abb2023q1fininfo

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE

ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of April 2023

Commission File Number 001-16429

ABB Ltd

(Translation of registrant’s name into English)

Affolternstrasse 44, CH-8050, Zurich, Switzerland

(Address of principal executive office)

Indicate by check mark whether

the registrant files or will file

annual reports under cover of Form

20-F or Form 40-F.

Form 20-F

☒

Form 40-F

⬜

Indicate by check mark if the registrant

is submitting the Form 6-K in paper

as permitted by Regulation S-T Rule

101(b)(1):

⬜

Note:

Regulation S-T Rule 101(b)(1) only

permits the submission in paper of

a Form 6-K if submitted solely to provide

attached annual report to security

holders.

Indication by check mark if the registrant

is submitting the Form 6-K in paper

as permitted by Regulation S-T Rule

101(b)(7):

⬜

Note:

Regulation S-T Rule 101(b)(7) only

permits the submission in paper of

a Form 6-K if submitted to furnish a

report or

other document that the registrant foreign

private issuer must furnish

and make public under the laws of the

jurisdiction in

which the registrant is incorporated, domiciled

or legally organized (the registrant’s “home country”),

or under the rules of the

home country exchange on which the registrant’s securities

are traded, as long as the report

or other document is not a press

release, is not required to be and has

not been distributed to the registrant’s security holders,

and, if discussing a material event,

has already been the subject of a Form

6-K submission or other Commission

filing on EDGAR.

Indicate by check mark whether

the registrant by furnishing the

information contained in this Form

is also thereby furnishing

the information to the Commission

pursuant to Rule 12g3-2(b) under

the Securities Exchange Act of 1934.

Yes

⬜

☒

If “Yes” is marked, indicate below the file number assigned to the

registrant in connection with Rule 12g3-2(b):

82-

This Form 6-K consists of the following:

Press release issued by ABB Ltd dated April

25, 2023 titled “Q1 2023 results”.

Q1 2023 Financial Information.

Press release issued by ABB Ltd dated

April 25, 2023 titled “ABB plans

to delist ADRs from NYSE”.

Announcements regarding transactions

in ABB Ltd’s Securities made by the directors or the

members of the

Executive Committee.

The information provided by Item

2 above is hereby incorporated by reference

into the Registration Statements

on Form F-3 of

ABB Ltd and ABB Finance (USA) Inc.

(File Nos. 333-223907 and 333-223907-01)

and registration statements on Form

S-8

(File Nos. 333-190180, 333-181583,

333-179472, 333-171971 and

333-129271) each of which was

previously filed with the

Securities and Exchange Commission.

—

ZURICH, SWITZERLAND, APRIL

25, 2023

Q1 2023 results

Strong start to the year

●

Orders $9,450 million

+1%; comparable

+9%

●

Revenues $7,859 million

+13%; comparable

+22%

●

Income from operations

$1,198 million; margin

15.2%

●

Operational EBITA

$1,277 million;

margin

16.3%

●

Basic EPS $0.56;

+78%

●

Cash flow from operating

activities

$282 million

Ad hoc Announcement pursuant to Art.

53 Listing Rules of SIX Swiss Exchange

—

Q1 2023

First three months

Press Release

—

“ABB had a strong start to the year, with a positive development in most measures,

including cash flow. This gives us the confidence to raise our 2023 guidance.”

Björn Rosengren

, CEO

KEY FIGURES

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

9,450

9,373

Revenues

7,859

6,965

13%

22%

Gross Profit

2,716

2,281

19%

as % of revenues

34.6%

32.7%

+1.9 pts

Income from operations

1,198

857

40%

Operational EBITA

1,277

997

28%

33%

as % of operational revenues

16.3%

14.3%

+2 pts

Income from continuing operations, net of tax

1,065

643

66%

Net income attributable to ABB

1,036

604

72%

Basic earnings per share ($)

0.56

0.31

78%

Cash flow from operating activities

282

(573)

n.a.

For a reconciliation of non-GAAP measures, see “supplemental

reconciliations and definitions” in the attached

Q1 2023 Financial Information.

EPS growth rates are computed using unrounded amounts.

Constant currency (not adjusted for portfolio

changes).

Amount represents total for both continuing and

discontinued operations.

ABB

INTERIM

REPORT

2023

Customer activity was

strong in the first quarter

Despite a very

high comparable from

last year,

we increased order intake

1% (9% comparable)

with a positive development

in three out

of four business

areas. While Robotics & Discrete

Automation

improved orders sequentially,

it declined from last year’s high

level which benefited

from pre-buys in a period

of significant

component shortages.

Particularly strong momentum

was noted

in Process Automation

with orders reaching the

highest level in

recent history.

A positive underlying momentum

was noted also

in all three regions.

Just like in the previous

quarter, we

did not

face significant

supply chain constraints,

hence we converted backlog

into

customer deliveries.

Revenue growth was strong

at 13%

(22%

comparable), with double

-digit comparable increases

in all

business areas. The

impacts from robust development

in both

pricing and volumes

more than offset the notable

adverse

impact from changes

in exchange rates.

Despite strong

revenue growth we

built order backlog, with

book-to-bill at

120%.

I was pleased about

the operational execution

of the increased

revenues.

We improved the

Operational EBITA by

28%

$1,277 million and

the margin was up by 200

basis points to

16.3%. This is the strongest

first quarter result in many

years.

On top of the strong operational

performance, net income was

additionally supported

by net positive tax

impacts of

approximately $200

million linked to a favorable

resolution of

certain prior year tax

matters, mainly related to

the divestment

of the Power Grids

business.

It was good to see

our cash flow improve from

last year by $855

million, in line with

our expectations. Cash

flow from operating

activities of $282

million was strong for a first

quarter,

and set

us off to a robust

start for what I expect

will be a good cash

delivery this year.

I feel confident that our

balance sheet will be

strong enough to support

both organic and acquired

growth, a

rising, sustainable dividend

per share over time and

utilizing

share buybacks as

a means to return excess

cash to our

shareholders. In early

April, we launched our new

buyback program of up

to $1 billion, which will run

until March

2024.

In February,

we published our first integrated

report, including

our 2022 sustainability

report showing solid progress

toward our

2030 goals. One highlight

to mention is that we

reduced our

own greenhouse

gas emissions by 43%, a

total reduction of

65% from the 2019

baseline.

Furthermore, we defined

a new emissions reduction

target for

our supply chain, covering

suppliers that account for

70% of our

procurement spend.

We have continued our

work to strengthen

ABB’s circularity approach

by defining clear key performance

indicators for every

stage of the product life

cycle, from design

to end-of-life. The largest positive

environmental impact

we can

make is through providing

our customers with resource

-efficient

products and the demand

for clean energy and

efficiency is

broad and long-term.

After having been listed

on the New York

Stock Exchange

(NYSE) since 2001,

we have decided to delist

and plan to

eventually deregister

with the SEC.

The main reason being

that

the access to international

equity markets has increased

since

our listing,

through digital trading on

multiple platforms.

Consequently,

we no longer see the

need to be listed on as

many as three equity

capital markets. We

plan to delist our

American Depositary

Receipts (ADRs) on or

around May 23,

2023, and as from the

time of delisting, the ABB ADRs

will

instead be converted

to a sponsored Level

I program. This still

gives US investors

the ability to invest in

ABB through ADRs.

The ABB shares

will remain listed on the

SIX Swiss Exchange

and the Swedish

Nasdaq exchange due to the

company’s

heritage. The delisting

and planned deregistration

in the US

would be yet another

step towards further simplification

and

efficiency at ABB.

I want to emphasize

that we remain as committed

to the US-

market, which represent

ed 24% of our revenues

in 2022. The

United States is critical

to ABB’s success, and

approximately

85%

of ABB’s sales

in the US are from products

produced

locally.

support future success,

we are currently investing

approximately $170

million in our US facilities

to meet

increasing demand

for clean energy and automation.

Björn Rosengren

CEO

In the

second quarter of 2023

, we anticipate double-digit

comparable revenue

growth to support an improvement

in the

Operational EBITA

margin,

year-on-year.

In full-year 2023

, despite current market uncertainty,

anticipate comparable

revenue

growth to be at least

10%

and

we expect to improve

Operational EBITA

margin,

year-on-year.

CEO summary

Outlook

ABB

INTERIM

REPORT

2023

In the first quarter,

a robust customer activity

resulted in an

order intake of $9,450

million, representing an

increase of 1%

(9% comparable) from

last year’s high level. The strongest

order momentum was

noted in the late-cyclical

process

industry-related business

segments.

Order intake improved

in three out of four business

areas.

Process Automation

increased orders by 25%

(55%

comparable) supported

by a strong general demand

pattern

as well as by timing of

larger project orders, and

additionally

by the impact from

the de-booking of approximately

$190 million in last

year’s period. Electrification

orders were

up by 1% (5% comparable)

despite weakness in the

residential construction

market. Motion improved

by 3% (8%

comparable). In Robotics

& Discrete Automation

customers

returned to a seemingly

more normal order pattern,

recovering from the

previous quarter,

although some

hampering effect

from customers outside

of the automotive

segment adjusting

inventory levels was noted.

In total, orders

declined by 23%

(20% comparable)

from the high comparable

last year.

The automotive segment

improved on EV-related

investments, while

softening demand was noted

in the

robotics consumer

related segments.

In transport & infrastructure,

there was a positive development

marine & ports and

renewables. In buildings

there was weakness

in all three regions

in residential-related demand,

while

commercial construction

was solid.

Demand in the process

-related business was strong

across the

board, with particular strength

in oil & gas, and it held

up well also

for refining, water & wastewater,

power generation and

pulp &

paper.

Customer activity was

high in all three regions.

Orders in Europe

increased by 1% (10%

comparable), with growth

rates reflecting

the de-booking last year

The underlying business increased

slightly,

despite weakness in Germany.

Asia, Middle East and

Africa declined by 2%

(up 11%

comparable), although

China

declined by 12%

(3% comparable).

The Covid-related

implications in China

eased quickly,

and demand came off

to a

strong start early in

the quarter with the additional

timing related

support from ordering

ahead of the New Year

celebrations in

China,

after which

customer activity slowed

somewhat from the

record-high comparable

last year.

The Americas improved

by 3%

(5% comparable), weighed

down by the United States

which

declined by 4% (3% comparable)

from the challenging

comparable in last

year’s period.

Orders and revenues

Orders by region

($ in millions,

unless otherwise

indicated)

CHANGE

Q1 2023

Q1 2022

US$

Comparable

Europe

3,582

3,534

10%

The Americas

2,985

2,897

Asia, Middle East

and Africa

2,883

2,942

-2%

11%

ABB Group

9,450

9,373

Growth

Change year-on-year

Orders

Revenues

Comparable

22%

-5%

-6%

Portfolio changes

-3%

Total

13%

Revenues by region

($ in millions,

unless otherwise

indicated)

CHANGE

Q1 2023

Q1 2022

US$

Comparable

Europe

2,872

2,518

14%

24%

The Americas

2,653

2,169

22%

25%

Asia, Middle East

and Africa

2,334

2,278

16%

ABB Group

7,859

6,965

13%

22%

ABB

INTERIM

REPORT

2023

Gross profit

Gross profit increased

strongly by 19% (25% constant

currency) to

$2,716 million, supported

by a significant

gross margin

improvement of

190 basis points to 34.6%.

Gross margin improved

in all business areas,

with three showing significant

increases.

Income from operations

amounted to $1,198 million,

representing a

strong increase of 40

(46%

constant currency),

year-on-year.

Compared with last

year, earnings

were mainly supported

by the

improved operational

performance, with some

additional tailwind

from lower expenses

related to both acquisition

and divestments

and non-operational

items.

Operational EBITA

The year-on-year improvement

was driven by strong operational

execution of the significantly

higher volumes as

well as benefits

from successful price

management

with only a slight adverse

impact from raw materials

and freight costs. Price

clearly more than

offset higher

labor costs. Selling, general

and administrative

expenses declined

in relation to revenues to 17.0%,

from 17.8%

last year.

The operational improvements

more than offset the

adverse impact from

changes in exchange

rates, resulting in an

Operational EBITA

of $1,277

million, an increase of 28% (33%

constant currency)

year-on-year.

Operational EBITA in

Corporate

and Other amounted

to -$111

million, out of which -$28

million

related to the E-mobility

business, which is reported as

part of

Group Corporate and

Other as from this quarter.

Net finance expenses

Net finance expense

was $21 million,

somewhat lower than

expected due to

a reduction in certain income

tax-related risks.

Income tax

Income tax expense

was $119

million with an effective

tax rate of

10.1%, including approximately

17% net benefit on the favorable

resolution of a prior

year tax matter relating to

the divestment of the

Power Grids business.

Net income and earnings

per share

Net income attributable

to ABB was $1,036 million and

increased by

72%, driven primarily by

improved operational performance

and the

benefit of the resolution

of the prior year tax matter

booked in the

quarter.

This resulted in basic earnings

per share of $0.56, up

from

$0.31

last year.

Operational EBITA

($ millions)

Q1 2023

Q1 2022

Corporate and Other

E-mobility

(28)

(2)

Corporate costs, intersegment

eliminations and other

(83)

(32)

Total

(111)

(34)

Majority of which relates to underlying corporate

Earnings

ABB

INTERIM

REPORT

2023

Net working capital

amounted to $4,164 million,

increasing

year-on-year from $3,461

million and sequentially

from

$3,216 million.

The sequential increase

was mainly driven

by higher receivables

triggered by high revenue

growth and

higher inventories on

the back of continued

strong order

intake.

That said, inventory volumes

began to decline

toward the end of the

quarter.

Net working capital as a

percentage of revenues

was 13.9% up from 11.1%.

Capital expenditures

Purchases of property,

plant and equipment

and intangible

assets amounted to

$151 million.

Net debt

amounted to $3,826 million

at the end of the quarter

and increased from

$2,772 million year-on-year,

and

sequentially from $2,779

million. The sequential

increase was

mainly driven by

the initial dividend payment

s, partially offset

by positive free cash

flow during the period

as well as the

shares issued in our subsidiary

ABB E-mobility to third

parties

in private placements

of $341 million.

Cash flows

Cash flow from operating

activities was $282

million and

increased year-on-year

from -$573 million. The

improvement

was driven by positive

cash generation across

all business

areas on the back of higher

earnings and a lower build-up

of net

working capital,

year-on-year. It

should also be noted that

last

year’s cash flow included

a negative cash flow

of approximately

$170 million for income

taxes related to business

separations.

Share buyback program

ABB has completed

its share buyback program that

was

launched in April 2022.

Through this buyback program,

ABB

repurchased a total

of 67,459,000 shares –

equivalent to 3.29%

of its issued share

capital at launch of the buyback

program –

for a total amount of approximately

$2 billion. This included

the

remaining $1.2 billion

of the $7.8 billion of cash

proceeds from

the Power Grids divestment.

A new share buyback program

up to $1 billion was

launched on April 3, 2023.

($ millions,

unless otherwise indicated)

Mar. 31

2023

Mar. 31

2022

Dec. 31

2022

Short term debt and current

maturities of long-term debt

3,433

3,114

2,535

Long-term debt

5,230

6,171

5,143

Total debt

8,663

9,285

7,678

Cash & equivalents

3,438

5,216

4,156

Restricted cash - current

Marketable securities and

short-term investments

1,380

967

725

Restricted cash - non-current

–

300

–

Cash and marketable securities

4,837

6,513

4,899

Net debt (cash)*

3,826

2,772

2,779

Net debt (cash)* to EBITDA ratio

0.9

0.4

0.7

Net debt (cash)* to Equity ratio

0.30

0.20

0.21

At Mar. 31, 2023, Mar. 31, 2022 and Dec. 31, 2022, net debt(cash) excludes net

pension

(assets)/liabilities of $(301) million $(13) million and $(114) million, respectively.

Balance sheet & Cash flow

ABB

INTERIM

REPORT

2023

Orders and revenues

Despite a very challenging

comparable from last

year, order

intake increased by

1% (5% comparable) to

$4,141 million, the

highest quarterly level in

several years.

Strong orders added

further to the order backlog,

with book-

to-bill at 115%.

●

Demand improved

in all customer segments

except for

residential construction,

which declined year-on-year

in all

three regions. Weakness

in residential construction

impacted primarily the

Smart Buildings division,

and to

some extent also Installation

Products, while the other

divisions generally

improved order intake at

a double-digit

pace.

●

Orders increased by

4% (15% comparable)

in Asia, Middle

East and Africa,

as the decline in China of

11%

(4%

comparable) was more

than offset by a strong

development

elsewhere in the

region. Europe improved by

1% (5%

comparable), as a solid

development in a majority

of the

markets more than

offset a low single-digit

decline in

Germany.

The Americas declined

slightly by 1% (1%

comparable), weighed

down by a 6% drop in the

United

States.

●

Revenues increased

by 11%

(16% comparable)

to the

highest level in many

years, with strong developments

both pricing and

volume, supported by solid

market

demand and execution

of the order backlog.

●

This was the first quarter

when the E-mobility business

was

not reported as part

of the business area. In

preparation of

the planned separate

listing and new governance

structure,

E-mobility is now reported

in Corporate and Other.

Profit

Both earnings and

margin reached their

highest levels in recent

history.

Operational EBITA amounted

to $677

million, up 32% year-

on-year, and

the Operational EBITA

margin reached 19.0%,

representing a 310

basis points improvement.

●

The impacts from operational

leverage on increased volumes

and strong pricing activities,

in combination with lower

costs

related to raw materials

and freight,

more than offset a slight

negative divisional

and geographical mix

in revenues,

as well as

the adverse impacts

from changes in exchange

rates.

●

Margins improved in all

divisions except in Smart

Buildings

where

profitability was slightly

hampered due to the

weakness in

residential construction

demand.

Growth

Change year-on-year

Orders

Revenues

Comparable

16%

-4%

-5%

Portfolio changes

Total

11%

—

Electrification

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

4,141

4,112

Order backlog

7,101

5,946

19%

24%

Revenues

3,590

3,236

11%

16%

Operational EBITA

677

512

32%

as % of operational revenues

19.0%

15.9%

+3.1 pts

Cash flow from operating activities

395

354%

No. of employees (FTE equiv.)

51,130

49,650

ABB

INTERIM

REPORT

2023

Orders and revenues

Order intake of $2,262

million reached the highest

level in

several years,

up by 3% (8% comparable)

from last year’s

high comparable. Notably,

the order intake increased

also

when separating out

the impact of larger project

orders. Book-

to-bill was 11

7%, expanding the

order backlog to

$5,102 million.

●

Positive development

for the energy efficiency

-related

drives business,

the e-mobility Traction

division and the

Service division supported

the strong overall order

growth,

while the low voltage

motor divisions declined

from last

year’s very high levels.

●

In total, customer activity

improved in all segments,

except

for weakness in

the HVAC business

due to softer

construction demand.

●

Order intake increased

in Europe by 6% (11%

comparable),

despite a double-digit decline

in Germany.

Asia, Middle East

and Africa was up by

2% (11%

comparable), as a slight

decline in China

was more than offset by

good momentum

elsewhere in the

region. The Americas was

stable (1%

comparable), including

a slight increase of 2% (2%

comparable) in the

United States.

●

Strong revenue growth

of 23%

(29% comparable)

supported by execution

of the order backlog resulted

the highest revenues

since the formation of

the Motion

business area. Significant

support from both increased

volumes and robust

price development.

Profit

Operational EBITA

of $366 million

and Operational EBITA

margin of 18.9% reached

their highest levels in

several

years.

●

Positive

earnings and margin impact

from earlier

implemented price

actions were the main driver

to the

year-on-year improvement.

●

Efficient execution

of increased volumes, supported

deliveries from the

order backlog,

contributed

significantly.

●

The margin was somewhat

supported by a positive

divisional mix as the drives

and service businesses

represented a slightly

larger proportion

of revenues, year-

on-year.

Growth

Change year-on-year

Orders

Revenues

Comparable

29%

-5%

-7%

Portfolio changes

Total

23%

—

Motion

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

2,262

2,202

Order backlog

5,102

4,317

18%

22%

Revenues

1,940

1,572

23%

29%

Operational EBITA

366

274

34%

as % of operational revenues

18.9%

17.4%

+1.5 pts

Cash flow from operating activities

149

(2)

n.a.

No. of employees (FTE equiv.)

21,000

20,330

ABB

INTERIM

REPORT

2023

Orders and revenues

Driven by a strong

underlying customer activity

across the

segments,

as well as by supportive

timing of some project

orders, the orders

increased by 25%

(55% comparable)

$2,113

million - the highest quarterly

level in recent history.

The

order backlog increased

to $6,893 million.

●

All divisions reported

order growth of more

than 15%

(+20%

comparable) year

-on-year. Momentum

was particularly strong

in the Energy Industries

division, including high

activity

related to new energy

sources such as hydrogen,

which

admittedly still is a

small part of the total but

growing at a high

pace.

●

Europe improved by 44

(88%

comparable), with growth

rates positively impacted

by the order de-booking

approximately $190

million in last year’s period.

Asia, Middle

East and Africa was up

by 5% (34%

comparable), with

strong

contribution from China

at 16% (52% comparable).

The

Americas was up by

29% (47%

comparable), including an

overall decline in the

United States of 9% (up 6%

comparable).

●

Total

revenue growth was hampered

primarily by the absence

the Turbocharging

division (Accelleron)

which was spun-off in

2022. That aside, a strong

customer activity and deliveries

from

the order backlog resulted

in revenues of $1,436

million, down in

total by 5% (up 15% comparable),

year-on-year.

Profit

Strong operational

performance resulted

in an Operational EBITA

margin of 14.2%, up by

120 basis points year-on

-year,

more than

offsetting the adverse

margin impact of 140

basis points related to

the exit of the high-margin

Accelleron business.

●

Significant gross

margin improvement was

the main contributor

to the strong operational

performance.

●

Operational EBITA

margin increased in

all divisions except for

a slight decline in Marine

& Ports, which was somewhat

impacted by an adverse

mix due to lower share

of revenues

stemming from the

arctic marine propulsion business.

●

All divisions were well

into double-digit margin

territory.

Particularly strong

year-on-year improvement was

noted in

Measurement & Analytics

which benefited from

a positive mix

in deliveries.

Growth

Change year-on-year

Orders

Revenues

Comparable

55%

15%

-7%

-5%

Portfolio changes

-23%

-15%

Total

25%

-5%

—

Process Automation

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

2,113

1,692

25%

55%

Order backlog

6,893

6,190

11%

21%

Revenues

1,436

1,506

-5%

15%

Operational EBITA

205

196

as % of operational revenues

14.2%

13.0%

+1.2 pts

Cash flow from operating activities

112

87%

No. of employees (FTE equiv.)

20,500

21,920

ABB

INTERIM

REPORT

2023

Orders and revenues

Order intake amounted

to $1,001 million, declining

by 23%

(20% comparable)

from the high order level

last year, which

benefitted from pre-buys

in a period of a strained supply

chain. While orders

increased from the fourth

quarter,

somewhat of a hampering

effect from customers

outside of

the automotive segment

adjusting inventory

levels was

noted,

particularly in China.

●

Orders declined

at a double-digit rate in both divisions

and all regions.

In total, book-to-bill was 107%

and order

backlog increased to

$2,782 million.

●

Orders were positively

impacted by favorable

development in the

automotive segment.

This was

however offset

by declines across other

segments and

primarily for machine

builders, from last year’s

very high

level.

●

With no material supply

chain constraints, execution

the order backlog supported

the strong revenue growth

28% (35% comparable).

Both divisions benefitted from

strong double-digit

comparable growth, with

contribution

from both higher volumes

and solid pricing actions.

Profit

Operational EBITA

close to tripled

year-on-year and

amounted to $140

million, supported by

higher production

output and favorable business

mix, which triggered

820 basis point margin

improvement to 14.9%.

●

Significantly higher

volumes in production improved

cost

absorption and were

the main driver in the strong

earnings increase.

●

Strong contribution

from earlier implemented

price

actions.

Growth

Change year-on-year

Orders

Revenues

Comparable

-20%

35%

-3%

-7%

Portfolio changes

Total

-23%

28%

—

Robotics & Discrete Automation

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

1,001

1,308

-23%

-20%

Order backlog

2,782

2,495

12%

16%

Revenues

937

730

28%

35%

Operational EBITA

140

186%

as % of operational revenues

14.9%

6.7%

+8.2 pts

Cash flow from operating activities

130

(29)

n.a.

No. of employees (FTE equiv.)

10,850

10,690

ABB

INTERIM

REPORT

2023

Quarterly highlights

●

ABB’s production

site in Xiamen – which

covers 425,000

and employs over 3,000

people – has reduced its

equivalent (CO

e) emissions by 13,400

tons as part of

ABB’s global Mission

to Zero program. This year,

Xiamen

will be opening its doors

to customers and other

manufacturers in

China to showcase how its smart

digital

technology has been

applied to decarbonize

and reduce

scope 2 emissions

and help them achieve

sponsored Level

II ADR program into a sponsored

Level I ADR

program, which would

give US investors a continued

investment option,

in addition to the ordinary

ABB share. The

company’s shares

will remain listed on the

SIX Swiss

Exchange (SIX) and

the Swedish Nasdaq exchange

due to the

company’s heritage.

Significant events

ABB

INTERIM

REPORT

2023

Divestments

Company/unit

Closing date

Revenues, $ million

No. of employees

2022

Hitachi Energy JV (Power Grids, 19.9% stake)

28-Dec

Note: comparable growth calculation includes acquisitions

and divestments with revenues of greater than $50

million.

Represents the estimated revenues for the last fiscal

year prior to the announcement of the respective

acquisition/divestment unless otherwise stated.

ABB Group

Q1 2022

Q2 2022

Q3 2022

Q4 2022

FY 2022

Q1 2023

EBITDA, $ in million

1,067

794

906

1,384

4,151

1,389

Return on Capital Employed, %

n.a.

16.50

n.a.

Net debt/Equity

0.20

0.34

0.21

0.30

Net debt/ EBITDA 12M rolling

0.4

0.7

0.9

Net working capital, % of 12M rolling revenues

12.1%

12.8%

11.7%

11.1%

13.9%

Earnings per share, basic, $

0.31

0.20

0.19

0.61

1.30

0.56

Earnings per share, diluted, $

0.31

0.20

0.19

0.60

1.30

0.55

Dividend per share, CHF

n.a.

0.84

n.a.

Share price at the end of period, CHF

29.12

24.57

24.90

28.06

31.37

Share price at the end of period, $

30.76

25.43

24.41

30.46

34.30

Number of employees (FTE equivalents)

104,720

106,380

106,830

105,130

106,170

No. of shares outstanding at end of period (in millions)

1,929

1,892

1,875

1,865

1,862

Data prior to October 3, 2022, has been adjusted for

the Accelleron spin-off (Source: FactSet).

Excludes one project estimated to a total of ~$100

million, that is ongoing in the non-core business. Exact

exit timing is difficult to assess due to legal proceedings

etc.

Excludes Operational EBITA from E-mobility business.

Includes restructuring and restructuring-related as

well as separation costs.

Includes net positive tax impact of $206 million linked

to a favorable resolution of certain prior year tax matters

in Q1 2023 but excludes the impact of acquisitions

or divestments or any

significant non-operational items.

($ in millions, unless otherwise stated)

FY 2023

Net finance expenses

~(150)

unchanged

Effective tax rate

~21%

from ~25%

Capital Expenditures

~(800)

unchanged

($ in millions, unless otherwise stated)

FY 2023

Q2 2023

Corporate and Other Operational EBITA

~(300)

~(75)

unchanged

Non-operating items

Acquisition-related amortization

~(220)

~(55)

unchanged

Restructuring and related

~(150)

~(40)

unchanged

ABB Way transformation

~(180)

~(40)

unchanged

Additional 2023 guidance

Acquisitions

Company/unit

Closing date

Revenues, $ million

No. of employees

2022

Motion

PowerTech Converter

business

1-Dec

~60

300

Electrification

ASKI Industrie Elektronik GmbH

3-Oct

Electrification

Numocity Technologies

Private Ltd. (majority stake)

22-Jul

Additional figures

Acquisitions and divestments, last twelve months

ABB

INTERIM

REPORT

2023

For additional information please contact:

Media Relations

Phone: +41 43 317

71 11

Email:

media.relations@ch.abb.com

Investor Relations

Phone: +41 43 317

71 11

Email:

investor.relations@ch.abb.com

ABB Ltd

Affolternstrasse

8050 Zurich

Switzerland

Financial calendar

2023

July 20

Q2 2023 results

October 18

Q3 2023 results

November 30

Capital Markets

Day in Frosinone, Italy

This press release

includes forward-looking information

and

statements as well

as other statements concerning

the

outlook for our business,

including those in the sections

this release titled “CEO summary,”

“Outlook,” “Earnings,”

“Balance sheet & cash

flow,” “Sustainability” and

“Significant events”.

These statements are based

on current

expectations, estimates

and projections about the

factors

that may affect

our future performance,

including global

economic conditions,

the economic conditions

of the

regions and industries

that are major markets for

ABB.

These expectations, estimates

and projections are generally

identifiable by statements

containing words such as

“anticipates,” “expects,”

“estimates,” “plans,” “targets

,”

“likely” or similar expressions.

However, there

are many

risks and uncertainties,

many of which are beyond

our

control, that could cause

our actual results to differ

materially from the

forward-looking information

and

statements

made in this press

release and which could

affect our ability

to achieve any or all of

our stated targets. Some important

factors that could cause

such differences include,

among

others, business risks

associated with the volatile

global

economic environment

and political conditions,

costs

associated with compliance

activities, market acceptance

new products and services,

changes in governmental

regulations and currency

exchange rates and such

other

factors as may be discussed

from time to time in

ABB Ltd’s

filings with the U.S. Securities

and Exchange Commission,

including its Annual

Reports on Form 20-F.

Although ABB

Ltd believes that

its expectations reflected in any

such

forward looking statement

are based upon reasonable

assumptions, it can

give no assurance that those

expectations will be

achieved.

The Q1 2023

results press release

and presentation slides

are available on the

ABB News Center at

www.abb.com/news

and on the Investor

Relations

homepage at www.abb.com/investorrelations.

A conference call and

webcast for analysts

and investors is

scheduled to begin

today at 10:00 a.m. CET.

pre-register for the conference

call or to join the

webcast, please

refer to the ABB website:

www.abb.com/investorrelations.

The recorded session

will be available after

the event on

ABB’s website.

Important notice about forward-looking information

Q1 results presentation on April 25, 2023

ABB

(ABBN: SIX Swiss

Ex) is a technology leader

in electrification and automation,

enabling a more sustainable

and resource-

efficient future.

The company’s solutions

connect engineering know

-how and software

to optimize how things

are manufactured,

moved, powered and

operated. Building on

more than 130 years of

excellence, ABB’s ~105,000

employees are committed

driving innovations

that accelerate industrial

transformation.

Q1 2023

FINANCIAL

INFORMATION

April 25, 2023

Q1 2023

Financial information

Q1 2023

FINANCIAL

INFORMATION

—

Financial

Information

Contents

─ 05

Key Figures

06 ─

Consolidated

Financial

Information

(unaudited)

29 ─

Supplemental

Reconciliations

and Definitions

Q1 2023

FINANCIAL

INFORMATION

—

Key Figures

CHANGE

($ in millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

(1)

Orders

9,450

9,373

Order backlog (end March)

21,607

18,901

14%

21%

Revenues

7,859

6,965

13%

22%

Gross Profit

2,716

2,281

19%

as % of revenues

34.6%

32.7%

+1.9 pts

Income from operations

1,198

857

40%

Operational EBITA

(1)

1,277

997

28%

33%

(2)

as % of operational revenues

(1)

16.3%

14.3%

+2 pts

Income from continuing operations, net of tax

1,065

643

66%

Net income attributable to ABB

1,036

604

72%

Basic earnings per share ($)

0.56

0.31

78%

(3)

Cash flow from operating activities

(4)

282

(573)

n.a.

Cash flow from operating activities in continuing operations

283

(564)

n.a.

(1)

For a reconciliation of non-GAAP measures see “

Supplemental Reconciliations and Definitions

” on page 29.

(2)

Constant currency (not adjusted for portfolio changes).

(3)

EPS growth rates are computed using unrounded amounts.

(4)

Cash flow from operating activities includes both continuing and discontinued operations.

Q1 2023

FINANCIAL

INFORMATION

CHANGE

($ in millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Local

Comparable

Orders

ABB Group

9,450

9,373

Electrification

4,141

4,112

Motion

2,262

2,202

Process Automation

2,113

1,692

25%

32%

55%

Robotics & Discrete Automation

1,001

1,308

-23%

-20%

Corporate and Other

196

305

Intersegment eliminations

(263)

(246)

Order backlog (end March)

ABB Group

21,607

18,901

14%

19%

21%

Electrification

7,101

5,946

19%

24%

Motion

5,102

4,317

18%

22%

Process Automation

6,893

6,190

11%

18%

21%

Robotics & Discrete Automation

2,782

2,495

12%

16%

Corporate and Other

(incl. intersegment eliminations)

(271)

(47)

Revenues

ABB Group

7,859

6,965

13%

19%

22%

Electrification

3,590

3,236

11%

16%

Motion

1,940

1,572

23%

30%

29%

Process Automation

1,436

1,506

-5%

15%

Robotics & Discrete Automation

937

730

28%

35%

Corporate and Other

169

114

Intersegment eliminations

(213)

(193)

Income from operations

ABB Group

1,198

857

Electrification

655

481

Motion

353

254

Process Automation

200

151

Robotics & Discrete Automation

115

Corporate and Other

(incl. intersegment eliminations)

(125)

(51)

Income from operations %

ABB Group

15.2%

12.3%

Electrification

18.2%

14.9%

Motion

18.2%

16.2%

Process Automation

13.9%

10.0%

Robotics & Discrete Automation

12.3%

3.0%

Operational EBITA

ABB Group

1,277

997

28%

33%

Electrification

677

512

32%

38%

Motion

366

274

34%

40%

Process Automation

205

196

11%

Robotics & Discrete Automation

140

186%

212%

Corporate and Other

(1)

(incl. intersegment eliminations)

(111)

(34)

Operational EBITA %

ABB Group

16.3%

14.3%

Electrification

19.0%

15.9%

Motion

18.9%

17.4%

Process Automation

14.2%

13.0%

Robotics & Discrete Automation

14.9%

6.7%

Cash flow from operating activities

ABB Group

282

(573)

Electrification

395

Motion

149

(2)

Process Automation

112

Robotics & Discrete Automation

130

(29)

Corporate and Other

(incl. intersegment eliminations)

(503)

(680)

Discontinued operations

(1)

(9)

(1)

Corporate and Other at Q1 2023 and Q1 2022 includes losses of $28 million and $2 million, respectively, relating to E-mobility.

Q1 2023

FINANCIAL

INFORMATION

Operational EBITA

Process

Robotics & Discrete

ABB

Electrification

Motion

Automation

($ in millions, unless otherwise indicated)

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Revenues

7,859

6,965

3,590

3,236

1,940

1,572

1,436

1,506

937

730

Foreign exchange/commodity timing

differences in total revenues

(16)

(3)

(22)

(10)

–

(1)

Operational revenues

7,843

6,962

3,568

3,226

1,940

1,575

1,446

1,505

938

735

Income from operations

1,198

857

655

480

353

254

200

151

115

Acquisition-related amortization

Restructuring, related and

implementation costs

(1)

–

Changes in obligations related to

divested businesses

(14)

–

Acquisition- and divestment-related

expenses and integration costs

Certain other non-operational items

(1)

–

Foreign exchange/commodity timing

differences in income from operations

(24)

(15)

(18)

(19)

(2)

(1)

Operational EBITA

1,277

997

677

512

366

274

205

196

140

Operational EBITA margin (%)

16.3%

14.3%

19.0%

15.9%

18.9%

17.4%

14.2%

13.0%

14.9%

6.7%

(1)

Includes impairment of certain assets.

Depreciation and Amortization

Process

Robotics & Discrete

ABB

Electrification

Motion

Automation

($ in millions)

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Q1 23

Q1 22

Depreciation

125

136

Amortization

including total acquisition-related amortization of:

Orders received and revenues by region

($ in millions, unless otherwise indicated)

Orders received

CHANGE

Revenues

CHANGE

Com-

Q1 23

Q1 22

US$

Local

parable

Q1 23

Q1 22

US$

Local

parable

Europe

3,582

3,534

10%

2,872

2,518

14%

20%

24%

The Americas

2,985

2,897

2,653

2,169

22%

23%

25%

of which United States

2,130

2,225

-4%

-3%

1,984

1,582

25%

26%

28%

Asia, Middle East and Africa

2,883

2,942

-2%

11%

2,334

2,278

12%

16%

of which China

1,355

1,537

-12%

-5%

-3%

1,155

1,100

13%

16%

ABB Group

9,450

9,373

7,859

6,965

13%

19%

22%

Q1 2023

FINANCIAL

INFORMATION

—

Consolidated Financial Information

ABB Ltd Consolidated Income Statements (unaudited)

Three months ended

($ in millions, except per share data in $)

Mar. 31, 2023

Mar. 31, 2022

Sales of products

6,644

5,749

Sales of services and other

1,215

1,216

Total revenues

7,859

6,965

Cost of sales of products

(4,418)

(3,968)

Cost of services and other

(725)

(716)

Total cost of sales

(5,143)

(4,684)

Gross profit

2,716

2,281

Selling, general and administrative expenses

(1,339)

(1,239)

Non-order related research and development expenses

(304)

(277)

Other income (expense), net

125

Income from operations

1,198

857

Interest and dividend income

Interest and other finance expense

(61)

(22)

Non-operational pension (cost) credit

Income from continuing operations before taxes

1,184

884

Income tax expense

(119)

(241)

Income from continuing operations, net of

tax

1,065

643

Loss from discontinued operations, net of tax

(5)

(11)

Net income

1,060

632

Net income attributable to noncontrolling interests and redeemable noncontrolling

interests

(24)

(28)

Net income attributable to ABB

1,036

604

Amounts attributable to ABB shareholders:

Income from continuing operations, net of tax

1,041

615

Loss from discontinued operations, net of tax

(5)

(11)

Net income

1,036

604

Basic earnings per share attributable to ABB shareholders:

Income from continuing operations, net of tax

0.56

0.32

Loss from discontinued operations, net of tax

–

(0.01)

Net income

0.56

0.31

Diluted earnings per share attributable to ABB shareholders:

Income from continuing operations, net of tax

0.56

0.31

Loss from discontinued operations, net of tax

–

(0.01)

Net income

0.55

0.31

Weighted-average number of shares outstanding

(in millions) used to compute:

Basic earnings per share attributable to ABB shareholders

1,861

1,936

Diluted earnings per share attributable to ABB shareholders

1,874

1,953

Due to rounding, numbers presented may not add to the totals provided.

See Notes to the Interim Consolidated Financial Information

Q1 2023

FINANCIAL

INFORMATION

—

ABB Ltd Condensed Consolidated Statements of Comprehensive

Income (unaudited)

Three months ended

($ in millions)

Mar. 31, 2023

Mar. 31, 2022

Total comprehensive income, net of

tax

1,153

577

Total comprehensive income

attributable to noncontrolling interests and redeemable

noncontrolling interests, net of tax

(30)

(23)

Total comprehensive income attributable

to ABB shareholders, net of tax

1,123

554

Due to rounding, numbers presented may not add to the totals provided.

See Notes to the Interim Consolidated Financial Information

Q1 2023

FINANCIAL

INFORMATION

—

ABB Ltd Consolidated Balance Sheets (unaudited)

($ in millions)

Mar. 31, 2023

Dec. 31, 2022

Cash and equivalents

3,438

4,156

Restricted cash

Marketable securities and short-term investments

1,380

725

Receivables, net

7,174

6,858

Contract assets

1,009

954

Inventories, net

6,269

6,028

Prepaid expenses

304

230

Other current assets

484

505

Current assets held for sale and in discontinued operations

615

Total current assets

20,692

19,570

Property, plant and equipment, net

3,888

3,911

Operating lease right-of-use assets

870

841

Investments in equity-accounted companies

153

130

Prepaid pension and other employee benefits

935

916

Intangible assets, net

1,285

1,406

Goodwill

10,381

10,511

Deferred taxes

1,381

1,396

Other non-current assets

454

467

Total assets

40,039

39,148

Accounts payable, trade

4,945

4,904

Contract liabilities

2,339

2,216

Short-term debt and current maturities of long-term debt

3,433

2,535

Current operating leases

228

220

Provisions for warranties

1,060

1,028

Dividends payable to shareholders

411

–

Other provisions

1,196

1,171

Other current liabilities

4,112

4,323

Current liabilities held for sale and in discontinued operations

225

132

Total current liabilities

17,949

16,529

Long-term debt

5,230

5,143

Non-current operating leases

666

651

Pension and other employee benefits

716

719

Deferred taxes

731

729

Other non-current liabilities

1,807

2,085

Non-current liabilities held for sale and in discontinued operations

Total liabilities

27,119

25,876

Commitments and contingencies

Redeemable noncontrolling interest

Stockholders’ equity:

Common stock, CHF 0.12 par value

(1,965 million shares issued at March 31, 2023, and December

31, 2022)

171

Additional paid-in capital

279

141

Retained earnings

19,411

20,082

Accumulated other comprehensive loss

(4,469)

(4,556)

Treasury stock, at cost

(103 million and 100 million shares at March 31, 2023,

and December 31, 2022, respectively)

(3,165)

(3,061)

Total ABB stockholders’ equity

12,227

12,777

Noncontrolling interests

604

410

Total stockholders’ equity

12,831

13,187

Total liabilities and stockholders’

equity

40,039

39,148

Due to rounding, numbers presented may not add to the totals provided.

See Notes to the Consolidated Financial Information

Q1 2023

FINANCIAL

INFORMATION

—

ABB Ltd Consolidated Statements of Cash Flows (unaudited)

Three months ended

($ in millions)

Mar. 31, 2023

Mar. 31, 2022

Operating activities:

Net income

1,060

632

Loss from discontinued operations, net of tax

Adjustments to reconcile net income to net cash provided

by (used in) operating activities:

Depreciation and amortization

191

210

Changes in fair values of investments

(13)

(24)

Pension and other employee benefits

(46)

Deferred taxes

(116)

Loss from equity-accounted companies

Net gain from derivatives and foreign exchange

(37)

(28)

Net gain from sale of property,

plant and equipment

(26)

(32)

Other

Changes in operating assets and liabilities:

Trade receivables, net

(366)

(317)

Contract assets and liabilities

107

Inventories, net

(264)

(542)

Accounts payable, trade

Accrued liabilities

(324)

(390)

Provisions, net

(53)

Income taxes payable and receivable

(115)

Other assets and liabilities, net

(81)

Net cash provided by (used in) operating activities – continuing

operations

283

(564)

Net cash used in operating activities – discontinued operations

(1)

(9)

Net cash provided by (used in) operating activities

282

(573)

Investing activities:

Purchases of investments

(660)

(128)

Purchases of property, plant and

equipment and intangible assets

(151)

(187)

Acquisition of businesses (net of cash acquired) and increases

in cost-

and equity-accounted companies

(19)

(145)

Proceeds from sales of investments

305

Proceeds from sales of property,

plant and equipment

Net cash from settlement of foreign currency derivatives

Other investing activities

Net cash used in investing activities – continuing operations

(736)

(44)

Net cash used in investing activities – discontinued

operations

(5)

(21)

Net cash used in investing activities

(741)

(65)

Financing activities:

Net changes in debt with original maturities of 90 days or less

(714)

1,305

Increase in debt

1,633

2,542

Repayment of debt

(36)

(41)

Delivery of shares

370

Purchase of treasury stock

(274)

(1,561)

Dividends paid

(1,294)

(889)

Dividends paid to noncontrolling shareholders

(3)

(1)

Proceeds from issuance of subsidiary shares

341

–

Other financing activities

(34)

Net cash provided by (used in) financing activities – continuing

operations

(240)

1,691

Net cash provided by financing activities – discontinued

operations

–

Net cash provided by (used in) financing activities

(240)

1,691

Effects of exchange rate changes on cash and equivalents

and restricted cash

(5)

Adjustment for the net change in cash and equivalents and restricted

cash in Assets held for sale

(13)

–

Net change in cash and equivalents and restricted cash

(717)

1,057

Cash and equivalents and restricted cash, beginning of period

4,174

4,489

Cash and equivalents and restricted cash, end of period

3,457

5,546

Supplementary disclosure of cash flow information:

Interest paid

Income taxes paid

207

340

Due to rounding, numbers presented may not add to the totals provided.

See Notes to the Consolidated Financial Information

Q1 2023

FINANCIAL

INFORMATION

—

ABB Ltd Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

($ in millions)

Common

stock

Additional

paid-in

capital

Retained

earnings

Accumulated

other

comprehensive

loss

Treasury

stock

Total ABB

stockholders’

equity

Non-

controlling

interests

Total

stockholders’

equity

Balance at January 1, 2022

178

22,477

(4,088)

(3,010)

15,579

378

15,957

Net income

604

632

Foreign currency translation

adjustments, net of tax of $0

(70)

(5)

(75)

Effect of change in fair value of

available-for-sale securities,

net of tax of $(3)

(12)

Unrecognized income (expense)

related to pensions and other

postretirement plans,

net of tax of $10

Change in derivative instruments

and hedges, net of tax of $2

Changes in noncontrolling interests

(10)

(7)

(17)

Dividends to

noncontrolling shareholders

–

(3)

Dividends to shareholders

(1,700)

Share-based payment arrangements

Purchase of treasury stock

(1,561)

Delivery of shares

(26)

(104)

500

370

Other

Balance at March 31, 2022

178

–

21,278

(4,138)

(4,071)

13,247

391

13,638

Balance at January 1, 2023

171

141

20,082

(4,556)

(3,061)

12,777

410

13,187

Net income

(1)

1,036

1,061

Foreign currency translation

adjustments, net of tax of $(1)

Effect of change in fair value of

available-for-sale securities,

net of tax of $1

Unrecognized income (expense)

related to pensions and other

postretirement plans,

net of tax of $1

–

Change in derivative instruments

and hedges, net of tax of $0

Issuance of subsidiary shares

170

168

338

Other changes in

noncontrolling interests

–

(1)

Dividends to

noncontrolling shareholders

–

(5)

Dividends to shareholders

(1,706)

Share-based payment arrangements

Purchase of treasury stock

(253)

Delivery of shares

(53)

148

Other

(2)

Balance at March 31, 2023

171

279

19,411

(4,469)

(3,165)

12,227

604

12,831

(1)

Amounts attributable to noncontrolling interests for the three months ended March 31, 2023, exclude net losses of $1 million related to redeemable noncontrolling interests, which are

reported in the mezzanine equity section on the Consolidated Balance Sheets. See Note 4 for details.

Due to rounding, numbers presented may not add to the totals provided.

See Notes to the Consolidated Financial Information

Q1 2023

FINANCIAL

INFORMATION

—

Notes to the Consolidated Financial Information (unaudited)

─

Note 1

The Company and basis of presentation

ABB Ltd and its subsidiaries (collectively,

the Company) together form a technology

leader in electrification and automation, enabling a more sustainable

and

resource-efficient future. The Company’s solutions connect

engineering know-how and software to optimize how things

are manufactured, moved, powered and

operated.

The Company’s Consolidated Financial Information is prepared

in accordance with United States of America generally accepted

accounting principles (U.S.

GAAP) for interim financial reporting. As such, the Consolidated

Financial Information does not include all the

information and notes required under U.S. GAAP

for

annual consolidated financial statements. Therefore, such financial

information should be read in conjunction with the audited

consolidated financial statements in

the Company’s Annual Report for the year ended December

31, 2022.

The preparation of financial information in conformity with U.S. GAAP

requires management to make assumptions and

estimates that directly affect the amounts

reported in the Consolidated Financial Information. These accounting

assumptions and estimates include:

●

estimates to determine valuation allowances for deferred tax assets

and amounts recorded for unrecognized tax benefits,

●

estimates related to credit losses expected to occur over

the remaining life of financial assets such as trade and other

receivables, loans and other

instruments,

●

estimates used to record expected costs for employee severance

in connection with restructuring programs,

●

estimates of loss contingencies associated with litigation or

threatened litigation and other claims and inquiries, environmental

damages, product

warranties, self-insurance reserves, regulatory and other proceedings,

●

assumptions and projections, principally related to future material,

labor and project-related overhead costs, used in determining the

percentage-of-

completion on projects where revenue is recognized over time,

as well as the amount of variable consideration the

Company expects to be entitled to,

●

assumptions used in the calculation of pension and postretirement

benefits and the fair value of pension plan assets,

●

assumptions used in determining inventory obsolescence and net

realizable value,

●

growth rates, discount rates and other assumptions used to determine

impairment of long-lived assets and in testing goodwill

for impairment,

●

estimates and assumptions used in determining the fair

values of assets and liabilities assumed in business

combinations, and

●

estimates and assumptions used in determining the initial fair

value of retained noncontrolling interests

and certain obligations in connection with

divestments.

The actual results and outcomes may differ from the Company’s

estimates and assumptions.

A portion of the Company’s activities (primarily long-term

construction activities) has an operating cycle that

exceeds one year. For classification

of current assets

and liabilities related to such activities, the Company elected to

use the duration of the individual contracts as

its operating cycle. Accordingly,

there are accounts

receivable, contract assets, inventories and provisions related to

these contracts which will not be realized within one

year that have been classified as current.

Basis of presentation

In the opinion of management, the unaudited Consolidated Financial

Information contains all necessary

adjustments to present fairly the financial position, results

of operations and cash flows for the reported periods. Management considers

all such adjustments to be of a normal recurring nature. The

Consolidated Financial

Information is presented in United States dollars ($)

unless otherwise stated. Due to rounding, numbers presented

in the Consolidated Financial Information may

not add to the totals provided.

Certain amounts reported in the Consolidated Financial Information for

prior periods have been reclassified to conform to the

current year’s presentation. These

changes relate primarily to the reorganization of the Company’s

operating segments (see Note 16 for details).

Q1 2023

FINANCIAL

INFORMATION

─

Note 2

Recent accounting pronouncements

Applicable for current periods

Disclosure about supplier finance program obligations

In January 2023, the Company adopted an accounting standard

update which requires entities to disclose information related

to supplier finance programs. Under

the update, the Company is required to disclose annually

(i) the key terms of the program, (ii) the amount of the supplier

finance obligations outstanding and where

those obligations are presented in the balance sheet at the reporting

date, and (iii) a rollforward of the supplier finance obligation

program within the reporting

period. The Company adopted this update retrospectively for all

in-scope transactions, with the exception of the rollforward

disclosures, which will be adopted

prospectively for annual periods beginning January 1, 2024.

Apart from the additional disclosure requirements, this

update does not have a significant impact on

the Company’s consolidated financial statements.

The total outstanding supplier finance obligation included in “Accounts

payable, trade” in the Consolidated Balance Sheets

at March 31, 2023 and December 31,

2022, amounted to $460 million and $477 million, respectively.

The Company’s payment terms related to suppliers’

finance programs are not impacted by the

suppliers’ decisions to sell amounts under the arrangements

and are typically consistent with local market practices.

Facilitation of the effects of reference rate reform on financial

reporting

In January 2023, the Company adopted an accounting standard

update which provides temporary optional expedients and

exceptions to the current guidance on

contract modifications and hedge accounting to ease the financial

reporting burdens related to the expected market

transition from the London Interbank Offered

Rate (LIBOR) and other interbank offered rates to alternative

reference rates. The Company is applying this standard

update as relevant contract and hedge

accounting relationship modifications are made during the course

of the transition period ending December 31, 2024. This

update does not have a significant

impact on the Company’s consolidated financial statements.

─

Note 3

Discontinued operations and assets held for sale

Divestment of the Power Grids business

In 2020, the Company completed the divestment of its

Power Grids business to Hitachi Ltd (Hitachi).

Upon closing of the sale, the Company entered into various

transition services agreements (TSAs),

some of which continue to have services performed. Pursuant

to these TSAs, the Company and Hitachi Energy provide

each other, on a transitional basis, various

services. The services provided by the Company

primarily include finance, information technology,

human resources

and certain other administrative services. The TSAs were to

be performed for up to 3 years with the possibility

to agree on extensions on an exceptional basis

for

business-critical services which are reasonably necessary to avoid a material

adverse impact on the business. The TSA for

information technology services was

extended until mid-2025. In the three months ended March

31, 2023 and 2022, the Company has recognized within

its continuing operations, general and

administrative expenses incurred to perform the TSAs,

offset by $37 million and $38 million, respectively,

in TSA-related income for such services that is reported

in Other income (expense), net.

Discontinued operations

As a result of the sale of the Power Grids business, substantially

all Power Grids-related assets and liabilities have

been sold. As this divestment represented

strategic shift that would have a major effect on the Company’s

operations and financial results, the

results of operations for this business are presented

discontinued operations and the assets and liabilities are presented

as held for sale and in discontinued operations.

Certain of the business contracts in the Power

Grids business continue to be executed by subsidiaries of the Company

for the benefit/risk of Hitachi Energy.

Assets and liabilities relating to, as well as the net

financial results of, these contracts will continue to be included

in discontinued operations until they have been completed

or otherwise transferred to Hitachi

Energy. The remaining business

activities of the Power Grids business being executed

by the Company is not significant.

In addition, the Company also has retained obligations (primarily for

environmental and taxes) related to other businesses

disposed or otherwise exited that

qualified as discontinued operations at the time of their

disposal. Changes to these retained obligations are also included

in Loss from discontinued operations, net

of tax.

At March 31, 2023, the balances reported as held for sale and

in discontinued operations pertaining to the activities of the Power Grids business

and other

obligations will remain with the Company until such time as

the obligations

are settled or the activities are fully wound down

These balances amounted to

$90 million of current assets, $122 million of current liabilities

and $20 million of non-current liabilities.

Planned business divestments classified as held for sale

The Company classifies its long-lived assets or disposal groups

to be sold as held for sale in the period in which all of

the held for sale criteria are met. The

Company initially measures a long-lived asset or disposal group

that is classified as held for sale at the lower of its carrying

value or fair value less any costs

sell. Any resulting loss is recognized in the period in whi

ch the held for sale criteria are met,

while gains are not recognized on the sale of a

long-lived asset or

disposal group until the date of sale. The Company assesses

the fair value of a long-lived asset or disposal group less any costs

to sell at each reporting period

and until the asset or disposal group is no longer classified

as held for sale.

In January 2023, the Company entered into an agreement to

divest its Power Conversion Division to AcBel Polytech

Inc. for cash proceeds of $505 million.

The

Power Conversion Division is part of the Company’s

Electrification operating segment

and the divestment,

subject to regulatory approvals, is expected to be

completed in the second half of 2023.

Q1 2023

FINANCIAL

INFORMATION

As this planned divestment does not qualify as a discontinued operation,

the results of operations for this business are included

in the Company’s continuing

operations for all periods presented. The assets and liabilities of

this business are shown as assets and liabilities held for

sale in the Company’s Consolidated

Balance Sheet at March 31, 2023.

The carrying amounts of the major classes

of assets and liabilities held for sale relating to this planned divestment

are as

follows:

($ in millions)

March 31, 2023

Assets

Receivables, net

Inventories, net

106

Property, plant and equipment, net

Other intangible assets, net

Goodwill

175

Other assets

Current assets held for sale

525

Liabilities

Accounts payable, trade

Other liabilities

Current liabilities held for sale

103

In the three months ended March 31, 2023 and 2022,

Income from continuing operations before taxes includes

income of $17 million and $1 million, respectively,

from the Power Conversion Division.

─

Note 4

Acquisitions and equity-accounted companies

Acquisition of controlling interests

Acquisitions of controlling interests were as follows:

Three months ended March 31,

($ in millions, except number of acquired businesses)

2023

2022

Purchase price for acquisitions (net of cash acquired)

(1)

138

Aggregate excess of purchase price over fair value of net assets

acquired

(2)

191

Number of acquired businesses

–

(1)

Excluding changes in cost- and equity-accounted companies.

(2)

Recorded as goodwill.

In the table above, the “Purchase price for acquisitions”

and “Aggregate excess of purchase price over fair value of

net assets acquired” amounts for the three

months ended March 31, 2022,

relate primarily to the acquisition of InCharge Energy,

Inc. (In-Charge).

Acquisitions of controlling interests have been accounted for under the

acquisition method and have been included in the Comp

any’s consolidated financial

statements since the date of acquisition.

On January 26, 2022, the Company increased its ownership in

In-Charge to a 60 percent controlling interest through

a stock purchase agreement. In-Charge

headquartered in Santa Monica, USA, and is a provider of

turn-key commercial electric vehicle charging hardware and

software solutions. The resulting cash

outflows for the Company amounted to $134

million (net of cash acquired of $4 million). The acquisition

expands the market presence of the E-mobility

Division of

its Electrification operating segment,

particularly in the North American market. In connection

with the acquisition, the Company’s pre-existing

13.2 percent

ownership of In-Charge was revalued to fair value and a gain

of $32 million was recorded in “Other income

(expense),

net” in the three months ended March 31,

2022. The Company entered into an agreement with the remaining

noncontrolling shareholders allowing either party to put or

call the remaining 40 percent of the

shares until 2027. The amount for which either party can exercise

their option is dependent on a formula based on revenues and

thus, the amount is subject to

change. As a result of this agreement, the noncontrolling interest

is classified as Redeemable noncontrolling interest

(i.e. mezzanine equity) in the Consolidated

Balance Sheets and was initially recognized at fair value.

While the Company uses its best estimates and assumptions

as part of the purchase price allocation process

to value assets acquired and liabilities assumed

the acquisition date, the purchase price allocation for acquisitions

is preliminary for up to 12 months after the acquisition

date and is subject to refinement as more

detailed analyses are completed and additional information about

the fair values of the assets and liabilities becomes available.

Investments in equity-accounted companies

In connection with the divestment of its Power Grids business

to Hitachi in 2020 (see Note 3), the Company

initially retained a 19.9

percent interest in the business

until December 2022, when the retained investment was sold to Hitachi.

During the Company’s period of ownership

of the retained 19.9 percent interest, based on

its continuing involvement with the Power Grids business, including

the membership in its governing board of directors,

the Company concluded that it had

significant influence over Hitachi Energy.

As a result, the investment was accounted for using the

equity method through to the date of its sale.

In the three months ended March 31, 2023 and 2022,

the Company recorded its share of the earnings of

investees accounted for under the equity method of

accounting in Other income (expense), net, as follows:

Three months ended March 31,

($ in millions)

2023

2022

Loss from equity-accounted companies, net of taxes

(7)

(11)

Basis difference amortization (net of deferred income tax benefit)

–

(37)

Loss from equity-accounted companies

(7)

(48)

Q1 2023

FINANCIAL

INFORMATION

─

Note 5

Cash and equivalents, marketable securities and short-term investments

Cash and equivalents, marketable securities and short-term

investments consisted of the following:

March 31, 2023

Cash and

Marketable

Gross

equivalents

securities

unrealized

and restricted

and short-term

($ in millions)

Cost basis

gains

losses

Fair value

cash

investments

Changes in fair value

recorded in net income

Cash

1,319

Time deposits

2,424

2,138

286

Equity securities

696

714

4,439

–

4,457

3,457

1,000

Changes in fair value recorded

in other comprehensive income

Debt securities available-for-sale:

U.S. government obligations

270

(11)

261

Other government obligations

Corporate

(6)

395

(17)

380

–

380

Total

4,834

(17)

4,837

3,457

1,380

Of which:

Restricted cash, current

December 31, 2022

Cash and

Marketable

Gross

equivalents

securities

unrealized

and restricted

and short-term

($ in millions)

Cost basis

gains

losses

Fair value

cash

investments

Changes in fair value

recorded in net income

Cash

1,715

Time deposits

2,459

Equity securities

345

355

4,519

–

4,529

4,174

355

Changes in fair value recorded

in other comprehensive income

Debt securities available-for-sale:

U.S. government obligations

269

(15)

255

Other government obligations

Corporate

(7)

391

(22)

370

–

370

Total

4,910

(22)

4,899

4,174

725

Of which:

Restricted cash, current

Q1 2023

FINANCIAL

INFORMATION

─

Note 6

Derivative financial instruments

The Company is exposed to certain currency,

commodity, interest rate and equity

risks arising from its global operating, financing and

investing activities. The

Company uses derivative instruments to reduce and manage the

economic impact of these exposures.

Currency risk

Due to the global nature of the Company’s operations, many

of its subsidiaries are exposed to currency risk

in their operating activities from entering into

transactions in currencies other than their functional currency.

To manage such

currency risks, the Company’s policies require its

subsidiaries to hedge their

foreign currency exposures from binding sales and purchase

contracts denominated in foreign currencies. For forecasted foreign currency

denominated sales of

standard products and the related foreign currency denominated purchases,

the Company’s policy is to hedge up to a maximum of

100 percent of the forecasted

foreign currency denominated exposures, depending on the

length of the forecasted exposures. Forecasted

exposures greater than 12 months are not hedged.

Forward foreign exchange contracts are the main instrument

used to protect the Company against the volatility of future

cash flows (caused by changes in

exchange rates) of contracted and forecasted sales and purchases

denominated in foreign currencies. In addition, within

its treasury operations, the Company

primarily uses foreign exchange swaps and forward foreign exchange

contracts to manage the currency and timing mismatches

arising in its liquidity management

activities.

Commodity risk

Various commodity products

are used in the Company’s manufacturing activities.

Consequently it is exposed to volatility in future cash flows

arising from changes

in commodity prices. To

manage the price risk of commodities, the Company’s

policies require that its subsidiaries hedge the commodity

price risk exposures from

binding contracts, as well as at least 50 percent (up to a maximum

of 100 percent) of the forecasted commodity exposure over

the next 12 months or longer (up to

a maximum of 18 months). Primarily swap contracts are used to

manage the associated price risks of commodities.

Interest rate risk

The Company has issued bonds at fixed rates. Interest rate swaps

and cross-currency interest rate swaps are used to manage

the interest rate and foreign

currency risk associated with certain debt and generally such

swaps are designated as fair value hedges. In addition, from time

to time, the Company uses

instruments such as interest rate swaps, interest rate futures, bond

futures or forward rate agreements to manage interest

rate risk arising from the Company’s

balance sheet structure but does not designate such instruments

as hedges.

Equity risk

The Company is exposed to fluctuations in the fair value of

its warrant appreciation rights (WARs)

issued under its management

incentive plan. A WAR gives its

holder the right to receive cash equal to the market price of

an equivalent listed warrant on the date of exercise.

To eliminate

such risk, the Company has

purchased cash-settled call options, indexed to the shares of the

Company, which entitle the Company

to receive amounts equivalent to its obligations

under the

outstanding WARs.

Volume of derivative activity

In general, while the Company’s primary objective in

its use of derivatives is to minimize exposures arising from

its business, certain derivatives are designated

and qualify for hedge accounting treatment while others either are

not designated or do not qualify for hedge accounting.

Foreign exchange and interest rate derivatives

The gross notional amounts of outstanding foreign exchange and

interest rate derivatives (whether designated as

hedges or not) were as follows:

Type of derivative

Total notional amounts

($ in millions)

March 31, 2023

December 31, 2022

March 31, 2022

Foreign exchange contracts

13,273

13,509

13,255

Embedded foreign exchange derivatives

1,104

933

863

Cross-currency interest rate swaps

870

855

888

Interest rate contracts

2,963

2,830

4,421

Derivative commodity contracts

The Company uses derivatives to hedge its direct or indirect exposure

to the movement in the prices of commodities which are

primarily copper, silver and

aluminum. The following table shows the notional amounts of outstanding

derivatives (whether designated as hedges or not), on

a net basis, to reflect the

Company’s requirements for these commodities:

Type of derivative

Unit

Total notional amounts

March 31, 2023

December 31, 2022

March 31, 2022

Copper swaps

metric tonnes

27,920

29,281

39,223

Silver swaps

ounces

2,392,353

2,012,213

2,634,550

Aluminum swaps

metric tonnes

6,750

6,825

6,950

Equity derivatives

At March 31, 2023, December 31, 2022, and March 31,

2022, the Company held 5 million, 8 million and 9 million cash

-settled call options indexed to ABB Ltd

shares (conversion ratio 5:1) with a total fair value of $14

million, $15 million and $20 million, respectively.

Cash flow hedges

As noted above, the Company mainly uses forward foreign exchange

contracts to manage the foreign exchange risk

of its operations, commodity swaps to

manage its commodity risks and cash-settled call options to

hedge its WAR liabilities. The Company applies cash

flow hedge accounting in only limited cases. In

these cases, the effective portion of the changes in their

fair value is recorded in “Accumulated other comprehensive

loss” and subsequently reclassified into

earnings in the same line item and in the same period as

the underlying hedged transaction affects

earnings. For the three months ended March 31, 2023 and

2022, there were no significant amounts recorded for cash

flow hedge accounting activities.

Fair value hedges

To reduce its interest

rate exposure arising primarily from its debt issuance activities,

the Company uses interest rate swaps

and cross-currency interest rate

swaps. Where such instruments are designated as fair value hedges,

the changes in the fair value of these instruments,

as well as the changes in the fair value of

the risk component of the underlying debt being hedged, are recorded

as offsetting gains and losses in “Interest

and other finance expense”.

Q1 2023

FINANCIAL

INFORMATION

The effect of derivative instruments, designated and qualifying

as fair value hedges, on the Consolidated Income

Statements was as follows:

Three months ended March 31,

($ in millions)

2023

2022

Gains (losses) recognized in Interest and other finance expense:

Interest rate contracts

Designated as fair value hedges

(29)

Hedged item

(10)

Cross-currency interest rate swaps

Designated as fair value hedges

(11)

(45)

Hedged item

Derivatives not designated in hedge relationships

Derivative instruments that are not designated as hedges or do not

qualify as either cash flow or fair value hedges

are economic hedges used for risk management

purposes. Gains and losses from changes in the fair values

of such derivatives are recognized in the same line

in the income statement as the economically

hedged transaction.

Furthermore, under certain circumstances, the Company

is required to split and account separately for foreign currency

derivatives that are embedded within

certain binding sales or purchase contracts denominated

in a currency other than the functional currency of the subsidiary

and the counterparty.

The gains (losses) recognized in the Consolidated Income Statements

on derivatives not designated in hedging relationships

were as follows:

Type of derivative not

Gains (losses) recognized in income

designated as a hedge

Three months ended March 31,

($ in millions)

Location

2023

2022

Foreign exchange contracts

Total revenues

Total cost of sales

(1)

(6)

SG&A expenses

(1)

Non-order related research and development

–

Interest and other finance expense

Embedded foreign exchange contracts

Total revenues

(2)

Total cost of sales

(1)

Commodity contracts

Total cost of sales

Other

Interest and other finance expense

–

Total

(1)

SG&A expenses represent

“Selling, general and

administrative expenses”.

The fair values of derivatives included in the Consolidated Balance

Sheets were as follows:

March 31, 2023

Derivative assets

Derivative liabilities

Current in

Non-current in

Current in

Non-current in

“Other current

“Other non-current

“Other current

“Other non-current

($ in millions)

assets”

liabilities”

Derivatives designated as hedging instruments:

Foreign exchange contracts

–

Interest rate contracts

–

Cross-currency interest rate swaps

–

281

Cash-settled call options

–

Total

–

311

Derivatives not designated as hedging instruments:

Foreign exchange contracts

149

Commodity contracts

–

Interest rate contracts

–

Embedded foreign exchange derivatives

Total

187

Total fair value

201

119

327

Q1 2023

FINANCIAL

INFORMATION

December 31, 2022

Derivative assets

Derivative liabilities

Current in

Non-current in

Current in

Non-current in

“Other current

“Other non-current

“Other current

“Other non-current

($ in millions)

assets”

liabilities”

Derivatives designated as hedging instruments:

Foreign exchange contracts

–

Interest rate contracts

–

Cross-currency interest rate swaps

–

288

Cash-settled call options

–

Total

–

349

Derivatives not designated as hedging instruments:

Foreign exchange contracts

140

Commodity contracts

–

Interest rate contracts

–

Embedded foreign exchange derivatives

Total

169

112

Total fair value

184

121

367

Close-out netting agreements provide for the termination, valuation

and net settlement of some or all outstanding transactions

between two counterparties on the

occurrence of one or more pre-defined trigger events.

Although the Company is party to close-out netting agreements

with most derivative counterparties, the fair values

in the tables above and in the Consolidated

Balance Sheets at March 31, 2023, and December 31, 2022,

have been presented on a gross basis.

The Company’s netting agreements and other similar arrangements

allow net settlements under certain conditions.

At March 31, 2023, and December 31, 2022,

information related to these offsetting arrangements was

as follows:

($ in millions)

March 31, 2023

Gross amount

Derivative liabilities

Cash

Non-cash

Type of agreement or

of recognized

eligible for set-off

collateral

Net asset

similar arrangement

assets

in case of default

received

exposure

Derivatives

210

(91)

–

119

Total

210

(91)

–

119

($ in millions)

March 31, 2023

Gross amount

Derivative liabilities

Cash

Non-cash

Type of agreement or

of recognized

eligible for set-off

collateral

Net liability

similar arrangement

liabilities

in case of default

pledged

exposure

Derivatives

417

(91)

–

326

Total

417

(91)

–

326

($ in millions)

December 31, 2022

Gross amount

Derivative liabilities

Cash

Non-cash

Type of agreement or

of recognized

eligible for set-off

collateral

Net asset

similar arrangement

assets

in case of default

received

exposure

Derivatives

194

(96)

–

Total

194

(96)

–

($ in millions)

December 31, 2022

Gross amount

Derivative liabilities

Cash

Non-cash

Type of agreement or

of recognized

eligible for set-off

collateral

Net liability

similar arrangement

liabilities

in case of default

pledged

exposure

Derivatives

458

(96)

–

362

Total

458

(96)

–

362

Q1 2023

FINANCIAL

INFORMATION

─

Note 7

Fair values

The Company uses fair value measurement principles to record certain

financial assets and liabilities on a recurring basis

and, when necessary,

to record certain

non-financial assets at fair value on a non-recurring basis,

as well as to determine fair value disclosures for certain financial

instruments carried at amortized cost

in the financial statements. Financial assets and liabilities recorded

at fair value on a recurring basis include foreign currency,

commodity and interest rate

derivatives, as well as cash-settled call options and available

-for-sale securities.

Non-financial assets recorded at fair value on a non-recurring

basis include

long-lived assets that are reduced to their estimated fair value due

to impairments.

Fair value is the price that would be received when selling an

asset or paid to transfer a liability in an orderly transaction

between market participants at the

measurement date. In determining fair value, the Company

uses various valuation techniques including the market

approach (using observable market data for

identical or similar assets and liabilities), the income approach (discounted

cash flow models) and the cost approach (using costs

a market participant would incur

to develop a comparable asset). Inputs used to determine the fair

value of assets and liabilities are defined by a three-level

hierarchy, depending on the nature

those inputs. The Company has categorized its financial assets

and liabilities and non-financial assets measured at

fair value within this hierarchy based on

whether the inputs to the valuation technique are observable or unobservable.

An observable input is based on market data obtained from

independent sources,

while an unobservable input reflects the Company’s

assumptions about market data.

The levels of the fair value hierarchy are as follows:

Level 1:

Valuation inputs consist

of quoted prices in an active market for identical

assets or liabilities (observable quoted prices). Assets

and liabilities valued

using Level 1 inputs include exchange

‑

traded equity securities, listed derivatives

which are actively traded such as commodity futures, interest rate

futures and certain actively traded debt securities.

Level 2:

Valuation inputs consist

of observable inputs (other than Level 1 inputs)

such as actively quoted prices for similar assets, quoted prices

in inactive

markets and inputs other than quoted prices such

as interest rate yield curves, credit spreads, or inputs derived from

other observable data by

interpolation, correlation, regression or other means. The adjustments

applied to quoted prices or the inputs used in valuati

on models may be both

observable and unobservable. In these cases, the fair value measurement

is classified as Level 2 unless the unobservable portion

of the adjustment or

the unobservable input to the valuation model is significant, in

which case the fair value measurement would be

classified as Level 3. Assets and

liabilities valued or disclosed using Level 2 inputs include investments

in certain funds, certain debt securities that are not actively

traded, interest rate

swaps, cross-currency interest rate swaps, commodity

swaps, cash-settled call options, forward foreign exchange

contracts, foreign exchange swaps and

forward rate agreements, time deposits, as well as financing receivables

and debt.

Level 3:

Valuation inputs are based on

the Company’s assumptions of relevant market

data (unobservable input).

Whenever quoted prices involve bid-ask spreads, the Company

ordinarily determines fair values based on mid-market

quotes. However, for the purpose of

determining the fair value of cash-settled call options serving

as hedges of the Company’s management incentive

plan, bid prices are used.

When determining fair values based on quoted prices

in an active market, the Company considers if the

level of transaction activity for the financial instrument

has

significantly decreased or would not be considered orderly.

In such cases, the resulting changes in valuation

techniques would

be disclosed. If the market is

considered disorderly or if quoted prices are not available, the Company

is required to use another valuation technique, such

as an income approach.

Recurring fair value measures

The fair values of financial assets and liabilities measured at

fair value on a recurring basis were as follows:

March 31, 2023

($ in millions)

Level 1

Level 2

Level 3

Total fair value

Assets

Securities in “Marketable securities and short-term investments”:

Equity securities

714

Debt securities—U.S. government obligations

261

Debt securities—Other government obligations

Debt securities—Corporate

Derivative assets—current in “Other current assets”

201

Derivative assets—non-current in “Other non-current assets”

Total

261

1,064

–

1,325

Liabilities

Derivative liabilities—current in “Other current liabilities”

119

Derivative liabilities—non-current in “Other non-current liabilities”

327

Total

–

446

–

446

Q1 2023

FINANCIAL

INFORMATION

December 31, 2022

($ in millions)

Level 1

Level 2

Level 3

Total fair value

Assets

Securities in “Marketable securities and short-term investments”:

Equity securities

355

Debt securities—U.S. government obligations

255

Debt securities—European government obligations

Debt securities—Corporate

Derivative assets—current in “Other current assets”

184

Derivative assets—non-current in “Other non-current assets”

Total

255

681

–

936

Liabilities

Derivative liabilities—current in “Other current liabilities”

121

Derivative liabilities—non-current in “Other non-current liabilities”

367

Total

–

488

–

488

The Company uses the following methods and assumptions in

estimating fair values of financial assets

and liabilities measured at fair value on a recurring basis:

●

Securities in “Marketable securities and short-term investments”:

If quoted market prices in active markets for identical assets

are available, these are

considered Level 1 inputs; however,

when markets are not active, these inputs are

considered Level 2. If such quoted market prices are

not available,

fair value is determined using market prices for similar assets

or present value techniques, applying an appropriate risk-free

interest rate adjusted for

non-performance risk. The inputs used in present value techniques

are observable and fall into the Level 2 category.

●

Derivatives

: The fair values of derivative instruments are determined using

quoted prices of identical instruments from an

active market, if available

(Level 1 inputs). If quoted prices are not available, price quotes

for similar instruments, appropriately adjusted, or present value

techniques, based on

available market data, or option pricing models are used. Cash-settled

call options hedging the Company’s WAR

liability are valued based on bid prices

of the equivalent listed warrant. The fair values obtained using price

quotes for similar instruments or valuation techniques

represent a Level 2 input

unless significant unobservable inputs are used.

Non-recurring fair value measures

There were no significant non-recurring fair value measurements

during the three months ended March 31, 2023 and

2022.

Disclosure about financial instruments carried on a cost

basis

The fair values of financial instruments carried on a cost

basis were as follows:

March 31, 2023

($ in millions)

Carrying value

Level 1

Level 2

Level 3

Total fair value

Assets

Cash and equivalents (excluding securities with original

maturities up to 3 months):

Cash

1,300

Time deposits

2,138

Restricted cash

Marketable securities and short-term investments

(excluding securities):

Time deposits

286

Liabilities

Short-term debt and current maturities of long-term debt

(excluding finance lease obligations)

3,406

2,365

1,041

3,406

Long-term debt (excluding finance lease obligations)

5,093

5,014

5,034

December 31, 2022

($ in millions)

Carrying value

Level 1

Level 2

Level 3

Total fair value

Assets

Cash and equivalents (excluding securities with original

maturities up to 3 months):

Cash

1,697

Time deposits

2,459

Restricted cash

Liabilities

Short-term debt and current maturities of long-term debt

(excluding finance lease obligations)

2,500

1,068

1,432

2,500

Long-term debt (excluding finance lease obligations)

4,976

4,813

4,843

Q1 2023

FINANCIAL

INFORMATION

The Company uses the following methods and assumptions in

estimating fair values of financial instruments carried

on a cost basis:

●

Cash and equivalents (excluding securities with original maturities

up to 3 months), Restricted cash, and Marketable

securities and short-term

investments (excluding securities):

The carrying amounts approximate the fair

values as the items are short-term in nature or,

for cash held in banks,

are equal to the deposit amount.

●

Short-term debt and current maturities of long-term debt (excluding

finance lease obligations):

Short-term debt includes commercial paper,

bank

borrowings and overdrafts. The carrying amounts of short-term debt

and current maturities of long-term debt, excluding finance

lease obligations,

approximate their fair values.

●

Long-term debt (excluding finance lease obligations):

Fair values of bonds are determined using quoted market

prices (Level 1 inputs), if available. For

bonds without available quoted market prices and other long-term

debt, the fair values are determined using a discounted cash flow

methodology

based upon borrowing rates of similar debt instruments and

reflecting appropriate adjustments for non-performance risk

(Level 2 inputs).

─

Note 8

Contract assets and liabilities

The following table provides information about Contract assets

and Contract liabilities:

($ in millions)

March 31, 2023

December 31, 2022

March 31, 2022

Contract assets

1,009

954

1,072

Contract liabilities

2,339

2,216

2,080

Contract assets primarily relate to the Company’s right to receive

consideration for work completed but for which no invoice

has been issued at the reporting date.

Contract assets are transferred to receivables when rights

to receive payment become unconditional. Management expects

that the majority of the amounts will be

collected within one year of the respective balance sheet date.

Contract liabilities primarily relate to up-front advances received on

orders from customers as well as amounts invoiced

to customers in excess of revenues

recognized predominantly on long-term projects. Contract liabilities

are reduced as work is performed and as revenues are recognized

The significant changes in the Contract assets and Contract liabilities

balances were as follows:

Three months ended March 31,

2023

2022

Contract

($ in millions)

assets

liabilities

assets

liabilities

Revenue recognized, which was included in the Contract liabilities

balance at Jan 1, 2023/2022

(651)

(518)

Additions to Contract liabilities - excluding amounts recognized as

revenue during the period

707

701

Receivables recognized that were included in the Contract

assets balance at Jan 1, 2023/2022

(325)

(318)

The Company considers its order backlog to represent its

unsatisfied performance obligations. At March 31, 2023, the Company

had unsatisfied performance

obligations totaling $21,607 million and, of this amount, the Company

expects to fulfill approximately 66 percent of the obligations in

2023, approximately

23 percent of the obligations in 2024 and the balance thereafter.

Q1 2023

FINANCIAL

INFORMATION

─

Note 9

Debt

The Company’s total debt at March 31, 2023, and December

31, 2022, amounted to $8,663 million and $7,678 million,

respectively.

Short-term debt and current maturities of long-term debt

The Company’s “Short-term debt and current maturities of

long-term debt” consisted of the following:

($ in millions)

March 31, 2023

December 31, 2022

Short-term debt

1,047

1,448

Current maturities of long-term debt

2,386

1,087

Total

3,433

2,535

Short-term debt primarily represented issued commercial paper and

short-term bank borrowings from various banks.

At March 31, 2023,

and December 31, 2022,

$946 million and $1,383 million, respectively,

was outstanding under the $2 billion Euro-commercial

paper program. At March 31, 2023,

$34 million was

outstanding under the $2 billion commercial paper program in

the United States, whereas at December 31, 2022,

no amount was outstanding under this program.

Long-term debt

The Company’s long-term debt at March 31, 2023, and

December 31, 2022, amounted to $5,230 million and $5,143

million, respectively.

Outstanding bonds (including maturities within the next 12 months)

were as follows:

March 31, 2023

December 31, 2022

(in millions)

Nominal outstanding

Carrying value

(1)

Nominal outstanding

Carrying value

(1)

Bonds:

0.625% EUR Instruments, due 2023

EUR

700

759

EUR

700

742

0% CHF Bonds, due 2023

CHF

275

300

CHF

275

298

0.625% EUR Instruments, due 2024

EUR

700

737

EUR

700

720

Floating Rate EUR Instruments, due 2024

EUR

500

545

EUR

500

536

0.75% EUR Instruments, due 2024

EUR

750

787

EUR

750

769

0.3% CHF Bonds, due 2024

CHF

280

305

CHF

280

303

2.1% CHF Bonds, due 2025

CHF

150

163

CHF

150

162

3.25% EUR Instruments, due 2027

EUR

500

540

0.75% CHF Bonds, due 2027

CHF

425

462

CHF

425

460

3.8% USD Notes, due 2028

(2)

USD

383

381

USD

383

381

1.0% CHF Bonds, due 2029

CHF

170

185

CHF

170

184

0% EUR Instruments, due 2030

EUR

800

691

EUR

800

677

2.375% CHF Bonds, due 2030

CHF

150

163

CHF

150

162

3.375% EUR Instruments, due 2031

EUR

750

802

4.375% USD Notes, due 2042

(2)

USD

609

590

USD

609

590

Total

7,410

5,984

(1)

USD carrying values include unamortized debt issuance costs, bond discounts or premiums, as well as adjustments for fair value hedge accounting, where appropriate.

(2)

Prior to completing a cash tender offer in November 2020, the original principal amount outstanding,

on each of the 3.8% USD Notes,

due 2028,

and the 4.375% USD Notes,

due

2042, was USD 750 million.

In January 2023, the Company issued the following EUR Instruments:

(i) EUR 500 million of 3.25 percent Instruments,

due 2027, and (ii) EUR 750 million of

3.375 percent Instruments, due 2031, both paying interest

annually in arrears. The aggregate net proceeds

of these EUR Instruments, after discount and

fees,

amounted to EUR 1,235 million (equivalent to approximately

$1,338 million on date of issuance).

Q1 2023

FINANCIAL

INFORMATION

─

Note 10

Commitments and contingencies

Contingencies—Regulatory, Compliance

and Legal

Regulatory

Based on findings during an internal investigation, the Company

self-reported to the SEC and the DoJ, in the United

States, to the Special Investigating Unit (SIU)

and the National Prosecuting Authority (NPA)

in South Africa as well as to various authorities in other countries

potential suspect payments and other compliance

concerns in connection with some of the Company’s

dealings with Eskom and related persons. Many of those

parties have expressed an interest in, or

commenced an investigation into, these matters and the Company is

cooperating fully with them. The Company paid $104

million to Eskom in December 2020 as

part of a full and final settlement with Eskom and the Special Investigating

Unit relating to improper payments and other compliance

issues associated with the

Controls and Instrumentation Contract, and its Variation

Orders for Units 1 and 2 at Kusile. The Company

made a provision of approximately $325 million which

was recorded in Other income (expense), net, during the third

quarter of 2022. In December 2022, the Company settled with

the SEC and DOJ as well as the

authorities in South Africa and Switzerland. The matter is still pending

with the authorities in Germany,

but the Company does not believe that it will need to

record

any additional provisions for this matter.

General

The Company is aware of proceedings, or the threat of proceedings,

against it and others in respect of private claims by

customers and other third parties with

regard to certain actual or alleged anticompetitive practices.

Also, the Company is subject to other claims and legal

proceedings, as well as investigations carried

out by various law enforcement authorities. With respect to the

above-mentioned claims, regulatory matters,

and any related proceedings, the Company will bear

the related costs, including costs necessary to resolve

them.

Liabilities recognized

At March 31, 2023, and December 31, 2022, the Company had

aggregate liabilities of $97 million and $86

million, respectively, included

in “Other provisions” and

“Other non

‑

current liabilities”, for the above regulatory,

compliance and legal contingencies, and none of the individual

liabilities recognized was significant. As it is

not possible to make an informed judgment on, or reasonably predict,

the outcome of certain matters and as it is not possible,

based on information currently

available to management, to estimate the maximum potential

liability on other matters, there could be adverse outcomes beyond

the amounts accrued.

Guarantees

General

The following table provides quantitative data regarding the Company’s

third-party guarantees. The maximum potential payments

represent a “worst-case

scenario”, and do not reflect management’s expected

outcomes.

Maximum potential payments

($ in millions)

March 31, 2023

December 31, 2022

Performance guarantees

3,778

4,300

Financial guarantees

Total

(1)

3,872

4,396

(1)

Maximum potential payments include amounts in both continuing and discontinued operations.

The carrying amount of liabilities recorded in the Consolidated

Balance Sheets reflects the Company’s best estimate of

future payments, which it may incur as

part

of fulfilling its guarantee obligations. In respect of the above guarantees,

the carrying amounts of liabilities at March

31, 2023, and December 31, 2022, were not

significant.

The Company is party to various guarantees providing financial

or performance assurances to certain third parties. These guarantees,

which have various

maturities up to 2035, mainly consist of performance guarantees

whereby (i) the Company guarantees

the performance of a third party’s product or service

according to the terms of a contract and (ii) as member

of a consortium/joint-venture that includes third parties, the

Company guarantees not only its own

performance but also the work of third parties. Such guarantees

may include guarantees that a project will be completed

within a specified time. If the third party

does not fulfill the obligation, the Company will compensate the

guaranteed party in cash or in kind. The original

maturity dates for the majority of these

performance guarantees range from one to ten years.

In conjunction with the divestment of the high-voltage cable

and cables accessories businesses, the Company has

entered into various performance guarantees

with other parties with respect to certain liabilities of the

divested business. At March 31, 2023, and December 31,

2022, the maximum potential payable under

these guarantees amounts to $855 million and $843 million, respectively,

and these guarantees have various original maturities

ranging from five to ten years.

The Company retained obligations for financial, performance

and indemnification guarantees related to the sale of the

Power Grids business (see Note 3 for

details). The performance and financial guarantees have been

indemnified by Hitachi Ltd. These guarantees, which

have various maturities up to 2035, primarily

consist of bank guarantees, standby letters of credit, business

performance guarantees and other trade-related

guarantees, the majority of which have original

maturity dates ranging from one to ten years. The maximum amount

payable under these guarantees at March 31, 2023, and

December 31, 2022, is

approximately $2.5 billion and $3.0 billion, respectively.

Commercial commitments

In addition, in the normal course of bidding for and executing certain

projects, the Company has entered into standby

letters of credit, bid/performance bonds

and

surety bonds (collectively “performance bonds”) with various

financial institutions. Customers can draw on such

performance bonds in the event that the Company

does not fulfill its contractual obligations. The Company would

then have an obligation to reimburse the financial institution

for amounts paid under the performance

bonds. At both March 31, 2023, and December 31, 2022, the

total outstanding performance bonds aggregated to

$2.9 billion. There have been no significant

amounts reimbursed to financial institutions under these types

of arrangements in the three months ended March

31, 2023 and 2022.

Product and order-related contingencies

The Company calculates its provision for product warranties

based on historical claims experience and specific review

of certain contracts. The reconciliation of the

“Provisions for warranties”, including guarantees of product performance,

was as follows:

($ in millions)

2023

2022

Balance at January 1,

1,028

1,005

Claims paid in cash or in kind

(40)

(36)

Net increase in provision for changes in estimates, warranties

issued and warranties expired

Exchange rate differences

(8)

Balance at March 31,

1,060

999

Q1 2023

FINANCIAL

INFORMATION

─

Note 11

Income taxes

In calculating income tax expense, the Company uses an estimate

of the annual effective tax rate based upon the

facts and circumstances known at each

interim

period. On a quarterly basis, the actual effective tax

rate is adjusted, as appropriate, based upon changed facts

and circumstances, if any, as

compared to those

forecasted at the beginning of the year and each interim period

thereafter.

The effective tax rate of 10.1 percent in the three months

ended March 31, 2023, was lower than the effective tax

rate of 27.3 percent in the three months ended

March 31, 2022, primarily due to a net benefit realized on a favorable

resolution of an uncertain tax position in the three months

ended March 31, 2023.

February 2023, on completion of a tax audit, the Company

obtained resolution of the uncertain tax position for which

an amount was recorded within Other non-

current liabilities as of December 31, 2022. In the three months

ended March 31, 2023, the Company released the provision

of $206

million, due to the resolution

of this matter,

which resulted in an increase of $0.11

in earnings per share (basic and diluted).

─

Note 12

Employee benefits

The Company operates defined benefit pension plans, defined contribution

pension plans, and termination indemnity

plans, in accordance with local regulations

and practices. At March 31, 2023, the Company’s most significant

defined benefit pension plans are in Switzerland as well as

in Germany, the United Kingdom,

and the United States. These plans cover a large portion of the

Company’s employees and provide benefits to employees

in the event of death, disability,

retirement, or termination of employment. Certain of these

plans are multi-employer plans. The Company also operates

other postretirement benefit plans including

postretirement health care benefits and other employee-related

benefits for active employees including long-service

award plans. The measurement date used

for

the Company’s employee benefit plans is December

31. The funding policies of the Company’s plans

are consistent with the local government and tax

requirements.

Net periodic benefit cost of the Company’s defined benefit

pension and other postretirement benefit plans consisted of

the following:

($ in millions)

Defined pension benefits

other postretirement benefit plans

The Company expects to make contributions totaling approximately

$67 million and $5 million to its defined pension plans

and other postretirement benefit plans,

respectively, for the full year 2023.

Q1 2023

FINANCIAL

INFORMATION

─

Note 13

Stockholder's

equity

At the Annual General Meeting of Shareholders (AGM) on March

23, 2023, shareholders approved the proposal of the

Board of Directors to distribute 0.84

Swiss

francs per share to shareholders. The declared dividend amounted

to $1,706 million, with the Company disburs

ing a portion in March and the remaining amounts

in April.

In March 2023, the Company completed the share buyback

program that was launched in April 2022. This program was executed

on a second trading line on the

SIX Swiss Exchange. Through this program, the Company purchased

a total of 67 million shares for approximately

$2.0 billion, of which 8 million shares were

purchased in the first quarter of 2023 (resulting in an

increase in Treasury stock of $253 million

Also in March 2023, the Company announced a new share buyback

program of up to $1 billion. This program, which was

launched in April 2023, is being executed

on a second trading line on the SIX Swiss Exchange and is planned

to run until the Company’s 2024 AGM.

During the first quarter of 2023, the Company delivered, out

of treasury stock, approximately 5 million shares

in connection with its Management Incentive Plan.

In February 2023, the Company obtained funding through

a private placement of shares in its ABB E-Mobility subsidiary,

ABB E-mobility Holding Ltd

(ABB E-Mobility),

receiving gross proceeds of 325 million Swiss francs

(approximately $351 million) and reducing the Company’s

ownership in ABB E-Mobility from

92 percent to 81 percent. This resulted in an increase

in Additional paid-in capital of $170

million.

─

Note 14

Earnings per share

Basic earnings per share is calculated by dividing income by the

weighted-average number of shares outstanding during

the period. Diluted earnings per share is

calculated by dividing income by the weighted-average number of shares

outstanding during the period, assuming that all potentially

dilutive securities were

exercised, if dilutive. Potentially dilutive securities comprise outstanding

written call options, and outstanding options and

shares granted subject to certain

conditions under the Company’s share-based payment arrangements.

Basic earnings per share

Three months ended March 31,

($ in millions, except per share data in $)

2023

2022

Amounts attributable to ABB shareholders:

Income from continuing operations, net of tax

1,041

615

Loss from discontinued operations, net of tax

(5)

(11)

Net income

1,036

604

Weighted-average number of shares outstanding

(in millions)

1,861

1,936

Basic earnings per share attributable to ABB shareholders:

Income from continuing operations, net of tax

0.56

0.32

Loss from discontinued operations, net of tax

–

(0.01)

Net income

0.56

0.31

Diluted earnings per share

Three months ended March 31,

($ in millions, except per share data in $)

2023

2022

Amounts attributable to ABB shareholders:

Income from continuing operations, net of tax

1,041

615

Loss from discontinued operations, net of tax

(5)

(11)

Net income

1,036

604

Weighted-average number of shares outstanding (in millions)

1,861

1,936

Effect of dilutive securities:

Call options and shares

Adjusted weighted-average number of shares outstanding

(in millions)

1,874

1,953

Diluted earnings per share attributable to ABB shareholders:

Income from continuing operations, net of tax

0.56

0.31

Loss from discontinued operations, net of tax

–

(0.01)

Net income

0.55

0.31

Q1 2023

FINANCIAL

INFORMATION

─

Note 15

Reclassifications out of accumulated other comprehensive loss

The following table shows changes in “Accumulated other comprehensive

loss” (OCI) attributable to ABB, by component, net

of tax:

Unrealized gains

Pension and

Foreign currency

(losses) on

other

Derivative

translation

available-for-sale

postretirement

instruments

($ in millions)

adjustments

securities

plan adjustments

and hedges

Total OCI

Balance at January 1, 2022

(2,993)

(1,089)

(8)

(4,088)

Other comprehensive (loss) income:

Other comprehensive (loss) income

before reclassifications

(80)

(12)

(4)

(76)

Amounts reclassified from OCI

–

Total other comprehensive (loss)

income

(75)

(12)

(55)

Less:

Amounts attributable to

noncontrolling interests and

redeemable noncontrolling interests

(5)

–

(5)

Balance at March 31, 2022

(3,063)

(10)

(1,061)

(4)

(4,138)

Unrealized gains

Pension and

Foreign currency

(losses) on

other

Derivative

translation

available-for-sale

postretirement

instruments

($ in millions)

adjustments

securities

plan adjustments

and hedges

Total OCI

Balance at January 1, 2023

(3,691)

(19)

(838)

(8)

(4,556)

Other comprehensive (loss) income:

Other comprehensive (loss) income

before reclassifications

(8)

Amounts reclassified from OCI

–

Total other comprehensive (loss)

income

–

Less:

Amounts attributable to

noncontrolling interests and

redeemable noncontrolling interests

–

Balance at March 31, 2023

(3,612)

(14)

(838)

(5)

(4,469)

The amounts reclassified out of OCI for the three months

ended March 31, 2023 and 2022, were not significant.

─

Note 16

Operating segment data

The Chief Operating Decision Maker (CODM) is the Chief

Executive Officer. The CODM

allocates resources to and assesses the performance of

each operating

segment using the information outlined below. The

Company is organized into the following segments, based

on products and services: Electrification, Motion,

Process Automation and Robotics & Discrete Automation. The remaining

operations of the Company are included in

Corporate and Other.

Effective January 1, 2023, the E-mobility Division

is no longer managed within the Electrification segment

and has become a separate operating segment. This

new segment does not currently meet any of the size thresholds

to be considered a reportable segment and as such is presented

within Corporate and Other.

The

segment information for the three months ended March 31,

2023 and 2022, and at December 31, 2022,

has been recast to reflect this change.

A description of the types of products and services

provided by each reportable segment is as follows:

●

Electrification:

manufactures and sells electrical products and solutions

which are designed to provide safe, smart and

sustainable electrical flow from

the substation to the socket. The portfolio of increasingly digital and connected

solutions includes renewable power solutions, modular substation

packages, distribution automation products, switchboard and panelboards,

switchgear, UPS solutions, circuit breakers,

measuring and sensing devices,

control products, wiring accessories, enclosures and cabling

systems and intelligent home and building solutions,

designed to integrate and automate

lighting, heating, ventilation, security and data communication

networks.

The products and services are delivered through six

operating Divisions:

Distribution Solutions, Smart Power, Smart

Buildings, Installation Products,

Power Conversion and Service.

●

Motion:

designs, manufactures, and sells drives, motors, generators

and traction converters that are driving the low-carbon future

for industries, cities,

infrastructure and transportation. These products, digital technology

and related services enable industrial customers to increase

energy efficiency,

improve safety and reliability, and achieve

precise control of their processes. Building on over 130

years of cumulative experience in electric

powertrains, Motion combines domain expertise and technology

to deliver the optimum solution for a wide range of applications

in all industrial

segments. In addition, Motion, along with its partners,

has a leading global service presence. These products and services

are delivered through seven

operating Divisions: Large Motors and Generators, IEC LV

Motors, NEMA Motors, Drive Products, System Drives,

Service and Traction.

Q1 2023

FINANCIAL

INFORMATION

●

Process Automation:

offers a broad range of industry-specific,

integrated automation, electrification and digital solutions,

as well as lifecycle services for

the process,

hybrid and marine industries. The product portfolio includes

control technologies, industrial software, advanced

analytics, sensing and

measurement technology, and marine

propulsion systems. In addition,

Process Automation offers a comprehensive range

of services,

from repair to

advanced digital capabilities such as remote monitoring, preventive

maintenance, asset performance management, emission

monitoring and

cybersecurity.

The products, systems and services are currently delivered through four operating

Divisions: Energy Industries, Process Industries,

Marine & Ports and Measurement & Analytics as well as,

prior to its spin-off in October 2022, the Turbocharging

Division (Accelleron).

●

Robotics & Discrete Automation:

delivers its products, solutions and services

through two operating Divisions: Robotics and Machine Automation.

Robotics includes industrial robots, autonomous mobile robotics, software,

robotic solutions, field services, spare parts, and

digital services. Machine

Automation specializes in solutions based on its programmable

logic controllers (PLC), industrial PCs (IPC), servo

motion, transport systems and

machine vision.

Both Divisions offer engineering and simulation software

as well as a comprehensive range of digital solutions.

Corporate and Other:

includes headquarter costs,

the Company’s corporate real estate activities, Corporate Treasury

Operations, the E-mobility operating

segment, historical operating activities of certain divested businesses

and other non-core operating activities.

The primary measure of profitability on which the operating segments

are evaluated is Operational EBITA, which

represents income from operations excluding:

●

amortization expense on intangibles arising upon acquisition (acquisition

-related amortization),

●

restructuring, related and implementation costs,

●

changes in the amount recorded for obligations related to divested

businesses occurring after the divestment date (changes

in obligations related to

divested businesses),

●

gains and losses from sale of businesses (including fair value adjustment

on assets and liabilities held for sale),

●

acquisition- and divestment-related expenses and integration costs,

●

certain other non-operational items, as well as

●

foreign exchange/commodity timing differences in income

from operations consisting of: (a) unrealized gains

and losses on derivatives (foreign

exchange, commodities, embedded derivatives), (b) realized

gains and losses on derivatives where the underlying hedged

transaction has not yet been

realized, and (c) unrealized foreign exchange movements on receivables/payables

(and related assets/liabilities).

Certain other non-operational items generally includes certain regulatory,

compliance and legal costs, other income/expense relating

to the Power Grids joint

venture, certain asset write downs/impairments and certain

other fair value changes, changes in estimates relating to opening

balance sheets of acquired

businesses (changes in pre-acquisition estimates), as well as

other items which are determined by management on

a case-by-case basis.

The CODM primarily reviews the results of each segment on

a basis that is before the elimination of profits

made on inventory sales between segments. Segment

results below are presented before these eliminations, with a total deduction

for intersegment profits to arrive at the Company’s

consolidated Operational EBITA.

Intersegment sales and transfers are accounted for as if the sales

and transfers were to third parties, at current market prices.

The following tables present disaggregated segment revenues from

contracts with customers, Operational EBITA,

and the reconciliations of consolidated

Operational EBITA to Income from continuing

operations before taxes for the three months ended March

31, 2023 and 2022, as well as total assets at March 31

2023, and December 31, 2022.

Three months ended March 31, 2023

Robotics &

Process

Discrete

Corporate

($ in millions)

Electrification

Motion

Automation

and Other

Total

Geographical markets

Europe

1,162

638

519

474

2,872

The Americas

1,407

632

421

136

2,653

of which: United States

1,043

533

264

1,984

Asia, Middle East and Africa

957

549

489

324

2,334

of which: China

457

281

162

248

1,155

3,526

1,819

1,429

934

151

7,859

Product type

Products

3,306

1,583

827

791

137

6,644

Services and other

220

236

602

143

1,215

3,526

1,819

1,429

934

151

7,859

Third-party revenues

3,526

1,819

1,429

934

151

7,859

Intersegment revenues

121

(195)

–

Total revenues

(1)

3,590

1,940

1,436

937

(44)

7,859

Q1 2023

FINANCIAL

INFORMATION

Three months ended March 31, 2022

Robotics &

Process

Discrete

Corporate

($ in millions)

Electrification

Motion

Automation

and Other

Total

Geographical markets

Europe

1,062

466

585

354

2,518

The Americas

1,164

492

368

108

2,169

of which: United States

849

407

221

1,582

Asia, Middle East and Africa

951

499

546

267

2,278

of which: China

457

287

150

197

1,100

3,177

1,457

1,499

729

103

6,965

Product type

Products

2,981

1,248

813

612

5,749

Services and other

196

209

686

117

1,216

3,177

1,457

1,499

729

103

6,965

Third-party revenues

3,177

1,457

1,499

729

103

6,965

Intersegment revenues

115

(182)

–

Total revenues

(1)

3,236

1,572

1,506

730

(79)

6,965

(1)

Due to rounding, numbers presented may not add to the totals provided.

Three months ended

March 31,

($ in millions)

2023

2022

Operational EBITA:

Electrification

677

512

Motion

366

274

Process Automation

205

196

Robotics & Discrete Automation

140

Corporate and Other

‒

E-mobility

(28)

(2)

‒ Corporate costs, intersegment eliminations and other

(83)

(32)

Total

1,277

997

Acquisition-related amortization

(54)

(60)

Restructuring, related and implementation costs

(1)

(28)

(16)

Changes in obligations related to divested businesses

(3)

Acquisition- and divestment-related expenses and integration

costs

(19)

(59)

Foreign exchange/commodity timing differences in

income from operations:

Unrealized gains and losses on derivatives (foreign exchange,

commodities, embedded derivatives)

Realized gains and losses on derivatives where the underlying hedged

transaction has not yet been realized

(5)

(2)

Unrealized foreign exchange movements on receivables/payables (and

related assets/liabilities)

(1)

Certain other non-operational items:

Other income/expense relating to the Power Grids joint venture

(35)

Regulatory, compliance and legal costs

–

Business transformation costs

(2)

(34)

(26)

Changes in pre-acquisition estimates

–

(1)

Certain other fair value changes, including asset impairments

(1)

Other non-operational items

(7)

Income from operations

1,198

857

Interest and dividend income

Interest and other finance expense

(61)

(22)

Non-operational pension (cost) credit

Income from continuing operations before taxes

1,184

884

(1)

Includes impairment of certain assets.

(2)

Amount includes ABB Way process transformation costs of $30 million and $25 million for three months ended March 31, 2023 and 2022, respectively.

Total assets

(1)

($ in millions)

March 31, 2023

December 31, 2022

Electrification

13,001

12,993

Motion

6,832

6,565

Process Automation

4,672

4,598

Robotics & Discrete Automation

4,960

4,901

Corporate and Other

(2)

10,574

10,091

Consolidated

40,039

39,148

(1)

Total assets are after intersegment eliminations and therefore reflect third-party assets only.

(2)

At March 31, 2023, and December 31, 2022,

respectively, Corporate and Other includes $90 million and $96 million of assets in the Power Grids business which is reported as

discontinued operations (see Note 3). In addition, at March 31, 2023, Corporate and Other includes

assets held for sale of $525 million (see Note 3).

Q1 2023

FINANCIAL

INFORMATION

Q1 2023

FINANCIAL

INFORMATION

—

Supplemental Reconciliations

and Definitions

The following

reconciliations

and definitions

include

measures

which ABB

uses to

supplement

its Consolidated

Financial

Information

(unaudited)

which is

prepared

in accordance

with

United

States

generally

accepted

accounting

principles

(U.S.

GAAP).

Certain

of these

financial

measures

are, or

may be,

considered

non-GAAP

financial

measures

as defined

in the

rules of

the U.S.

Securities

and Exchange

Commission

(SEC).

While

ABB’s

management

believes

that the

non-GAAP

financial

measures

herein

are useful

in evaluating

ABB’s

operating

results,

this information

should

be considered

as supplemental

in nature

and not

as a substitute

for the

financial

information

prepared

in accordance

with U.S.

GAAP.

Therefore

these

measures

should

not be

viewed

in isolation

but considered

together

with

the Consolidated

Financial

Information

(unaudited)

prepared

in accordance

with

U.S. GAAP

as of and

for the

three

months

ended

March 31,

2023.

Comparable growth rates

Growth rates for certain key figures may be presented and discussed

on a “comparable” basis. The comparable growth rate measures growth

on a constant

currency basis. Since we are a global company,

the comparability of our operating results reported

in U.S. dollars is affected by foreign currency

exchange rate

fluctuations. We calculate the impacts from foreign currency

fluctuations by translating the current-year periods’ reported key

figures into U.S. dollar amounts using

the exchange rates in effect for the comparable periods

in the previous year.

Comparable growth rates are also adjusted for changes

in our business portfolio. Adjustments to our business

portfolio occur due to acquisitions, divestments,

by exiting specific business activities or customer markets. The adjustment

for portfolio changes is calculated as follows: where

the results of any business

acquired or divested have not been consolidated and reported for the

entire duration of both the current and comparable

periods, the reported key figures of such

business are adjusted to exclude the relevant key figures

of any corresponding quarters which are not comparable when

computing the comparable growth rate.

Certain portfolio

changes which do not qualify as divestments under

U.S. GAAP have been treated in a similar manner to

divestments. Changes in our portfolio

where we have exited certain business activities or customer markets

are adjusted as if the relevant business

was divested in the period when the decision to

cease business activities was taken. We do not adjust

for portfolio changes where the relevant business

has annualized revenues of less than $50 million.

The following tables provide reconciliations of reported growth rates

of certain key figures to their respective comparable growth

rate.

Comparable growth rate reconciliation by Business Area

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Business Area

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Electrification

11%

16%

Motion

23%

-1%

29%

Process Automation

25%

23%

55%

-5%

15%

Robotics & Discrete Automation

-23%

-20%

28%

35%

ABB Group

13%

22%

Q1 2023

FINANCIAL

INFORMATION

Regional comparable growth rate reconciliation

Regional comparable growth rate reconciliation for ABB Group

- Quarter

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Region

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Europe

10%

14%

24%

The Americas

22%

25%

of which: United States

-4%

-1%

-3%

25%

28%

Asia, Middle East and Africa

-2%

11%

10%

16%

of which: China

-12%

-3%

16%

ABB Group

13%

22%

Regional comparable growth rate reconciliation by Business

Area - Quarter

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Region

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Europe

14%

The Americas

-1%

21%

of which: United States

-6%

23%

Asia, Middle East and Africa

11%

15%

11%

12%

of which: China

-11%

-4%

Electrification

11%

16%

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Region

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Europe

-1%

11%

30%

-1%

36%

The Americas

29%

of which: United States

32%

-1%

31%

Asia, Middle East and Africa

11%

12%

10%

22%

of which: China

-8%

-1%

11%

Motion

23%

-1%

29%

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Region

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Europe

44%

12%

32%

88%

-11%

15%

The Americas

29%

17%

47%

14%

15%

30%

of which: United States

-9%

15%

20%

19%

39%

Asia, Middle East and Africa

21%

34%

-10%

15%

11%

of which: China

16%

27%

52%

22%

37%

Process Automation

25%

23%

55%

-5%

14%

15%

Q1 2023 compared to Q1 2022

Order growth rate

Revenue growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Region

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Europe

-21%

-17%

34%

41%

The Americas

-17%

-1%

-18%

27%

of which: United States

-23%

26%

Asia, Middle East and Africa

-29%

-23%

22%

10%

32%

of which: China

-31%

-26%

25%

11%

36%

Robotics & Discrete Automation

-23%

-20%

28%

35%

Q1 2023

FINANCIAL

INFORMATION

Order backlog growth rate reconciliation

March 31, 2023 compared to March 31, 2022

US$

Foreign

(as

exchange

Portfolio

Business Area

reported)

impact

changes

Comparable

Electrification

19%

24%

Motion

18%

22%

Process Automation

11%

21%

Robotics & Discrete Automation

12%

16%

ABB Group

14%

21%

Other growth rate reconciliations

Q1 2023 compared to Q1 2022

Service orders growth rate

Services revenues growth rate

US$

Foreign

US$

Foreign

(as

exchange

Portfolio

(as

exchange

Portfolio

Business Area

reported)

impact

changes

Comparable

reported)

impact

changes

Comparable

Electrification

10%

12%

17%

Motion

12%

13%

20%

Process Automation

-16%

23%

11%

-12%

25%

17%

Robotics & Discrete Automation

10%

15%

22%

28%

ABB Group

-6%

13%

12%

14%

19%

Q1 2023

FINANCIAL

INFORMATION

Operational EBITA as

% of operational revenues (Operational EBITA margin)

Definition

Operational EBITA margin

Operational EBITA margin is Operational

EBITA as a percentage of

operational revenues.

Operational EBITA

Operational earnings before interest, taxes and acquisition-related

amortization (Operational EBITA)

represents Income from operations excluding:

●

acquisition-related amortization (as defined below),

●

restructuring, related and implementation costs,

●

changes in the amount recorded for obligations related to divested

businesses occurring after the divestment date (changes

in obligations related to

divested businesses),

●

gains and losses from sale of businesses (including fair value adjustment

on assets and liabilities held for sale),

●

acquisition- and divestment-related expenses and integration costs,

●

certain other non-operational items, as well as

●

foreign exchange/commodity timing differences in income

from operations consisting of: (a) unrealized gains

and losses on derivatives (foreign

exchange, commodities, embedded derivatives), (b) realized

gains and losses on derivatives where the underlying hedged

transaction has not yet been

realized, and (c) unrealized foreign exchange movements on receivables/payables

(and related assets/liabilities).

Certain other non-operational items generally includes certain regulatory,

compliance and legal costs, other income/expense relating

to the Power Grids joint

venture, certain asset

write downs/impairments and certain other fair

value changes, changes in estimates relating to opening balance

sheets of acquired

businesses (changes in pre-acquisition estimates), as well as

other items which are determined by management on

a case-by-case basis.

Operational EBITA is our measure of

segment profit but is also used by management to evaluate

the profitability of the Company

as a whole.

Acquisition-related amortization

Amortization expense on intangibles arising upon acquisitions.

Restructuring, related and implementation costs

Restructuring, related and implementation costs consists

of restructuring and other related expenses, as well as internal and external

costs relating to the

implementation of group-wide restructuring programs.

Operational revenues

The Company presents operational revenues solely for the purpose

of allowing the computation of Operational EBITA

margin. Operational revenues are Total

revenues adjusted for foreign exchange/commodity timing differences

in total revenues of: (i) unrealized gains and losses

on derivatives, (ii) realized gains and

losses on derivatives where the underlying hedged transaction

has not yet been realized, and (iii) unrealized foreign

exchange movements on receivables (and

related assets). Operational revenues are not intended to be an

alternative measure to Total

revenues, which represent our revenues measured

in accordance

with U.S. GAAP.

Reconciliation

The following tables provide reconciliations of consolidated Operational

EBITA to Net Income and Operational

EBITA Margin by business.

Reconciliation of consolidated Operational EBITA

to Net Income

Three months ended March 31,

($ in millions)

2023

2022

Operational EBITA

1,277

997

Acquisition-related amortization

(54)

(60)

Restructuring, related and implementation costs

(1)

(28)

(16)

Changes in obligations related to divested businesses

(3)

Acquisition- and divestment-related expenses and integration

costs

(19)

(59)

Certain other non-operational items

(34)

Foreign exchange/commodity timing differences in

income from operations

Income from operations

1,198

857

Interest and dividend income

Interest and other finance expense

(61)

(22)

Non-operational pension (cost) credit

Income from continuing operations before taxes

1,184

884

Income tax expense

(119)

(241)

Income from continuing operations, net of

tax

1,065

643

Loss from discontinued operations, net of tax

(5)

(11)

Net income

1,060

632

(1)

Includes impairment of certain assets.

Q1 2023

FINANCIAL

INFORMATION

Reconciliation of Operational EBITA

margin by business

Three months ended March 31, 2023

Corporate and

Robotics &

Other and

Process

Discrete

Intersegment

($ in millions, unless otherwise indicated)

Electrification

Motion

Automation

elimination

Consolidated

Total revenues

3,590

1,940

1,436

937

(44)

7,859

Foreign exchange/commodity timing

differences in total revenues:

Unrealized gains and losses

on derivatives

(14)

(4)

Realized gains and losses on derivatives

where the underlying hedged

transaction has not yet been realized

(1)

–

Unrealized foreign exchange movements

on receivables (and related assets)

(7)

(4)

(1)

(3)

(19)

Operational revenues

3,568

1,940

1,446

938

(49)

7,843

Income (loss) from operations

655

353

200

115

(125)

1,198

Acquisition-related amortization

Restructuring, related and

implementation costs

–

Changes in obligations related to

divested businesses

–

Acquisition- and divestment-related expenses

and integration costs

Certain other non-operational items

–

(8)

(1)

Foreign exchange/commodity timing

differences in income from operations:

Unrealized gains and losses on derivatives

(foreign exchange, commodities,

embedded derivatives)

(15)

–

(2)

(7)

(22)

Realized gains and losses on derivatives

where the underlying hedged

transaction has not yet been realized

–

Unrealized foreign exchange movements

on receivables/payables

(and related assets/liabilities)

(3)

(2)

(1)

–

(7)

Operational EBITA

677

366

205

140

(111)

1,277

Operational EBITA margin (%)

19.0%

18.9%

14.2%

14.9%

n.a.

16.3%

In the three months ended March 31, 2023, certain other non-operational

items in the table above includes the following:

Three months ended March 31, 2023

Robotics &

Process

Discrete

Corporate

($ in millions, unless otherwise indicated)

Electrification

Motion

Automation

and Other

Consolidated

Certain other non-operational items:

Other income/expense relating to the

Power Grids joint venture

–

(13)

Certain other fair values changes,

including asset impairments

–

(2)

Business transformation costs

(1)

–

Other non-operational items

(2)

–

(22)

(23)

Total

–

(8)

(1)

Amounts

include ABB Way process transformation costs of $30 million for the three months ended March 31, 2023.

Q1 2023

FINANCIAL

INFORMATION

Three months ended March 31, 2022

Corporate and

Robotics &

Other and

Process

Discrete

Intersegment

($ in millions, unless otherwise indicated)

Electrification

Motion

Automation

elimination

Consolidated

Total revenues

3,236

1,572

1,506

730

(79)

6,965

Foreign exchange/commodity timing

differences in total revenues:

Unrealized gains and losses

on derivatives

(11)

(1)

(2)

(8)

Realized gains and losses on derivatives

where the underlying hedged

transaction has not yet been realized

(3)

–

Unrealized foreign exchange movements

on receivables (and related assets)

–

(2)

Operational revenues

3,226

1,575

1,505

735

(79)

6,962

Income (loss) from operations

480

254

151

(50)

857

Acquisition-related amortization

Restructuring, related and

implementation costs

–

Changes in obligations related to

divested businesses

–

(14)

Acquisition- and divestment-related expenses

and integration costs

Certain other non-operational items

–

Foreign exchange/commodity timing

differences in income from operations:

Unrealized gains and losses on derivatives

(foreign exchange, commodities,

embedded derivatives)

(21)

(1)

(5)

(18)

Realized gains and losses on derivatives

where the underlying hedged

transaction has not yet been realized

–

(3)

–

Unrealized foreign exchange movements

on receivables/payables

(and related assets/liabilities)

–

(3)

Operational EBITA

512

274

196

(34)

997

Operational EBITA margin (%)

15.9%

17.4%

13.0%

6.7%

n.a.

14.3%

In the three months ended March 31, 2022, certain other non-operational

items in the table above includes the following:

Three months ended March 31, 2022

Robotics &

Process

Discrete

Corporate

($ in millions, unless otherwise indicated)

Electrification

Motion

Automation

and Other

Consolidated

Certain other non-operational items:

Regulatory, compliance and legal costs

–

(1)

Other income/expense relating to the

Power Grids joint venture

–

Certain other fair values changes,

including asset impairments

–

(34)

Business transformation costs

(1)

–

Changes in pre-acquisition estimates

–

Other non-operational items

–

Total

–

(1)

Amounts

include ABB Way process transformation costs of $25 million for the three months ended March 31, 2022.

Q1 2023

FINANCIAL

INFORMATION

Net debt

Definition

Net debt

Net debt is defined as Total

debt less Cash and marketable securities.

Total debt

Total debt is the sum

of Short-term debt and current maturities of long-term

debt, and Long-term debt.

Cash and marketable securities

Cash and marketable securities is the sum of Cash and equivalents,

Restricted cash (current and non-current)

and Marketable securities and short-term

investments.

Reconciliation

($ in millions)

March 31, 2023

December 31, 2022

Short-term debt and current maturities of long-term debt

3,433

2,535

Long-term debt

5,230

5,143

Total debt

8,663

7,678

Cash and equivalents

3,438

4,156

Restricted cash - current

Marketable securities and short-term investments

1,380

725

Cash and marketable securities

4,837

4,899

Net debt

3,826

2,779

Net debt/Equity ratio

Definition

Net debt/Equity ratio

Net debt/Equity ratio is defined as Net debt divided by Equity.

Equity

Equity is defined as Total

stockholders’ equity.

Reconciliation

($ in millions, unless otherwise indicated)

March 31, 2023

December 31, 2022

Total stockholders'

equity

12,831

13,187

Net debt (as defined above)

3,826

2,779

Net debt / Equity ratio

0.30

0.21

Net debt/EBITDA ratio

Definition

Net debt/EBITDA ratio

Net debt/EBITDA ratio is defined as Net debt divided by

EBITDA.

EBITDA

EBITDA is defined as Income from operations for the trailing

twelve months preceding the balance sheet date before depreciati

on and amortization for the same

trailing twelve-month period.

Reconciliation

($ in millions, unless otherwise indicated)

March 31, 2023

March 31, 2022

Income from operations for the three months ended:

June 30, 2022 / 2021

587

1,094

September 30, 2022 / 2021

708

852

December 31, 2022 / 2021

1,185

2,975

March 31, 2023 / 2022

1,198

857

Depreciation and Amortization for the three months

ended:

June 30, 2022 / 2021

207

230

September 30, 2022 / 2021

198

220

December 31, 2022 / 2021

199

216

March 31, 2023 / 2022

191

210

EBITDA

4,473

6,654

Net debt (as defined above)

3,826

2,772

Net debt / EBITDA

0.9

0.4

Q1 2023

FINANCIAL

INFORMATION

Net working capital as a percentage of revenues

Definition

Net working capital as a percentage of revenues

Net working capital as a percentage of revenues is calculated

as Net working capital divided by Adjusted revenues for the

trailing twelve months.

Net working capital

Net working capital is the sum of (i) receivables, net, (ii) contract

assets, (iii) inventories, net, and (iv) prepaid expenses; less

(v) accounts payable, trade, (vi)

contract liabilities (including non-current amounts)

and (vii) other current liabilities (excluding primarily:

(a) income taxes payable, (b) current derivative liabilities,

(c)

pension and other employee benefits, (d) payables under the share

buyback program, (e) liabilities related to certain other restructuring

-related activities and

(f) liabilities related to the divestment of the Power Grids business

); and including the amounts related to these accounts which have been

presented as either

assets or liabilities held for sale but excluding any amounts included

in discontinued operations.

Adjusted revenues for the trailing twelve months

Adjusted revenues for the trailing twelve months includes total revenues

recorded by ABB in the twelve months preceding the relevant

balance sheet date adjusted

to eliminate revenues of divested businesses and the estimated

impact of annualizing revenues of certain acquisitions

which were completed in the same trailing

twelve-month period.

Reconciliation

($ in millions, unless otherwise indicated)

March 31, 2023

March 31, 2022

Net working capital:

Receivables, net

7,174

6,851

Contract assets

1,009

1,072

Inventories, net

6,269

5,372

Prepaid expenses

304

289

Accounts payable, trade

(4,945)

(4,830)

Contract liabilities

(2,339)

(2,080)

Other current liabilities

(1)

(3,444)

(3,213)

Net working capital in assets and liabilities held for sale

136

–

Net working capital

4,164

3,461

Total revenues for the three months

ended:

June 30, 2022 / 2021

7,251

7,449

September 30, 2022 / 2021

7,406

7,028

December 31, 2022 / 2021

7,824

7,567

March 31, 2023 / 2022

7,859

6,965

Adjustment to annualize/eliminate revenues of certain acquisitions/divestments

(340)

(363)

Adjusted revenues for the trailing twelve months

30,000

28,646

Net working capital as a percentage of revenues (%)

13.9%

12.1%

(1)

Amounts exclude $668 million and $901 million at March 31, 2023 and 2022, respectively, related primarily to (a) income taxes payable, (b) current derivative liabilities, (c) pension

and other employee benefits, (d) payables under the share buyback program, (e) liabilities related to certain restructuring-related activities and (f) liabilities related to the divestment of

the Power Grids business.

Q1 2023

FINANCIAL

INFORMATION

Free cash flow conversion to net income

Definition

Free cash flow conversion to net income

Free cash flow conversion to net income is calculated as free cash

flow divided by Adjusted net income attributable to

ABB.

Adjusted net income attributable to ABB

Adjusted net income attributable to ABB is calculated as net income

attributable to ABB adjusted for: (i) impairment of

goodwill, (ii) losses from extinguishment

debt, and (iii) gains arising on the sale of both the Hitachi

Energy Joint Venture and Power

Grids business, the latter being included in discontinued operations.

Free cash flow

Free cash flow is calculated as net cash provided by operating activities

adjusted for: (i) purchases of property,

plant and equipment and intangible assets,

and (ii)

proceeds from sales of property,

plant and equipment.

Free cash flow for the trailing twelve months

Free cash flow for the trailing twelve months includes free cash flow

recorded by ABB in the twelve months preceding the

relevant balance sheet date.

Net income for the trailing twelve months

Net income for the trailing twelve months includes net income

recorded by ABB (as adjusted) in the twelve months

preceding the relevant balance sheet date.

Free cash flow conversion to net income

Twelve months to

($ in millions, unless otherwise indicated)

March 31, 2023

December 31, 2022

Net cash provided by operating activities – continuing

operations

2,181

1,334

Adjusted for the effects of continuing operations:

Purchases of property, plant and

equipment and intangible assets

(726)

(762)

Proceeds from sale of property, plant and

equipment

123

127

Free cash flow from continuing operations

1,578

699

Net cash used in operating activities – discontinued operations

(39)

(47)

Free cash flow

1,539

652

Adjusted net income attributable to ABB

(1)

2,869

2,442

Free cash flow conversion to net income

54%

27%

(1)

Adjusted net income attributable to ABB for the year ended December 31, 2022, is adjusted to exclude the gain on the sale of Hitachi Energy Joint Venture of $43 million and

reductions to the gain on the sale of Power Grids of $10 million.

Reconciliation of the trailing twelve months to

March 31, 2023

Continuing operations

Discontinued

operations

($ in millions)

Net cash provided by

continuing operating

activities

Purchases of

property, plant and

equipment and

intangible assets

Proceeds

from sale of property,

plant and equipment

Net cash provided

by (used in)

discontinued

operating activities

Adjusted net income

attributable to ABB

(1)

Q2 2022

385

(151)

(3)

383

Q3 2022

793

(165)

(2)

362

Q4 2022

720

(259)

(33)

1,088

Q1 2023

283

(151)

(1)

1,036

Total for the trailing twelve

months to March 31, 2023

2,181

(726)

123

(39)

2,869

(1)

Adjusted net income attributable to ABB for Q2, Q3 and Q4 of 2022, is adjusted to exclude reductions to the gain on the sale of Power Grids of $4 million, $2 million and $(1) million,

respectively.

In addition, Q4 2022 is also adjusted to exclude the gain on the sale of Hitachi Energy Joint Venture of $43 million.

Q1 2023

FINANCIAL

INFORMATION

Net finance expenses

Definition

Net finance expenses is calculated as Interest and dividend income

less Interest and other finance expense.

Reconciliation

Three months ended March 31,

($ in millions)

2023

2022

Interest and dividend income

Interest and other finance expense

(61)

(22)

Net finance expenses

(21)

(9)

Book-to-bill ratio

Definition

Book-to-bill ratio is calculated as Orders received divided by Total

revenues.

Reconciliation

Three months ended March 31,

2023

2022

($ in millions, except Book-to-bill presented as a ratio)

Orders

Revenues

Book-to-bill

Orders

Revenues

Book-to-bill

Electrification

4,141

3,590

1.15

4,112

3,236

1.27

Motion

2,262

1,940

1.17

2,202

1,572

1.40

Process Automation

2,113

1,436

1.47

1,692

1,506

1.12

Robotics & Discrete Automation

1,001

937

1.07

1,308

730

1.79

Corporate and Other

(incl. intersegment eliminations)

(67)

(44)

n.a.

(79)

n.a.

ABB Group

9,450

7,859

1.20

9,373

6,965

1.35

Q1 2023

FINANCIAL

INFORMATION

—

ABB Ltd

Corporate Communications

P.O. Box

8131

8050

Zurich

Switzerland

Tel:

+41 (0)43

317 71

www.abb.com

—

ZURICH, SWITZERLAND, APRIL

25,

2023

ABB plans to delist ADRs from NYSE

ABB is planning to delist its

American Depositary

Receipts (ADRs) from the

New York Stock Exchange

(NYSE),

and ultimately to seek to deregister

its ADRs and

the underlying shares

under the US Securities

Exchange Act

of 1934 (the Exchange

Act). In connection with the delisting

of its ADRs from the

NYSE, ABB

intends to convert

its current sponsored Level II

ADR program into a sponsored

Level I ADR program,

which would give US

investors a continued investment

option, in addition to the

ordinary ABB share.

The company’s shares

will

remain listed on the SIX Swiss

Exchange (SIX) and the Nasdaq

Stockholm due to the company’s

heritage.

ABB was listed on the NYSE in

April 2001. Investor access

to international equity markets

has significantly

changed in recent times with digital

trading on multiple platforms

providing many new possibilities

to investors.

Consequently, the need to be

listed on as many as three

equity capital markets has decreased.

Trading of ABB shares

is currently conducted predominantly

on the SIX and via electronic

trading platforms.

ABB expects that reducing the

number of listings will support

internal simplification and efficiency

while the

company remains fully committed

to an open and frequent

dialog with US investors, as well

as maintaining the

highest standards of corporate

governance and transparent

financial reporting.

ABB plans to file the required

Form 25 with the SEC on or

around May 12, 2023.

The last day of trading of

ABB’s ADRs on

the NYSE is expected to be

on or around May 22, 2023,

and the delisting is expected

become effective on or around

May 23, 2023.

Once the delisting is effective,

ABB’s ADRs will

no longer be traded

on the NYSE but will instead be traded

the US over-the-counter (OTC)

market. In connection

with the delisting,

ABB will establish a Level I

ADR

program to allow investors to continue

to hold their

ABB shares in the form

of ADRs. Once the

12-month US

Average Daily Trading Volume

(ADTV) in

ABB ADRs has

fallen to less than 5 percent

ADTV worldwide,

ABB

intends to apply for deregistration

with the SEC and for termination

of its equity reporting obligations

under the

Exchange Act.

Timo Ihamuotila, Chief Financial

Officer of

ABB. “Over the last years, capital

market access has moved

strongly

towards trading on digital platforms.

Furthermore,

ABB has a strong balance

sheet and good capital markets

access to facilitate both organic

and inorganic growth,

while also returning cash to

shareholders.

As a result,

we believe three separate stock market

listings are no longer necessary

for us. The delisting and deregistration

in the US would be yet another

step towards further simplification

and efficiency at

ABB. I would also like to

emphasize that we remain fully

committed to serve the

US market with our leading, sustainable

and resource-

efficient solutions for electrification

and automation.”

The US is ABB’s

largest market representing

nearly a quarter of

Group revenues and since 2010,

ABB has

invested a combined $14 billion

in the US with acquisitions,

plant expansions, operational

improvements, state-

of-the-art equipment,

products, and people. With approx.

20,000 employees in more than

40 manufacturing

and distribution facilities,

ABB is investing, growing, and

serving across

America through industries

that create

jobs, encourage innovation, and

achieve a more productive,

sustainable future.

1/2

ABB

is a technology leader in electrification

and automation,

enabling a more sustainable and

resource-

efficient future. The

company’s solutions connect engineering

know-how and software to

optimize how things

are manufactured, moved,

powered and operated.

Building on more than 130

years of excellence,

ABB’s

~105,000 employees are

committed to driving innovations

that accelerate industrial transformation.

www.abb.com

—

For more information please

contact:

Media Relations

Phone: +41 43 317 71 11

Email: media.relations@ch.abb.com

Investor Relations

Phone: +41 43 317 71 11

Email: investor.relations@ch.abb.com

ABB Ltd

Affolternstrasse 44

8050 Zurich

Switzerland

Important notice about

forward-looking information

This press release includes forward-looking

information and statements

which are based on current

expectations, estimates and projections

about the factors that

may affect our future performance,

including the

economic conditions of the regions

and industries that are

major markets for

ABB. These expectations,

estimates and projections are generally

identifiable by statements

containing words such as “intends”,

“expects”, “plans”, or similar expressions.

However, there are many

risks and uncertainties, many

of which are

beyond our control, that could

cause our actual results to

differ materially from the forward-looking

information

and statements made in this press

release and which could

affect our ability to achieve any or

all of our stated

targets or anticipated transactions.

Some important factors

that could cause such differences

include, among

others, business risks associated

with the COVID-19 pandemic,

the volatile global economic environment

and

political conditions including

the conflict in Ukraine, costs

associated with compliance activities,

market

acceptance of new products and

services, changes in

governmental regulations

and currency exchange rates

and such other factors as may

be discussed from time to

time in ABB Ltd’s

filings with the U.S. Securities

and

Exchange Commission, including

its Annual

Reports on Form 20-F.

Although ABB Ltd

believes that its

expectations reflected in any

such forward-looking statement

are based upon reasonable

assumptions, it can

give no assurance that those expectations

will be achieved.

The foregoing list of factors is not

exclusive and

undue reliance should not be

placed upon any forward-looking

statements, including projections,

which speak

only as of the date made.

ABB PLANS TO DELIST ADRS FROM NYSE

2/2

January 1 — March 31, 2023

ABB Ltd announces that the following

members of the Executive Committee

or Board of Directors of ABB

have purchased,

sold or been granted ABB’s registered shares, call options

and warrant appreciation rights (“WARs”), in the following amounts:

Name

Date

Type of Instrument

Received*

Purchased

Sold

Price / Instrument

Björn Rosengren

February 01, 2023

12,742

CHF

31.39

Tarak Mehta

February 03, 2023

60,000

CHF

31.97

Peter Terwiesch

February 03, 2023

42,940

CHF

31.38

Key:

* Received instruments were delivered

as part of the ABB Ltd Director’s or

Executive Committee Member’s

compensation or as compensation

for foregone

benefits

SIGNATURES

Pursuant to the requirements of the Securities

Exchange Act of 1934, the registrant

has duly caused this report to be signed

its behalf by the undersigned, thereunto

duly authorized.

ABB LTD

Date: April 25, 2023.

By:

/s/ Ann-Sofie Nordh

Name:

Ann-Sofie Nordh

Title:

Group Senior Vice President and

Head of Investor Relations

Date: April 25, 2023.

By:

/s/ Richard A. Brown

Name:

Richard A. Brown

Title:

Group Senior Vice President and

Chief Counsel Corporate & Finance