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Sep 30
ITW Q3 2025 Earnings Report
ITW posted solid third-quarter results with record operating margins and strong free cash flow.
Key Takeaways
Illinois Tool Works delivered a strong Q3 2025, with record operating margin of 27.4%, EPS of $2.81, and free cash flow conversion of 110%. Revenue reached $4.1 billion with 1% organic growth, and the company repurchased $375 million of its own shares.
Revenue grew to $4.1 billion with 1% organic growth
EPS came in at $2.81, up from prior year excluding one-time gains
Operating margin reached a record 27.4%
Free cash flow was $904 million, converting at 110% of net income
ITW
ITW
ITW Revenue by Segment
Revenue by Segment
Automotive OEM Revenue
CapyFin.comFood Equipment Revenue
CapyFin.comTest & Measurement Revenue
CapyFin.comWelding Revenue
CapyFin.comPolymers & Fluids Revenue
CapyFin.comConstruction Products Revenue
CapyFin.comSpecialty Products Revenue
CapyFin.com Forward Guidance
ITW narrowed its FY2025 GAAP EPS guidance to $10.40–$10.50 and maintained a stable outlook with modest organic growth expectations.
Positive Outlook
- GAAP EPS guidance narrowed to $10.40–$10.50
- Expected organic revenue growth of up to 2%
- Projected free cash flow at ~100% of net income
- Operating margin expected at 26–27%
- Plan to repurchase ~$1.5 billion in shares
Challenges Ahead
- Organic growth guidance includes possibility of 0%
- Continued supply chain and tariff-related cost challenges
- Currency translation remains a headwind
- Flat overall revenue growth forecast at midpoint
- Tax rate expected to rise to ~23%