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Illinois Tool Gears Up to Report Q2 Earnings: What to Expect?
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Key Takeaways
ITW is expected to post Q2 EPS of $2.56, up 0.8% year over year, on revenues of $4.01 billion.
Cost controls and enterprise initiatives are seen boosting gross margin by 70 basis points to 44.5%.
Segment results are mixed, with Food Equipment up, but Automotive OEM and Construction Products down.
Illinois Tool Works Inc. (ITW - Free Report) is scheduled to release second-quarter 2025 results on July 30, before market open.
The Zacks Consensus Estimate for second-quarter earnings has increased 0.8% in the past 30 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters. The average surprise was 3%.
The consensus estimate for revenues is pegged at $4.01 billion, down 0.4% from the year-ago quarter’s figure. The consensus estimate for adjusted earnings is pinned at $2.56 per share, indicating a 0.8% increase from the year-ago quarter’s number.
Let’s see how things have shaped up for Illinois Tool this earnings season.
Factors to Note Ahead of ITW’s Results
Growth in the institutional end markets in North America, along with higher service revenues and strong demand in the European warewashing equipment end market, is likely to have boosted the performance of Illinois Tool’s Food Equipment segment. We expect the segment’s revenues to increase 0.3% year over year to $668.8 million.
Recovery in the equipment business due to higher demand in the Asia Pacific and the Middle East markets is expected to have aided the Welding segment’s performance in the second quarter. Despite this, softness in the industrial and commercial end markets is likely to have hurt the segment’s performance. We expect the segment’s revenues to decrease 0.1% from the year-ago quarter to $465.3 million.
Strong momentum in the ground support equipment, appliance, consumer packaging and specialty films businesses is likely to have driven ITW’s Specialty Products segment. Polymers & Fluids segment’s performance is expected to have benefited from strength in the polymers business, driven by higher demand in South America, Europe and Asia Pacific markets.
However, weakness in the filter medical business is likely to have impacted the Specialty Products segment’s performance, while softness in the body repair and the tire repair businesses is expected to mar the Polymers & Fluids segment’s results. We expect the Specialty Products segment’s revenues to decrease 0.2% year over year to $448.2 million and the Polymers & Fluids segment’s revenues to decline 1.7% year over year to $446.3 million.
Nonetheless, cost management and enterprise initiatives are anticipated to have aided ITW’s margin performance. We expect ITW’s gross margin to increase 70 basis points to 44.5% in the second quarter.
A decrease in North American auto build rate, due to unfavorable customer mix and product line simplification activities, is likely to have weighed on ITW’s Automotive OEM segment. We expect the segment’s revenues to decrease 2.3% year over year to $795.8 million in the second quarter.
Also, the Test & Measurement and Electronics segment is expected to have put up a weak show due to softness in the MTS Test & Simulation business and the consumable semiconductor market in North America, arising from declining demand in the industrial and commercial sectors. We expect the segment’s revenues to decrease 1.1% year over year to $670.4 million in the second quarter.
Lower demand in the North American, European and Asia Pacific commercial and residential end markets is likely to have hurt the Construction Products segment’s revenues in the second quarter. We expect the segment’s revenues to decrease 0.3% from the year-ago quarter to $502.4 million.
ITW has considerable exposure to overseas markets. Given the company’s substantial international operations, foreign currency headwinds are likely to have marred its profitability.
Our proven model predicts an earnings beat for ITW this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as elaborated below.
Earnings ESP: ITW has an Earnings ESP of +1.19% as the Most Accurate Estimate is pegged at $2.59 per share, which is higher than the Zacks Consensus Estimate of $2.56. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: ITW currently carries a Zacks Rank of 3.
Other Stocks to Consider
Here are some other companies within the broader Industrial Products sector, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
Stanley Black & Decker, Inc. (SWK - Free Report) has an Earnings ESP of +18.80% and a Zacks Rank of 3 at present. The company is slated to release second-quarter 2025 results on July 29.
Illinois Tool’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3%.
Eaton Corporation plc (ETN - Free Report) has an Earnings ESP of +0.39% and a Zacks Rank of 3 at present. The company is scheduled to release second-quarter 2025 results on Aug. 5.
Eaton’s earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 1.9%.
Emerson Electric Co. (EMR - Free Report) has an Earnings ESP of +0.46% and a Zacks Rank of 3 at present. The company is slated to release third-quarter fiscal 2025 (ended June 2025) results on Aug. 6.
Emerson’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.4%.
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Illinois Tool Gears Up to Report Q2 Earnings: What to Expect?
Key Takeaways
Illinois Tool Works Inc. (ITW - Free Report) is scheduled to release second-quarter 2025 results on July 30, before market open.
The Zacks Consensus Estimate for second-quarter earnings has increased 0.8% in the past 30 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters. The average surprise was 3%.
The consensus estimate for revenues is pegged at $4.01 billion, down 0.4% from the year-ago quarter’s figure. The consensus estimate for adjusted earnings is pinned at $2.56 per share, indicating a 0.8% increase from the year-ago quarter’s number.
Let’s see how things have shaped up for Illinois Tool this earnings season.
Factors to Note Ahead of ITW’s Results
Growth in the institutional end markets in North America, along with higher service revenues and strong demand in the European warewashing equipment end market, is likely to have boosted the performance of Illinois Tool’s Food Equipment segment. We expect the segment’s revenues to increase 0.3% year over year to $668.8 million.
Recovery in the equipment business due to higher demand in the Asia Pacific and the Middle East markets is expected to have aided the Welding segment’s performance in the second quarter. Despite this, softness in the industrial and commercial end markets is likely to have hurt the segment’s performance. We expect the segment’s revenues to decrease 0.1% from the year-ago quarter to $465.3 million.
Strong momentum in the ground support equipment, appliance, consumer packaging and specialty films businesses is likely to have driven ITW’s Specialty Products segment. Polymers & Fluids segment’s performance is expected to have benefited from strength in the polymers business, driven by higher demand in South America, Europe and Asia Pacific markets.
However, weakness in the filter medical business is likely to have impacted the Specialty Products segment’s performance, while softness in the body repair and the tire repair businesses is expected to mar the Polymers & Fluids segment’s results. We expect the Specialty Products segment’s revenues to decrease 0.2% year over year to $448.2 million and the Polymers & Fluids segment’s revenues to decline 1.7% year over year to $446.3 million.
Nonetheless, cost management and enterprise initiatives are anticipated to have aided ITW’s margin performance. We expect ITW’s gross margin to increase 70 basis points to 44.5% in the second quarter.
A decrease in North American auto build rate, due to unfavorable customer mix and product line simplification activities, is likely to have weighed on ITW’s Automotive OEM segment. We expect the segment’s revenues to decrease 2.3% year over year to $795.8 million in the second quarter.
Also, the Test & Measurement and Electronics segment is expected to have put up a weak show due to softness in the MTS Test & Simulation business and the consumable semiconductor market in North America, arising from declining demand in the industrial and commercial sectors. We expect the segment’s revenues to decrease 1.1% year over year to $670.4 million in the second quarter.
Lower demand in the North American, European and Asia Pacific commercial and residential end markets is likely to have hurt the Construction Products segment’s revenues in the second quarter. We expect the segment’s revenues to decrease 0.3% from the year-ago quarter to $502.4 million.
ITW has considerable exposure to overseas markets. Given the company’s substantial international operations, foreign currency headwinds are likely to have marred its profitability.
Illinois Tool Works Inc. Price and EPS Surprise
Illinois Tool Works Inc. price-eps-surprise | Illinois Tool Works Inc. Quote
Earnings Whispers
Our proven model predicts an earnings beat for ITW this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as elaborated below.
Earnings ESP: ITW has an Earnings ESP of +1.19% as the Most Accurate Estimate is pegged at $2.59 per share, which is higher than the Zacks Consensus Estimate of $2.56. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: ITW currently carries a Zacks Rank of 3.
Other Stocks to Consider
Here are some other companies within the broader Industrial Products sector, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
Stanley Black & Decker, Inc. (SWK - Free Report) has an Earnings ESP of +18.80% and a Zacks Rank of 3 at present. The company is slated to release second-quarter 2025 results on July 29.
Illinois Tool’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3%.
Eaton Corporation plc (ETN - Free Report) has an Earnings ESP of +0.39% and a Zacks Rank of 3 at present. The company is scheduled to release second-quarter 2025 results on Aug. 5.
Eaton’s earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 1.9%.
Emerson Electric Co. (EMR - Free Report) has an Earnings ESP of +0.46% and a Zacks Rank of 3 at present. The company is slated to release third-quarter fiscal 2025 (ended June 2025) results on Aug. 6.
Emerson’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.4%.