Schneider Electric Is in an Excellent Position to Benefit From Demand for Greener Buildings

We believe Schneider Electric’s software strategy offers competitive advantages and should add revenue visibility and returns stability. While stand-alone software sales composes around 10% of the group total on our estimates, they support sales for other products and increase customer retention, as the software systems are deeply integrated with end users’ operations. They also provide recurring revenue through licensing fees. We expect software sales to outgrow the group and increase as a portion of revenue over the medium term.