Post-It Maker 3M Defies Tariff Headwinds With Strong Q2 And Outlook Boost

Benzinga
07-18

Post-it maker 3M Company (NYSE:MMM) stock surged Friday after it reported better-than-expected second-quarter 2025 results and raised its full-year guidance.

The company posted GAAP sales of $6.3 billion, up 1.4% year over year. Adjusted sales came in at $6.2 billion, reflecting 1.5% organic growth and beating the consensus estimate of $6.09 billion.

This marked 3M’s third consecutive quarter of growth across all three business groups, with 13 of 16 divisions posting gains. Growth was led by strong performance in electronics and industrials, with China up mid-single digits and EMEA remaining flat.

The adjusted operating margin expanded 290 basis points to 24.5%, driven by growth, productivity gains, and lower restructuring costs. These were partially offset by investments, tariffs, and foreign exchange impacts.

Also Read: 3M Gears Up For Q2 Print; Here Are The Recent Forecast Changes From Wall Street’s Most Accurate Analysts

Adjusted earnings per share rose 12% year over year to $2.16, topping the Street estimate of $2.01.

By segment, Safety & Industrial posted 3.6% adjusted sales growth to $2.86 billion, with adjusted operating margin expanding to 25.8% from 22.6%.

Transportation & Electronics’ revenue grew 1.9% to $1.94 billion, and its adjusted operating margin rose to 24.6% from 22.3%.

The Consumer segment saw modest 0.6% growth to $1.27 billion, with adjusted operating margin improving to 21.1% from 17.4% a year ago.

3M returned $1.3 billion to shareholders during the quarter and reported adjusted free cash flow of $1.3 billion, despite a $1.0 billion cash outflow from operations due to $2.2 billion in litigation-related payments.

2025 Guidance

3M now sees 2025 Adjusted EPS of $7.75-$8.0 (prior $7.60-$7.90) versus the consensus of $7.68, includes the impact from tariffs.

3M expects 2025 adjusted sales organic growth of ~2% (prior lower end of 2% to 3%), and operating cash flow of $5.1–$5.5 billion with >100% free cash flow conversion.

3M raised its full-year outlook, citing stronger productivity, a more measured investment pace amid softer demand and evolving tariffs, and a reduced foreign exchange headwind of $0.05, down from $0.15 previously.

“Our 3M eXcellence operating model is the foundation for delivering on each of our strategic priorities, and it drives the operating rigor and rhythm of our performance culture. With execution improving and solid results in the first half, we have confidence in our increased full-year EPS guidance, which now embeds the expected impact of tariffs,” commented William Brown, 3M Chairman and CEO.

Price Action: At the last check on Friday, MMM shares were trading higher by 3.06% at $163.90 premarket.

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