SWK · Stanley Black & Decker, Inc.

Stanley Black & Decker delivered Q1 2026 results with net sales of $3.8 billion, up 3% year-over-year, driven by 3% higher pricing and 3% favorable currency, offset by 3% lower volumes primarily from retail softness in North America. Organic sales were flat. Gross margin expanded 20 basis points to 30.1% on a GAAP basis due to operational cost improvements and pricing, though adjusted gross margin dipped 20 basis points to 30.2% from tariff expenses, volume deleverage, and inflation. SG&A as a percent of sales improved slightly to 23.0%. Tools & Outdoor sales rose 2% with pricing and currency gains offsetting volume declines, particularly in North America retail, partially mitigated by international strength and professional channel growth; segment margin contracted to 8.3% (adjusted 8.7%) from growth investments and lower-margin outdoor mix. Engineered Fastening sales surged 10% (7% organic) on aerospace and automotive strength, boosting margins to 11.9% (adjusted 12.0%). CEO Chris Nelson highlighted disciplined execution keeping sales, margins, and cash on track for full-year plans amid economic uncertainty. The April 6 completion of the $1.8 billion CAM sale to Howmet Aerospace generated $1.6 billion net proceeds, mostly applied to debt reduction, enabling share repurchases. This prompted raised 2026 GAAP EPS guidance to $4.15-$5.35 (from the CAM gain) while reaffirming adjusted EPS at $4.90-$5.70 and free cash flow at $500-$700 million (including taxes/fees) or $700-$900 million excluding. Non-GAAP adjustments totaled $81 million, mainly restructuring ($44.9M) and asset impairments ($22.7M). Management emphasized core focus post-divestiture for sustainable growth.