (4 quarter average). Capital employed Capital employed is calculated as the sum of Adjusted total fixed assets and Net working capital (as defined above). Adjusted total fixed assets Adjusted total fixed assets is the sum of (i) property, plant and equipment, net, (ii) goodwill, (iii) other intangible assets, net, (iv) investments in equity-accounted companies, (v) operating lease right-of-use assets, and (vi) fixed assets included in assets held for sale, less (vii) deferred tax liabilities recognized in certain acquisitions. Net working capital Net working capital is the sum of (i) receivables, net, (ii) contract assets, (iii) inventories, net, and (iv) prepaid expens es; less (v) accounts payable, trade, (vi) contract liabilities and (vii) other current liabilities (excluding primarily: (a) income taxes payable, (b) current der ivative liabilities, (c) pension and other employee benefits, (d) payables under the share buyback program, (e) liabilities related to certain other restructuring -related activities and (f) liabilities related to the divestment of the Power Grids business); and including the amounts related to these accounts which have been presented as either assets or liabilities held for sale but excluding any amounts included in discontinued operations. Notional tax on Operational EBITA The Notional tax on Operational EBITA is computed using the adjusted group effective tax rate multiplied by Operational EBITA . Adjusted Group effective tax rate The Adjusted Group effective tax rate is computed by dividing a n adjusted income tax expense by an adjusted pre -tax income. Certain amounts recorded in income before taxes and the related income tax expense (primarily due to gains and losses from sale of businesses ) are removed from the reported amounts when computing these adjusted amounts. Certain other amounts recorded in income tax expense are also exclude d from the computation to determine the Adjusted Group effective tax rate. Reconciliation ($ in millions, unless otherwise indicated) 2024 Q3 2024 Q2 2024 Q1 2023 Q4 2023 Q3 Adjusted total fixed assets: Property, plant and equipment, net 4,248 4,095 4,047 4,142 3,891 Goodwill 10,582 10,525 10,494 10,561 10,356 Other intangible assets, net 1,036 1,089 1,128 1,223 1,181 Investments in equity-accounted companies 185 189 178 187 186 Operating lease right-of-use assets 873 861 863 893 850 Fixed assets included in assets held for sale 176 – – – – Total fixed assets 17,100 16,759 16,710 17,006 16,464 Less: Deferred taxes recognized in certain acquisitions (1) (253) (265) (281) (297) (312) Adjusted total fixed assets 16,847 16,494 16,429 16,709 16,152 Net working capital - (as defined above) 3,603 3,607 3,588 3,257 4,041 Capital employed 20,450 20,101 20,017 19,966 20,193 Operational EBITA for the three months ended 1,553 1,564 1,417 1,333 Average Capital employed (4 quarters) 20,101 Operational EBITA for the trailing twelve months 5,867 Notional tax on Operational EBITA (1,467) Operational EBITA after tax for the trailing twelve months 4,400 Return on Capital employed (ROCE) - Trailing twelve months 21.9% (1) Amount relates to GEIS acquired in 2018, B&R acquired in 2017, Thomas & Betts acquired in 2012 and Baldor acquired in 2011. ===== SIDA 61 ===== 48 Q3 2024 FINANCIAL INFORMATION Return on Capital employed (ROCE) on Net Operating assets Definition Return on Capital employed (ROCE) on Net Operating assets Return on Capital employed on Net Operating assets is calculated as Operational EBITA after tax, divided by the average of the period’s opening and closing Capital employed on Net Operating assets. Capital employed on Net Operating assets Capital employed on Net Operating assets is calculated as the sum of Operating assets and Net working capital (as defined on the previous page). Operating assets Operating assets is the sum of (i) property, plant and equipment, net, (ii) capitalized software for internal use, net, (iii) investments in equity-accounted companies, (iv) operating lease right-of-use assets, and (v) fixed assets included in assets held for sale, as applicable. Return on Capital employed (ROCE) on Net Operating assets – Trailing twelve months Return on Capital employed (ROCE) on Net Operating assets is calculated as Operational EBITA after tax, divided by the average of the period’s opening and closing Capital employed on Net Operating assets for each of the four quarters during the trailing twelve -month period (4 quarter average). Reconciliation – ROCE on Net Operating assets December 31, ($ in millions, unless otherwise indicated) 2023 2022 Operating assets: Property, plant and equipment, net 4,142 3,911 Capitalized software for internal use, net 129 110 Investments in equity-accounted companies 187 130 Operating lease right-of-use assets 893 841 Total Operating assets 5,351 4,992 Net working capital - (as defined above) 3,257 3,216 Capital employed on Net Operating assets 8,608 8,208 Capital employed on Net Operating assets: - at December 31, 2022 8,208 - at December 31, 2023 8,608 Average Capital employed on Net Operating assets 8,408 Operational EBITA for the year ended 5,427 Notional tax on Operational EBITA (as defined above) (1,248) Operational EBITA after tax 4,179 ROCE on Net Operating assets 49.7% Reconciliation – Return on Capital employed (ROCE) on Net Operating assets – Trailing twelve months ($ in millions, unless otherwise indicated) 2024 Q3 2024 Q2 2024 Q1 2023 Q4 2023 Q3 Operating assets: Property, plant and equipment, net 4,248 4,095 4,047 4,142 3,891 Capitalized software for internal use, net 119 116 124 129 104 Investments in equity-accounted companies 185 189 178 187 186 Operating lease right-of-use assets 873 861 863 893 850 Fixed assets included in assets held for sale 11 – – – – Total Operating assets 5,436 5,261 5,212 5,351 5,031 Net working capital - (as defined above) 3,603 3,607 3,588 3,257 4,041 Capital employed on Net Operating assets 9,039 8,868 8,800 8,608 9,072 Operational EBITA for the three months ended 1,553 1,564 1,417 1,333 Average Capital employed on Net Operating assets (4 quarters) 8,833 Operational EBITA for the trailing twelve months 5,867 Notional tax on Operational EBITA (as defined above) (1,467) Operational EBITA after tax for the trailing twelve months 4,400 ROCE on Net Operating assets - Trailing twelve months 49.8% ===== SIDA 62 ===== — ABB Ltd Corporate Communications P.O. Box 8131 805 0 Zurich Switzerland Tel: +41 (0)43 317 71 11 www.abb.com