Danfoss delivered a solid performance in a volatile market

• Sales in 2024 amounted to EUR 9.7 billion.  
• Operational EBITA was EUR 1,097 million corresponding to a margin of 11.3%. 
• Investments in innovative solutions (R&D) at EUR 488 million, corresponding to 5.0% of sales.
• Continued to decouple our emissions from our sales growth, achieving a 19% reduction in scope 1 and 2 carbon emissions. 
• Outlook 2025 sales range of EUR 9.5-11.0 billion and operational EBITA margin range of 10.8-12.3%.

In 2024, we delivered solid operational results and most of our core businesses remained resilient. However, factors such as higher interest rates and lower farm income sent the build of new off-highway machines within agriculture and construction into a cyclical downturn. The electric vehicle market was also impacted by governments scaling back incentives. 

We have as always proactively managed our business performance through the cycle and maintained our long-term focus. To set Danfoss up for the future, we have taken decisive actions to evolve our operating model to better serve our customers, improve competitiveness, enable faster decision-making, and become a more responsive organization.

We continued with significant investments in delivering competitive and innovative solutions as well as regionalizing our factory footprint, thereby continuing to execute on our green growth strategy.

NORDBORG, DENMARK – In 2024, sales were EUR 9,674 million. Despite challenging market conditions, we delivered a solid operational EBITA of EUR 1,097 million, equal to a margin of 11.3%. 

Over the past five years, we doubled the size of Danfoss, achieving balanced sales and a strong local presence across the Americas, Europe, and Asia. We firmly believe in the long-term growth opportunities for Danfoss and in offering great service to our customers all over the world. This is why we continue to invest in factory automation and in regionalizing our supply chain to become more resilient. Additionally, we completed the integration of the Eaton Hydraulics acquisition into the Danfoss Power Solutions segment.

With our new operating model, we have decentralized further to move closer to our customers and become easier to do business with. We focus on strengthening innovation and our entrepreneurial mindset as well as improving our cost competitiveness and responsiveness through increasing speed in decision-making. Today, we operate Danfoss through three segments and 16 divisions. Our businesses now operate within a significantly simplified structure, supported by leaner Shared and Corporate functions.

For Danfoss, sustainability is a key driver of competitiveness and an integrated part of our strategy. We continued to decouple our organic growth from emissions, reducing our scope 1 and 2 emissions by 19% as we work toward our ambitious 90% reduction target by 2030.  We also signed a power purchase agreement covering 100% green electricity for our two campuses in Haiyan, China reducing our carbon emissions by 40,000 tons every year as of 2025, which is equivalent to 33% of Danfoss’ emissions in China and 9% globally.

In 2024, we launched the ‘Green Ask’ initiative with strategic suppliers, which covers 40% of our EUR 3.5 billion spend to enhance data on sourced products and identify decarbonization opportunities.

Financial Outlook 2025
Danfoss has a continued ambition to expand or maintain our market share. Sales are expected to be in the range of EUR 9.5-11.0bn for the full year.
The operational EBITA margin is expected to be in the range of 10.8-12.3%, following our continued investments in new products and solutions.

Key Figures for 2024

• Sales in 2024 were down 9% to EUR 9,674m (2023: 10,654m).
• Operational EBITA (EBITA excl. integration costs and other operating income and expenses): EUR 1,097m equal to a margin of 11.3% (2023: EUR 1,455m or 13.7%)
• Investments in innovation (R&D) maintained at a high level of EUR 488m (2023: 487m), corresponding to 5.0% of sales (2023: 4.6%).
• Investments (CapEx) excluding M&A were EUR 434 million (2023: 596m).
• Net profit EUR 370 million (2023: 819m).
• Free operating cash flow (after financial items and tax) amounted to EUR 467 million (2023: 692m).
• Lost Time Injury Frequency (LTIF) continues to be at the same low level as the previous year at 1.3 (2023: 1.2).
• The total number of employees decreased to 39,360 (2023: 42,054), reflecting efforts to balance the workforce in alignment with the current market conditions as well as the implementation of our adjusted operating model.
  

Read the full annual report here.