Trimble Stock Sinks 18% After Q3 Sales Miss, Cut to GAAP Profit Outlook

Trimble Inc. (NASDAQ:TRMB) shares plunged Wednesday after the industrial technology company reported third-quarter revenue that missed estimates, cut its full-year GAAP earnings guidance and narrowed its adjusted outlook.

Q3 Revenue and Earnings

Quarterly revenue was $966.8 million, up 7% from a year earlier and just missing the analyst estimate of $972.62 million.

Organic revenue increased 7% year over year.

Annualized recurring revenue rose 11% to $2.56 billion, or 10% on an organic basis.

Trimble posted adjusted earnings of 86 cents per share, in line with the analyst estimate.

Adjusted gross margin contracted to 70.5% from 71.2% a year earlier.

CFO Phil Sawarynski said Trimble generated $643.6 million of free cash flow through the first three quarters and ended the quarter with $215 million of cash and a 1.2-times leverage ratio, which is well below its long-term target ratio of 2.5-times.

Executives Highlight AI Platform Growth, 2027 Opportunities

Trimble executives said U.S. strength, construction software growth, AI adoption and deeper platform integration are supporting the company’s outlook, while weaker European markets, agriculture softness and product-transition headwinds are weighing on near-term ARR growth.

CEO Rob Painter said Trimble’s Connect and Scale strategy remains central to growth as the company links field data with office software across construction and transportation. Management also pointed to new products including the ST30 Smart Target, Maxwell 8-based GNSS receivers, expanded transportation routing tools and Trimble Dock and Yard as drivers of customer productivity and recurring revenue opportunities.

AI is becoming another growth pillar. Painter said Trimble is prioritizing adoption and engagement before monetization, with products such as ARC Agent, Driver Intelligence, Fleet Assistant, Trimble Assist and AI-powered construction tools already gaining traction. He said AI monetization should develop through subscriptions, add-ons, consumption credits and project-based models as usage matures.

Management also highlighted strong AECO fundamentals, including 13% ARR growth, rising cross-sell and upsell activity, strength in data centers, reshoring, manufacturing and energy projects, and a backlog that increased about 13%.

Near-term challenges include weaker agriculture positioning-services demand, lower-than-expected subscription renewals on bundled offerings, a $20 million ARR drag from exiting a low-margin white-label product and softer European freight conditions. Painter also cited inflation and geopolitical pressure in Europe and the Middle East.

On M&A, Painter said Trimble remains disciplined but is increasingly asking whether AI-native capabilities can be built internally rather than acquired, after faster internal development reduced the need for at least one potential tuck-in deal.

Narrows Full-Year Outlook

For fiscal 2026, Trimble now expects revenue of $3.910 billion to $3.940 billion (versus prior forecast of $3.900 billion to $3.950 billion). Analysts expect revenue of $3.932 billion.

The company expects adjusted earnings of $3.63-$3.69 per share (compared to previous guidance of $3.60-$3.70 per share), versus the analyst estimate of $3.66 per share. Trimble also lowered its GAAP outlook to a loss of 49 cents to 55 cents per share from a loss of 7 cents to 12 cents.

Fourth-Quarter Outlook

For the fourth quarter, Trimble projected revenue of $1.031 billion to $1.061 billion, compared with analyst estimates of $1.035 billion. The company forecast adjusted earnings of $1.13-$1.19 per share, in line with analyst expectations of $1.16 per share.

Stock Reaction

TRMB Stock Price Activity: Trimble shares are trading lower by 18.11% at $53.73 at the time of publication on Wednesday, according to Benzinga Pro data.

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