Illinois Tool Works 8-K
PositiveEarningsGuidance raised
Double-digit organic growth in Test & Measurement and Electronics and Welding supports higher full-year revenue and EPS guidance.
Filed 2026-07-28 09:21 ET
- 2.02 Results of Operations
- 9.01 Financial Statements and Exhibits
Summary
Q2 2026 results with raised FY2026 guidance. Revenue grew 6.1% and GAAP diluted EPS rose 10.1%; operating income reached a company quarterly record. Stronger organic growth in capital-expenditure-related segments supported the increase in full-year revenue and EPS outlook.
Key Figures
| Metric | Q2 2026 | Q2 2025 | Y/Y |
|---|---|---|---|
| Revenue | $4.30B | $4.05B | 6.1% |
| Operating income | $1.15B | $1.07B | 7.4% |
| Net income | $815M | $755M | 8.0% |
| Diluted EPS | $2.84 | $2.58 | 10.1% |
| Operating cash flow | $723M | $550M | 31.5% |
| Free cash flow | $631M | $449M | 40.5% |
- Organic revenue grew 4.5%, led by North America at 6.4%; Test & Measurement and Electronics and Welding delivered double-digit organic growth. Foreign currency added 1.4 percentage points to revenue growth and acquisitions added 0.2 points.
- Operating margin expanded 40 bp to 26.7%; enterprise initiatives contributed 120 bp. Price increases more than offset higher raw-material costs in dollar terms, though timing lags modestly diluted margins.
- Free cash flow conversion was 77% of net income. ITW returned over $1.2B through dividends and share repurchases, including $750M of repurchases; average diluted shares fell 2.0% to 287.0M from 292.9M.
Guidance
| Metric | Period | Guidance | Prior | Direction |
|---|---|---|---|---|
| GAAP diluted EPS | FY2026 | $11.35-$11.55 | — | Raised by $0.15 |
| Revenue growth | FY2026 | 4%-5% | — | Raised |
| Organic revenue growth | FY2026 | 3%-4%; midpoint raised 1.5 percentage points | — | Raised |
| Operating margin | FY2026 | 26.5%-27.5% | — | — |
| Enterprise initiatives contribution | FY2026 | More than 100 bp | — | — |
| Free cash flow conversion to net income | FY2026 | More than 100% | — | — |
| Share repurchases | FY2026 | ≈$1.5B | — | — |
| Effective tax rate | FY2026 | 23%-24% | — | — |
Investor Takeaways
- Watch whether organic growth momentum continues in the capital-expenditure-related segments that drove Q2’s acceleration.
- Full-year results will show whether ITW delivers the raised growth and EPS outlook while maintaining its projected margin range.
The summary is written by an AI model reading the filing.
Model 005 · prompt 01d34d48e3