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Jun 30, 2024
ITW Q2 2024 Earnings Report
ITW's financial performance remained solid, marked by strong operational execution and profitability, despite a moderated demand environment.
Key Takeaways
ITW reported a slight decrease in revenue but an increase in operating income and EPS. The company is narrowing its full-year GAAP EPS guidance.
Revenue decreased by 1% to $4.0 billion with flat organic growth.
Operating income increased by 4.5% to $1.05 billion.
Operating margin increased by 140 bps to 26.2%, driven by enterprise initiatives.
GAAP EPS increased by 2% to $2.54, and excluding a one-time 2023 tax item, EPS increased by 5%.
ITW
ITW
ITW Revenue by Segment
Revenue by Segment
Automotive OEM Revenue
CapyFin.comFood Equipment Revenue
CapyFin.comTest & Measurement and Electronics Revenue
CapyFin.comWelding Revenue
CapyFin.comPolymers & Fluids Revenue
CapyFin.comConstruction Products Revenue
CapyFin.comSpecialty Products Revenue
CapyFin.com Forward Guidance
ITW is lowering the top-end of its full year GAAP EPS guidance range to $10.30 to $10.40 per share and expects revenue and organic growth to be approximately flat for 2024.
Positive Outlook
- Operating margin guidance is raised to a narrower range of 26.5 to 27 percent, an increase of 165 bps at the midpoint.
- Enterprise initiatives are projected to contribute more than 100 basis points to operating margin.
- Free cash flow is expected to exceed 100 percent of net income.
- The company plans to repurchase approximately $1.5 billion of its own shares.
- Projected effective tax rate remains unchanged in the range of 24 to 24.5 percent.
Challenges Ahead
- Full year GAAP EPS guidance is narrowed to a range of $10.30 to $10.40 per share.
- Revenue growth is projected to be approximately flat for 2024.
- Organic growth is projected to be approximately flat for 2024.
- Demand environment continued to moderate across the portfolio.
- Foreign currency exchange rates exiting the second quarter impact revenue.
Revenue & Expenses
Visualization of income flow from segment revenue to net income