Illinois Tool Works Inc. Reports Strong Q4 2025 Earnings and Outlines Optimistic 2026 Guidance
Illinois Tool Works Inc. (NYSE: ITW) released its fourth‑quarter 2025 financial results on February 3, 2026, showing solid growth across revenue, earnings and operating margin. The company also issued guidance for 2026, projecting continued expansion and margin improvement.
Q4 2025 Financial Highlights
| Metric | 2025 Q4 | 2024 Q4 | YoY Change |
|---|---|---|---|
| Net income | $790 million | $750 million | +$40 million |
| GAAP EPS | $2.72 | $2.54 | +$0.18 |
| Revenue | $4.093 billion | $3.932 billion | +$161 million (4.1 %) |
| Organic revenue growth | 1.3 % | – | – |
The company reported a 4 % increase in revenue, driven by all seven operating segments. Net income rose by 7 % year over year, and earnings per share increased by 7 %, meeting or exceeding analyst expectations. Operating margin expanded to 26.5 %–27.5 %, representing roughly a 100‑basis‑point improvement over the prior year.
2026 Guidance
Illinois Tool Works announced its 2026 outlook with the following key points:
- GAAP EPS: $11.00–$11.40 per share, reflecting a mid‑point growth of 7 % versus the prior year.
- Revenue: 2 %–4 % growth, with organic growth projected at 1 %–3 %.
- Operating margin: 26.5 %–27.5 %, an improvement of about 100 basis points, driven by enterprise initiatives that contributed 100 basis points.
- Segment performance: All seven segments are expected to deliver positive organic growth and operating margin expansion.
The guidance was issued in a market environment where the company’s shares were trading slightly lower, at $264.01 per share, down 0.21 % from the close of $264.21 on February 1, 2026.
Dividend and Share‑holder Activity
Illinois Tool Works maintains a dividend growth policy that has persisted across business cycles. Institutional activity on the day of the earnings release included:
- BankPlus Trust Department selling 506 shares.
- Goldman Sachs Equal Weight U.S. Large‑Cap Equity ETF purchasing 1,439 shares.
- TRED AVON FAMILY WEALTH, LLC acquiring 199 shares.
These transactions reflect a mix of short‑term trading and long‑term positioning by large investors.
Market Context
The company operates in the industrials sector, specializing in machinery and related components such as fasteners, tooling, and specialty equipment. Its market capitalization is approximately $76 billion, with a price‑to‑earnings ratio of 25.8. The 52‑week high for the stock was $278.13 (March 9, 2025), and the 52‑week low was $214.66 (April 7, 2025).
Overall, Illinois Tool Works’ Q4 2025 results and 2026 outlook suggest steady growth, improved profitability, and continued commitment to shareholder value.
