Stanley Black & Decker (SWK) Q4 2025 earnings summary

Executive summary

• Full-year 2025 revenue reached $15.1 billion, down 1% organically, with DEWALT and Aerospace Fasteners showing notable growth; Aerospace Fasteners up 25% year-over-year.

• Adjusted Gross Margin expanded 70 basis points to 30.7% for the year, driven by tariff mitigation, pricing, and supply chain efficiencies.

• Adjusted EBITDA grew 5% to $1.6 billion and Adjusted EPS rose 7% to $4.67 in 2025.

• Free cash flow for the year was $688 million, supporting dividends, debt reduction, and brand investments.

• Announced sale of Aerospace Fasteners and CAM businesses, with proceeds earmarked for debt reduction and capital flexibility.

Financial highlights

• Fourth quarter net sales were $3.7 billion, down 1% year-over-year; full-year net sales were $15.1 billion, down 2%.

• Fourth quarter Adjusted Gross Margin was 33.3%, up 210 basis points year-over-year.

• Q4 Adjusted EPS was $1.41; free cash flow exceeded $880 million.

• Engineered Fastening Q4 revenue grew 6% reported and 8% organically, with Aerospace up 35% organically.

• Tools & Outdoor Q4 revenue was $3.2 billion, down 2% year-over-year; organic revenue down 4%.

Outlook and guidance

• 2026 Adjusted EPS expected in the range of $4.90–$5.70, up 13% at midpoint; GAAP EPS guidance $3.15–$4.35.

• Free cash flow targeted at $700–$900 million for 2026, reflecting a 16% increase at midpoint.

• Total company and organic revenue expected to grow low single digits year-over-year.

• Adjusted Gross Margin projected to expand by 150 basis points in 2026, with back-half margin improvement as tariff and volume headwinds subside.

• Transitioning gas-powered walk-behind outdoor products to a license model, reducing 2026 revenue by $120–$140 million but enhancing margins.