Illinois Tool Works Inc (0J8W.L) Q2 2025 Earnings Report

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Illinois Tool Works Inc

0J8W.L

$250.38 0.85%

Exchange: LSE | Sector: Industrials | Industry: Industrial Capital Goods

Q2 2025

Published: Aug 1, 2025

Earnings Highlights

Revenue of $4.05B up 0.7% year-over-year
EPS of $2.58 increased by 1.2% from previous year
Gross margin of 44.0%
Net income of 755.00M
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0J8W.L

Company 0J8W.L

Period Q2 2025

Currency USD

Report Type Quarterly Earnings

Generated Dec 8, 2025

Executive Summary

Paragraph 1: Illinois Tool Works reported a solid QQ2 2025, with revenue of $4.053 billion, up 0.65% year over year and 5.57% quarter over quarter. The company delivered a robust gross margin of 43.97% and an operating margin of 26.35%, underscoring consistent pricing power and favorable mix across its diversified portfolio of seven segments. Net income of $0.755 billion and earnings per share of $2.58 reflect disciplined cost management alongside topline resiliency in a market characterized by ongoing macro headwinds for industrials.

Key Performance Indicators

Revenue

Increasing

4.05B

QoQ: 5.57% | YoY: 0.65%

Gross Profit

Increasing

1.78B

43.97% margin

QoQ: 7.54% | YoY: 2.41%

Operating Income

Increasing

1.07B

QoQ: 12.30% | YoY: 1.33%

Net Income

Decreasing

755.00M

QoQ: 7.86% | YoY: -0.53%

EPS

Increasing

2.58

QoQ: 8.40% | YoY: 1.18%

Revenue Trend

Margin Analysis

Financial Highlights

Revenue: $4.053B (YoY +0.65%, QoQ +5.57%)
- Gross Profit: $1.782B; Gross Margin: 43.97%
- Operating Income: $1.068B; Operating Margin: 26.35%
- Net Income: $0.755B; Net Margin: 18.63%
- EBITDA: $1.171B; EBITDA Margin: 28.89%
- EPS: $2.58; Diluted EPS: $2.58; WeightAvg Shares: 292.3–292.9M

Cash Flow and Balance Sheet:
- Operating Cash Flow: $0.550B; Free Cash Flow: $0.449B
- Cash and Cash Equivalents: $0.788B; Total Debt: $8.937B; Net Debt: $8.149B
- Total Assets: $16.048B; Net Debt = Gross Debt minus Cash
- Interest Coverage: 14.43x; Debt/Capitalization: 0.736; Dividend Payout: 58.1%
- Cash Conversion Cycle: 117.2 days; ROA: 4.70%; ROE: 23.5%; ROCE: 8.81%

Valuation and Multiples:
- Price/Earnings: 23.93x; Price/Book: 22.51x; EV/EBITDA: 68.68x; Price/Sales: 17.83x
- Dividend Yield: ~0.61%
- ITW vs peers shows premium multiples reflecting strong cash flow quality and portfolio diversity (see peer benchmarks below).

Income Statement

Metric	Value	YoY Change	QoQ Change
Revenue	4.05B	0.65%	5.57%
Gross Profit	1.78B	2.41%	7.54%
Operating Income	1.07B	1.33%	12.30%
Net Income	755.00M	-0.53%	7.86%
EPS	2.58	1.18%	8.40%

Key Financial Ratios

Gross Profit Margin

Good

44.00%

Gross profit margin is healthy and competitive within industry standards

Operating Profit Margin

Excellent

26.40%

Operating margin is exceptional, indicating strong pricing power and operational efficiency

Net Profit Margin

Good

18.60%

Net profit margin is healthy and competitive within industry standards

Return on Assets

Fair

4.70%

Return on assets is acceptable but below top-tier companies

Return on Equity

Strong

23.50%

Return on equity demonstrates excellent capital efficiency and value creation

Current Ratio

Healthy

1.59

Current ratio shows adequate liquidity to meet short-term obligations

Debt to Equity

High Risk

2.78

Debt-to-equity indicates high leverage and elevated financial risk

P/E Ratio

Fair Value

23.93x

P/E ratio in line with market averages

Price to Book

High Premium

22.51x

Very high premium suggests asset-light business model or lofty expectations

Historical Earnings Comparison

Period	Revenue ($M)	EPS ($)	YoY Growth	Report
Q3 2025	4,059.00	2.81	+2.3%	View
Q2 2025	4,053.00	2.58	+0.7%	View
Q1 2025	3,839.00	2.38	-3.4%	View
Q4 2024	3,932.00	2.54	-1.3%	View
Q3 2024	3,966.00	3.91	-1.6%	View

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Illinois Tool Works Inc (0J8W.L) Q2 2025 Earnings Report

Earnings Highlights

Executive Summary

Key Performance Indicators

Revenue Trend

Margin Analysis

Financial Highlights

Income Statement

Key Financial Ratios

Management Insights Available for Members

Peer Comparison Available for Members

Investment Outlook & SWOT Available for Members

Historical Earnings Comparison

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