STANLEY BLACK DECKER INC
For the period ended Mar 29, 2025. Filed Apr 30, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 29, 2025 · Filed Apr 30, 2025
SWK$114.85-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-28; filed 2024-10-29.
0000093556-24-000181
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-03-29; filed 2025-04-30.
0000093556-25-000107
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 117 previous paragraphs and 101 current paragraphs.
34 unchanged; 55 reworded; 12 added; 26 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 10 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (12)
Current report
The charges associated with the ongoing execution of the supply chain transformation are reflected in the Non-GAAP adjustments detailed below in "Results From Operations" and the full year estimate of Non-GAAP adjustments detailed below in "2025 Planning Assumptions." In addition, although the program is expected to be completed by the end of 2025, the Company expects to incur additional charges and make cash investments beyond 2025 relating to footprint actions to support the ongoing network transformation and reposition its supply chain, as necessary.
Current report
Engineered Fastening
Current report
The Company also provides multi-year strategic goals for the non-GAAP financial measures of adjusted gross margin, presented on a basis excluding certain gains and charges, as well as organic revenue growth. A reconciliation for these non-GAAP measures is not available without unreasonable effort due to the inherent difficulty of forecasting the timing and/or amount of various items that have not yet occurred, including the high variability and low visibility with respect to certain gains or charges that would generally be excluded from non-GAAP financial measures and which could be material to the Company’s results in accordance with U.S. GAAP. Additionally, estimating such GAAP measures and providing a meaningful reconciliation consistent with the Company’s accounting policies for future periods requires a level of precision that is unavailable for these future multi-year periods and cannot be accomplished without unreasonable effort. The Company believes such a reconciliation would also imply a degree of precision that is inappropriate for these forward-looking measures.
Current report
First Quarter 2025
Current report
First Quarter 2024
Current report
Cost of Sales and Gross Profit: The Company reported cost of sales of $2.624 billion in the first three months of 2025 compared to $2.761 billion in the first three months of 2024. The year-over-year change in cost of sales was primarily driven by the supply chain transformation efficiencies, partially offset by freight inflation and the initial impact from tariffs. Gross profit, defined as sales less cost of sales, was $1.121 billion, or 29.9% of net sales, in the first three months of 2025 compared to
Current report
Other, net: Other, net totaled $47.5 million and $80.0 million in the first three months of 2025 and 2024, respectively. Excluding Non-GAAP adjustments, Other, net totaled $56.2 million and $83.5 million for the first three months of 2025 and 2024, respectively. The year-over-year decrease in Other, net, both inclusive and exclusive of Non-GAAP adjustments, is primarily driven by appreciation of certain investments in the first quarter of 2025 compared to write-downs on certain investments in the first quarter of 2024, as well as lower environmental remediation costs and deal-related costs, and lower intangible asset amortization due to the divestiture of the Infrastructure business on April 1, 2024.
Current report
Segment profit for the first three months of 2025 was $289.2 million, or 8.8% of net sales, compared to $255.7 million, or 7.8% of net sales, in the first three months of 2024. Excluding Non-GAAP adjustments, which primarily related to footprint actions associated with the supply chain transformation, of $25.0 million and $22.9 million for the three months ended March 29, 2025 and March 30, 2024, respectively, segment profit was 9.6% of net sales in the first three months of 2025 and 8.5% of net sales in the first three months of 2024. The year-over-year change in segment profit as a percent of sales and adjusted segment profit as a percent of sales was primarily due to supply chain transformation efficiencies and benefits from new innovation launches, which were partially offset by freight inflation, the initial impact from tariffs and investments in growth initiatives.
Current report
Engineered Fastening:
Current report
TARIFF POLICY IMPLICATIONS
Current report
In response to the United States’ recent policy actions and to safeguard gross margins, the Company has implemented a high-single digit U.S. Tools & Outdoor price increase in April, with plans to introduce a second price increase effective the beginning of the third quarter. The Company is also accelerating strategic adjustments to its supply chain with the objective of leveraging Mexico and reducing China tariff costs over the next 12-24 months. The Company expects to leverage its industry leading North American footprint as a competitive advantage (approximately 60% of cost of sales in the United States). Management also intends to continue proactively engaging with the U.S. administration. The 2025 earnings per share impact from tariffs net of price and supply chain adjustments is currently estimated to be roughly negative $0.75 reflecting the timing required to implement mitigation countermeasures. Refer to "2025 Planning Assumptions" below.
Current report
2025 PLANNING ASSUMPTIONS
Removed paragraphs (26)
Previous report
Industrial
Previous report
As previously discussed, the Company sold its Infrastructure business on April 1, 2024. This divestiture did not qualify for discontinued operations and therefore, its results were included in the Company's Consolidated Statements of Operations and Comprehensive Income (Loss) in continuing operations through the date of sale.
Previous report
Third Quarter 2024
Previous report
Year-To-Date 2024
Previous report
Third Quarter 2023
Previous report
Year-To-Date 2023
Previous report
Net sales were $11.645 billion in the first nine months of 2024 compared to $12.045 billion in the first nine months of 2023, representing a decrease of 3% driven by a 2% decrease from the Infrastructure divestiture and a 1% decrease in volume. Tools & Outdoor net sales decreased 1% compared to the first nine months of 2023 driven by a 1% decrease in volume. Industrial net sales decreased 14% compared to the first nine months of 2023 as a 12% decrease from the Infrastructure divestiture, a 2% decrease in volume and a 1% decrease from foreign currency was partially offset by a 1% increase in price.
Previous report
Gross profit was $3.370 billion, or 28.9% of net sales, in the first nine months of 2024 compared to $2.828 billion, or 23.5% of net sales, in the first nine months of 2023. Non-GAAP adjustments, which reduced gross profit, were $72.7 million for the nine months ended September 28, 2024 and $157.0 million for the nine months ended September 30, 2023. Excluding these adjustments, gross profit was 29.6% of net sales for the nine months ended September 28, 2024, compared to 24.8% for the nine months ended September 30, 2023, primarily due to lower inventory destocking costs, supply chain transformation benefits and lower shipping costs.
Previous report
SG&A, inclusive of the provision for credit losses, was $2.478 billion, or 21.3% of net sales, in the first nine months of 2024, compared to $2.457 billion, or 20.4% of net sales, in the first nine months of 2023. Within SG&A, Non-GAAP adjustments totaled $62.8 million for the nine months ended September 28, 2024 and $75.5 million for the nine months ended September 30, 2023. Excluding these adjustments, SG&A was 20.7% of net sales for the nine months ended September 28, 2024, compared to 19.8% for the nine months ended September 30, 2023, driven by the same factors discussed above that impacted the third quarter of 2024.
Previous report
Other, net: Other, net totaled $86.4 million in the third quarter of 2024 compared to $94.0 million in the third quarter of 2023. Excluding Non-GAAP adjustments, Other, net, totaled $89.4 million and $99.5 million in the third quarter of 2024 and 2023, respectively. The year-over-year decrease is primarily driven by lower write-downs on investments.
Previous report
Other, net totaled $392.9 million in the first nine months of 2024 compared to $224.3 million in the first nine months of 2023. The year-over-year increase was driven by environmental remediation reserve adjustments. Excluding Non-GAAP adjustments, Other, net totaled $251.0 million and $247.1 million for the first nine months of 2024 and 2023, respectively.
Previous report
Refer to Note O, Contingencies, for additional information on the environmental remediation reserve adjustment relating to the Centredale site.
Previous report
Asset Impairment Charges: During the third quarter of 2024, the Company recorded a pre-tax, non-cash impairment charge of $41.0 million related to the Lenox trade name. Refer to Note M, Restructuring Charges and Other Costs, for additional information. In addition, the Company recorded a pre-tax impairment charge of $5.9 million related to a small business in the Industrial segment. In the third quarter of 2023, the Company recognized a $124.0 million pre-tax, non-cash impairment charge related to the Irwin and Troy-Bilt trade names. Refer to the Company’s Annual Report on Form 10-K for the year ended December 30, 2023 for further information.
Previous report
Excluding the tax effect on Non-GAAP adjustments, for the three and nine months ended September 30, 2023, the Company recognized an income tax benefit on continuing operations of $24.2 million and $8.7 million, respectively, resulting in effective tax rates of (18.1)% and (12.1)%, respectively. The effective tax rates for the three and nine months ended September 30, 2023 differ from the U.S. statutory tax rate of 21% due to the items discussed above.
Previous report
Tools & Outdoor net sales decreased $136.3 million, or 1%, in the first nine months of 2024 compared to the first nine months of 2023 driven by volume declines. Organic revenue declined 2% in both North America and Europe and increased 6% in the rest of the world.
Previous report
Segment profit for the third quarter of 2024 was $327.5 million, or 10.0% of net sales, compared to $273.4 million, or 8.1% of net sales, in the third quarter of 2023. Excluding Non-GAAP adjustments of $35.5 million and $39.4 million for the three months ended September 28, 2024 and September 30, 2023, respectively, segment profit was 11.1% of net sales in the third quarter of 2024 and 9.3% in the third quarter of 2023. The year-over-year increase was primarily due to supply chain transformation benefits, which were partially offset by growth investments.
Previous report
Segment profit for the first nine months of 2024 was $899.3 million, or 8.9% of net sales, compared to $394.1 million, or 3.9% of net sales, in the first nine months of 2023. Excluding Non-GAAP adjustments of $111.0 million and $174.4 million for the nine months ended September 28, 2024 and September 30, 2023, respectively, segment profit was 10.0% of net sales in the first nine months of 2024 and 5.6% in the first nine months of 2023. The year-over-year increase was primarily due to lower inventory destocking costs, supply chain transformation benefits and lower shipping costs, which were partially offset by growth investments.
Previous report
Industrial:
Previous report
Industrial net sales decreased $263.1 million, or 14%, in the first nine months of 2024 compared to the first nine months of 2023, as a 12% decrease from the Infrastructure divestiture, a 2% decrease in volume and a 1% decrease from foreign currency was partially offset by a 1% increase in price. Engineered Fastening organic revenues increased 2%, primarily due to aerospace growth.
Previous report
Industrial segment profit for the third quarter of 2024 totaled $70.2 million, or 14.4% of net sales, compared to $62.5 million, or 10.4% of net sales, in the corresponding 2023 period. Excluding a Non-GAAP gain of $2.6 million for the three months ended September 28, 2024 and a Non-GAAP charge of $10.5 million for the three months ended September 30, 2023, segment profit amounted to 13.9% of net sales in the third quarter of 2024 compared to 12.2% in the third quarter of 2023. The year-over-year increase was due to price realization and cost control.
Previous report
On a year-to-date basis, the corporate overhead element of SG&A amounted to $208.7 million in 2024 compared to $224.1 million in 2023. Excluding Non-GAAP adjustments of $21.1 million for the nine months ended September 28, 2024 and $38.8 million for the nine months ended September 30, 2023, the corporate overhead element of SG&A was $187.6 million and $185.3 million for the nine months ended September 28, 2024 and September 30, 2023, respectively.
Previous report
The $67 million of net restructuring charges for the nine months ended September 28, 2024 includes: $56 million in the Tools & Outdoor segment; $6 million in Industrial; and $5 million in Corporate.
Previous report
2024 OUTLOOK
Previous report
Cash flows provided by investing activities totaled $500.8 million in the first nine months of 2024, primarily due to net proceeds from sales of businesses of $735.6 million, partially offset by capital and software expenditures of $239.4 million. Cash flows used in investing activities totaled $206.8 million in the first nine months of 2023, primarily due to capital and software expenditures of $216.4 million.
Previous report
Critical Accounting Estimates:
Previous report
During 2024, the Company continued its brand prioritization and investment strategy for its major brands, while leveraging certain of its specialty brands in a more focused manner. As a result of these ongoing brand prioritization efforts, and in connection with the preparation of its financial statements for the quarter ended September 28, 2024, the Company tested its indefinite-lived trade names for impairment utilizing a discounted cash flow valuation model. The key assumptions used included discount rates, royalty rates, and perpetual growth rates applied to updated sales projections. The Company determined that the fair values of its indefinite-lived trade names exceeded their respective carrying amounts, with the exception of the Lenox trade name. The Company recognized a $41.0 million pre-tax, non-cash impairment charge related to this trade name in the third quarter of 2024. Subsequent to this impairment charge, the Lenox carrying value totaled $115.0 million. The Company intends to continue utilizing this trade name indefinitely, which represented approximately 2% of 2023 net sales for the Tools & Outdoor segment. Refer to Note L, Restructuring Charges and Other Costs, for further discussion.
Reworded paragraphs (55)
Previous wording
The following discussion contains statements reflecting the Company's views about its future performance that constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. There are a number of important factors that could cause actual results to differ materially from those indicated by such forward-looking statements. Please read the information under the caption entitled “Cautionary Statement under the Private Securities Litigation Reform Act of 1995."
Current wording
The following discussion contains statements reflecting the Company's views about its future performance that constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. There are a number of important factors that could cause actual results to differ materially from those indicated by such forward-looking statements. Please read the information under the caption entitled “Cautionary Statement Concerning Forward-Looking Statements."
Previous wording
•Advancing innovation, electrification and global market penetration to achieve organic revenue growth of 2 to 3 times the market;
Current wording
•Advancing innovation, electrification and global market penetration to achieve mid-single digit organic revenue growth (2 to 3 times the market);
Previous wording
In terms of capital allocation, the Company remains committed, over time, to returning excess capital to shareholders through a strong and growing dividend as well as opportunistically repurchasing shares. In the near term, the Company intends to direct any capital in excess of the quarterly dividend on its common stock toward debt reduction and internal growth investments.
Current wording
In terms of capital allocation, the Company remains committed, over time, to returning excess capital to shareholders through a strong and growing dividend as well as a preference toward opportunistically repurchasing shares. In the near term, the Company intends to direct any capital in excess of the quarterly dividend on its common stock toward debt reduction and internal growth investments.
Previous wording
In April 2021, the Board of Directors approved repurchases by the Company of its outstanding securities other than common stock up to an aggregate amount of $3.0 billion. No repurchases have been executed pursuant to this authorization to date.
Current wording
In April 2021, the Board of Directors approved repurchases by the Company of its outstanding securities, other than its common stock, up to an aggregate amount of $3.0 billion. No repurchases have been executed pursuant to this authorization to date.
Previous wording
On April 1, 2024, the Company sold its Infrastructure business to Epiroc AB for net proceeds of $728.5 million. The Company used the net proceeds to reduce debt in the second quarter of 2024.
Current wording
On April 1, 2024, the Company sold its Infrastructure business comprised of the attachment and handheld hydraulic tools business to Epiroc AB for net proceeds of $728.5 million. The Company used the net proceeds to reduce debt in the second quarter of 2024. Refer to Note Q, Divestitures, for further discussion.
Previous wording
In mid-2022, the Company launched a program comprised of a series of initiatives designed to generate cost savings by resizing the organization and reducing inventory with the ultimate objective of driving long-term growth, improving profitability and generating strong cash flow. These initiatives are expected to optimize the cost base as well as provide a platform to fund investments to accelerate growth in the core businesses. The program consists of a selling, general, and administrative ("SG&A") planned pre-tax run-rate cost savings of $500 million and a supply chain transformation expected to deliver $1.5 billion of pre-tax run-rate cost savings by the end of 2025 to achieve projected 35%+ adjusted gross margins.
Current wording
In mid-2022, the Company launched a program comprised of a series of initiatives designed to generate cost savings by resizing the organization and reducing inventory with the ultimate objective of driving long-term growth, improving profitability and generating strong cash flow. These initiatives are expected to optimize the cost base as well as provide a platform to fund investments to accelerate growth in the core businesses. The program consists of a selling, general, and administrative ("SG&A") planned pre-tax run-rate cost savings of $500 million and a supply chain transformation expected to deliver $1.5 billion of pre-tax run-rate cost savings by the end of 2025 and facilitate the achievement of projected 35%+ adjusted gross margins.
Previous wording
The SG&A cost savings are generated by simplifying the corporate structure, optimizing organizational spans and layers and reducing indirect spend. These savings will help fund $300 million to $500 million of innovation and commercial investments through 2025 designed to accelerate organic growth.
Current wording
The SG&A cost savings were generated by simplifying the corporate structure, optimizing organizational spans and layers and reducing indirect spend. These savings will help fund $300 million to $500 million of innovation and commercial investments through 2025 designed to accelerate organic growth.
Previous wording
The $1.5 billion of pre-tax run-rate cost savings from the supply chain transformation will be driven by the following value streams:
Current wording
The $1.5 billion of pre-tax run-rate cost savings from the supply chain transformation has been, and continues to be, driven by the following value streams:
Previous wording
•Strategic Sourcing: Implementing capabilities to source in a more efficient and integrated manner across all of the Company’s businesses and leveraging contract manufacturing;
Current wording
•Material Productivity: Implementing capabilities to source in a more efficient and integrated manner across all of the Company’s businesses and leveraging contract manufacturing;
Previous wording
•Operational Excellence: Leveraging the SBD Operating Model and re-designing in-plant operations following footprint rationalization to deliver incremental efficiencies, simplified organizational design and inventory optimization;
Current wording
•Operational Excellence: Redesigning in-plant operations following footprint rationalization to deliver incremental efficiencies, simplified organizational design and inventory optimization leveraging a standard operating model and LEAN principles;
Previous wording
During the first nine months of 2024 and since inception of the program, the Company has generated approximately $400 million and $1.4 billion, respectively, of pre-tax run-rate savings, driven by lower headcount, indirect spend reductions and the supply chain transformation. These savings are comprised of supply chain efficiency benefits, which support gross margin improvements as the benefits turn through inventory, and SG&A savings. The Company believes that it is on track to grow to approximately $2 billion of pre-tax run-rate savings by year-end 2025. In addition, the Company has reduced inventory by approximately $2.0 billion since the end of the second quarter of 2022 and expects further inventory and working capital reductions to support free cash flow generation in 2024.
Current wording
During the first three months of 2025 and since inception of the program, the Company has generated approximately $130 million and $1.7 billion, respectively, of pre-tax run-rate savings, driven by lower headcount, indirect spend reductions and the supply chain transformation. These savings are comprised of supply chain efficiency benefits, which support gross margin improvements as the benefits turn through inventory, and SG&A savings. The Company believes that it is on track to grow to approximately $2 billion of pre-tax run-rate savings by year-end 2025.
Previous wording
The charges associated with the supply chain transformation are reflected in the Non-GAAP adjustments detailed below in "Results From Operations" and the full year estimate of Non-GAAP adjustments detailed below in "2024 Outlook". The cash investment required to achieve the estimated $1.5 billion of pre-tax run-rate supply chain cost savings is expected to be approximately $0.9 billion to $1.1 billion, of which approximately 40% is expected to be capital expenditures. Through 2023, the Company has made approximately $0.2 billion of these cash investments. The Company will continue prioritizing capital expenditures consistent with its existing approach and expects total capital expenditures, inclusive of the supply chain transformation, to be $325 million to $375 million for 2024 and to approximate 3.0% of net sales annually in 2025 and beyond.
Current wording
The cash investment required to achieve the estimated $1.5 billion of pre-tax run-rate supply chain cost savings is expected to be approximately $0.7 billion. Of the total estimated cash investment, approximately 30% is expected to be capital expenditures. Through 2024, the Company has made approximately $0.5 billion of total cash investments. The Company intends to continue prioritizing capital expenditures consistent with its existing approach and expects total capital expenditures, inclusive of the supply chain transformation, to approximate $0.3 billion in 2025 and 2.5% to 3.0% of net sales annually over the long term.
Previous wording
The Company’s operations are classified into two reportable business segments: Tools & Outdoor and Industrial. Both reportable segments have significant international operations and are exposed to translational and transactional impacts from fluctuations in foreign currency exchange rates.
Current wording
The Company’s operations are classified into two reportable business segments: Tools & Outdoor and Engineered Fastening. In the first quarter of 2025, the Industrial segment was renamed “Engineered Fastening” as a result of a more focused portfolio following recent divestitures.The Engineered Fastening segment name change is to the name only and had no impact on the Company’s consolidated financial statements or segment results. Both reportable segments have significant international operations and are exposed to translational and transactional impacts from fluctuations in foreign currency exchange rates.
Previous wording
The Tools & Outdoor segment is comprised of the Power Tools Group ("PTG"), Hand Tools, Accessories & Storage ("HTAS"), and Outdoor Power Equipment ("Outdoor") product lines. Annual revenues in the Tools & Outdoor segment were $13.4 billion in 2023, representing 85% of the Company’s total revenues.
Current wording
The Tools & Outdoor segment is comprised of the Power Tools Group ("PTG"), Hand Tools, Accessories & Storage ("HTAS"), and Outdoor Power Equipment ("Outdoor") product lines. Annual revenues in the Tools & Outdoor segment were $13.3 billion in 2024, representing 87% of the Company’s total revenues.
Previous wording
The PTG product line includes both professional and consumer products. Professional products, primarily under the DEWALT® brand, include professional grade corded and cordless electric power tools and equipment including drills, impact wrenches and drivers, grinders, saws, routers and sanders, as well as pneumatic tools and fasteners including nail guns, nails, staplers and staples, and concrete and masonry anchors. DIY and tradesperson focused products include corded and cordless electric power tools sold primarily under the CRAFTSMAN® brand, and consumer home products such as hand-held vacuums, paint tools and cleaning appliances primarily under the BLACK+DECKER® brand.
Current wording
The PTG product line includes both professional and consumer products. Professional products, primarily under the DEWALT® brand, include professional grade corded and cordless electric power tools and equipment including drills, impact wrenches and drivers, grinders, saws, routers, sanders, and concrete prep and placement tools as well as pneumatic tools and fasteners including nail guns, nails, staplers and staples, and concrete and masonry anchors. DIY and tradesperson focused products include corded and cordless electric power tools sold primarily under the CRAFTSMAN® and STANLEY® brands, and consumer home products such as household power tools, hand-held vacuums, and small appliances primarily under the BLACK+DECKER® brand.
Previous wording
The HTAS product line sells hand tools, power tool accessories and storage products. Hand tools include measuring, leveling and layout tools, planes, hammers, demolition tools, clamps, vises, knives, saws, chisels and industrial and automotive tools. Power tool accessories include drill bits, screwdriver bits, router bits, abrasives, saw blades and threading products. Storage products include tool boxes, sawhorses, medical cabinets and engineered storage solution products.
Current wording
The HTAS product line sells hand tools, power tool accessories and storage products primarily under the DEWALT®, CRAFTSMAN® and STANLEY® brands. Hand tools include measuring, leveling and layout tools, planes, hammers, demolition tools, clamps, vises, knives, saws, chisels, material handling, and industrial and automotive tools. Power tool accessories include drill bits, screwdriver bits, router bits, abrasives, saw blades and threading products. Storage products include tool boxes, sawhorses, cabinets and engineered storage solution products.
Previous wording
The Outdoor product line primarily sells corded and cordless electric lawn and garden products, including hedge trimmers, string trimmers, lawn mowers, pressure washers and related accessories, and gas powered lawn and garden products, including lawn tractors, zero turn ride on mowers, walk behind mowers, snow blowers, residential robotic mowers, utility terrain vehicles (UTVs), hand-held outdoor power equipment, garden tools, and parts and accessories to professionals and consumers under the DEWALT®, CRAFTSMAN®, CUB CADET®, BLACK+DECKER®, and HUSTLER® brand names.
Current wording
The Outdoor product line primarily sells corded and cordless electric lawn and garden products, including hedge trimmers, string trimmers, lawn mowers, pressure washers and related accessories, and gas powered lawn and garden products, including lawn tractors, zero turn ride on mowers, walk behind mowers, snow blowers, residential robotic mowers, hand-held outdoor power equipment, garden tools, and parts and accessories to professionals and consumers under the DEWALT®, CRAFTSMAN®, CUB CADET®, BLACK+DECKER®, and HUSTLER® brand names.
Previous wording
The Industrial segment is comprised of the Engineered Fastening business and the Infrastructure business prior to its sale in April 2024. Annual revenues in the Industrial segment, inclusive of the Infrastructure business, were $2.4 billion in 2023, representing 15% of the Company’s total revenues.
Current wording
The Engineered Fastening segment is comprised of the Engineered Fastening business and included the Infrastructure business prior to its sale in April 2024. Annual revenues in the Engineered Fastening segment, inclusive of the Infrastructure business, were $2.1 billion in 2024, representing 13% of the Company’s total revenues.
Previous wording
The Company has provided a discussion of its results both inclusive and exclusive of certain gains and charges. The results and measures, including gross profit, SG&A, Other, net, Income taxes, and segment profit (including Corporate Overhead), on a basis excluding certain gains and charges, free cash flow, organic revenue and organic growth are Non-GAAP financial measures. The Company considers the use of Non-GAAP financial measures relevant to aid analysis and understanding of the Company’s results and business trends aside from the material impact of these items and ensures appropriate comparability to operating results of prior periods. Supplemental Non-GAAP information should not be considered in isolation or as a substitute for the related GAAP financial measures. Non-GAAP financial measures presented herein may differ from similar measures used by other companies.
Current wording
The Company has provided a discussion of its results both inclusive and exclusive of certain gains and charges. The results and measures, including gross profit, SG&A, Other, net, Income taxes, segment profit, and corporate overhead, on a basis excluding certain gains and charges, free cash flow, organic revenue and organic growth are Non-GAAP financial measures. These Non-GAAP financial measures are defined and reconciled to their most directly comparable GAAP financial measures below. The Company considers the use of Non-GAAP financial measures relevant to aid analysis and understanding of the Company’s results and business trends aside from the material impact of certain gains and charges and ensures appropriate comparability to operating results of prior periods. Supplemental Non-GAAP information should not be considered in isolation or as a substitute for the related GAAP financial measures. Non-GAAP financial measures presented herein may differ from similar measures used by other companies.
Previous wording
With the exception of forecasted free cash flow included in “2024 Outlook” as discussed below, the Non-GAAP financial measures of gross profit, SG&A, Other, net, Income taxes, and segment profit (including Corporate Overhead), presented on a basis excluding certain gains and charges, as well as free cash flow, organic revenue and organic growth are defined and reconciled to their most directly comparable GAAP financial measures below. Due to high variability and difficulty in predicting items that impact cash flow from operations, a reconciliation of forecasted free cash flow to its most directly comparable GAAP estimate has been omitted. The Company believes such a reconciliation would also imply a degree of precision that is inappropriate for this forward-looking measure.
Current wording
The Company provides expectations for the non-GAAP financial measures of full-year 2025 adjusted EPS, presented on a basis excluding certain gains and charges, as well as 2025 free cash flow. Forecasted full-year 2025 adjusted EPS is reconciled to forecasted full-year 2025 GAAP EPS under the section entitled "2025 Planning Assumptions" below. Consistent with past methodology, forecasted full-year 2025 GAAP EPS excludes the impacts of potential acquisitions and divestitures, potential future regulatory changes or strategic shifts that could impact the Company's contingent liabilities or intangible assets, respectively, potential future cost actions in response to external factors that have not yet occurred, and any other items not specifically referenced under “2025 Planning Assumptions.” A reconciliation of forecasted 2025 free cash flow to its most directly comparable GAAP estimate is not available without unreasonable effort due to high variability and difficulty in predicting items that impact cash flow from operations, which could be material to the Company’s results in accordance with U.S. GAAP. The Company believes such a reconciliation would also imply a degree of precision that is inappropriate for this forward-looking measure.
Previous wording
The Company’s operating results at the consolidated level as discussed below include and exclude certain gains and charges impacting gross profit, SG&A, Other, net, and Income taxes. The Company’s business segment results as discussed below include and exclude certain gains and charges impacting gross profit and SG&A. These amounts for the third quarter and year-to-date periods of 2024 and 2023 are as follows:
Current wording
The Company’s operating results at the consolidated level as discussed below include and exclude certain gains and charges impacting gross profit, SG&A, Other, net, and Income taxes. The Company’s business segment results as discussed below include and exclude certain gains and charges impacting gross profit and SG&A. Corporate overhead as discussed below includes and excludes certain gains and charges. These amounts for the first quarters of 2025 and 2024 are as follows:
Previous wording
Below is a summary of the pre-tax Non-GAAP adjustments for the third quarter and year-to-date periods of 2024 and 2023.
Current wording
Below is a summary of the pre-tax Non-GAAP adjustments for the first quarters of 2025 and 2024.
Previous wording
Net Sales: Net sales were $3.751 billion in the third quarter of 2024 compared to $3.954 billion in the third quarter of 2023, representing a decrease of 5% as a 1% increase in price was more than offset by a 3% decrease in volume, a 2% decrease from the Infrastructure divestiture and a 1% decrease from foreign currency. Tools & Outdoor net sales decreased 3% compared to the third quarter of 2023 as a 1% increase in price was more than offset by a 3% decrease in volume and 1% decrease from foreign currency. Industrial net sales decreased 18% compared to the third quarter of 2023 as a 17% decrease from the Infrastructure divestiture and a 2% decrease in volume was partially offset by a 1% increase in price.
Current wording
Net Sales: Net sales were $3.745 billion in the first three months of 2025 compared to $3.870 billion in the first three months of 2024, representing a decrease of 3% as a 1% increase in volume was more than offset by a 2% decrease from foreign currency and a 2% decrease from the Infrastructure divestiture. Tools & Outdoor net sales were flat compared to the first three months of 2024 as a 1% increase in volume was offset by a 1% decrease from foreign currency. Engineered Fastening net sales decreased 21% compared to the first three months of 2024 as a 1% increase in price was more than offset by a 2% decrease in volume, a 2% decrease from foreign currency, a 16% decrease from the Infrastructure divestiture, and a 2% decrease from a product line transfer to Tools & Outdoor.
Previous wording
Gross Profit: Gross profit was $1.121 billion, or 29.9% of net sales, in the third quarter of 2024 compared to $1.061 billion, or 26.8% of net sales, in the third quarter of 2023. Non-GAAP adjustments, which reduced gross profit, were $24.8 million for the three months ended September 28, 2024 and $32.2 million for the three months ended September 30, 2023. Excluding these adjustments, gross profit was 30.5% of net sales for the three months ended September 28, 2024, compared to 27.6% for the three months ended September 30, 2023, primarily due to supply chain transformation benefits.
Current wording
$1.109 billion, or 28.6% of net sales, in the first three months of 2024. Non-GAAP adjustments, which increased cost of sales and reduced gross profit, were $16.7 million for the three months ended March 29, 2025 and $14.4 million for the three months ended March 30, 2024. Excluding these adjustments, gross profit was 30.4% of net sales, for the three months ended March 29, 2025, compared to 29.0% of net sales, for the three months ended March 30, 2024. The year-over-year change in gross profit as a percent of sales and adjusted gross profit as a percent of sales was primarily driven by the aforementioned factors impacting cost of sales, as well as benefits from new innovation launches.
Previous wording
SG&A Expenses: SG&A, inclusive of the provision for credit losses, was $797.1 million, or 21.2% of net sales, in the third quarter of 2024, compared to $794.3 million, or 20.1% of net sales, in the third quarter of 2023. Within SG&A, Non-GAAP adjustments totaled $15.1 million for the three months ended September 28, 2024 and $29.4 million for the three months ended September 30, 2023. Excluding these adjustments, SG&A was 20.8% of net sales for the three months ended September 28, 2024, compared to 19.3% for the three months ended September 30, 2023, as the Company increased growth investments designed to deliver future market share gains.
Current wording
SG&A Expenses: SG&A, inclusive of the provision for credit losses, was $867.0 million, or 23.2% of net sales, in the first three months of 2025, compared to $851.8 million, or 22.0% of net sales, in the first three months of 2024. Within SG&A, Non-GAAP adjustments totaled $22.0 million for the three months ended March 29, 2025 and $20.1 million for the three months ended March 30, 2024. Excluding these adjustments, SG&A was 22.6% of net sales for the three months ended March 29, 2025, compared to 21.5% for the three months ended March 30, 2024. The year-over-year change in SG&A as a percent of sales and adjusted SG&A as a percent of sales was driven by investments in revenue generating initiatives designed to deliver increased market penetration and future market share gains.
Previous wording
Distribution center costs (i.e. warehousing and fulfillment facility and associated labor costs) are classified within SG&A. This classification may differ from other companies who may report such expenses within cost of sales. Due to diversity in practice, to the extent the classification of these distribution costs differs from other companies, the Company’s gross margins may not be comparable. Such distribution costs classified in SG&A amounted to $134.4 million and $396.7 million for the three and nine months ended September 28, 2024, respectively, and $132.7 million and $392.9 million for the three and nine months ended September 30, 2023, respectively.
Current wording
Distribution center costs (i.e. warehousing and fulfillment facility and associated labor costs) are classified within SG&A. This classification may differ from other companies who may report such expenses within cost of sales. Due to diversity in practice, to the extent the classification of these distribution costs differs from other companies, the Company’s gross margins may not be comparable. Such distribution costs classified in SG&A amounted to $129.0 million and $130.5 million for the first three months of 2025 and 2024, respectively.
Previous wording
Loss on Sales of Businesses: During the first nine months of 2023, the Company reported a pre-tax loss of $7.6 million primarily related to the divestiture of a small business in the Industrial segment.
Current wording
Loss on Sale of Business: During the first three months of 2025, the Company reported a pre-tax loss of $0.3 million related to the divestiture of small business in the Engineered Fastening segment.
Previous wording
During the first quarter of 2024, the Company recorded a pre-tax impairment charge of $25.5 million related to the Infrastructure business. Refer to Note Q, Divestitures, for additional information on the divestiture of the Infrastructure business completed in the second quarter of 2024.
Current wording
Asset Impairment Charge: During the first three months of 2024, the Company recorded a pre-tax impairment charge of $25.5 million related to the Infrastructure business. Refer to Note Q, Divestitures, for additional information on the divestiture of the Infrastructure business completed in the second quarter of 2024.
Previous wording
Interest, net: Net interest expense was $78.6 million in the third quarter of 2024 compared to $94.4 million in the third quarter of 2023. On a year-to-date basis, net interest expense was $244.9 million in 2024 and $284.9 million in 2023. The year-over-year decreases were primarily driven by lower commercial paper balances in 2024.
Current wording
Interest, net: Net interest expense was $77.2 million in the first quarter of 2025 compared to $87.9 million in the first quarter of 2024. The year-over-year decrease was primarily driven by lower commercial paper balances in 2025 and higher interest income.
Previous wording
Income Taxes: For the three and nine months ended September 28, 2024, the Company recognized an income tax benefit from continuing operations of $1.6 million and income tax expense of $24.3 million, respectively, resulting in effective tax rates of (1.8)% and 21.0%, respectively. Excluding the tax effect on Non-GAAP adjustments, for the three and nine months ended September 28, 2024, the Company recognized income tax expense on continuing operations of $10.4 million and $98.7 million, respectively, resulting in effective tax rates of 5.3% and 18.5%, respectively. These effective tax rates for the three months ended September 28, 2024 differ from the U.S. statutory tax rate of 21% primarily due to the recognition of previously unrecognized foreign deferred tax assets, remeasurement of uncertain tax position reserves, tax credits, and state income taxes, partially offset by non-deductible expenses and U.S. tax on foreign earnings. For the nine months ended September 28, 2024, the primary drivers are consistent with those discussed above, which in aggregate result in effective tax rates that approximate the U.S. statutory tax rate of 21%.
Current wording
Income Taxes: For the three months ended March 29, 2025, the Company recognized income tax expense of $37.2 million, resulting in an effective tax rate of 29.2%. Excluding the tax effect on Non-GAAP adjustments, for the three months ended March 29, 2025, the Company recognized income tax expense of $44.7 million, resulting in an effective tax rate of 28.1%. These effective tax rates for the three months ended March 29, 2025 differ from the U.S. statutory tax rate of 21% primarily due to non-deductible expenses, losses for which a tax benefit is not recognized, and U.S. tax on foreign earnings, partially offset by remeasurement of uncertain tax position reserves and tax credits.
Previous wording
For the three and nine months ended September 30, 2023, the Company recognized an income tax benefit from continuing operations of $61.7 million and $291.3 million, respectively, resulting in effective tax rates of 108.2% and 98.1%, respectively. The income tax benefit for the three months ended September 30, 2023 included an incremental interim tax benefit to reflect the impact of a change in the estimated annual effective tax rate to the prior interim year-to-date tax benefit, which reversed in the fourth quarter of 2023. The effective tax rates for the three and nine months ended September 30, 2023 differ from the U.S. statutory tax rate of 21% primarily due to a tax benefit associated with the intra-entity asset transfer of certain intangible assets, tax on foreign earnings at tax rates different than the U.S. tax rate, state income taxes and tax credits, partially offset by U.S. tax on foreign earnings, non-deductible expenses and losses for which a tax benefit is not recognized.
Current wording
For the three months ended March 30, 2024, the Company recognized income tax expense of $28.8 million, resulting in an effective tax rate of 59.6%. Excluding the tax effect on Non-GAAP adjustments, for the three months ended March 30, 2024, the Company recognized income tax expense of $35.6 million, resulting in an effective tax rate of 29.7%. These effective tax rates differ from the U.S. statutory tax rate of 21% primarily due to non-deductible expenses, U.S. tax on foreign earnings, and losses for which a tax benefit is not recognized, partially offset by tax credits and state income taxes.
Previous wording
On December 20, 2021, the Organization for Economic Cooperation and Development (“OECD”) published a proposal for the establishment of a global minimum tax rate of 15% (“Pillar Two"). The Pillar Two rules provide a template that jurisdictions can translate into domestic law to assist with the implementation within an agreed upon timeframe and in a coordinated manner, which became effective for fiscal years beginning after January 1, 2024. To date, jurisdictions in which the Company operates are in various stages of implementation.
Current wording
On December 20, 2021, the Organization for Economic Cooperation and Development published a proposal for the establishment of a global minimum tax rate of 15% (“Pillar Two"). The Pillar Two rules provide a template that jurisdictions can translate into domestic law, to assist with the implementation within an agreed upon timeframe and in a coordinated manner. Certain countries in which the Company operates have enacted legislation effective January 1, 2024, while other jurisdictions are in various stages of implementation.
Previous wording
The OECD and other countries continue to publish guidance and legislation which include transition and safe harbor rules. The Company expects to avail itself of the transitional safe harbor rules in most jurisdictions in which the Company operates. There are, however, a limited number of jurisdictions where the transitional safe harbor relief does not apply. The Company expects the Pillar Two tax impact from these jurisdictions to be immaterial to its estimated annual effective rate for 2024 and continues to monitor developments in legislation, regulation, and interpretive guidance in this area.
Current wording
The Company has performed an assessment of the potential impact to its income taxes as a result of Pillar Two. The assessment of the potential impact is based on the most recent tax filings, country-by-country reporting, and financial statements of affected subsidiaries. Based on results of the assessment, the Company believes it can avail itself of the transitional safe harbor rules in most jurisdictions in which the Company operates. There are, however, a limited number of jurisdictions where the transitional safe harbor relief does not apply. The Company expects the Pillar Two tax impact from these jurisdictions to be immaterial to its estimated annual tax rate for 2025. The Company continues to assess the potential impact of Pillar Two and monitor developments in legislation, regulation, and interpretive guidance in this area.
Previous wording
The Company’s operations are classified into two reportable business segments: Tools & Outdoor and Industrial.
Current wording
The Company’s operations are classified into two reportable business segments: Tools & Outdoor and Engineered Fastening.
Previous wording
Tools & Outdoor net sales decreased $92.0 million, or 3%, in the third quarter of 2024 compared to the third quarter of 2023 as a 1% price increase was more than offset by a 3% decline in volume and a 1% decrease from foreign currency. Organic revenue declined 2% as growth in DEWALT® was offset by the weak consumer and DIY backdrop. Organic revenue decreased 4% in North America, and increased 1% and 6% in Europe and the rest of the world, respectively.
Current wording
Tools & Outdoor net sales decreased $3.7 million, or were relatively flat, in the first three months of 2025 compared to the first three months of 2024 as a 1% increase in volume was offset by a 1% decrease from foreign currency. Organic revenue increased 1%, with continued growth in DEWALT® supported by professional demand as well as strong shipments in advance of the outdoor season. Total revenue increased 2% in North America, decreased 2% in Europe, and decreased 9% in the rest of the world. Excluding the impact from foreign currency, organic revenue increased 2% in North America, remained flat in Europe, and decreased 3% in the rest of the world.
Previous wording
Industrial net sales decreased $110.6 million, or 18%, in the third quarter of 2024 compared to the third quarter of 2023, as a 17% decrease from the Infrastructure divestiture and a 2% decrease in volume was partially offset by a 1% increase in price. Engineered Fastening organic revenues decreased 1% as aerospace expansion and a return to growth in general industrial was more than offset by market softness in automotive.
Current wording
Engineered Fastening net sales decreased $121.2 million, or 21%, in the first three months of 2025 compared to the first three months of 2024, as a as a 1% increase in price was more than offset by a 2% decrease in volume, a 2% decrease from foreign currency, a 16% decrease from the Infrastructure divestiture, and a 2% decrease from a product line transfer to the Tools & Outdoor segment. Engineered Fastening organic revenues decreased 1%, as aerospace and general industrial growth was more than offset by automotive market softness.
Previous wording
Industrial segment profit for the first nine months of 2024 totaled $202.2 million, or 12.9% of net sales, compared to $201.5 million, or 11.0% of net sales, in the corresponding 2023 period. Excluding Non-GAAP adjustments of $3.4 million and $19.3 million for the nine months ended September 28, 2024 and September 30, 2023, respectively, segment profit amounted to 13.1% of net sales in the first nine months of 2024 compared to 12.1% in the first nine months of 2023. The year-over-year increase was driven by the same factors discussed above for the third quarter of 2024.
Current wording
Engineered Fastening segment profit for the first three months of 2025 totaled $39.0 million, or 8.4% of net sales, compared to $65.2 million, or 11.1% of net sales, in the corresponding 2024 period. Excluding Non-GAAP adjustments, which primarily related to costs associated with the supply chain transformation, of $7.7 million and $5.7 million for the three months ended March 29, 2025 and March 30, 2024, respectively, segment profit amounted to 10.1% of net sales in the first three months of 2025 compared to 12.1% of net sales in the first three months of 2024. The year-over-year change in segment profit as a percent of sales and adjusted segment profit as a percent of sales was primarily due to lower volume in higher margin automotive.
Previous wording
Corporate Overhead includes the corporate overhead element of SG&A, which is not allocated to the business segments. Corporate Overhead amounted to $74.2 million and $69.6 million in the third quarter of 2024 and 2023, respectively. Excluding Non-GAAP adjustments of $7.0 million for the three months ended September 28, 2024 and $11.7 million for the three months ended September 30, 2023, the corporate overhead element of SG&A was $67.2 million and $57.9 million for the three months ended September 28, 2024 and September 30, 2023, respectively.
Current wording
The corporate overhead element of SG&A, which is not allocated to the business segments for purposes of determining segment profit, consists of the costs associated with the executive management team and expenses related to centralized functions that benefit the entire Company but are not directly attributable to the business segments, such as legal and corporate finance functions, as well as expenses for the world headquarters facility. Corporate overhead amounted to $74.4 million and $64.2 million in the first quarter of 2025 and 2024, respectively. Excluding Non-GAAP adjustments, which primarily consisted of transition services costs related to previously divested businesses, of $6.0 million for the three months ended March 29, 2025 and $5.9 million for the three months ended March 30, 2024, the corporate overhead element of SG&A was $68.4 million and $58.3 million for the three months ended March 29, 2025 and March 30, 2024, respectively.
Previous wording
For the three and nine months ended September 28, 2024, the Company recognized net restructuring charges of $22.1 million and $66.9 million, respectively, primarily related to severance costs and facility closure charges. The Company expects to achieve annual net cost savings of approximately $122 million by the end of 2025 related to the restructuring costs incurred during the nine months ended September 28, 2024. The majority of the $33.9 million of reserves remaining as of September 28, 2024 is expected to be utilized within the next 12 months.
Current wording
For the three months ended March 29, 2025, the Company recognized net restructuring charges of $1.2 million, primarily related to severance costs partially offset by adjustments to facility exit costs related to site closures as part of the supply chain transformation. The Company expects to achieve annual net cost savings of approximately $15 million by the end of 2025 related to the restructuring costs incurred during the three months ended March 29, 2025. The majority of the $34.9 million of reserves remaining as of March 29, 2025 is expected to be utilized within the next 12 months.
Previous wording
The $22 million of net restructuring charges for the three months ended September 28, 2024 includes: $21 million in the Tools & Outdoor segment and $1 million in the Industrial segment.
Current wording
The $1.2 million of net restructuring charges for the three months ended March 29, 2025 includes: $1.6 million of net reversals in the Tools & Outdoor segment; $0.3 million of charges in the Engineered Fastening segment; and $2.5 million of charges in Corporate.
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Previous report — wording carried elsewhere
Refer to Note Q, Divestitures, for further discussion.
Previous report — wording carried elsewhere
Financing Activities: Cash flows used in financing activities totaled $234.3 million in the third quarter of 2024, primarily driven by cash dividend payments on common stock of $123.6 million and net short-term commercial paper repayments of $121.5 million. Cash flows used in financing activities totaled $387.7 million in the third quarter of 2023, primarily driven by net short-term commercial paper repayments of $266.4 million and cash dividend payments on common stock of $121.3 million.