Illinois Tool Works Reports Q3 2026 Results and Raises FY26 EPS Guidance

Illinois Tool Works Inc. (NYSE: ITW) Q3 2026 Earnings & Guidance Update

Overview

On October 27, 2026, Illinois Tool Works Inc. filed a Form 8-K under Item 2.02 reporting financial results for the third quarter ended September 30, 2026, and updated full-year 2026 financial guidance.

Key Q3 2026 Financial Highlights

• Operating Revenue: Reached $4.24 billion, an increase of 4.4% year-over-year. Organic revenue grew 3.8% (led by 6.0% growth in North America). Excluding a ~$40 million revenue headwind caused by tornado damage to two Welding facilities, total company organic revenue growth was approximately 5%.
• Operating Income & Margin: Achieved a record operating income of $1.18 billion (+5.9% YoY). Operating margin expanded 40 basis points to 27.8%, driven by 130 basis points from enterprise initiatives and favorable price/cost realization.
• Net Income & Diluted EPS: GAAP net income rose 4.1% to $855 million, generating diluted EPS of $3.00, up 6.8% compared to $2.81 in Q3 2025.
• Cash Flow & Capital Allocation: Generated $953 million in operating cash flow and $851 million in free cash flow (100% net income conversion). Repurchased $187 million in common stock and increased the quarterly dividend by 7% (annualized to $6.88 per share), marking ITW's 63rd consecutive year of dividend increases.

Updated Full-Year 2026 Guidance

• Diluted GAAP EPS: Increased by $0.05 at the midpoint to a narrowed range of $11.45 to $11.55 (representing ~10% YoY growth at the midpoint).
• Total Revenue Growth: Raised to a range of 4.5% to 5.5% (organic revenue growth reaffirmed at 3% to 4%).
• Operating Margin: Projected in the range of 26.5% to 27.5%, with enterprise initiatives contributing >100 basis points.
• Capital Return: Anticipates full-year share repurchases of approximately $1.5 billion and free cash flow conversion of approximately 100% of net income.