Shares fell 11.5% as investors reacted negatively to margin compression in the Products and SI segment alongside weaker operating cash flow, despite revenue growth and raised full-year guidance.

• Revenue grew 7% year-over-year, supported by 18% growth in Software and Services and modest 1% growth in Products and SI.
• Operating margins expanded company-wide by 50 basis points to 28.8% on a non-GAAP basis, but Products and SI margins declined from 28.1% to 24.8%, pressured by unfavorable mix and higher supply chain costs.
• GAAP EPS declined to $2.18 due to a $0.45 noncash Silvus earnout charge; non-GAAP EPS increased 6% to $3.37.
• Operating cash flow fell $59 million year-over-year to $451 million, with free cash flow down $84 million, driven by inventory investments and higher interest expense.
• Orders reached a record $15.7 billion backlog (up 11%), reflecting strong demand, with notable wins in both segments, but investors focused on margin pressure and cash flow softness.