Stanley Black & Decker, Inc. (NYSE:SWK) reported stronger-than-expected second-quarter results on Wednesday, with earnings surpassing Wall Street forecasts as the company increased its full-year profit and cash flow guidance.
Shares of the tools and outdoor products manufacturer rose around 3% in pre-market trading following the results.
The company reported adjusted earnings of $1.57 per share, comfortably ahead of analysts’ consensus estimate of $1.21. Revenue totalled $4.0 billion, exceeding expectations of $3.96 billion and remaining broadly unchanged from the same quarter last year.
Organic Sales and Margins Improve
Organic sales increased 3% year over year, supported by continued strength across U.S. retail markets as well as commercial and industrial customer demand.
The quarter also benefited from approximately $0.17 per share in net tariff refunds.
Adjusted gross margin expanded by 620 basis points from a year earlier to 33.7%, including an estimated 250 basis point benefit from the tariff refunds.
Company Raises 2026 Guidance
Following the stronger-than-expected quarter, Stanley Black & Decker increased its financial outlook for the full year.
The company now expects adjusted earnings per share of between $5.20 and $5.80, compared with previous guidance of $4.90 to $5.70. The midpoint of the new range, $5.50 per share, is above analysts’ consensus estimate of $5.37.
Stanley Black & Decker also raised its free cash flow forecast to between $600 million and $800 million, up from its previous guidance of $500 million to $700 million.
President and Chief Executive Officer Chris Nelson said: “The Stanley Black & Decker team is committed to executing our strategy and delivering profitable, organic growth. Our second quarter sales, gross margin, and cash performance keep us firmly on track to achieve our full-year targets.”
Tools Business Leads Performance
The company’s Tools & Outdoor division generated sales of $3.56 billion during the quarter, an increase of 3% from the prior year.
Adjusted operating margin for the segment improved by 380 basis points to 11.8%, reflecting stronger profitability across the business.
Meanwhile, revenue from the Engineered Fastening segment declined 18% to $396 million, primarily due to the completed sale of the Consolidated Aerospace Manufacturing business in April.
Excluding the impact of that divestiture, organic revenue in the segment increased 3%.
Balance Sheet Strengthens
During the quarter, Stanley Black & Decker reduced its debt by $1.7 billion, further strengthening its balance sheet.
The company also returned capital to shareholders by repurchasing approximately 3.2 million shares for $250 million.
Stanley Black & Decker stock price
