ITW · Illinois Tool Works Inc.

Illinois Tool Works Inc. (ITW) reported solid first-quarter 2026 results, with revenue of $4.02 billion, up 4.6% year-over-year, driven primarily by a 3.9% favorable foreign currency translation and 0.3% from acquisitions, while organic growth was modest at 0.4%. Operating income rose 7% to $1.02 billion, and operating margin expanded 60 basis points to 25.4%, benefiting from 120 basis points of enterprise initiative contributions. GAAP EPS grew 12% to $2.66, reflecting strong operational leverage and share repurchases. Segment performance varied: Welding and Test & Measurement & Electronics led organic growth at 6.0% and 4.6%, respectively, while Automotive OEM and Construction Products saw organic declines. Management highlighted positive demand trends in capex-related segments. The company raised its full-year 2026 GAAP EPS guidance by $0.10 to a range of $11.10-$11.50, implying 8% growth at the midpoint. Revenue growth is expected at 2-4% with organic growth of 1-3%. Operating margin is projected to reach 26.5-27.5%, driven by enterprise initiatives. Free cash flow conversion is expected to exceed 100% of net income, and the company plans to repurchase approximately $1.5 billion of shares. The effective tax rate is guided at 23-24%. ITW's resilient business model and disciplined execution position it well for continued outperformance.