“In the event we see negative economic growth in the second half of the year, we would expect full year 2025 sales and revenues to only be down slightly versus 2024.”

In context

“intake in all three segments, which led to record organic growth in our backlog. As a result, in pre-tariff scenario, which does not include any impact from tariffs, we would have expected full year 2025 sales and revenues to be about flat versus 2024. This would represent a slight improvement since our outlook last quarter. In this scenario, we would also expect adjusted operating profit margins to be in the top half of the target margin range based on the corresponding level of sales and revenues. ME&T free cash flow would also be in the top half of the $5 billion to $10 billion target range. However, due to the tariff announcements and increasing economic uncertainty, we have evaluated a variety of scenarios to estimate the potential impact on our results for the remainder of the year. In the event we see negative economic growth in the second half of the year, we would expect full year 2025 sales and revenues to only be down slightly versus 2024. This expectation is a reflection of the diversity of our end markets and the strength our record backlog, especially for large engines and solar turbines where we have line of sight to production for the remainder of 2025. Before considering additional mitigating actions we might take and assuming the tariffs in place today remain for the duration of 2025, we would still expect to be in the target margin range for adjusted operating profit as well as in the ME&T free cash flow target range for the year. Andrew will provide more details on key assumptions for the second quarter and full year in a moment. To further support our range of scenarios, I'll now share the latest view of our end markets based on current conditions. Starting with Construction Industries. As I said earlier, we are e”